EXHIBIT 10.12
ASSET EXCHANGE AGREEMENT
By and Among
AMERICAN RADIO SYSTEMS CORPORATION
AMERICAN RADIO SYSTEMS LICENSE CORP.
CITICASTERS CO.
REGENT BROADCASTING OF KANSAS CITY, INC.
and
REGENT LICENSEE OF KANSAS CITY, INC.
Dated as of
June 19, 1997
TABLE OF CONTENTS
ARTICLE 1 DEFINED TERMS...................................................................................2
ARTICLE 2 EXCHANGE OF LICENSES AND STATIONS...............................................................2
2.1 Agreement to Exchange Licenses and Stations.....................................................2
2.2 Appraisals; Tax Reporting.......................................................................3
2.3 Assumption of Liabilities and Obligations. .....................................................4
2.4 Closing Date....................................................................................8
2.5 Accounts Receivable. ..........................................................................9
ARTICLE 3 REPRESENTATIONS AND WARRANTIES OF THE JACOR PARTIES............................................10
3.1 Organization and Business; Power and Authority; Effect of Transaction..........................10
3.2 Financial and Other Information. .............................................................11
3.3 Material Statements and Omissions; Absence of Events...........................................11
3.4 Changes in Condition...........................................................................12
3.5 Title to Properties; Leases. .................................................................12
3.6 Compliance with Private Authorizations.........................................................13
3.7 Compliance with Governmental Authorizations and Applicable Law.................................13
3.8 Intangible Assets..............................................................................14
3.9 Related Transactions...........................................................................15
3.10 Tax Matters....................................................................................15
3.11 Employee Benefit Plans; Jacor Station Employees................................................15
3.12 Material Agreements............................................................................16
3.13 Ordinary Course of Business....................................................................17
3.14 Broker or Finder...............................................................................17
3.15 Environmental Matters..........................................................................17
3.16 Trade or Barter................................................................................18
ARTICLE 4 REPRESENTATIONS AND WARRANTIES OF THE AMERICAN.................................................18
4.1 Organization and Business; Power and Authority; Effect of Transaction..........................18
4.2 Financial and Other Information. .............................................................20
4.3 Material Statements and Omissions; Absence of Events...........................................20
4.4 Changes in Condition...........................................................................20
4.5 Title to Properties; Leases. .................................................................20
4.6 Compliance with Private Authorizations.........................................................22
4.7 Compliance with Governmental Authorizations and Applicable Law.................................22
4.8 Intangible Assets..............................................................................23
4.9 Related Transactions...........................................................................23
4.10 Tax Matters....................................................................................24
4.11 Employee Benefit Plans; American Station Employees.............................................24
4.12 Material Agreements............................................................................25
4.13 Ordinary Course of Business....................................................................25
4.14 Broker or Finder...............................................................................26
4.15 Environmental Matters..........................................................................26
4.16 Trade or Barter................................................................................27
ARTICLE 5 COVENANTS......................................................................................27
5.1 Access to Information; Confidentiality.........................................................27
5.2 Agreement to Cooperate.........................................................................28
5.3 Public Announcements...........................................................................34
5.4 Notification of Certain Matters................................................................34
5.5 No Solicitation................................................................................34
5.6 Conduct of Business by the Jacor Parties Pending the Closing...................................35
5.7 Conduct of Business by American Pending the Closing............................................36
5.8 Risk of Loss...................................................................................37
5.9 American and Jacor Station Employees...........................................................38
ARTICLE 6 CLOSING CONDITIONS.............................................................................38
6.1 Conditions to Obligations of Each Party to Effect the Exchanges................................38
6.2 Conditions to Obligations of the American Parties. ...........................................39
6.3 Conditions to Obligations of the Jacor Parties ................................................41
ARTICLE 7 TERMINATION, AMENDMENT AND WAIVER..............................................................42
7.1 Termination....................................................................................42
7.2 Effect of Termination..........................................................................43
ARTICLE 8 INDEMNIFICATION................................................................................44
8.1 Survival. .....................................................................................44
8.2 Indemnification................................................................................44
8.4 Notice of Claims...............................................................................45
8.5 Defense of Third Party Claims..................................................................45
8.6 Exclusive Remedy...............................................................................46
ARTICLE 9 GENERAL PROVISIONS.............................................................................46
9.1 Amendment......................................................................................46
9.2 Waiver.........................................................................................46
9.3 Fees, Expenses and Other Payments..............................................................46
9.4 Notices........................................................................................46
9.5 Specific Performance; Other Rights and Remedies................................................47
9.6 Severability...................................................................................48
9.7 Counterparts...................................................................................48
9.8 Section Headings...............................................................................48
9.9 Governing Law..................................................................................48
9.10 Further Acts...................................................................................48
9.11 Entire Agreement...............................................................................49
9.12 Assignment.....................................................................................49
9.13 Parties in Interest............................................................................49
9.14 Mutual Drafting................................................................................49
9.15 American Agent for American License............................................................49
9.16 Citicasters Agent for the Other Jacor Parties..................................................49
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APPENDIX A: Definitions
SCHEDULES: Jacor Disclosure Schedule
American Disclosure Schedule
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ASSET EXCHANGE AGREEMENT
This ASSET EXCHANGE AGREEMENT (this "Agreement") is dated as of June
19,1997, by and among American Radio Systems Corporation, a Delaware corporation
("American" or an "American Party"), American Radio Systems License Corp, a
Delaware corporation ("American License" or an "American Party" and,
collectively with American, the "American Parties"), Citicasters Co., an Ohio
corporation ("Citicasters"), Regent Broadcasting of Kansas City, Inc., a
Delaware corporation ("Regent Broadcasting"), and Regent Licensee of Kansas
City, Inc., a Delaware corporation ("Regent Licensee" and, collectively with
Regent Broadcasting, the "Regent Parties", the Regent Parties, being herein
referred to with Citicasters, individually as a "Jacor Party" and collectively
as the "Jacor Parties" or "Jacor").
WHEREAS, Citicasters is the licensee of and operates radio stations
WDAF(AM) and KYYS(FM), Kansas City, Missouri (the "Citicasters Stations")
pursuant to licenses issued to Citicasters by the FCC (the "Citicasters FCC
Licenses"), and Regent Broadcasting operates and Regent Licensee is the licensee
of radio stations KMXV(FM), Kansas City, Missouri, and KUDL(FM), Kansas City,
Kansas (the "Regent Stations" and, collectively with the Citicasters Stations,
the "Jacor Stations") pursuant to licenses issued to Regent Licensee by the FCC
(the "Regent FCC Licenses" and, collectively with the Citicasters FCC Licenses,
the "Jacor FCC Licenses");
WHEREAS, American operates and American License is the licensee of
radio stations WMMX(FM), WTUE(FM) and WONE(AM), Dayton, Ohio, WLQT(FM),
Kettering-Dayton, Ohio, WBTT(FM), Englewood, Ohio and WXEG(FM), Beavercreek,
Ohio (the "American Stations") pursuant to licenses issued to American License
by the FCC (the "American FCC Licenses");
WHEREAS, (i) American License and Citicasters desire to exchange the
American Citicasters FCC Licenses for the Citicasters FCC Licenses, and American
and Citicasters desire to exchange the American Citicasters Assets (other than
the American Citicasters FCC Licenses) for the Citicasters Assets (other than
the Citicasters FCC Licenses) (collectively, the "Citicasters Exchange"), and
(ii) American License and Regent Licensee desire to exchange the American Regent
FCC Licenses for the Regent FCC Licenses, and American and Regent Broadcasting
desire to exchange the American Regent Assets (other than the American Regent
FCC Licenses) for the Regent Assets (other than the Regent FCC Licenses), all on
the terms and subject to the conditions hereinafter set forth (collectively, the
"Regent Exchange" and, collectively with the Citicasters Exchange, the
"Exchanges"); and
WHEREAS, the parties hereto intend the Exchanges to qualify as
Like-Kind Exchanges;
NOW, THEREFORE, in consideration of the above premises and the
covenants and agreements contained herein, American, American License,
Citicasters, Regent Broadcasting and Regent Licensee intending to be legally
bound, do hereby covenant and agree as follows:
ARTICLE 1
DEFINED TERMS
As used herein, the terms defined in Appendix A shall have the
respective meanings set forth therein. Terms defined in the singular shall have
a comparable meaning when used in the plural, and vice versa, and the reference
to any gender shall be deemed to include all genders. Unless otherwise defined
or the context otherwise clearly requires, terms for which meanings are provided
in this Agreement shall have such meanings when used in either Disclosure
Schedule and each Collateral Document executed or required to be executed
pursuant hereto or thereto or otherwise delivered, from time to time, pursuant
hereto or thereto. References to "hereof", "herein" or similar terms are
intended to refer to this Agreement as a whole and not a particular section, and
references to "this Section" are intended to refer to the entire section and not
a particular subsection thereof. The term "either party" shall refer to the
Jacor Parties and the American Parties.
ARTICLE 2
EXCHANGE OF LICENSES AND STATIONS
2.1 Agreement to Exchange Licenses and Stations. Subject to the terms
and conditions set forth in this Agreement:
(a) Citicasters and American hereby agree to exchange,
transfer and deliver to each other, as applicable, on the Closing Date,
the Citicasters Assets (other than the Citicasters FCC Licenses) and
the American Citicasters Assets (other than the American Citicasters
FCC Licenses);
(b) Citicasters and American License hereby agree to exchange,
transfer and deliver to each other, as applicable, the Citicasters FCC
Licenses and the American Citicasters FCC Licenses,
(c) Regent Broadcasting and American hereby agree to exchange,
transfer and deliver to each other, as applicable, on the Closing Date,
the Regent Assets (other than the Regent FCC Licenses) and the American
Regent Assets (other than the American Regent FCC Licenses); and
(d) Regent Licensee and American License hereby agree to
exchange, transfer and deliver to each other, as applicable, the Regent
FCC Licenses and the American Regent FCC Licenses,
in each case, free and clear of any Liens of any nature whatsoever except
Permitted Liens and Permitted Title Exceptions.
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2.2 Appraisals; Tax Reporting.
(a) The Jacor Parties and the American Parties agree that the fair
market value of each asset included in the Jacor Assets and the American Assets
will be determined on the basis of the appraisals (the "Appraisals"), prepared
by the firm of Bond & ▇▇▇▇▇▇, whose fee and expenses shall be equally borne by
Citicasters and Regent Broadcasting, on the one hand, and American, on the other
hand. The parties shall direct Bond & ▇▇▇▇▇▇ to deliver Appraisals within sixty
(60) days from the date hereof and to set forth in the Appraisals the fair
market value of each asset included in the Jacor Assets and the American Assets.
(b) Promptly after delivery of the Appraisals, and in any event prior
to the Closing Date, the parties shall prepare and agree upon the appraised
value of each asset included in the Jacor Assets and the American Assets (which
values shall be based upon the Appraisals) and shall set forth those values on a
schedule (the "Valuation Schedule"). The parties shall not take any position
inconsistent with the valuations set forth on the Valuation Schedule and will
prepare and file all Tax Returns and reports related to the Exchange, including
without limitation those required under Section 1060 of the Code and all
original and amended federal, state and local income Tax Returns, on a basis
consistent with such valuations. Each asset included in the Citicasters Assets,
the Regent Assets, the American Citicasters Assets and the American Regent
Assets shall be set forth in the appropriate "exchange group" and "residual
group" (each within the meaning of Treas. Reg. section 1.1031(j)-1) on the basis
set forth in the Valuation Schedule.
(c) Each of the parties intend to report the transactions contemplated
hereby as a "like-kind exchange" to the maximum extent permissible under Section
1031 of the Code, consistent with the Appraisals and the Valuation Schedule.
Each of the parties shall cooperate with the other in any and all respects
necessary to achieve like-kind exchange treatment to the maximum extent
permissible under Section 1031 of the Code and shall endeavor to give the other
notice of any disallowance of or challenge to such reporting by any Taxing
Authority; provided, however, that the failure to give such notice shall not
result in any liability of the party failing to give the notice. Without
limiting the generality of the foregoing, in order to effectuate the
transactions contemplated hereby as a like-kind exchange to the maximum extent
possible under Section 1031 of the Code, or to facilitate one or more of the
Exchanges (or any part thereof) as part of a deferred like-kind exchange, each
of American and American License, on the one hand, and Citicasters and the
Regent Broadcasting and Regent Licensee, on the other hand, (i) may at any time
at or prior to Closing assign its rights, in whole or in part, under this
Agreement (but such assignment shall not relieve it of its obligations under
this Agreement) to a "qualified intermediary" (as defined in Treas. Reg.
ss.1.1031(k)-1(g)(4)), subject to all rights and obligations hereunder of
Citicasters, Regent Broadcasting and Regent Licensee, on the one hand, and
American and American License, on the other hand, respectively, and, in such
event, (ii) shall promptly provide written notice of such assignment to the
other party. If American or American Licensee shall have given notice of such
assignment to a qualified intermediary, Citicasters, Regent Broadcasting and/or
Regent Licensee, as the case may be, shall (i) promptly provide American and
American License with written acknowledgment of such notice and (ii) at the
Closing, convey the Citicasters Assets or the Regent Assets, as the case may be,
(or such portion of them as shall have been designated in writing by American or
American License) to the "qualified intermediary" rather than to American and
American License (which conveyance shall, to such extent, discharge the
obligation of Citicasters,
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Regent Broadcasting and/or Regent Licensee, as the case may be, to deliver the
Citicasters Assets and the Citicasters Stations and/or the Regent Assets and the
Regent Stations, as the case may be, hereunder). If Citicasters, Regent
Broadcasting and/or Regent Licensee, as the case may be, shall have given notice
of such assignment to a qualified intermediary, American and American License
shall (i) promptly provide Citicasters, Regent Broadcasting and/or Regent
Licensee, as the case may be, with written acknowledgment of such notice and
(ii) at the Closing, convey the American Citicasters Assets and/or the American
Regent Assets (or such portion of them as shall have been designated in writing
by Citicasters, Regent Broadcasting and/or Regent Licensee, as the case may be)
to the "qualified intermediary" rather than to Citicasters, Regent Broadcasting
and/or Regent Licensee, as the case may be (which conveyance shall, to such
extent, discharge the obligation of American and American License to deliver the
American Citicasters Assets and/or the American Regent Assets and the
corresponding American Stations hereunder).
(d) Notwithstanding the provisions of this Section 2.2, the parties to
this Agreement will rely solely on their own advisors in determining the tax
consequences of the transactions contemplated by this Agreement and each party
is not relying, and will not rely, on any representations or assurances of any
other party regarding such consequences other than the representations,
warranties, covenants and agreements set forth in writing in this Agreement or
furnished pursuant to the provisions hereof. Notwithstanding anything in this
Agreement to the contrary, the obligations of the parties set forth in this
Section 2.2 shall survive the Closing.
2.3 Assumption of Liabilities and Obligations.
(a) The American Parties agree to assume (i) the Citicasters Assumable
Agreements at the Closing or, to the extent provided in the Citicasters Stations
TBA, upon the TBA Date of the Citicasters Stations TBA and (ii) the Regent
Assumable Agreements at the Closing or, to the extent provided in the Regent
Stations TBA, upon the TBA Date of the Regent Stations TBA. Except as expressly
provided in this Agreement, including without limitation Section 2.3(e), or in
the Citicasters Stations TBA or the Regent Stations TBA, the American Parties
shall not assume or become obligated to perform any debt, liability or
obligation of Citicasters, Regent Broadcasting or Regent Licensee or relating to
the ownership or operation of the Citicasters Assets or the Regent Assets or the
conduct of the business of the Citicasters Stations or the Regent Stations prior
to the Closing whatsoever, other than to the extent set forth in the assumption
of the Citicasters Assumable Agreements or the Regent Assumable Agreements. The
parties acknowledge and agree that the assumption of the Citicasters Assumable
Agreements and the Regent Assumable Agreements shall not, except to the extent
of any proration pursuant to the provisions of Section 2.3(e), entail the
assumption by the American Parties of any obligation or liability of
Citicasters, Regent Broadcasting or Regent Licensee with respect to (i) any
obligations or liabilities under the Citicasters Assumable Agreements or the
Regent Assumable Agreements relating to the period prior to the Cut-off Date;
(ii) any Claims to which Citicasters, Regent Broadcasting or Regent Licensee is
a party or to which any of the Citicasters Assets or the Citicasters Stations or
any of the Regent Assets or the Regent Stations is subject relating to the
ownership or operation of the Citicasters Assets or the Regent Assets or the
conduct of the business of the Citicasters Stations or the Regent Stations prior
to the Closing (other than as provided in the Citicasters Stations TBA or the
Regent Stations TBA); or (iii) any liability for any Taxes attributable to the
ownership or operation of the Citicasters Assets or the Regent Assets or the
conduct of the business of the Citicasters Stations or the Regent Stations on
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or prior to the Closing Date. All such obligations and liabilities (the
"Citicasters Nonassumed Liabilities" and the "Regent Nonassumed Liabilities",
respectively, and, collectively, the "Jacor Nonassumed Liabilities") shall
remain and be the obligations and liabilities solely of Citicasters, Regent
Broadcasting and Regent Licensee, as the case may be.
(b) Citicasters agrees to assume the American Citicasters Assumable
Agreements at the Closing or, to the extent provided in the American Citicasters
Stations TBA, upon the TBA Date of the American Citicasters Stations TBA. Except
as expressly provided in this Agreement, including without limitation Section
2.3(f), or in the American Citicasters Stations TBA, Citicasters shall not
assume or become obligated to perform any debt, liability or obligation of
either American Party or relating to the ownership or operation of the American
Assets or the conduct of the business of the American Stations prior to the
Closing whatsoever, other than to the extent set forth in the assumption of the
American Citicasters Assumable Agreements. The parties acknowledge and agree
that the assumption of the American Citicasters Assumable Agreements shall not,
except to the extent of any proration pursuant to the provisions of Section
2.3(f), entail the assumption by Citicasters of any obligation or liability of
either American Party with respect to (i) any obligations or liabilities under
the American Citicasters Assumable Agreements relating to the period prior to
the Cut-off Date; (ii) any Claims to which either American Party is a party or
to which any of the American Assets or any of the American Stations is subject
relating to the ownership or operation of the American Assets or the conduct of
the business of the American Stations prior to the Closing (other than as
provided in the American Citicasters Stations TBA); or (iii) any liability for
any Taxes attributable to the ownership or operation of the American Assets or
the American Stations on or prior to the Closing Date. All such obligations and
liabilities (the "American Citicasters Nonassumed Liabilities") shall remain and
be the obligations and liabilities solely of the American Parties.
(c) The Regent Parties agrees to assume the American Regent Assumable
Agreements at the Closing or, to the extent provided in the American Regent
Stations TBA, upon the TBA Date of the American Regent Stations TBA. Except as
expressly provided in this Agreement, including without limitation Section
2.3(g), or in the American Regent Stations TBA, the Regent Parties shall not
assume or become obligated to perform any debt, liability or obligation of
either American Party or relating to the ownership or operation of the American
Assets or the conduct of the business of the American Stations prior to the
Closing whatsoever, other than to the extent set forth in the assumption of the
American Regent Assumable Agreements. The parties acknowledge and agree that the
assumption of the American Regent Assumable Agreements shall not, except to the
extent of any proration pursuant to the provisions of Section 2.3(g), entail the
assumption by the Regent Parties of any obligation or liability of either
American Party with respect to (i) any obligations or liabilities under the
American Regent Assumable Agreements relating to the period prior to the Cutoff
Date; (ii) any Claims to which either American Party is a party or to which any
of the American Assets or any of the American Stations is subject relating to
the ownership or operation of the American Assets or the conduct of the business
of the American Stations prior to the Closing (other than as provided in the
American Regent Stations TBA); or (iii) any liability for any Taxes attributable
to the ownership or operation of the American Assets or the American Stations on
or prior to the Closing Date. All such obligations and liabilities (the
"American Regent Nonassumed Liabilities" and, collectively with the American
Citicasters Nonassumed Liabilities, the "American
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Nonassumed Liabilities") shall remain and be the obligations and liabilities
solely of the American Parties.
(d) Notwithstanding anything contained in this Agreement to the
contrary and except as otherwise provided in the Citicasters Stations TBA, the
Regent Stations TBA, the American Citicasters Stations TBA or the American
Regent Stations TBA, as the case may be, all items of income and expense
(including without limitation with respect to rent, utilities, Pro Ratable Taxes
and wages, salaries and accrued but unused vacation for employees) arising from
the conduct of the business of (i) the Citicasters Stations and the American
Citicasters Stations shall be prorated between American and Citicasters, and
(ii) the Regent Stations and the American Regent Stations shall be prorated
between American and Regent Broadcasting, in each case, as of 12:01 a.m.,
Eastern time, on the Cut-Off Date, with the transferring party responsible for
any such items prior to the Cut-off Date and the transferee party responsible
for any such items subsequent to the Cut-off Date.
(e) Within sixty (60) days after the Cut-Off Date, American shall
deliver to Citicasters and Regent Broadcasting a schedule of its proposed
prorations with respect to the American Citicasters Assets and the American
Citicasters Stations and the American Regent Assets and the American Regent
Stations, respectively, which shall set forth in reasonable detail the basis for
those determinations, and which shall account for any amount owed by American to
Citicasters or Regent Broadcasting pursuant to the provisions of Section 2.3(i)
(the "Dayton Proration Schedule"). The Dayton Proration Schedule shall be
conclusive and binding upon Citicasters and Regent Broadcasting unless
Citicasters or Regent Broadcasting provides American with written notice of
objection (the "Notice of Disagreement") within thirty (30) days after
Citicasters' and Regent Broadcasting's receipt of the Dayton Proration Schedule,
which notice shall state the prorations proposed by Citicasters or Regent
Broadcasting, as the case may be (the "Jacor Proration Schedule"). American
shall have fifteen (15) days from receipt of a Notice of Disagreement to accept
or reject the Jacor Proration Schedule. If American rejects the Jacor Proration
Schedule, and the amount in dispute exceeds Five Thousand Dollars ($5,000), the
dispute shall be submitted within ten (10) days of such rejection to the
Chicago, Illinois office of ▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & Co., LLP (the "Referee") for
resolution, such resolution to be made within thirty (30) days after submission
to the Referee and to be final, conclusive and binding on American, Citicasters
and Regent Broadcasting. American, on the one hand, and Citicasters and Regent
Broadcasting, on the other hand, agree to share equally the cost and expenses of
the Referee, but each party shall bear its own legal and other expenses, if any.
If the amount in dispute is equal to or less than Five Thousand Dollars
($5,000), such amount shall be divided equally between Citicasters and/or Regent
Broadcasting, on the one hand, and American, on the other hand. Payment by any
party pursuant hereto of the proration amounts determined pursuant to this
Section 2.3(e) shall be due fifteen (15) days after the last to occur of (i)
Citicasters' acceptance of the Dayton Proration Schedule or failure to give
American a timely Notice of Disagreement; (ii) Regent Broadcasting's acceptance
of the Dayton Proration Schedule or failure to give American a timely Notice of
Disagreement; (iii) American's acceptance of the Jacor Proration Schedule or
failure to reject the Jacor Proration Schedule within fifteen (15) days of
receipt of a timely Notice of Disagreement; (iv) American's rejection of the
Jacor Proration Schedule in the event the amount in dispute equals or is less
than Five Thousand Dollars ($5,000); and (v) notice to American, Citicasters and
Regent Broadcasting of the resolution of the disputed
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amount by the Referee in the event that the amount in dispute exceeds Five
Thousand Dollars ($5,000).
(f) Within sixty (60) days after the Cut-Off Date, Citicasters shall
deliver to American a schedule of its proposed prorations with respect to the
Citicasters Assets and the Citicasters Stations which shall set forth in
reasonable detail the basis for those determinations, and which shall account
for any amount owed by Citicasters to American pursuant to the provisions of
Section 2.3(i) (the "Citicasters Kansas City Proration Schedule"). The
Citicasters Kansas City Proration Schedule shall be conclusive and binding upon
American unless American provides Citicasters with a Notice of Disagreement
within thirty (30) days after American's receipt of the Citicasters Kansas City
Proration Schedule, which notice shall state the prorations proposed by American
(the "American Citicasters Proration Schedule"). Citicasters shall have fifteen
(15) days from receipt of a Notice of Disagreement to accept or reject the
American Citicasters Proration Schedule. If Citicasters rejects the American
Citicasters Proration Schedule and the amount in dispute exceeds Five Thousand
Dollars ($5,000), the dispute shall be submitted within ten (10) days of such
rejection to the Referee for resolution, such resolution to be made within
thirty (30) days after submission to the Referee and to be final, conclusive and
binding on Citicasters and American. American and Citicasters agree to share
equally the cost and expenses of the Referee, but each party shall bear its own
legal and other expenses, if any. If the amount in dispute is equal to or less
than Five Thousand Dollars ($5,000), such amount shall be divided equally
between American and Citicasters. Payment by American or Citicasters, as the
case may be, of the proration amounts determined pursuant to this Section 2.3(f)
shall be due fifteen (15) days after the last to occur of (i) American's
acceptance of the Citicasters Kansas City Proration Schedule or failure to give
Citicasters a timely Notice of Disagreement; (ii) Citicasters' acceptance of the
American Citicasters Proration Schedule or failure to reject the American
Citicasters Proration Schedule within fifteen (15) days of receipt of a timely
Notice of Disagreement; (iii) Citicasters' rejection of the American Citicasters
Proration Schedule in the event the amount in dispute equals or is less than
Five Thousand Dollars ($5,000); and (iv) notice to Citicasters and American of
the resolution of the disputed amount by the Referee in the event that the
amount in dispute exceeds Five Thousand Dollars ($5,000).
(g) Within sixty (60) days after the Cut-Off Date, Regent Broadcasting
shall deliver to American a schedule of its proposed prorations with respect to
the Regent Assets and the Regent Stations which shall set forth in reasonable
detail the basis for those determinations, and which shall account for any
amount owed by Regent Broadcasting to American pursuant to the provisions of
Section 2.3(i) (the "Regent Kansas City Proration Schedule"). The Regent Kansas
City Proration Schedule shall be conclusive and binding upon American unless
American provides Regent Broadcasting with a Notice of Disagreement within
thirty (30) days after American's receipt of the Regent Kansas City Proration
Schedule, which notice shall state the prorations proposed by American (the
"American Regent Proration Schedule"). Regent Broadcasting shall have fifteen
(15) days from receipt of a Notice of Disagreement to accept or reject the
American Regent Proration Schedule. If Regent Broadcasting rejects the American
Regent Proration Schedule and the amount in dispute exceeds Five Thousand
Dollars ($5,000), the dispute shall be submitted within ten (10) days of such
rejection to the Referee for resolution, such resolution to be made within
thirty (30) days after submission to the Referee and to be final, conclusive and
binding on Regent Broadcasting and American. American and Regent Broadcasting
agree to share equally the cost and expenses of the Referee, but each party
shall bear its own legal and other expenses, if any. If the amount in
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dispute is equal to or less than Five Thousand Dollars ($5,000), such amount
shall be divided equally between American and Regent Broadcasting. Payment by
American or Regent Broadcasting, as the case may be, of the proration amounts
determined pursuant to this Section 2.3(g) shall be due fifteen (15) days after
the last to occur of (i) American's acceptance of the Regent Kansas City
Proration Schedule or failure to give Regent Broadcasting a timely Notice of
Disagreement; (ii) Regent Broadcasting's acceptance of the American Regent
Proration Schedule or failure to reject the American Regent Proration Schedule
within fifteen (15) days of receipt of a timely Notice of Disagreement; (iii)
Regent Broadcasting's rejection of the American Regent Proration Schedule in the
event the amount in dispute equals or is less than Five Thousand Dollars
($5,000); and (iv) notice to Regent Broadcasting and American of the resolution
of the disputed amount by the Referee in the event that the amount in dispute
exceeds Five Thousand Dollars ($5,000).
(h) Any payment required by American to Citicasters or Regent
Broadcasting or by Citicasters or Regent Broadcasting to American, as the case
may be, under Section 2.3(e), 2.3(f) or 2.3(g) shall be paid by wire transfer of
immediately available funds to the account of the payee with a financial
institution in the United States as designated by such party in the Citicasters
Kansas City Proration Schedule, the Regent Kansas City Proration Schedule or the
Dayton Proration Schedule, as the case may be, or the Notice of Disagreement (or
by separate notice in the event a Notice of Disagreement is not sent). If any
party fails to pay when due any amount under Section 2.3(e), 2.3(f) or 2.3(g)
interest on such amount will accrue from the date payment was due to the date
such payment is made at a per annum rate equal to the "prime rate" as published
daily in the Money Rates column of the Wall Street Journal (or the average of
such rates if more than one rate indicated) plus two percent (2%), and such
interest shall be payable upon demand.
(i) With respect to Trade Agreements American, as the assigning party,
shall be required to pay to Citicasters and Regent Broadcasting, as the assuming
party and Citicasters and Regent Broadcasting, as the assigning party, shall be
required to pay to American, as the assuming party, an amount, if any, by which
the aggregate obligations and liabilities (determined in accordance with GAAP)
for unperformed air time under all such Trade Agreements as of 12:01 a.m. on the
applicable Cut-off Date exceeds by $20,000, the fair market value of the
services or property (determined in accordance with GAAP) to be received by the
assuming party (treating Citicasters and Regent Broadcasting as one assuming
party for these purposes) under such Trade Agreements after 12:01 a.m. on the
applicable Cut-off Date under all such Trade Agreements. There shall be no
payment required by the assuming party to the assigning party with respect to
the Trade Agreements, notwithstanding that the excess, if any, of the
obligations and liabilities under the Trade Agreements over the fair market
value of the services and property to be received under such Trade Agreements
after 12:01 a.m. on the applicable Cut-off Date is less than the amount
specified in the first sentence of this paragraph.
(j) Nothing contained in this Section 2.3 is intended or shall be
deemed to amend or modify the indemnification provisions of Article 8 nor to
reallocate responsibility for the matters set forth therein.
2.4 Closing Date. The closing of the Exchanges (the "Closing") shall
take place at a mutually convenient location to be agreed upon by the parties,
at 10:00 a.m., local time, within ten
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(10) business days after the satisfaction or waiver of each of the conditions
specified in Article 6 (other than those to be satisfied at the Closing) or such
other date, prior to the Termination Date, as the parties may agree (the
"Closing Date"). At the Closing, (a) each of the parties shall deliver such
deeds (in recordable form and warrantying against matters not covered by title
insurance other than Permitted Liens and Permitted Title Exceptions), bills of
sale, assignments, assumptions of liabilities and other instruments and
documents as are described in this Agreement or as may be otherwise reasonably
requested by the parties and their respective counsel and the legal opinions
described in Sections 6.2(b) and 6.3(b), and (b) as part of the Jacor Assets,
Jacor shall pay to American an amount equal to the American Tower Adjustment by
wire transfer of immediately available funds to such account as is designated by
American in written instructions to Jacor not later than two (2) business days
prior to the Closing.
2.5 Accounts Receivable. Effective, if at all, upon the earlier to
occur of Closing or the commencement of the effectiveness of the applicable TBA,
each of Citicasters and Regent Broadcasting hereby appoints American its agent
for the purpose of collecting all Accounts Receivable relating to the
Citicasters Stations and the Regent Stations, respectively, and American hereby
appoints Citicasters and Regent Broadcasting its agent for the purpose of
collecting all Accounts Receivable relating to the American Citicasters Stations
and the American Regent Stations, respectively. Each party shall deliver to the
other on or as soon as practicable after the earlier to occur of the applicable
TBA Date or the Closing Date (but, in any event, within ten (10) days after such
earlier date) a complete and detailed statement showing the name, amount and age
of each Account Receivable of its Stations. Subject to and limited by the
following, revenues relating to the Citicasters Accounts Receivable and the
Regent Accounts Receivable will be for the account of Citicasters and Regent
Broadcasting, respectively, and revenues relating to the American Accounts
Receivable will be for the account of American. Each agent shall use the same
collection procedures as it uses with respect to its own accounts receivable to
collect the Accounts Receivable with respect to which it is acting as agent for
a period of ninety (90) days after the applicable Cut-off Date (the "Collection
Period"). Any payment received by any agent during the Collection Period from
any customer with an account which is an Account Receivable with respect to
which it is acting as agent shall first be applied in reduction of such Account
Receivable, unless the customer indicates otherwise in writing. During the
Collection Period, each agent shall furnish the other with a list of, and pay
over to the other, the amounts collected with respect to the Accounts Receivable
with respect to which it is acting as agent within five (5) days after the end
of each month during the Collection Period. Each agent shall provide the other
with a final accounting on or before the fifteenth (15th) day following the end
of the Collection Period. Upon the request of either agent at and after such
time, the parties shall meet to mutually and in good faith analyze any
uncollected Accounts Receivable to determine if the same, in their reasonable
business judgment, are deemed to be collectable and if the party which acted as
agent with respect thereto desires to retain such Accounts Receivable in the
interest of maintaining an advertising relationship. As to each such Accounts
Receivable, the parties shall in good faith attempt to negotiate the value of
such Accounts Receivable, which the purchasing party shall pay to the other if
the purchasing party, in its sole discretion, chooses to retain such Accounts
Receivable. Each party shall retain the right to collect any of its Accounts
Receivable as to which the parties are unable to reach agreement as to such
value, and each party agrees to turn over to the other any payments received
against any such Accounts Receivable. None of the agents shall be obligated to
use any extraordinary efforts to collect any of the Accounts Receivable assigned
to it for collection hereunder or to refer any of such
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Accounts Receivable to a collection agency or to any attorney for collection,
and none of the agents shall make any such referral or compromise, nor settle or
adjust the amount of any such Accounts Receivable, except with the approval of
the party entitled to such Accounts Receivable. None of the agents shall incur
any liability to any other party for any uncollected Accounts Receivable unless
such agent shall have engaged in willful misconduct or gross negligence in the
performance of its obligations set forth in this Section. During and after the
Collection Period, without specific agreement with the agent with respect
thereto to the contrary, none of the assigning parties nor its agents shall make
any direct solicitation of the Accounts Receivable for collection purposes,
except for Accounts Receivable retained by the assigning party after the
Collection Period.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES OF THE JACOR PARTIES
The Jacor Parties, jointly and severally, represent and warrant to the
American Parties as follows:
3.1 Organization and Business; Power and Authority; Effect of
Transaction.
(a) Each of the Jacor Parties is a corporation duly organized, validly
existing and in good standing under the laws of its jurisdiction of
organization, has all requisite corporate power and authority to own or hold
under lease its properties and to conduct its business as now conducted.
(b) Each of the Jacor Parties has all requisite corporate power and
authority necessary to enable it to execute and deliver, and to perform its
obligations under, this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto or to consummate the
Exchanges and the other Transactions; and the execution, delivery and
performance of this Agreement and each Collateral Document executed or required
to be executed pursuant hereto or thereto have been duly authorized by all
requisite corporate or other action on the part of the Jacor Parties. This
Agreement has been duly executed and delivered by the Jacor Parties and
constitutes, and each Collateral Document executed or required to be executed
pursuant hereto or thereto or to consummate the Exchanges and the other
Transactions when executed and delivered by a Jacor Party will constitute,
legal, valid and binding obligations of such Jacor Parties, enforceable in
accordance with their respective terms, except as such enforceability may be
limited by bankruptcy, moratorium, insolvency and similar laws affecting the
rights and remedies of creditors and obligations of debtors generally and by
general principles of equity.
(c) Except as set forth in Section 3.1(c) of the Jacor Disclosure
Schedule, neither the execution and delivery by the Jacor Parties of this
Agreement or any Collateral Document executed or required to be executed by any
of them pursuant hereto or thereto, nor the consummation by the Jacor Parties of
the Exchanges and the other Transactions, nor compliance with the terms,
conditions and provisions hereof or thereof by the Jacor Parties:
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(i) will conflict with, or result in a breach or violation of,
or constitute a default under, any Organic Document of any of the Jacor
Parties or any Applicable Law on the part of any of the Jacor Parties,
or subject to obtaining any required consents, will conflict with, or
result in a breach or violation of, or constitute a default under, or
permit the acceleration of any obligation or liability in, or but for
any requirement of giving of notice or passage of time or both would
constitute such a conflict with, breach or violation of, or default
under, or permit any such acceleration in, any Jacor Material
Agreement; or
(ii) will require any Jacor Party to make or obtain any
Governmental Authorization, Governmental Filing or Private
Authorization, except for the FCC Consents, filings, if required, under
the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and Private Authorizations, the failure of
which to be obtained or maintained would not, individually or in the
aggregate, have an adverse effect on Jacor.
(d) None of the Jacor Parties has any direct or indirect Subsidiaries
or other Affiliates (other than a Jacor Party) which own or have any interest in
any of the Jacor Stations or any of the Jacor Assets. The Jacor Stations
constitute all of the radio stations which any Jacor Party or any of their
Affiliates owns or operates or has the right to acquire or operate in the Kansas
City, Missouri radio market.
3.2 Financial and Other Information.
(a) The Jacor Parties have heretofore furnished to American copies of
the unaudited financial statements of the Jacor Stations for the years ended
December 31, 1995 and 1996 (the "Jacor Financial Statements"). The Jacor
Financial Statements have been prepared on a consistent basis throughout the
periods covered thereby, and fairly present the financial condition, results of
operations and cash flow of the Jacor Stations, as of the respective dates
thereof and for the respective periods covered thereby.
(b) Except solely for the obligations and liabilities to be assumed by
the American Parties pursuant to the Jacor Assumable Agreements, there will, at
the time of Closing, be no obligations or liabilities of any nature, whether
accrued, absolute, contingent or otherwise, relating to the Jacor Parties, the
Jacor Assets or the Jacor Stations which could, after the Closing, result in any
form of transferee liability against either of the American Parties or subject
any of the Jacor Assets or any of the Jacor Stations to any Lien or otherwise
affect the full, free and unencumbered use of the Jacor Assets and the ownership
and operation of the Jacor Stations by American.
3.3 Material Statements and Omissions; Absence of Events. No
representation or warranty made by the Jacor Parties contained in this
Agreement, the Jacor Disclosure Schedule or any certificate, document or other
instrument furnished or to be furnished by the Jacor Parties pursuant to the
provisions hereof contains or will contain any untrue statement of a material
fact or omits or will omit to state any material fact required to make any
statement contained herein or therein not misleading. None of the Jacor Parties
is aware of any impending or contemplated Event that would cause any of the
representations and warranties made by it in this Article not to be true,
correct and complete on the date of such Event as if made on that date.
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3.4 Changes in Condition. Since December 31, 1996, except to the extent
specifically described in Section 3.4 of the Jacor Disclosure Schedule, there
has been no adverse change in the Jacor Assets or the Jacor Stations. There is
no Event known to the Jacor Parties which adversely affects, or (so far as the
Jacor Parties can now reasonably foresee) is likely to adversely affect, the
Jacor Assets or the Jacor Stations, except (a) to the extent specifically
described in Section 3.4 of the Jacor Disclosure Schedule and (b) for general
business and economic conditions and matters affecting the radio broadcasting
industry generally.
3.5 Title to Properties; Leases.
(a) Section 3.5(a) of the Jacor Disclosure Schedule lists all Real
Property owned by any Jacor Party (the "Jacor Owned Real Property") and
describes all Leases of Real Property (the "Jacor Leases") which is used or held
for use in the operation of the Jacor Stations (the Jacor Owned Real Property
and the real property subject to the Jacor Leases, being hereinafter
collectively referred to as the "Jacor Real Property"). One of the Jacor Parties
has (and American will upon Closing obtain) good and marketable title to the
Jacor Owned Real Property and valid and subsisting leasehold interests in the
Jacor Leases, in each case free and clear of all Liens, except (i) Permitted
Liens and (ii) Liens set forth on Section 3.5(a) of the Jacor Disclosure
Schedule (which Liens shall be released prior to Closing). One of the Jacor
Parties has full legal and practical access to all of the Jacor Owned Real
Property, and all easements, rights of way, and real property licenses relating
thereto have been properly recorded in the appropriate public recording offices,
except to the extent, if any, set forth in Section 3.5(a) of the Jacor
Disclosure Schedule. The Jacor Owned Real Property, together with the real
property that is subject to the Jacor Leases, includes all the real property,
easements, rights of way, and other real property interests necessary to conduct
the business and operations of the Jacor Stations as they are now conducted.
None of the buildings, structures, improvements or fixtures constructed on any
Jacor Owned Real Property and real property that is subject to the Jacor Leases,
including without limitation all towers, guy wires and guy anchors and ground
radials, encroach upon adjoining real property, and all such buildings,
structures, improvements and fixtures, are constructed and are operated and used
in conformance in all material respects with all "set back" lines, easements,
covenants, restrictions and all applicable building, fire, zoning, health and
safety laws and codes, except to the extent, if any, set forth in Section 3.5(a)
of the Jacor Disclosure Schedule. No utility lines serving such real property
pass over the lands of a third party except where appropriate easements have
been obtained or except as set forth in Section 3.5(a) of the Jacor Disclosure
Schedule. All buildings, structures, towers, antennae, improvements and fixtures
comprising the Jacor Owned Real Property or real property that is subject to the
Jacor Leases are in good and technically sound operating condition, have no
latent structural mechanical or other defects of material significance, are
reasonably suited for the purposes for which they are being used and each has
adequate rights of ingress and egress, utility service for water and sewer,
telephone, electric and/or gas, and sanitary service for the conduct of the
business and operations of the Jacor Stations as presently conducted, except to
the extent, if any, set forth in Section 3.5(a) of the Jacor Disclosure
Schedule. There is no pending or, to Jacor's knowledge, threatened condemnation
or other legal proceeding or action of any kind relating to such real property
and/or title thereto.
Except as otherwise set forth in Section 3.5(a) of the Jacor Disclosure
Schedule, each Jacor Lease included in the Jacor Real Property has been duly
authorized, executed and delivered by one
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of the Jacor Parties and, to Jacor's knowledge, each of the other parties
thereto, and is a legally valid and binding obligation of one of the Jacor
Parties, and, to Jacor's knowledge, each of the other parties thereto,
enforceable in accordance with its terms. One of the Jacor Parties enjoys
peaceful and undisturbed possession under all Jacor Leases pursuant to which it
will hold any Jacor Real Property. All of the Jacor Leases are valid and
subsisting and in full force and effect; none of the Jacor Parties nor, to
Jacor's knowledge, any other party thereto, is in default in the performance,
observance or fulfillment of any obligation, covenant or condition contained in
any Jacor Lease.
(b) Section 3.5(b) of the Jacor Disclosure Schedule contains a true,
accurate and complete description of all material items of Jacor Personal
Property. One of the Jacor Parties owns and has good and merchantable title to
all of the Jacor Personal Property relating to the Jacor Stations (the "Jacor
Personal Property"), in each case, free and clear of all Liens, except (i)
Permitted Liens and (ii) Liens set forth on Section 3.5(b) of the Jacor
Disclosure Schedule (which Liens shall be released prior to Closing). Except as
set forth in Section 3.5(b) of the Jacor Disclosure Schedule, all of the Jacor
Personal Property is in a state of good repair and maintenance and is in good
operating condition, normal wear and tear excepted, has been maintained in a
manner consistent with generally accepted standards of good engineering practice
and currently permits the Jacor Stations to be operated in accordance with the
terms and conditions of the Jacor FCC Licenses and all Applicable Laws.
3.6 Compliance with Private Authorizations. Section 3.6 of the Jacor
Disclosure Schedule sets forth a true, accurate and complete list and
description of each Jacor Private Authorization which, individually or when
taken together with other substantially similar Jacor Private Authorizations, is
material to the Jacor Assets or the Jacor Stations, all of which are in full
force and effect. There does not exist any breach or violation of, or in default
in the performance, observance or fulfillment of, any Jacor Private
Authorization, and no Event exists or has occurred, which constitutes, or but
for any requirement of giving of notice or passage of time or both would
constitute, such a breach, violation or default, under any Jacor Private
Authorization, except as set forth in Section 3.6 of the Jacor Disclosure
Schedule. No Jacor Private Authorization is the subject of any pending or, to
Jacor's knowledge, threatened attack, revocation or termination.
3.7 Compliance with Governmental Authorizations and Applicable Law.
(a) Section 3.7(a) of the Jacor Disclosure Schedule contains a
description of:
(i) all Claims pending or, to Jacor's knowledge, threatened
against any Jacor Party with respect to the business, operation or
ownership of any of the Jacor Assets or any of the Jacor Stations,
including without limitation all Claims which, individually or in the
aggregate, are reasonably likely to result in the revocation or
termination of any of the Jacor FCC Licenses or the imposition of any
restriction of such a nature as would adversely affect the ownership or
operations of any of the Jacor Stations; in particular, but without
limiting the generality of the foregoing, there are no Claims pending
or, to Jacor's knowledge, threatened (x) before the FCC relating to the
business or operations of any of the Jacor Stations other than Claims
which affect the radio broadcasting industry generally, or (y) before
any Authority involving charges of illegal discrimination by any of the
Jacor Stations under any federal or state employment Laws; and
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(ii) each Governmental Authorization (including without
limitation all FCC Licenses) required under Applicable Laws to own and
operate the Jacor Stations, as currently conducted or proposed to be
conducted on or prior to the Closing Date, all of which are in full
force and effect (the "Jacor Governmental Authorizations").
Attached to the Jacor Disclosure Schedule are true, correct and complete copies
of the Jacor Governmental Authorizations (including without limitation any and
all amendments and other modifications thereto).
(b) One of the Jacor Parties is the authorized legal holder of the FCC
Licenses listed in Section 3.7(a) of the Jacor Disclosure Schedule, none of
which is subject to any restriction or condition which would limit in any
respect the operations of the Jacor Stations as currently conducted. The Jacor
FCC Licenses are valid and in good standing, are in full force and effect and
are not impaired in any respect by any act or omission of any Jacor Party or its
officers, directors, employees or agents. The Jacor Stations are operating in
accordance with the Jacor FCC Licenses, all underlying construction permits and
the FCA. Except as disclosed in Section 3.7(b) of the Jacor Disclosure Schedule,
no application, action or proceeding is pending for the renewal or modification
of any Jacor FCC Licenses and, to Jacor's knowledge, there is not as of the date
of this Agreement issued or outstanding any investigation or complaint against
any Jacor Party at the FCC relating to any of the Jacor Stations. Except as
disclosed in Section 3.7(b) of the Jacor Disclosure Schedule, as of the date of
this Agreement, there is no proceeding pending at, or outstanding notice of
violation from, the FCC relating to any of the Jacor Stations. All fees payable
to Authorities pursuant to the Jacor Station FCC Licenses, including FCC annual
regulatory fees, have been paid and no event has occurred which, individually or
in the aggregate, and without the giving of notice or the lapse of time or both,
would constitute grounds for revocation thereof or would have an adverse effect
on any Jacor Party. Except (i) as set forth in Section 3.7(b) of the Jacor
Disclosure Schedule and (ii) for such reports, forms and statements the failure
of which to file would not, individually or in the aggregate, have an adverse
effect on the Jacor Stations, all reports, forms and statements required to be
filed by any Jacor Party with the FCC with respect to the Jacor Stations have
been filed and are true, complete and accurate in all respects. To Jacor's
knowledge, under the FCA, there are no facts that would disqualify it as the
transferee of the control of the American Stations.
The Jacor Governmental Authorizations comprise all Governmental
Authorizations which are necessary for the lawful ownership or operation of the
Jacor Assets or the lawful conduct of the business of the Jacor Stations as now
conducted, except for Governmental Authorizations, the failure of which to
obtain and maintain, would not, individually or in the aggregate, have any
adverse effect on the Jacor Assets or Jacor Stations. No Jacor Governmental
Authorization is the subject of any pending or, to Jacor's knowledge, threatened
challenge or proceeding to revoke or terminate any Jacor Governmental
Authorization. To Jacor's knowledge, except as set forth in Section 3.7(b) of
the Jacor Disclosure Schedule, no Jacor Party has any reason to believe that any
Jacor Governmental Authorization would not be renewed in the name of one of the
Jacor Parties by the granting Authority in the ordinary course.
3.8 Intangible Assets. Section 3.8 of the Jacor Disclosure Schedule
sets forth a true, accurate and complete description of all material Intangible
Assets held or used by any Jacor Party
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(other than the Jacor Governmental Authorizations and the Jacor Private
Authorizations) relating to the ownership and operation of the Jacor Assets or
the conduct of the business of the Jacor Stations (the "Jacor Intangible
Assets"), including without limitation the nature of one of the Jacor Party's
interest in each and the extent to which the same have been duly registered in
the offices as indicated therein. One of the Jacor Parties owns or possesses or
otherwise has the right to use the Jacor Intangible Assets.
3.9 Related Transactions. No Jacor Party is a party or subject to any
Contractual Obligation relating to the ownership and operation of the Jacor
Assets or the conduct of the business of the Jacor Stations between any Jacor
Party and any of their respective officers, directors, stockholders or employees
or, to the knowledge of Jacor, any Affiliate of any thereof, including without
limitation any Contractual Obligation providing for the furnishing of services
to or by, providing for rental of property, real, personal or mixed, to or from,
or providing for the lending or borrowing of money to or from or otherwise
requiring payments to or from, any such Person, other than (i) the Jacor
Employee Plans or Jacor Material Agreements constituting employment agreements,
(ii) Contracts between any of the Jacor Parties and its officers, directors,
stockholders or employees which will not be part of the Jacor Assets and will
constitute Jacor Excluded Assets and Jacor Nonassumed Obligations, and (iii) a
management agreement between Regent Broadcasting and Regent Licensee.
3.10 Tax Matters. Each of the Jacor Parties has in respect of the Jacor
Assets and the Jacor Stations filed all material Tax Returns which are required
to be filed, and has paid, or made adequate provision for the payment of, all
Taxes which have or may become due and payable pursuant to said Tax Returns and
all other governmental charges and assessments received to date other than those
Taxes being contested in good faith. There are no unpaid Taxes which are due and
payable, or alleged to be due and payable by any Taxing Authority, the
non-payment of which is or could become a Lien on any of the Jacor Assets or any
of the Jacor Stations or result in any transferee liability against any of the
Jacor Parties. All Taxes in respect of the Jacor Assets and the Jacor Stations
which any Jacor Party is required by law to withhold and collect have, to
Jacor's knowledge, been duly withheld and collected, and have been paid over, in
a timely manner, to the proper Authorities to the extent due and payable.
3.11 Employee Benefit Plans; Jacor Station Employees..
(a) Section 3.11(a) of the Jacor Disclosure Schedule contains a true,
accurate and complete list (and brief description) as of the date of this
Agreement of all employee benefit plans which are applicable to the Jacor
Station Employees ("Jacor Employee Plans"). Neither any Jacor Party nor its
Affiliates maintains any other employee benefit plan, as that term is defined in
Section 3 of ERISA, applicable to the Jacor Station Employees.
(b) Section 3.11(b) of the Jacor Disclosure Schedule contains a true,
accurate and complete list of all persons employed by any Jacor Party in the
ownership or operation of any of the Jacor Assets or the conduct of the business
of any of the Jacor Stations (the "Jacor Station Employees"), together with each
such employee's date of hire, the title or capacity in which such person is
employed, and a description of material compensation arrangements (other than
any Jacor Employee Plans).
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(c) No Jacor Party has received any notice that, and no Jacor Party is
aware of, any Jacor Station Employee who shall or is likely to terminate his or
her employment relationship with the Jacor Stations upon the execution of this
Agreement or after the Closing, except as set forth in Section 3.11(c) of the
Jacor Disclosure Schedule.
(d) Except as described in Section 3.11(d) of the Jacor Disclosure
Schedule, with respect to the Jacor Stations, (i) none of the Jacor Station
Employees is now or, to Jacor's knowledge, has been represented by any labor
union or other employee collective bargaining organization, and no Jacor Party
is or has been a party to any labor or other collective bargaining agreement
with respect to any Jacor Station Employee, (ii) there are no pending
grievances, disputes or controversies with any union or any other employee or
collective bargaining organization of such employees, or threats of strikes,
work stoppages or slowdowns or any pending demands for collective bargaining by
any such union or other organization, and (iii) no Jacor Party nor any of such
employees is now or, to Jacor's knowledge, has been subject to, involved in or
threatened with, any union elections, petitions therefore or other
organizational or recruiting activities, in each case with respect to any Jacor
Station Employee.
(e) Except as disclosed in Section 3.11(e) of the Jacor Disclosure
Schedule, each of the Jacor Parties have complied in all material respects with
all laws relating to the employment of labor, including, without limitation,
ERISA and those laws relating to wages, hours, collective bargaining,
unemployment insurance, workers' compensation, equal employment opportunity and
payment and withholding of taxes.
3.12 Material Agreements. Listed on Section 3.12 of the Jacor
Disclosure Schedule are all Material Agreements relating to the ownership or
operation of the Jacor Assets or the conduct of the business of the Jacor
Stations or to which any Jacor Party is a party or to which it is bound or to
which any of the Jacor Assets is or will, as of such time, be subject (the
"Jacor Material Agreements"). True, accurate and complete copies of each of such
Material Agreements have been made available by the Jacor Parties to American
and the Jacor Parties have provided American with photocopies of all such
Material Agreements requested by American (or true, accurate and complete
descriptions thereof have been set forth in Section 3.12 of the Jacor Disclosure
Schedule, if any such Material Agreements are oral). All of the Jacor Material
Agreements relating to the Jacor Stations are valid, binding and legally
enforceable obligations of one of the Jacor Parties, and, in all cases, to
Jacor's knowledge, all other parties thereto, and one of the Jacor Parties is
validly and lawfully conducting the business of the Jacor Stations and owning
and operating the Jacor Assets under each of the Jacor Material Agreements. Each
of the Jacor Parties has duly complied with all of the terms and conditions of
each Jacor Material Agreement and none has done or performed, or failed to do or
perform (and, to Jacor's knowledge, there is no pending or threatened Claim that
any Jacor Party has not so complied, done and performed or failed to do and
perform) any act which would invalidate or provide grounds for the other party
thereto to terminate (with or without notice, passage of time or both) any of
the Jacor Material Agreements or impair the rights or benefits, or increase the
costs, of any Jacor Party under any of Jacor Material Agreement. No Jacor Party
has expressly granted any waivers or forbearance under any Jacor Material
Agreement and, to Jacor's knowledge, no third party is in material default in
the performance of any of its obligations under any Jacor Material Agreement.
Except for those consents or approvals listed in Section 3.12 of the Jacor
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Disclosure Schedule, no consents or approvals of any third party are necessary
to permit the assignment by the Jacor Parties of the Jacor Material Agreements
to American and such assignment will not affect the validity or enforceability
of any Jacor Material Agreement or cause any material change in the substantive
terms of any of them.
3.13 Ordinary Course of Business. Each of the Jacor Parties, from the
later of December 31, 1996 or the acquisition of the applicable Jacor Assets and
Jacor Stations to the date hereof, except (i) as may be described on Section
3.13 of the Jacor Disclosure Schedule, or (ii) as may be required or expressly
contemplated by the terms of this Agreement, with respect to the Jacor Assets
and the Jacor Stations, has operated its business in the normal, usual and
customary manner in the ordinary and regular course of business, consistent with
prior practice and
(a) has not sold or otherwise disposed of or contracted to
sell or otherwise dispose of any of the Jacor Assets;
(b) other than in the ordinary course of business, consistent
with prior practice:
(i) has not made or committed to make any additions
to its property or any purchases of equipment, except for
normal maintenance and replacements; and
(ii) has not increased the compensation payable or to
become payable to any of its employees other than in the
ordinary course of business or otherwise altered, modified or
changed the terms of their employment;
(c) has not suffered any material damage, destruction or loss
(whether or not covered by insurance) or any acquisition or taking of
property by any Authority; and
(d) has not experienced any work stoppage.
3.14 Broker or Finder. No Person assisted in or brought about the
negotiation of this Agreement, the Exchanges or the subject matter of any other
Transaction in the capacity of broker, agent or finder or in any similar
capacity on behalf of any Jacor Party.
3.15 Environmental Matters. Except as set forth in Section 3.15 of the
Jacor Disclosure Schedule, solely with respect to the Jacor Assets and the Jacor
Real Property, no Jacor Party:
(a) has been notified in writing that it is potentially liable
under, has received any written request for information or other
correspondence concerning its potential liability with respect to any
site or facility under, or is a "potentially responsible party" under,
the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, the Resource Conservation Recovery Act, as
amended, or any similar state law;
(b) has entered into or received any consent decree,
compliance order or administrative order issued pursuant to any
Environmental Law;
-17-
(c) is a party in interest or in default under any judgment,
order, writ, injunction or decree of any final order issued pursuant to
any Environmental Law;
(d) is, to Jacor's knowledge, not in substantial compliance
with all Environmental Laws, has, to Jacor's knowledge, not obtained
all Environmental Permits required under Environmental Laws, and is the
subject of or, to Jacor's knowledge, threatened with any Legal Action
involving a demand for damages or other potential liability including
any Lien with respect to violations or breaches of any Environmental
Law;
(e) has any knowledge of any past or present Event which,
individually or in the aggregate, will interfere with or prevent
continued compliance with all Environmental Laws, or which,
individually or in the aggregate, will form the basis of any Claim for
the release or threatened release into the environment, of any
Hazardous Material;
(f) has any knowledge that any Hazardous Material is or has
been located at, on, in or under, or has been released or transported
from, the Jacor Assets or the Jacor Real Property in such manner so as
to require remediation, removal or cleanup or other liability or claim
under, any Environmental Laws; and
(g) has any knowledge that any underground storage tank is or
has been located at, on, in, or under the Jacor Real Property, or that
any friable asbestos containing material or Polychlorinated biphenyl
containing electrical equipment (other than non-leaking, unitlity-owned
transformers) are located thereon.
Notwithstanding anything to the contrary contained in this Agreement,
none of the Jacor Parties makes any representation or warranty with respect to
its compliance with Environmental Laws or environmental matters generally,
except as specifically set forth in this Section.
3.16 Trade or Barter. Section 3.16 of the Jacor Disclosure Schedule
sets forth a true, complete and accurate description (including obligations and
liabilities remaining thereunder) of all Jacor Trade Agreements that
individually involve or may involve, valued in accordance with GAAP, more than
$500 in obligations remaining thereunder as of the date of this Agreement in
money, property or services or a remaining term in excess of two months.
ARTICLE 4
REPRESENTATIONS AND WARRANTIES OF THE AMERICAN PARTIES
The American Parties, jointly and severally, represent and warrant to
the Jacor Parties as follows:
4.1 Organization and Business; Power and Authority; Effect of
Transaction.
(a) Each of the American Parties is a corporation duly organized,
validly existing and in good standing under the laws of its jurisdiction of
organization, has all requisite corporate power
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and authority to own or hold under lease its properties and to conduct its
business as now conducted.
(b) Each of the American Parties has all requisite corporate power and
authority necessary to enable it to execute and deliver, and to perform its
obligations under, this Agreement and each Collateral Document executed or
required to be executed by it pursuant hereto or thereto or to consummate the
Exchanges and the other Transactions; and the execution, delivery and
performance of this Agreement and each Collateral Document executed or required
to be executed pursuant hereto or thereto have been duly authorized by all
requisite corporate or other action on the part of the American Parties. This
Agreement has been duly executed and delivered by the American Parties and
constitutes, and each Collateral Document executed or required to be executed
pursuant hereto or thereto or to consummate the Exchanges and the other
Transactions when executed and delivered by an American Party will constitute,
legal, valid and binding obligations of such American Parties, enforceable in
accordance with their respective terms, except as such enforceability may be
limited by bankruptcy, moratorium, insolvency and similar laws affecting the
rights and remedies of creditors and obligations of debtors generally and by
general principles of equity.
(c) Except as set forth in Section 4.1(c) of the American Disclosure
Schedule, neither the execution and delivery by the American Parties of this
Agreement or any Collateral Document executed or required to be executed by
either of them pursuant hereto or thereto, nor the consummation by the American
Parties of the Exchanges and the other Transactions, nor compliance with the
terms, conditions and provisions hereof or thereof by the American Parties:
(i) will conflict with, or result in a breach or violation of,
or constitute a default under, any Organic Document of either of the
American Parties or any Applicable Law on the part of either of the
American Parties, or subject to obtaining any required consents, will
conflict with, or result in a breach or violation of, or constitute a
default under, or permit the acceleration of any obligation or
liability in, or but for any requirement of giving of notice or passage
of time or both would constitute such a conflict with, breach or
violation of, or default under, or permit any such acceleration in, any
American Material Agreement; or
(ii) will require either American Party to make or obtain any
Governmental Authorization, Governmental Filing or Private
Authorization, except for the FCC Consents, filings, if required, under
the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and Private Authorizations, the failure of
which to be obtained or maintained would not, individually or in the
aggregate, have an adverse effect on American.
(d) Neither of the American Parties has any direct or indirect
Subsidiaries or other Affiliates (other than an American Party) which own or
have any interest in any of the American Stations or any of the American Assets.
American owns all of the outstanding capital stock of American License, all of
which stock is duly authorized, validly issued, fully paid and nonassessable.
The American Stations constitute all of the radio stations which either American
Party or any of their Affiliates owns or operates or has the right to acquire or
operate in the Dayton, Ohio radio market.
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4.2 Financial and Other Information.
(a) American has heretofore furnished to one of the Jacor Parties
copies of the unaudited financial statements of the American Stations for the
years ended December 31, 1995 and 1996 (the "American Financial Statements").
The American Financial Statements have been prepared on a consistent basis
throughout the periods covered thereby, and fairly present the financial
condition, results of operations and cash flow of the American Stations, as of
the respective dates thereof and for the respective periods covered thereby.
(b) Except solely for the obligations and liabilities to be assumed by
the one of the Jacor Parties pursuant to the American Assumable Agreements,
there will, at the time of Closing, be no obligations or liabilities of any
nature, whether accrued, absolute, contingent or otherwise, relating to the
American Parties, the American Assets or the American Stations which could,
after the Closing, result in any form of transferee liability against any of the
Jacor Parties or subject any of the American Assets or any of the American
Stations to any Lien or otherwise affect the full, free and unencumbered use of
the American Assets and the ownership and operation of the American Stations by
one of the Jacor Parties.
4.3 Material Statements and Omissions; Absence of Events. No
representation or warranty made by the American Parties contained in this
Agreement, the American Disclosure Schedule or any certificate, document or
other instrument furnished or to be furnished by the American Parties pursuant
to the provisions hereof contains or will contain any untrue statement of a
material fact or omits or will omit to state any material fact required to make
any statement contained herein or therein not misleading. Neither American nor
American License is aware of any impending or contemplated Event that would
cause any of the representations and warranties made by it in this Article not
to be true, correct and complete on the date of such Event as if made on that
date.
4.4 Changes in Condition. Since December 31, 1996, except to the extent
specifically described in Section 4.4 of the American Disclosure Schedule, there
has been no adverse change in the American Assets or the American Stations.
There is no Event known to the American Parties which adversely affects, or (so
far as the American Parties can now reasonably foresee) is likely to adversely
affect, the American Assets or the American Stations, except (a) to the extent
specifically described in Section 4.4 of the American Disclosure Schedule and
(b) for general business and economic conditions and matters affecting the radio
broadcasting industry generally.
4.5 Title to Properties; Leases.
(a) Section 4.5(a) of the American Disclosure Schedule lists all Real
Property owned by either American Party (the "American Owned Real Property") and
describes all Leases of Real Property (the "American Leases") which is used or
held for use in the operation of the American Stations (the American Owned Real
Property and the real property subject to the American Leases, being hereinafter
collectively referred to as the "American Real Property"). American has (and one
of the Jacor Parties will upon Closing obtain) good and marketable title to the
American Owned Real Property and valid and subsisting leasehold interests in the
American Leases, in each case free and clear of all Liens, except (i) Permitted
Liens and (ii) Liens set forth on Section 4.5(a) of the
-20-
American Disclosure Schedule (which Liens shall be released prior to Closing).
American has full legal and practical access to all of the American Owned Real
Property, and all easements, rights of way, and real property licenses relating
thereto have been properly recorded in the appropriate public recording offices,
except to the extent, if any, set forth in Section 4.5(a) of the American
Disclosure Schedule. The American Owned Real Property, together with the real
property that is subject to the American Leases, includes all the real property,
easements, rights of way, and other real property interests necessary to conduct
the business and operations of the American Stations as they are now conducted.
None of the buildings, structures, improvements or fixtures constructed on any
American Owned Real Property and real property that is subject to the American
Leases, including without limitation all towers, guy wires and guy anchors and
ground radials, encroach upon adjoining real property, and all such buildings,
structures, improvements and fixtures, are constructed and are operated and used
in conformance in all material respects with all "set back" lines, easements,
covenants, restrictions and all applicable building, fire, zoning, health and
safety laws and codes, except to the extent, if any, set forth in Section 4.5(a)
of the American Disclosure Schedule. No utility lines serving such real property
pass over the lands of a third party except where appropriate easements have
been obtained or except as set forth in Section 4.5(a) of the American
Disclosure Schedule. All buildings, structures, towers, antennae, improvements
and fixtures comprising the American Owned Real Property or real property that
is subject to the American Leases are in good and technically sound operating
condition, have no latent structural mechanical or other defects of material
significance, are reasonably suited for the purposes for which they are being
used and each has adequate rights of ingress and egress, utility service for
water and sewer, telephone, electric and/or gas, and sanitary service for the
conduct of the business and operations of the American Stations as presently
conducted, except to the extent, if any, set forth in Section 4.5(a) of the
American Disclosure Schedule. There is no pending or, to American's knowledge,
threatened condemnation or other legal proceeding or action of any kind relating
to such real property and/or title thereto.
Except as otherwise set forth in Section 4.5(a) of the American
Disclosure Schedule, each American Lease included in the American Real Property
has been duly authorized, executed and delivered by American and, to American's
knowledge, each of the other parties thereto, and is a legally valid and binding
obligation of American, and, to American's knowledge, each of the other parties
thereto, enforceable in accordance with its terms. American enjoys peaceful and
undisturbed possession under all American Leases pursuant to which it will hold
any American Real Property. All of the American Leases are valid and subsisting
and in full force and effect; neither of the American Parties nor, to American's
knowledge, any other party thereto is in default in the performance, observance
or fulfillment of any obligation, covenant or condition contained in any
American Lease.
(b) Section 4.5(b) of the American Disclosure Schedule contains a true,
accurate and complete description of all material items of American Personal
Property. American owns and has good and merchantable title to all of the
American Personal Property relating to the American Stations (the "American
Personal Property"), in each case, free and clear of all Liens, except (i)
Permitted Liens and (ii) Liens set forth on Section 4.5(b) of the American
Disclosure Schedule (which Liens shall be released prior to Closing). Except as
set forth in Section 4.5(b) of the American Disclosure Schedule, all of the
American Personal Property is in a state of good repair and maintenance and is
in good operating condition, normal wear and tear excepted, has been maintained
-21-
in a manner consistent with generally accepted standards of good engineering
practice and currently permits the American Stations to be operated in
accordance with the terms and conditions of the American FCC Licenses and all
Applicable Laws.
4.6 Compliance with Private Authorizations. Section 4.6 of the American
Disclosure Schedule sets forth a true, accurate and complete list and
description of each American Private Authorization which, individually or when
taken together with other substantially similar American Private Authorizations,
is material to the American Assets or the American Stations, all of which are in
full force and effect. There does not exist any breach or violation of, or in
default in the performance, observance or fulfillment of, any American Private
Authorization, and no Event exists or has occurred, which constitutes, or but
for any requirement of giving of notice or passage of time or both would
constitute, such a breach, violation or default, under any American Private
Authorization, except as set forth in Section 4.6 of the American Disclosure
Schedule. No such Private Authorization is the subject of any pending or, to
American's knowledge, threatened attack, revocation or termination.
4.7 Compliance with Governmental Authorizations and Applicable Law.
(a) Section 4.7(a) of the American Disclosure Schedule contains a
description of:
(i) all Claims pending or, to American's knowledge, threatened
against either American Party with respect to the business, operation
or ownership of any of the American Assets or any of the American
Stations, including without limitation all Claims which, individually
or in the aggregate, are reasonably likely to result in the revocation
or termination of any of the American FCC Licenses or the imposition of
any restriction of such a nature as would adversely affect the
ownership or operations of any of the American Stations; in particular,
but without limiting the generality of the foregoing, there are no
Claims pending or, to American's knowledge, threatened (x) before the
FCC relating to the business or operations of any of the American
Stations other than Claims which affect the radio broadcasting industry
generally, or (y) before any Authority involving charges of illegal
discrimination by any of the American Stations under any federal or
state employment Laws; and
(ii) each Governmental Authorization (including without
limitation all FCC Licenses) required under Applicable Laws to own and
operate the American Stations, as currently conducted or proposed to be
conducted on or prior to the Closing Date, all of which are in full
force and effect (the "American Governmental Authorizations").
Attached to the American Disclosure Schedule are true, correct and complete
copies of the American Governmental Authorizations (including without limitation
any and all amendments and other modifications thereto).
(b) American License is the authorized legal holder of the FCC Licenses
listed in Section 4.7(a) of the American Disclosure Schedule, none of which is
subject to any restriction or condition which would limit in any respect the
operations of the American Stations as currently conducted. The American FCC
Licenses are valid and in good standing, are in full force and effect and are
not
-22-
impaired in any respect by any act or omission of either American Party or its
officers, directors, employees or agents. The American Stations are operating in
accordance with the American FCC Licenses, all underlying construction permits
and the FCA. Except as disclosed in Section 4.7(b) of the American Disclosure
Schedule, no application, action or proceeding is pending for the renewal or
modification of any American FCC Licenses and, to American's knowledge, there is
not as of the date of this Agreement issued or outstanding any investigation or
complaint against either American Party at the FCC relating to any of the
American Stations. Except as disclosed in Section 4.7(b) of the American
Disclosure Schedule, as of the date of this Agreement, there is no proceeding
pending at, or outstanding notice of violation from, the FCC relating to any of
the American Stations. All fees payable to Authorities pursuant to the American
Station FCC Licenses, including FCC annual regulatory fees, have been paid and
no event has occurred which, individually or in the aggregate, and without the
giving of notice or the lapse of time or both, would constitute grounds for
revocation thereof or would have an adverse effect on either American Party.
Except (i) as set forth in Section 4.7(b) of the American Disclosure Schedule
and (ii) for such reports, forms and statements the failure of which to file
would not, individually or in the aggregate, have an adverse effect on the
American Stations, all reports, forms and statements required to be filed by
either American Party with the FCC with respect to the American Stations have
been filed and are true, complete and accurate in all respects. To American's
knowledge, under the FCA, there are no facts that would disqualify it as the
transferee of the control of the Jacor Stations.
The American Governmental Authorizations comprise all Governmental
Authorizations which are necessary for the lawful ownership or operation of the
American Assets or the lawful conduct of the business of the American Stations
as now conducted, except for Governmental Authorizations, the failure of which
to obtain and maintain, would not, individually or in the aggregate, have any
adverse effect on the American Assets or American Stations. No American
Governmental Authorization is the subject of any pending or, to American's
knowledge, threatened challenge or proceeding to revoke or terminate any
American Governmental Authorization. To American's knowledge, except as set
forth in Section 4.7(b) of the American Disclosure Schedule, American has no
reason to believe that any American Governmental Authorization would not be
renewed in the name of American License by the granting Authority in the
ordinary course.
4.8 Intangible Assets. Section 4.8 of the American Disclosure Schedule
sets forth a true, accurate and complete description of all material Intangible
Assets held or used by either American Party (other than the American
Governmental Authorizations and the American Private Authorizations) relating to
the ownership and operation of the American Assets or the conduct of the
business of the American Stations (the "American Intangible Assets"), including
without limitation the nature of one of the American Party's interest in each
and the extent to which the same have been duly registered in the offices as
indicated therein. One of the American Parties owns or possesses or otherwise
has the right to use the American Intangible Assets.
4.9 Related Transactions. Neither American Party is a party or subject
to any Contractual Obligation relating to the ownership and operation of the
American Assets or the conduct of the business of the American Stations between
either American Party and any of their respective officers, directors,
stockholders or employees or, to the knowledge of American, any Affiliate of any
thereof, including without limitation any Contractual Obligation providing for
the furnishing of services to or by, providing for rental of property, real,
personal or mixed, to or from, or providing
-23-
for the lending or borrowing of money to or from or otherwise requiring payments
to or from, any such Person, other than (i) the American Employee Plans or
American Material Agreements constituting employment agreements, (ii) Contracts
between either American Party and its officers, directors, stockholders or
employees which will not be part of the American Assets and will constitute
American Excluded Assets and American Nonassumed Obligations, and (iii) a
management agreement between American and American License.
4.10 Tax Matters. Each of the American Parties has in respect of the
American Assets and the American Stations filed all material Tax Returns which
are required to be filed, and has paid, or made adequate provision for the
payment of, all Taxes which have or may become due and payable pursuant to said
Tax Returns and all other governmental charges and assessments received to date
other than those Taxes being contested in good faith. There are no unpaid Taxes
which are due and payable, or alleged to be due and payable by any Taxing
Authority, the non-payment of which is or could become a Lien on any of the
American Assets or any of the American Stations or result in any transferee
liability against any of the Jacor Parties. All Taxes in respect of the American
Assets and the American Stations which either American Party is required by law
to withhold and collect have, to American's knowledge, been duly withheld and
collected, and have been paid over, in a timely manner, to the proper
Authorities to the extent due and payable.
4.11 Employee Benefit Plans; American Station Employees..
(a) Section 4.11(a) of the American Disclosure Schedule contains a
true, accurate and complete list (and brief description) as of the date of this
Agreement of all employee benefit plans which are applicable to the American
Station Employees ("American Employee Plans"). Neither either American Party nor
its Affiliates maintains any other employee benefit plan, as that term is
defined in Section 3 of ERISA, applicable to the American Station Employees.
(b) Section 4.11(b) of the American Disclosure Schedule contains a
true, accurate and complete list of all persons employed by either American
Party in the ownership or operation of any of the American Assets or the conduct
of the business of any of the American Stations (the "American Station
Employees"), together with each such employee's date of hire, the title or
capacity in which such person is employed, and a description of material
compensation arrangements (other than any American Employee Plans).
(c) Neither American Party has received any notice that, and neither
American Party is aware of, any American Station Employee who shall or is likely
to terminate his or her employment relationship with the American Stations upon
the execution of this Agreement or after the Closing, except as set forth in
Section 4.11(c) of the American Disclosure Schedule.
(d) Except as described in Section 4.11(d) of the American Disclosure
Schedule, with respect to the American Stations, (i) none of the American
Station Employees is now or, to American's knowledge, has been represented by
any labor union or other employee collective bargaining organization, and
neither American Party is or has been a party to any labor or other collective
bargaining agreement with respect to any American Station Employee, (ii) there
are no pending grievances, disputes or controversies with any union or any other
employee or collective bargaining organization of such employees, or threats of
strikes, work stoppages or slowdowns or
-24-
any pending demands for collective bargaining by any such union or other
organization, and (iii) neither American Party nor any of such employees is now
or, to American's knowledge, has been subject to, involved in or threatened
with, any union elections, petitions therefore or other organizational or
recruiting activities, in each case with respect to any American Station
Employee.
(e) Except as disclosed in Section 4.11(e) of the American Disclosure
Schedule, each of the American Parties have complied in all material respects
with all laws relating to the employment of labor, including, without
limitation, ERISA and those laws relating to wages, hours, collective
bargaining, unemployment insurance, workers' compensation, equal employment
opportunity and payment and withholding of taxes.
4.12 Material Agreements. Listed on Section 4.12 of the American
Disclosure Schedule are all Material Agreements relating to the ownership or
operation of the American Assets or the conduct of the business of the American
Stations or to which either American Party is a party or to which it is bound or
to which any of the American Assets is or will, as of such time, be subject (the
"American Material Agreements"). True, accurate and complete copies of each of
such Material Agreements have been made available by American to one of the
Jacor Parties and American has provided one of the Jacor Parties with
photocopies of all such Material Agreements requested by one of the Jacor
Parties (or true, accurate and complete descriptions thereof have been set forth
in Section 4.12 of the American Disclosure Schedule, if any such Material
Agreements are oral). All of the American Material Agreements relating to the
American Stations are valid, binding and legally enforceable obligations of one
of the American Parties, and, in all cases, to American's knowledge, all other
parties thereto, and one of the American Parties is validly and lawfully
conducting the business of the American Stations and owning and operating the
American Assets under each of the American Material Agreements. Each of the
American Parties has duly complied with all of the terms and conditions of each
American Material Agreement and neither has done or performed, or failed to do
or perform (and, to American's knowledge, there is no pending or threatened
Claim that either American Party has not so complied, done and performed or
failed to do and perform) any act which would invalidate or provide grounds for
the other party thereto to terminate (with or without notice, passage of time or
both) any of the American Material Agreements or impair the rights or benefits,
or increase the costs, of either American Party under any of American Material
Agreement. Neither American Party has expressly granted any waivers or
forbearance under any American Material Agreement and, to American's knowledge,
no third party is in material default in the performance of any of its
obligations under any American Material Agreement. Except for those consents or
approvals listed in Section 4.12 of the American Disclosure Schedule, no
consents or approvals of any third party are necessary to permit the assignment
by the American Parties of the American Material Agreements to one of the Jacor
Parties and such assignment will not affect the validity or enforceability of
any American Material Agreement or cause any material change in the substantive
terms of any of them.
4.13 Ordinary Course of Business. Each of the American Parties, from
the later of December 31, 1996 or the acquisition of the applicable American
Assets and American Stations to the date hereof, except (i) as may be described
on Section 4.13 of the American Disclosure Schedule, or (ii) as may be required
or expressly contemplated by the terms of this Agreement, with respect to the
American Assets and the American Stations, has operated its business in the
normal,
-25-
usual and customary manner in the ordinary and regular course of business,
consistent with prior practice and
(a) has not sold or otherwise disposed of or contracted to
sell or otherwise dispose of any of the American Assets;
(b) other than in the ordinary course of business, consistent
with prior practice:
(i) has not made or committed to make any additions
to its property or any purchases of equipment, except for
normal maintenance and replacements; and
(ii) has not increased the compensation payable or to
become payable to any of its employees other than in the
ordinary course of business or otherwise altered, modified or
changed the terms of their employment;
(c) has not suffered any material damage, destruction or loss
(whether or not covered by insurance) or any acquisition or taking of
property by any Authority; and
(d) has not experienced any work stoppage.
4.14 Broker or Finder. No Person assisted in or brought about the
negotiation of this Agreement, the Exchanges or the subject matter of any other
Transaction in the capacity of broker, agent or finder or in any similar
capacity on behalf of either American Party.
4.15 Environmental Matters. Except as set forth in Section 4.15 of the
American Disclosure Schedule, solely with respect to the American Assets and the
American Real Property, neither American Party:
(a) has been notified in writing that it is potentially liable
under, has received any written request for information or other
correspondence concerning its potential liability with respect to any
site or facility under, or is a "potentially responsible party" under,
the Comprehensive Environmental Response, Compensation and Liability
Act of 1980, as amended, the Resource Conservation Recovery Act, as
amended, or any similar state law;
(b) has entered into or received any consent decree,
compliance order or administrative order issued pursuant to any
Environmental Law;
(c) is a party in interest or in default under any judgment,
order, writ, injunction or decree of any final order issued pursuant to
any Environmental Law;
(d) is, to American's knowledge, not in substantial compliance
with all Environmental Laws, has, to American's knowledge, not obtained
all Environmental Permits required under Environmental Laws, and is the
subject of or, to American's knowledge, threatened with any Legal
Action involving a demand for damages or other potential liability
including any Lien with respect to violations or breaches of any
Environmental Law;
-26-
(e) has any knowledge of any past or present Event which,
individually or in the aggregate, will interfere with or prevent
continued compliance with all Environmental Laws, or which,
individually or in the aggregate, will form the basis of any Claim for
the release or threatened release into the environment, of any
Hazardous Material;
(f) has any knowledge that any Hazardous Material is or has
been located at, on, in or under, or has been released or transported
from, the American Assets or the American Real Property in such manner
so as to require remediation, removal or cleanup or other liability or
claim under, any Environmental Laws; and
(g) has any knowledge that any underground storage tank is or
has been located at, on, in, or under the American Real Property, or
that any friable asbestos containing material or Polychlorinated
biphenyl containing electrical equipment (other than non-leaking,
unitlity-owned transformers) are located thereon.
Notwithstanding anything to the contrary contained in this Agreement,
neither American Party make any representation or warranty with respect to its
compliance with Environmental Laws or environmental matters generally, except as
specifically set forth in this Section.
4.16 Trade or Barter. Section 4.16 of the American Disclosure Schedule
sets forth a true, complete and accurate description (including obligations and
liabilities remaining thereunder) of all American Trade Agreements that
individually involve or may involve, valued in accordance with GAAP, more than
$500 in obligations remaining thereunder as of the date of this Agreement in
money, property or services or a remaining term in excess of two months.
ARTICLE 5
COVENANTS
5.1 Access to Information; Confidentiality.
(a) Each party shall afford to the other party and its accountants,
counsel, financial advisors and other representatives (the "Representatives")
full access during normal business hours throughout the period prior to the
Closing Date to all of its (and its Subsidiaries') properties, books, contracts,
commitments and records (including without limitation Tax Returns) relating to
the Assets and the Stations and, during such period, shall furnish promptly upon
request (i) a copy of each report, schedule and other document filed or received
by any of them pursuant to the requirements of any Applicable Law (including
without limitation the FCA) or filed by it or any of its Subsidiaries with any
Authority in connection with either of the Exchanges and the other Transactions
or any other report, schedule or documents which may have a material effect on
the businesses, operations, properties, prospects, personnel, condition,
(financial or other), or results of operations of their respective Assets or
Stations, (ii) to the extent not provided for pursuant to the preceding clause,
all financial records, ledgers, work papers and other sources of financial
information possessed or controlled by (x) any Jacor Party or its accountants
deemed by American or its Representatives necessary or useful for the purpose of
performing an audit of the business of the Jacor Stations and
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certifying financial statements and financial information pursuant to the
provisions of Section 6.2(d), and (y) American or its accountants deemed by any
Jacor Party or its Representatives necessary or useful for the purpose of
performing an audit of the business of the American Stations and certifying
financial statements and financial information pursuant to the provisions of
Section 6.3(d), and (iii) such other information concerning any of the foregoing
as American or any Jacor Party shall reasonably request. All non-public
information furnished pursuant to the provisions of this Agreement, including
without limitation this Section, will be kept confidential and shall not,
without the prior written consent of the party disclosing such information, be
disclosed by the other party in any manner whatsoever, in whole or in part, and,
except as required by Applicable Law (including without limitation in connection
with any registration statement or similar document filed pursuant to any
federal or state securities Law) shall not be used for any purposes, other than
in connection with the Exchanges and the other Transactions. Except as otherwise
herein provided, each party agrees to reveal such information only to those of
its Representatives or other Persons who need to know such the information for
the purpose of evaluating and consummating the Exchanges and the other
Transactions who are informed of the confidential nature of such information.
From and after the Closing, each of the parties shall not, without the prior
written consent of the other party, disclose any information remaining in its
possession with respect to the Assets and Stations conveyed by it pursuant to
the Exchanges and no such information shall be used for any purposes, other than
in connection with the Exchanges and the other Transactions or to the extent
required by Applicable Law.
(b) Notwithstanding the provisions of Section 5.1(a), each party may
disclose such information as it may reasonably determine to be necessary in
connection with seeking all Governmental and Private Authorizations or that is
required by Applicable Law to be disclosed, including without limitation in any
registration statement or other document required to be filed under any federal
or state securities Law. In the event that this Agreement is terminated in
accordance with its terms, each party shall promptly redeliver all non-public
written material provided pursuant to this Section or any other provision of
this Agreement or otherwise in connection with the Exchanges and the other
Transactions and shall not retain any copies, extracts or other reproductions in
whole or in part of such written material other than one copy thereof which
shall be delivered to independent counsel for such party.
(c) No investigation pursuant to this Section or otherwise shall affect
any representation or warranty in this Agreement of either party or any
condition to the obligations of the parties hereto.
5.2 Agreement to Cooperate.
(a) Each of the parties hereto shall use reasonable business efforts
(x) to take, or cause to be taken, all actions and to do, or cause to be done,
all things necessary, proper or advisable under Applicable Law to consummate the
Exchanges and make effective the other Transactions, and (y) to refrain from
taking, or cause to be taken, any action and to refrain from doing or causing to
be done, any thing which could impede or impair the consummation of the
Exchanges or the making effective of the other Transactions, including, in all
cases, without limitation using its reasonable business efforts (i) to prepare
and file with the applicable Authorities as promptly as practicable after the
execution of this Agreement all requisite applications and amendments thereto,
together with related information, data and exhibits, necessary to request
issuance of orders approving the
-28-
Exchanges and the other Transactions by all such applicable Authorities, each of
which must be obtained or become Final Orders in order to satisfy the condition
applicable to it set forth in Section 6.1(c), (ii) to obtain all necessary or
appropriate waivers, consents and approvals, (iii) to effect all necessary
registrations, filings and submissions (including without limitation, if
required, filings within twenty (20) business days of the date of this Agreement
under the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act and all filings necessary for the American
Parties and the Jacor Parties to own and operate the Jacor Stations and the
American Stations, respectively), (iv) to lift any injunction or other legal bar
to the Exchanges or any of the other Transactions (and, in such case, to proceed
with the Exchanges and the other Transactions as expeditiously as possible), and
(v) to obtain the satisfaction of the conditions specified in Article 6,
including without limitation the truth and correctness as of the Closing Date as
if made on and as of the Closing Date of the representations and warranties of
such party and the performance and satisfaction as of the Closing Date of all
agreements and conditions to be performed or satisfied by such party. Without
limiting the generality of the foregoing, the parties acknowledge and agree that
the assignment of the FCC Licenses as contemplated by this Agreement is subject
to the prior consent and approval of the FCC. Within ten (10) business days
following the execution of this Agreement, the American Parties and the Jacor
Parties shall file with the FCC appropriate applications for FCC Consents. The
parties shall prosecute said applications with all reasonable diligence and
otherwise use reasonable business efforts to obtain the grant of FCC Consents to
such applications as expeditiously as practicable. If the FCC Consents, or any
of them, imposes any condition on either party hereto, such party shall use
reasonable business efforts to comply with such condition unless compliance
would have a material adverse effect upon it. If reconsideration or judicial
review is sought with respect to any FCC Consent, the American Parties and the
Jacor Parties shall oppose such efforts to obtain reconsideration or judicial
review (but nothing herein shall be construed to limit any party's right to
terminate this Agreement pursuant to the provisions of Section 7.1).
Notwithstanding anything in this Agreement to the contrary, the Exchanges are
expressly conditioned upon the grant of the Final Order as to the FCC Consents
for the assignment of the FCC Licenses for the Stations without any condition
which would have a materially adverse effect upon the party acquiring such
Stations.
(b) The parties shall cooperate with one another in the preparation of
all Returns, questionnaires, applications or other documents regarding any Taxes
or transfer, recording, registration or other fees which become payable in
connection with the Exchanges and the other Transactions that are required to be
filed on or before the Closing Date.
(c) Each of the Jacor Parties shall cooperate and use its reasonable
business efforts to cause its independent accountants to reasonably cooperate
with American, and at American's expense, in order to enable American to have
the Jacor Parties or the Jacor Parties' or American's independent accountants
prepare audited financial statements for the Jacor Stations described in Section
6.2(d). The Jacor Parties represent and warrant that such financial statements
will have been prepared in accordance with GAAP applied on a basis consistent
with past practices and will present fairly the financial condition and results
of operation of the Jacor Stations. Without limiting the generality of the
foregoing, the Jacor Parties agree that they will (i) consent to the use of such
audited financial statements in any registration statement or other document
filed by American or any of its Affiliates under the Securities Act or the
Exchange Act and (ii) execute and deliver, and cause its officers to execute and
deliver, such "representation" letters as are customarily delivered
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in connection with audits and as American's or the Jacor Parties' independent
accountants may reasonably request under the circumstances.
American shall cooperate and use its reasonable business efforts to
cause its independent accountants to reasonably cooperate with the Jacor
Parties, and at the Jacor Parties' expense, in order to enable the Jacor Parties
to have American and American's or the Jacor Parties' independent accountants
prepare audited and unaudited financial statements for the American Stations
described in Section 6.3(d). American represents and warrants that such
financial statements will have been prepared in accordance with GAAP applied on
a basis consistent with past practices and will present fairly the financial
condition and results of operation of the American Stations. Without limiting
the generality of the foregoing, American agrees that it will (i) consent to the
use of such financial statements in any registration statement or other document
filed by the Jacor Parties or any of their Affiliates under the Securities Act
or the Exchange Act and (ii) execute and deliver, and cause its officers to
execute and deliver, such "representation" letters as are customarily delivered
in connection with audits and as the Jacor Parties' or American's independent
accountants may reasonably request under the circumstances.
(d) The applicable parties acknowledge and agree that they will,
subject to the expiration or earlier termination of the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act
waiting period, execute and deliver time brokerage agreements pursuant to which
(i) American would time broker the Citicasters Stations (the "Citicasters
Stations TBA"), (ii) American would time broker the Regent Stations (the "Regent
Stations TBA"), (iii) Citicasters would time broker each of the American
Citicasters Stations (the "American Citicasters Stations TBA"), and (iv) Regent
Broadcasting would time broker each of the American Regent Stations (the
"American Regent Stations TBA"). Anything in this Agreement to the contrary
notwithstanding, including without limitation any provision of Articles 3 and 4
and Sections 6.2 and 6.3, (i) the Jacor Parties shall not be liable in any
respect to the extent (A) any of their representations and warranties contained
in Article 3 are not true and correct in any material respect on and as of the
Closing Date or (B) any of their covenants contained in Article 5 are breached
in any material respect on and as of the Closing Date, in any such case due
solely to the operation of American under the Citicasters Stations TBA or the
Regent Stations TBA, (ii) the American Parties shall not be liable in any
respect to the extent (A) any of their representations and warranties contained
in Article 4 are not true and correct in any material respect on and as of the
Closing Date or (B) any of their covenants contained in Article 5 are breached
in any material respect on and as of the Closing Date, in any such case due
solely to the operation of the Citicasters or Regent Broadcasting under the
American Citicasters Stations TBA and the American Regent Stations TBA,
respectively, (iii) the conditions set forth in Section 6.3(f) shall not be
deemed to be not satisfied as a result of any action or failure to act of
American pursuant to the provisions of the Citicasters Stations TBA or the
Regent Stations TBA, (iv) the conditions set forth in Section 6.2(f) shall not
be deemed to be not satisfied as a result of any action or failure to act of
Citicasters or Regent Broadcasting pursuant to the provisions of the American
Citicasters Stations TBA and the American Regent Stations TBA, respectively, and
(v) the certificates to be delivered to the American Parties and the Jacor
Parties pursuant to the provisions of Section 6.2(c) and 6.3(c), respectively,
shall not be required to address any of such representations and warranties that
are not true and correct in any material respect or any of such covenants that
are breached in any material respect on and as of the Closing Date due to the
operation of the other party under the TBA Agreements.
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(e) Within thirty (30) days after the execution of this Agreement, (i)
American shall, at its expense, (x) commission a qualified title company to
prepare and provide to the Jacor Parties a preliminary title report with respect
to the American Real Property (the "American Preliminary Title Report") and
promptly provide a copy of the American Preliminary Title Report to the Jacor
Parties, together with complete copies of all documents relating to the title
exceptions referred to in the American Preliminary Title Report and (y)
commission a qualified surveyor (licensed in Ohio) to prepare and provide to the
Jacor Parties hereto a survey ("American Survey") of the American Real Property
depicting the location of all title exceptions and (ii) the Jacor Parties shall,
at their expense, (x) commission a qualified title company to prepare and
provide to the American Parties a preliminary title report with respect to the
Jacor Real Property (the "Jacor Preliminary Title Report") and promptly provide
a copy of the Jacor Preliminary Title Report to American, together with complete
copies of all documents relating to the title exceptions referred to in the
Jacor Preliminary Title Report and (y) commission a qualified surveyor (licensed
in Missouri) to prepare and provide to American hereto a survey ("Jacor Survey")
of the Jacor Real Property depicting the location of all title exceptions.
The Jacor Parties shall have the right to disapprove of any title
exceptions or survey exceptions (whether nor not disclosed on the American
Preliminary Title Report) which in their reasonable business judgment have a
material adverse impact on the title to the American Real Property or its
intended use and shall notify American of any such disapproval within ten (10)
business days after its receipt of both the American Preliminary Title Report
and the American Survey]. All title exceptions set forth in the American
Preliminary Title Report and any supplemental reports or updates to the
Preliminary Title Report and not disapproved within the time periods provided
herein shall constitute "American Permitted Title Exceptions". Prior to the
Closing, American shall, at its expense, remove or cause to be removed all
disapproved exceptions relating to the American Real Property (the "Jacor
Disapproved Matters") or, in the alternative, obtain title insurance in a form
reasonably satisfactory to the Jacor Parties insuring against the effect of such
Jacor Disapproved Matters; provided, however, that American shall not be
obligated to spend more than $150,000 in its attempt to remove or insure over
any such Jacor Disapproved Matters (other than monetary Liens which shall be
required to be removed regardless of the amount thereof). American shall notify
the Jacor Parties within ten (10) days after receipt of the notice of Jacor
Disapproved Matters whether it intends to remove the same. If American is unable
to remove or endorse over any such Jacor Disapproved Matters, or if American
exercises its right not to remove one or more Jacor Disapproved Matters, the
Jacor Parties may elect (i) to terminate this Agreement or (ii) to waive such
Jacor Disapproved Matters (such Jacor Disapproved Matters shall then be deemed
to be American Permitted Title Exceptions), in which event the Jacor Parties
shall receive a credit at the Closing in the amount (up to the positive
difference, if any, between (x) $150,000 and (y) the amount theretofore expended
by American pursuant to the provisions of this Section 5.2(e)) reasonably
necessary to remove or endorse over the Jacor Disapproved Matters or, if the
Jacor Disapproved Matters cannot be removed or endorsed over, to compensate it
for the reduction in value of such American Real Property resulting from such
Jacor Disapproved Matters.
American shall have the right to disapprove of any title exceptions or
survey exceptions (whether nor not disclosed on the Jacor Preliminary Title
Report) which in its reasonable business judgment have a material adverse impact
on the title to the Jacor Real Property or its intended use and shall notify the
Jacor Parties of any such disapproval within ten (10) business days after its
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receipt of both the Jacor Preliminary Title Report and the Jacor Survey. All
title exceptions set forth in the Jacor Preliminary Title Report and any
supplemental reports or updates to the Jacor Preliminary Title Report and not
disapproved within the time periods provided herein shall constitute "Jacor
Permitted Title Exceptions". Prior to the Closing, the Jacor Parties shall, at
their expense, remove or cause to be removed all disapproved exceptions relating
to the Jacor Real Property (the "American Disapproved Matters") or, in the
alternative, obtain title insurance in a form reasonably satisfactory to
American insuring against the effect of such American Disapproved Matters;
provided, however, that the Jacor Parties shall not be obligated to spend more
than $150,000 in its attempt to remove or insure over any such American
Disapproved Matters (other than monetary Liens which shall be required to be
removed regardless of the amount thereof). The Jacor Parties shall notify
American within ten (10) days after receipt of the notice of American
Disapproved Matters whether they intend to remove the same. If the Jacor Parties
are unable to remove or endorse over any such American Disapproved Matters, or
if the Jacor Parties exercise their right not to remove one or more American
Disapproved Matters, American may elect (i) to terminate this Agreement or (ii)
to waive such American Disapproved Matters (such American Disapproved Matters
shall then be deemed to be Jacor Permitted Title Exceptions), in which event
American shall receive a credit at the Closing in the amount (up to the positive
difference, if any, between (x) $150,000 and (y) the amount theretofore expended
by the Jacor Parties pursuant to the provisions of this Section 5.2(e))
reasonably necessary to remove or endorse over the American Disapproved Matters
or, if the American Disapproved Matters cannot be removed or endorsed over, to
compensate it for the reduction in value of such Jacor Real Property resulting
from such American Disapproved Matters.
(f) Within thirty (30) days after the execution of this Agreement, each
of American and the Jacor Parties may, at its sole expense, commission a
qualified engineering firm to conduct a Phase I environmental study of the Jacor
Real Property or the American Real Property, respectively (the study done by
American on such Jacor Real Property is hereinafter called the "American Study";
and the study done by the Jacor Parties on the American Real Property is
hereinafter called the "Jacor Study"). If American promptly notifies the Jacor
Parties in writing that the American Study discloses one or more material
environmental liabilities constituting a breach of the representations and
warranties of the Jacor Parties contained in Section 3.15 without regard to any
knowledge qualifiers contained therein, the Jacor Parties shall promptly
commence remedial action at their expense to cure all conditions giving rise to
all such liabilities and shall use its reasonable business efforts to cure all
such conditions prior to the Closing. If the Jacor Parties promptly notify
American in writing that the Jacor Study discloses one or more material
environmental liabilities constituting a breach of the representations and
warranties of American contained in Section 4.15 without regard to any knowledge
qualifiers contained therein, American shall promptly commence remedial action
at its expense to cure all conditions giving rise to all such liabilities and
shall use its reasonable business efforts to cure all such conditions prior to
the Closing. Notwithstanding the foregoing, neither American nor the Jacor
Parties shall be obligated to undertake a cure which such party reasonably
determines will exceed more than $150,000 in its attempt to cure all such
conditions. If, notwithstanding the use of reasonable business efforts, American
is or the Jacor Parties are unable prior to the Closing to cure all such
conditions, the party to whom the Real Property with such material environmental
liability is to be conveyed may elect (i) to terminate this Agreement or (ii) to
waive such environmental liability, in which event the waiving party shall
receive a credit at the Closing in the amount (up to the positive difference, if
any, between (x)
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$150,000 and (y) the amount theretofore expended by the other party pursuant to
the provisions of this Section 5.2(f)) reasonably necessary to cure such
environmental liability or, if such environmental liability cannot be cured, to
compensate it for the reduction in value of such Real Property resulting from
such environmental liability.
(g) Within thirty (30) days after the execution of this Agreement, each
of American and the Jacor Parties may, at its sole expense, do a study to
determine, to such party's reasonable satisfaction, that services for utilities
including, without limitation, water and sewer service, telephone service,
electric and/or gas service and sanitary services are sufficient to service the
Jacor Real Property or the American Real Property, as the case may be, and any
Real Property subject to the American Leases. If either party notifies the other
within such thirty-day period that the utility service is not sufficient for its
reasonable needs, then the party receiving such notice shall promptly commence
remedial action at its expense to cure such insufficiency and shall use its
reasonable business efforts to cure such insufficiency prior to the Closing.
Notwithstanding the foregoing, neither American nor the Jacor Parties shall be
obligated to spend more than $150,000 in its attempt to cure such insufficiency.
If, notwithstanding the use of its reasonable business efforts, American is or
the Jacor Parties are unable prior to the Closing to cure any such
insufficiency, the party to whom the Real Property with such insufficiency is to
be conveyed may elect to waive such insufficiency in which event the waiving
party shall receive a credit at the Closing in the amount (up to the positive
difference, if any, between (i) $150,000 and (ii) the amount theretofore
expended by the other party pursuant to the provisions of this Section 5.2(g))
reasonably necessary to cure such insufficiency or, if such insufficiency cannot
be cured, to compensate it for the reduction in value of such Real Property
resulting from such insufficiency.
(h) Within thirty (30) days after the execution of this Agreement, each
of American and the Jacor Parties may, at its sole expense, commission a
reputable engineer to conduct an inspection of the Jacor Assets and or the
American Assets, as the case may be (the inspection done by American on the
Jacor Assets is hereinafter called the "American Inspection"; and the inspection
done by the Jacor Parties on the American Assets is hereinafter called the
"Jacor Inspection"). If American notifies the Jacor Parties in writing within
such thirty-day period that the American Inspection discloses one or more
conditions that constitutes a breach of the representations of the Jacor Parties
contained in Section 3.5(b) or 3.7, the Jacor Parties shall promptly commence
remedial action at its expense to cure all such conditions and shall use its
reasonable business efforts to cure all such conditions prior to the Closing. If
the Jacor Parties notify American in writing within such thirty-day period that
the Jacor Parties inspection discloses one or more conditions that constitutes a
breach of the representations of American contained in Section 4.5(b) or 4.7,
American shall promptly commence remedial action at its expense to cure all such
conditions and, use its reasonable business efforts to cure all such conditions
prior to the Closing. Notwithstanding the foregoing, neither American nor the
Jacor Parties shall be obligated to undertake a cure which such party reasonably
determines will exceed more than $150,000 in its attempt to cure all such
conditions. If, notwithstanding the use of its reasonable business efforts,
American is or the Jacor Parties are unable prior to the Closing to cure all
such conditions, the party to whom the Assets with such conditions are to be
conveyed may elect (i) to terminate this Agreement or (ii) to waive such
conditions, in which event the waiving party shall receive a credit at the
Closing in the amount (up to the positive difference, if any, between (x)
$150,000 and (y) the amount theretofore expended by the other party pursuant to
the provisions of this Section 5.2(h)) reasonably necessary to cure such
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conditions or, if such conditions cannot be cured, to compensate it for the
reduction in value of such Real Property resulting from such conditions.
(i) Anything in Sections 5.2(e) through (h) to the contrary
notwithstanding, in the event (i) the amount required to remove or insure over
any American Disapproved Matter or Jacor Disapproved Matters or cure any
condition or insufficiency referred to in those sections would be more than
$150,000 in the aggregate, (ii) the party required to remove or insure over any
such American Disapproved Matter or Jacor Disapproved Matters or cure any such
condition or insufficiency is not willing to spend the additional amounts
required to do so, and (c) the other party is not willing to waive such matters,
the parties shall negotiate in good faith in an effort to resolve the issues
prior to terminating this Agreement.
5.3 Public Announcements. Each party shall consult with the other
before issuing any press release or otherwise making any public statements with
respect to this Agreement, the Exchanges or any other Transaction and shall not
issue any such press release or make any such public statement without the prior
consent of the other, which consent shall not be unreasonably withheld, or
delayed or conditioned. Notwithstanding anything to the contrary herein, each
party and such party's Affiliates shall, in accordance with their respective
legal obligations, including but not limited to filings permitted or required by
the Securities Act and the Exchange Act, the New York Stock Exchange, the NASDAQ
National Market and other similar regulatory bodies, make (a) such press
releases and other public statements and announcements as such party or its
Affiliates deem necessary and appropriate in connection with this Agreement and
the transactions contemplated hereby, and (b) any and all statements such party
deems in its sole judgment to be appropriate in any and all filings,
prospectuses and other similar documents. To the extent practicable, the party
proposing to make such press release or public statement will consult in advance
with the other regarding the nature, extent and form of such press release or
public statement.
5.4 Notification of Certain Matters. Each party shall give prompt
notice to the other, of the occurrence or non-occurrence of any Event the
occurrence or non-occurrence of which would be likely to cause (i) any
representation or warranty made by it contained in this Agreement to be untrue
or inaccurate in any respect such that one or more of the conditions of Closing
might not be satisfied, or (ii) any covenant, condition or agreement made by it
contained in this Agreement not to be complied with or satisfied, or (iii) any
change to be made in the Jacor Disclosure Schedule or the American Disclosure
Schedule, as the case may be, in any respect such that one or more of the
conditions of Closing might not be satisfied, and any failure made by it to
comply with or satisfy, or be able to comply with or satisfy, any covenant,
condition or agreement to be complied with or satisfied by it hereunder (or
thereunder) in any respect such that one or more of the conditions of Closing
might not be satisfied; provided, however, that the delivery of any notice
pursuant to this Section shall not limit or otherwise affect the remedies
available hereunder to the party receiving such notice.
5.5 No Solicitation. Neither party shall, nor shall it permit any
Affiliate or any of its Representatives (including, without limitation, any
investment banker, broker, finder, attorney or accountant retained by it) to,
initiate, solicit or facilitate, directly or indirectly, any inquiries or the
making of any proposal with respect to any Alternative Transaction, engage in
any discussions or
-34-
negotiations concerning, or provide to any other Person any information or data
relating to, it or any Affiliate for the purposes of, or otherwise cooperate in
any way with or assist or participate in, or facilitate any inquiries or the
making of any proposal which constitutes, or may reasonably be expected to lead
to, a proposal to seek or effect any Alternative Transaction, or agree to or
endorse any Alternative Transaction. The provisions of this Section shall apply
to each of American's Subsidiaries and the Jacor Parties' Subsidiaries and
Affiliates.
5.6 Conduct of Business by the Jacor Parties Pending the Closing.
Except as otherwise contemplated by this Agreement, and subject to American's
time brokering of the Citicasters Stations pursuant to the provisions of the
Citicasters Stations TBA and the Regent Stations pursuant to the provisions of
the Regent Stations TBA, unless American shall otherwise agree in writing, the
Jacor Parties shall, and shall cause their respective Subsidiaries, to the
extent relating to the Jacor Stations or the Jacor Assets, to:
(a) conduct their respective businesses in the ordinary and
usual course of business and consistent with past practice;
(b) use all reasonable business efforts to preserve intact
their respective business organizations and goodwill, keep available
the services of their respective present general managers, on-air
personalities and other key employees, and preserve the goodwill and
business relationships with customers and others having business
relationships with them and not engage in any action, directly or
indirectly, with the intent to adversely affect the transactions
contemplated by this Agreement;
(c) maintain with financially responsible insurance companies
insurance on their respective tangible assets and their respective
businesses in such amounts and against such risks and losses as are
consistent with past practice;
(d) maintain levels of advertising, marketing and promotion
efforts and expenditures consistent with past practices;
(e) (i) operate each of the Jacor Stations in conformity with
the Jacor FCC Licenses on a basis consistent with past practice and any
special temporary authority or program test authority issued
thereunder, the FCA and the rules and regulations of any other
Authority with jurisdiction over any of the Jacor Stations, and (ii)
take all actions necessary to maintain the Jacor FCC Licenses;
(f) refrain from changing the frequency or format of any of
the Jacor Stations or making any material changes in any Jacor
Station's studio or other structures, except to the extent required by
the FCA or the rules and regulation of the FCC;
(g) not make any material changes in the broadcast hours or in
the percentage or types of programming broadcast by any of the Jacor
Stations, or make any other material changes in any Jacor Station's
programming policies, except such changes as in the good faith judgment
of the Jacor Parties are required by the public interest;
-35-
(h) not (i) dispose of any of the Jacor Assets owned by any of
the Jacor Parties or used in the operation of any of the Jacor Stations
(other than for the disposition in the ordinary course of business of
immaterial assets that are of no further use to such Station or assets
that are replaced with assets of like kind and quality); (ii) modify,
change in any material respect or enter into any Material Agreement
relating to the business of any of the Jacor Stations; or (iii) fail to
maintain the Jacor Personal Property in a manner consistent with
generally accepted standards of good engineering practice and in a
state of good repair and maintenance and operating condition;
(i) notify American promptly if any Jacor Station's normal
broadcast transmissions are interrupted or impaired for (i) thirty (30)
minutes or more daily for a period of five (5) consecutive days or
during any seven (7) days within any period of thirty (30) consecutive
days (except for normal maintenance) or (ii) a period of six (6)
continuous hours or more and promptly take any actions reasonably
requested to remedy promptly the same;
(j) not create, assume or permit to exist any Lien upon any of
the Jacor Assets or any of the Jacor Stations, except for (i) Permitted
Liens and (ii) other Liens, if any, set forth on Section 3.5(a) or
3.5(b) of the Jacor Disclosure Schedule (which Liens shall be released
prior to Closing); and
(k) not waive any material right relating to the Jacor
Stations.
5.7 Conduct of Business by American Pending the Closing. Except as
otherwise contemplated by this Agreement, and subject to Citicasters' time
brokering of the American Stations pursuant to the American Citicasters Stations
TBA and Regent's time brokering of the American Regent Stations pursuant to the
American Regent Stations TBA, unless the Jacor Parties shall otherwise agree in
writing, after the date hereof and prior to the Closing Date, with respect to
the American Stations, American shall, and shall cause its Subsidiaries, to the
extent relating to any of the American Stations or the American Assets, to:
(a) conduct their respective businesses in the ordinary and
usual course of business and consistent with past practice;
(b) use all reasonable business efforts to preserve intact
their respective business organizations and goodwill, keep available
the services of their respective present general managers, on-air
personalities and other key employees, and preserve the goodwill and
business relationships with customers and others having business
relationships with them and not engage in any action, directly or
indirectly, with the intent to adversely affect the transactions
contemplated by this Agreement;
(c) maintain with financially responsible insurance companies
insurance on their respective tangible assets and their respective
businesses in such amounts and against such risks and losses as are
consistent with past practice;
(d) maintain levels of advertising, marketing and promotion
efforts and expenditures consistent with past practices;
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(e) (i) operate each of the American Stations in conformity
with the American FCC Licenses on a basis consistent with past practice
and any special temporary authority or program test authority issued
thereunder, the FCA and the rules and regulations of any other
Authority with jurisdiction over any of the American Stations and (ii)
take all actions necessary to maintain the American FCC Licenses;
(f) refrain from changing the frequency or format of any of
the American Stations or making any material changes in any American
Station's studio or other structures, except to the extent required by
the FCA or the rules and regulation of the FCC;
(g) not make any material changes in the broadcast hours or in
the percentage or types of programming broadcast by any of the American
Stations, or make any other material changes in any American Station's
programming policies, except such changes as in the good faith judgment
of American are required by the public interest;
(h) not (i) dispose of any of the American Assets owned by
American or used in the operation of any of the American Stations
(other than for the disposition in the ordinary course of business of
immaterial assets that are of no further use to such Station or assets
that are replaced with assets of like kind and quality); (ii) modify,
change in any material respect or enter into any Material Agreement
relating to the business of any of the American Stations; or (iii) fail
to maintain the American Personal Property in a manner consistent with
generally accepted standards of good engineering practice and in a
state of good repair and maintenance and operating condition;
(i) notify the Jacor Parties promptly if any American
Station's normal broadcast transmissions are interrupted or impaired
for (i) thirty (30) minutes or more daily for a period of five (5)
consecutive days or during any seven (7) days within any period of
thirty (30) consecutive days (except for normal maintenance) or (ii) a
period of six (6) continuous hours or more and promptly take any
actions reasonably requested to remedy promptly the same;
(j) not create, assume or permit to exist any Lien upon any of
the American Assets or any of the American Stations, except for (i)
Permitted Liens and (ii) other Liens, if any, set forth on Section
4.5(a) or 4.5(b) of the American Disclosure Schedule (which Liens shall
be released prior to Closing); and
(k) not waive any material rights relating to the American
Stations.
5.8 Risk of Loss. The risk of loss or damage to any of the Assets prior
to the Closing Date, which is not the responsibility at the time of such loss or
damage of the acquiring party under the express terms of the applicable TBA,
shall be upon the transferring party. In the event of any such loss or damage
for which a transferring party is responsible, it shall repair, replace and
restore any such damaged or lost Asset substantially to its prior condition as
soon as possible and in no event later than forty-five (45) days (or such longer
period as is reasonable under the circumstances) following the loss or damage;
provided, however, that in the event any such loss or damage of the Assets
exists on the Closing Date, then, notwithstanding any other provision of this
Agreement, the
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acquiring party at is option may extend the Closing Date for a period of up to
sixty (60) days until such time as the transferring party shall have repaired,
replaced and restored any such damaged or lost Asset substantially to its prior
condition; alternatively, at the request of the acquiring party, the parties
shall negotiate in good faith to determine an equitable adjustment in the terms
of the Exchanges (including the payment of cash by the transferring party) to
cover any such loss or damage and consummate the Exchanges on the Closing Date.
5.9 American and Jacor Station Employees.
(a) American will, during the effectiveness of the Jacor Stations TBA,
employ each Jacor Station Employee and, thereafter, simultaneously with the
consummation of the Exchange, offer employment to each such Jacor Station
Employee, in each case on terms and conditions which are not less favorable, in
the aggregate with respect to each such employee, than the terms and conditions
of such Jacor Station Employee's current employment (a true, correct and
complete in all material respects description of which is set forth in Section
5.9 of the Jacor Disclosure Schedule) or, in the event it does not so offer such
employment, assume the termination arrangements for such Jacor Station Employee
(a true, correct and complete in all material respects description of which is
set forth in Section 5.9 of the Jacor Disclosure Schedule).
(b) Jacor will, during the effectiveness of the American Stations TBA,
employ each American Station Employee and, thereafter, simultaneously with the
consummation of the Exchange, offer employment to each such American Station
Employee, in each case on terms and conditions which are not less favorable, in
the aggregate with respect to each such employee, than the terms and conditions
of such American Station Employee's current employment (a true, correct and
complete in all material respects description of which is set in Section 5.9 of
the American Disclosure Schedule) or, in the event it does not so offer such
employment, assume the termination arrangements for such American Station
Employee (a true, correct and complete in all material respects description of
which is set forth in Section 5.9 of the American Disclosure Schedule).
ARTICLE 6
CLOSING CONDITIONS
6.1 Conditions to Obligations of Each Party to Effect the Exchanges.
The respective obligations of each party to effect the Exchanges shall, except
as hereinafter provided in this Section, be subject to the satisfaction at or
prior to the Closing Date of the following conditions, any or all of which may
be waived by written agreement of the parties hereto, in whole or in part, to
the extent permitted by Applicable Law:
(a) As of the Closing Date, no Legal Action shall be pending
before or threatened in writing by any Authority seeking to enjoin,
restrain, prohibit or make illegal or to impose any materially adverse
conditions in connection with, the consummation of the Exchanges and
the other Transactions, or which might, in the reasonable business
judgment of American or the Jacor Parties, have a material adverse
effect on the Assets and Stations to be acquired by it, it being
understood and agreed that a written request by any Authority for
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information with respect to either of the Exchanges or any other
Transaction, which information could be used in connection with such
Legal Action, shall not in itself be deemed to be a threat of any such
Legal Action; and
(b) All authorizations, consents, waivers, orders or approvals
required to be obtained from all Authorities, and all Governmental
Filings required to be made by American and the Jacor Parties with any
Authority, prior to the consummation of the Exchanges and the other
Transactions, shall have been obtained from, and made with, the FCC and
all other required Authorities, except for such authorizations,
consents, waivers, orders, approvals, filings, registrations, notices
or declarations the failure to obtain or make would not, in the
reasonable business judgment of each of the parties, have a material
adverse effect on the Assets and Stations being acquired by such party.
Without limiting the generality of the foregoing, the FCC shall have
issued all necessary consents and approvals in connection with the
transactions contemplated by this Agreement, the same shall have become
Final Orders, and any conditions precedent to the effectiveness of such
Final Orders which are specified therein shall have been satisfied
without any materially adverse effect upon the party acquiring such
Stations.
6.2 Conditions to Obligations of the American Parties. The obligation
of the American Parties to effect the Exchanges shall be subject to the
satisfaction of the following conditions, any or all of which may be waived by
American in writing, in whole or in part, to the extent permitted by Applicable
Law:
(a) The Jacor Parties shall have delivered or cause to be
delivered to American all of the Collateral Documents required to be
delivered by the Jacor Parties to the American Parties at or prior to
the Closing pursuant to the terms of this Agreement; such Collateral
Documents shall be reasonably satisfactory in form, scope and substance
to American and its counsel; and American and its counsel shall have
received all information and copies of all documents, including without
limitation lien searches and records of corporate proceedings, which
they may reasonably request in connection therewith, such documents
where appropriate to be certified by proper corporate officers;
(b) The Jacor Parties shall have furnished American and, at
American's request, any bank or other financial institution providing
credit to American, with favorable opinions, dated the Closing Date of
▇▇▇▇▇▇▇, Head & ▇▇▇▇▇▇▇, counsel for the Jacor Parties, and of ▇▇▇▇▇ &
▇▇▇▇▇▇▇, L.L.P., FCC counsel for the Jacor Parties, in each case, in
form, scope and substance reasonably satisfactory to the parties;
(c) The representations and warranties of the Jacor Parties
contained in this Agreement shall be true and correct in all material
respects at and as of the Closing Date with the same force and effect
as though made on and as of such date except those which speak as of a
certain date which shall continue to be true and correct as of such
date on the Closing Date; each and all of the covenants, agreements and
conditions to be performed or satisfied by the Jacor Parties hereunder
at or prior to the Closing Date shall have been duly performed or
satisfied in all material respects; and the Jacor Parties shall have
furnished American with such certificates and other documents
evidencing the truth of such
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representations and warranties and the performance or satisfaction of
the covenants, agreements and conditions as American or its counsel
shall have reasonably requested;
(d) To the extent required of American by Rule 3-05 of
Regulation S-X under the Securities Act, American shall have received
(i) from its or the Jacor Parties' independent accountants a report
(which shall be unqualified as to the scope of the audit, access to the
books and records and the cooperation of management) on the financial
statements (consisting of balance sheets for each of the fiscal years
ended December 31, 1995 and 1996 and statements of operations and cash
flow for each of the three years in the period ended December 31, 1996)
of the Jacor Stations, which financial statements shall have been
prepared in conformity with GAAP and Regulation S-X under the
Securities Act, or (ii) from the Jacor Parties such documentation as
shall enable American's independent accountants to advise American in
writing that they could issue such an unqualified report;
(e) All authorizations, consents, waivers, orders or approvals
required to be obtained pursuant to the provisions of this Agreement
from all Persons (other than Authorities) prior to the consummation of
the Exchanges and the other Transactions, including without limitation
those required in order to vest fully in American all right, title and
interest in and to all of the Jacor Assets and the Jacor Stations
(including without limitation all Jacor Assumable Agreements heretofore
requested by American and set forth in Section 6.2(e) of the Jacor
Disclosure Schedule) and the full enjoyment thereof shall have been
obtained, without the imposition, individually or in the aggregate of
any condition or requirement which could materially adversely affect
the Jacor Assets or the Jacor Stations; provided, however, that with
respect to Jacor Assumable Agreements not so identified on Schedule
6.2(e) of the Jacor Disclosure Schedule, the Jacor Parties shall use
reasonable efforts to obtain any required third party consents to the
assignment thereof as requested by American, but obtaining such consent
shall not be a condition to Closing;
(f) Between the date of this Agreement and the Closing Date,
there shall not have occurred and be continuing any material adverse
change in the Jacor Assets or the Jacor Stations; as of the Closing
Date, the FCC Licenses with respect to the Jacor Stations shall not
have been materially and adversely affected by any act, or failure to
act, of any Jacor Party or any of their Affiliates;
(g) Withing thirty (30) days from the date of this Agreement:
(i) the Board of Directors of American shall have approved and ratified
this Agreement and the consummation of the transactions contemplated
hereby; and (ii) the lenders of American and its affiliates shall have
granted in writing their consent and any required waivers to the
transactions contemplated hereby; and
(h) From the date hereof through the Closing Date, (i) the
Citicasters Stations TBA shall not have been terminated by American as
permitted by the Citicaster Stations TBA as a result of Citicaster's
material noncompliance with its obligations under the Citicasters
Stations TBA; and (ii) the Regent Stations TBA shall not have been
terminated by Regent Broadcasting as permitted by the Regent Stations
TBA as a result of Regent's material noncompliance with its obligations
under the American Regent Stations TBA.
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6.3 Conditions to Obligations of the Jacor Parties . The obligation of
the Jacor Parties to effect the Exchanges shall be subject to the satisfaction
of the following conditions, any or all of which may be waived by the Jacor
Parties in writing, in whole or in part, to the extent permitted by Applicable
Law:
(a) The American Parties shall have delivered or cause to be
delivered to the Jacor Parties all of the Collateral Documents required
to be delivered by the American Parties to the Jacor Parties at or
prior to the Closing pursuant to the terms of this Agreement; such
Collateral Documents shall be reasonably satisfactory in form, scope
and substance to the Jacor Parties and their counsel; and the Jacor
Parties and their counsel shall have received all information and
copies of all documents, including without limitation lien searches and
records of corporate proceedings, which they may reasonably request in
connection therewith, such documents where appropriate to be certified
by proper corporate officers;
(b) The American Parties shall have furnished the Jacor
Parties and, at the Jacor Parties' request, any bank of other financial
institution providing credit to the Jacor Parties or any Subsidiary,
with favorable opinions, dated the Closing Date of ▇▇▇▇▇▇▇▇ & Worcester
LLP, counsel for the American Parties, and of Dow, ▇▇▇▇▇▇ & ▇▇▇▇▇▇▇▇▇,
FCC counsel for the American Parties, in each case, in form, scope and
substance reasonably satisfactory to the parties;
(c) The representations and warranties of the American Parties
contained in this Agreement shall be true and correct in all material
respects at and as of the Closing Date with the same force and effect
as though made on and as of such date except those which speak as of a
certain date which shall continue to be true and correct in all
material respects as of such date on the Closing Date; each and all of
the covenants, agreements and conditions to be performed or satisfied
by the American Parties hereunder at or prior to the Closing Date shall
have been duly performed or satisfied in all material respects; and the
American Parties shall have furnished the Jacor Parties with such
certificates and other documents evidencing the truth of such
representations and warranties and the performance or satisfaction of
the covenants, agreements and conditions as the Jacor Parties or their
counsel shall have reasonably requested;
(d) To the extent required of American by Rule 3-05 of
Regulation S-X under the Securities Act, the Jacor Parties shall have
received (i) from their or American's independent accountants a report
(which shall be unqualified as to the scope of the audit, access to the
books and records and the cooperation of management) on the financial
statements (consisting of balance sheets for each of the fiscal years
ended December 31, 1995 and 1996 and statements of operations and cash
flow for each of the three years in the period ended December 31, 1996)
of the American Stations, which financial statements shall have been
prepared in conformity with GAAP and Regulation S-X under the
Securities Act, or (ii) from the American Parties such documentation as
shall enable the Jacor Parties' independent accountants to advise the
Jacor Parties in writing that they could issue such an unqualified
report;
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(e) All authorizations, consents, waivers, orders or approvals
required to be obtained pursuant to the provisions of this Agreement
from all Persons (other than Authorities) prior to the consummation of
the Exchanges and the other Transactions, including without limitation
those required in order to vest fully in the Jacor Parties all right,
title and interest in and to all of the American Assets and the
American Stations (including without limitation all American Assumable
Agreements heretofore requested by the Jacor Parties and set forth in
Section 6.3(e) of the American Disclosure Schedule) and the full
enjoyment thereof shall have been obtained, without the imposition,
individually or in the aggregate, of any condition or requirement which
could materially adversely affect the American Assets or the American
Stations; provided, however, that with respect to American Assumable
Agreements not so identified on Schedule 6.3(e) of the American
Disclosure Schedule, American shall use reasonable efforts to obtain
any required third party consents to the assignment thereof as
requested by the Jacor Parties, but obtaining such consent shall not be
a condition to Closing;
(f) Between the date of this Agreement and the Closing Date,
there shall not have occurred and be continuing any material adverse
change in the American Assets or the American Stations; as of the
Closing Date, the FCC Licenses with respect to the American Stations
shall not have been materially and adversely affected by any act, or
failure to act, of the American Parties or any of their Affiliates;
(g) Withing thirty (30) days from the date of this Agreement:
(i) the Board of Directors of Jacor Communications, Inc. shall have
approved and ratified this Agreement and the consummation of the
transactions contemplated hereby; and (ii) the lenders of Jacor
Communications, Inc. and its Affiliates shall have granted in writing
their consent and any required waivers to the transactions contemplated
hereby; and
(h) From the date hereof through the Closing Date, (i) the
American Citicasters Stations TBA shall not have been terminated by
Citicasters as permitted by the American Citicaster Stations TBA as a
result of American's material noncompliance with its obligations under
the American Citicasters Stations TBA; and (ii) the American Regent
Stations TBA shall not have been terminated by Regent Broadcasting as
permitted by the American Regent Stations TBA as a result of American's
material noncompliance with its obligations under the American Regent
Stations TBA.
ARTICLE 7
TERMINATION, AMENDMENT AND WAIVER
7.1 Termination. This Agreement may be terminated at any time prior to
the Closing Date:
(a) by mutual consent of the Jacor Parties and American; or
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(b) by either American or the Jacor Parties if any permanent
injunction, decree or judgment by any Authority preventing the
consummation of the Exchanges shall have become final and
nonappealable; or
(c) by the Jacor Parties in the event none of the Jacor
Parties is in material breach of its agreements and covenants set forth
in this Agreement and none of their representations or warranties shall
have become and continue to be untrue in any material respect, and
either (i) the Exchanges has not been consummated prior to the
Termination Date or (ii) either of the American Parties is in material
breach of its agreements or covenants set forth in this Agreement or
any of its representations or warranties shall have become and continue
to be untrue in any material respect and such breach or untruth exists
and is not cured within the cure period specified in this Section; or
(d) by American in the event neither of the American Parties
is in material breach of its agreements and covenants set forth in this
Agreement and none of their representations or warranties shall have
become and continue to be untrue in any material respect, and either
(i) the Exchanges has not been consummated prior to the Termination
Date or (ii) any of the Jacor Parties is in material breach of its
agreements or covenants set forth in this Agreement or any of its
representations or warranties shall have become and continue to be
untrue in any material respect and such breach or untruth exists and is
not cured within the cure period specified in this Section; or
(e) by American or the Jacor Parties pursuant to the
provisions of Section 5.2(e), 5.2(f) or (h).
Neither party shall have the right to terminate this Agreement as a result of
the other party's breach or default unless the terminating party shall have
given the defaulting party thirty (30) business days to cure the default (or
such longer period not in excess of an additional thirty (30) business days as
is, in the reasonable business judgment of the parties, reasonably necessary to
effect such cure so long as the defaulting party is proceeding with due
diligence and best efforts to effect such cure); provided, however, that such
cure period shall not extend the Termination Date.
The term "Termination Date" shall, subject to the provisions of Section
5.8, mean March 31, 1998 or such other date as the parties may, from time to
time, mutually agree.
The right of American or the Jacor Parties to terminate this Agreement
pursuant to this Section shall remain operative and in full force and effect
regardless of any investigation made by or on behalf of either party, any Person
controlling any such party or any of their respective Representatives whether
prior to or after the execution of this Agreement.
7.2 Effect of Termination. Except as provided in Sections 5.1 (with
respect to confidentiality), 5.3 and 9.3 and this Section, in the event of the
termination of this Agreement pursuant to Section 7.1, this Agreement shall
forthwith become void, there shall be no liability on the part of either party,
or any of their respective Affiliates (including stockholders, officers,
directors or Representatives ), to the other and all rights and obligations of
either party shall cease; provided, however, that such termination shall not
relieve either party from liability for any
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misrepresentation or breach of any of its warranties, covenants or agreements
set forth in this Agreement.
ARTICLE 8
INDEMNIFICATION
8.1 Survival. Except as otherwise provided in Section 2.2(d) and the
last sentence of Section 5.1(a) to the effect that the provisions of Section 2.2
and of such sentence, respectively, shall survive the Closing without
limitation, and except with respect to obligations and liabilities assumed
pursuant to the American Assumable Agreements and the Jacor Assumable
Agreements, the representations, warranties, covenants and agreements of the
parties contained in or made pursuant to this Agreement or any Collateral
Document shall survive the Closing and shall remain operative and in full force
and effect for a period of (a) two (2) years after the Closing Date or (b) the
applicable statute of limitations in the case of matters arising out of any
breach referred to in Sections 2.3(a), 2.3(b), 2.3(c), 3.1(a), 3.1(b), 3.10,
3.15, 4.1(a), 4.1(b), 4.10, 4.15 and 5.2(c) (the "Indemnity Period"), regardless
of any investigation or statement as to the results thereof made by or on behalf
of any party hereto. No claim for indemnification, other than with respect to
fraud, may be asserted after the expiration of the Indemnity Period.
Notwithstanding anything herein to the contrary, any representation, warranty,
covenant and agreement which is the subject of a Claim which is asserted in
writing prior to the expiration of the Indemnity Period shall survive with
respect to such Claim or any dispute with respect thereto until the final
resolution thereof.
8.2 Indemnification. Each party (the "indemnifying party") agrees that
on and after the Closing it shall indemnify and hold harmless the other party
(the "indemnified party") from and against any and all damages, claims, losses,
expenses, costs, obligations and liabilities, including without limitation
liabilities for all reasonable attorneys', accountants' and experts' fees and
expenses including those incurred to enforce the terms of this Agreement or any
Collateral Document (collectively, "Loss and Expense"), suffered, directly or
indirectly, by the indemnified party by reason of, or arising out of:
(a) any breach of representation or warranty made by the
indemnifying party pursuant to this Agreement or any Collateral
Document or any failure by the indemnifying party to perform or fulfill
any of its respective covenants or agreements set forth in this
Agreement or any Collateral Document; or
(b) any Legal Action or other Claim by any third party
relating to the indemnifying party or the ownership or operations of
any of its Assets or the conduct of the business of its Stations to the
extent such Legal Action or other Claim has also resulted in a breach
of representation or warranty by the indemnifying party pursuant to
this Agreement or any Collateral Document; or
(c) the American Nonassumed Liabilities (in the case of the
American Parties being the indemnifying party) and the Jacor Nonassumed
Liabilities (in the case of the Jacor
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Parties being the indemnifying party), including without limitation any
Legal Action or other Claim brought or asserted by any third party; or
(d) the failure to comply with the Bulk Sales Law, if any, of
the State of Ohio (in the case of American being the indemnifying
party) or the State of Missouri (in the case of the Jacor Parties being
the indemnifying party).
The liability of each of the American Parties and each of the Jacor Parties
under this Article 8 shall, subject to the provisions of Section 8.3, be joint
and several. Without limiting the generality of any other provision of this
Agreement, the term "each indemnifying party" in this Article 8 shall mean the
American Parties as a group and the Jacor Parties as a group and not each member
thereof individually.
8.3 Limitation of Liability. Notwithstanding the provisions of Section
8.2, after the Closing, each indemnifying party's rights to indemnification
shall be subject to the following limitations: (i) the indemnified party shall
be entitled to recover its Loss and Expense in respect of any Claim only in the
event that the aggregate Loss and Expense for all Claims exceeds, in the
aggregate, $150,000, in which event the indemnified party shall be entitled to
recover all such Loss and Expense, and (ii) in no event shall the aggregate
amount required to be paid by each indemnifying party pursuant to the provisions
of this Section exceed $2,000,000, except for any Loss or Expense arising out of
matters of a nature referred to in Sections 3.1(b) and 4.1(b) as to which the
limitations set forth in this clause (ii) shall not apply. The provisions of the
immediately preceding sentence of this Section with respect to the limitation on
each indemnifying party's obligation to indemnify the indemnified party in
respect of Loss and Expense shall not be applicable to any claims which are
based on fraud or willful or intentional breach of representation or warranty.
8.4 Notice of Claims. If an indemnified party believes that it has
suffered or incurred any Loss and Expense, it shall notify the indemnifying
party promptly in writing, and in any event within the applicable time period
specified in Section 8.1, describing such Loss and Expense, all with reasonable
particularity and containing a reference to the provisions of this Agreement in
respect of which such Loss and Expense shall have occurred. If any Legal Action
is instituted by a third party with respect to which an indemnified party
intends to claim any liability or expense as Loss and Expense under this
Article, such indemnified party shall promptly notify the indemnifying party of
such Legal Action, but the failure to so notify the indemnifying party shall not
relieve such indemnifying party of its obligations under this Article, except to
the extent such failure to notify materially prejudices such indemnifying
party's ability to defend against such Claim.
8.5 Defense of Third Party Claims. The indemnifying party shall have
the right to conduct and control, through counsel of their own choosing,
reasonably acceptable to the indemnified party, any third party Legal Action or
other Claim, but the indemnified party may, at its election, participate in the
defense thereof at its sole cost and expense; provided, however, that if (a) the
indemnifying party shall fail to defend any such Legal Action or other Claim or
(b) the indemnified party shall have been advised by counsel that there may be
one or more legal defenses available to it which are different from or in
addition to those available to the indemnifying party, then the indemnified
party may defend, through counsel of its own choosing, reasonably acceptable to
the indemnifying party, such Legal Action or other Claim, and (so long as it
gives the
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indemnifying party at least fifteen (15) days' notice of the terms of the
proposed settlement thereof and permits the indemnifying party to then undertake
the defense thereof) settle such Legal Action or other Claim and to recover the
amount of such settlement or of any judgment and the reasonable costs and
expenses of such defense. The indemnifying party shall not compromise or settle
any such Legal Action or other Claim without the prior written consent of the
indemnified party, which consent shall not be unreasonably withheld, delayed or
conditioned.
8.6 Exclusive Remedy. Except for fraud or as otherwise provided in
Section 9.5, the indemnification provided in this Article shall be the sole and
exclusive post-Closing remedy available to either party against the other party
for any Claim under this Agreement.
ARTICLE 9
GENERAL PROVISIONS
9.1 Amendment. This Agreement may be amended from time to time by the
parties hereto at any time prior to the Closing Date but only by an instrument
in writing signed by the parties hereto.
9.2 Waiver. At any time prior to the Closing Date, except to the extent
not permitted by Applicable Law, American or the Jacor Parties may extend the
time for the performance of any of the obligations or other acts of the other,
waive any inaccuracies in the representations and warranties of the other
contained herein or in any document delivered pursuant hereto, and waive
compliance by the other with any of the agreements, covenants or conditions
contained herein. Any such extension or waiver shall be valid only if set forth
in an instrument in writing signed by the party or parties to be bound thereby.
9.3 Fees, Expenses and Other Payments. All costs and expenses, incurred
in connection with any transfer taxes, sales taxes, document stamps or other
charges levied by any Authority in connection with this Agreement, the Exchanges
and the other Transactions, shall be borne by American insofar as they related
to the American Stations and the American Assets and by the Jacor Parties
insofar as they relate to the Jacor Stations and the Jacor Assets. All filing
and similar fees (including without limitation ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ filings and FCC
filing fees) shall be borne equally by American, on the one hand, and the Jacor
Parties, on the other hand. All other costs and expenses incurred in connection
with this Agreement, the Exchanges and the other Transactions, and in compliance
with Applicable Law and Contracts as a consequence hereof and thereof, including
without limitation fees and disbursements of counsel, financial advisors and
accountants incurred by the parties hereto shall be borne solely and entirely by
the party which has incurred such costs and expenses.
9.4 Notices. All notices and other communications which by any
provision of this Agreement are required or permitted to be given shall be given
in writing and shall be (a) mailed by first-class or express mail, or by
recognized courier service, postage prepaid, (b) sent by telex, telegram,
telecopy or other form of rapid transmission, confirmed by mailing (by first
class or express mail, or by recognized courier service, postage prepaid)
written confirmation at substantially
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the same time as such rapid transmission, or (c) personally delivered to the
receiving party (which if other than an individual shall be an officer or other
responsible party of the receiving party). All such notices and communications
shall be mailed, sent or delivered as follows:
(a) If to American:
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇, President
and Chief Executive Officer
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇▇ & Worcester LLP
▇▇▇ ▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
(b) If to the Jacor Parties:
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇▇▇▇▇▇▇▇, President
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
▇▇▇▇▇▇▇, Head & ▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇▇▇▇▇, Esq.
Telecopier No.: (▇▇▇) ▇▇▇-▇▇▇▇
or to such other person(s), telex or facsimile number(s) or address(es) as the
party to receive any such communication or notice may have designated by written
notice to the other party.
9.5 Specific Performance; Other Rights and Remedies. Each party
recognizes and agrees that in the event the other party should refuse to perform
any of its obligations under this Agreement or any Collateral Document, the
remedy at law would be inadequate and agrees that for breach of such provisions,
each party shall, in addition to such other remedies as may be available to it
at law or in equity or as provided in Article 7, be entitled to injunctive
relief and to enforce its rights by an action for specific performance to the
extent permitted by Applicable Law. Each party hereby waives any requirement for
security or the posting of any bond or other surety in connection with any
temporary or permanent award of injunctive, mandatory or other equitable relief.
Nothing
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herein contained shall be construed as prohibiting each party from pursuing any
other remedies available to it pursuant to the provisions of, and subject to the
limitations contained in, this Agreement for such breach or threatened breach.
9.6 Severability. If any term or provision of this Agreement shall be
held or deemed to be, or shall in fact be, invalid, inoperative, illegal or
unenforceable as applied to any particular case in any jurisdiction or
jurisdictions, or in all jurisdictions or in all cases, because of the
conflicting of any provision with any constitution or statute or rule of public
policy or for any other reason, such circumstance shall not have the effect of
rendering the provision or provisions in question invalid, inoperative, illegal
or unenforceable in any other jurisdiction or in any other case or circumstance
or of rendering any other provision or provisions herein contained invalid,
inoperative, illegal or unenforceable to the extent that such other provisions
are not themselves actually in conflict with such constitution, statute or rule
of public policy, but this Agreement shall be reformed and construed in any such
jurisdiction or case as if such invalid, inoperative, illegal or unenforceable
provision had never been contained herein and such provision reformed so that it
would be valid, operative and enforceable to the maximum extent permitted in
such jurisdiction or in such case. Notwithstanding the foregoing, in the event
of any such determination the effect of which is to affect materially and
adversely either party, the parties shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible to the fullest extent permitted by Applicable Law in an acceptable
manner to the end that the Exchanges and the other Transactions are fulfilled
and consummated to the maximum extent possible; provided, however, that in the
event the parties are unable to reach agreement within a reasonable period of
time, under the circumstances, with respect to such modification, this Agreement
shall terminate and be of no further force and effect.
9.7 Counterparts. This Agreement may be executed in several
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument, binding upon all of the
parties. In pleading or proving any provision of this Agreement, it shall not be
necessary to produce more than one of such counterparts.
9.8 Section Headings. The headings contained in this Agreement are for
reference purposes only and shall not in any way affect the meaning or
interpretation of this Agreement.
9.9 Governing Law. The validity, interpretation, construction and
performance of this Agreement shall be governed by, and construed in accordance
with, the applicable laws of the United States of America and the laws of the
State of New York applicable to contracts made and performed in such State and,
in any event, without giving effect to any choice or conflict of laws provision
or rule that would cause the application of domestic substantive laws of any
other jurisdiction. Anything in this Agreement to the contrary notwithstanding,
including without limitation the provisions of Article 8, in the event of any
dispute between the parties which results in a Legal Action, the prevailing
party shall be entitled to receive from the non-prevailing party reimbursement
for reasonable legal fees and expenses incurred by such prevailing party in such
Legal Action.
9.10 Further Acts. Each party agrees that at any time, and from time to
time, before and after the consummation of the transactions contemplated by this
Agreement, it will do all such things
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and execute and deliver all such Collateral Documents and other assurances, as
any other party or its counsel reasonably deems necessary or desirable in order
to carry out the terms and conditions of this Agreement and the transactions
contemplated hereby or to facilitate the enjoyment of any of the rights created
hereby or to be created hereunder.
9.11 Entire Agreement. This Agreement (together with the Disclosure
Schedules and the other Collateral Documents delivered in connection herewith),
constitutes the entire agreement of the parties and supersedes all prior
agreements and undertakings, both written and oral, between the parties, with
respect to the subject matter hereof.
9.12 Assignment. This Agreement shall not be assignable by either party
and any such assignment shall be null and void, except that it shall inure to
the benefit of and be binding upon any successor to any party by operation of
law, including by way of merger, consolidation or sale of all or substantially
all of its assets, and each party may assign its rights and remedies hereunder
to any bank or other financial institution which has loaned funds or otherwise
extended credit to it. Without limiting the generality of the immediately
preceding sentence, in the event that either party finds it necessary or is
required to provide to a third party a collateral assignment of their or its
interest in this Agreement and/or any Collateral Documents, the other party will
cooperate with either the party requesting such assignment and any third party,
including but not limited to signing a consent and acknowledgment of such
assignment.
9.13 Parties in Interest. This Agreement shall be binding upon and
inure solely to the benefit of each party, and nothing in this Agreement,
express or implied, is intended to or shall confer upon any Person any right,
benefit or remedy of any nature whatsoever under or by reason of this Agreement,
except as otherwise provided in Section 9.12.
9.14 Mutual Drafting. This Agreement is the result of the joint efforts
of the American Parties and the Jacor Parties, and each provision hereof has
been subject to the mutual consultation, negotiation and agreement of the
parties and there shall be no construction against any party based on any
presumption of that party's involvement in the drafting thereof.
9.15 American Agent for American License. Anything in this Agreement to
the contrary notwithstanding, American License hereby grants American an
irrevocable power of attorney and hereby irrevocably appoints American its agent
for all purposes of this Agreement, including without limitation for the purpose
of executing and delivering extensions of the time for the performance of any of
the obligations or other acts of any of the Jacor Parties, waivers, terminations
or amendments, and any action taken by American pursuant to such power of
attorney and agency, and any such extension, waiver, termination or amendment
executed and delivered by American, shall be binding upon American License
whether or not it has specifically approved such action or executed such
extension, waiver, termination or amendment.
9.16 Citicasters Agent for the Other Jacor Parties. Anything in this
Agreement to the contrary notwithstanding, Regent Broadcasting and Regent
Licensee hereby grants Citicasters an irrevocable power of attorney and hereby
irrevocably appoints Citicasters its agent for all purposes of this Agreement,
including without limitation for the purpose of executing and delivering
extensions of the time for the performance of any of the obligations or other
acts of either of the
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American Parties, waivers, terminations or amendments, and any action taken by
Citicasters pursuant to such power of attorney and agency, and any such
extension, waiver, termination or amendment executed and delivered by American,
shall be binding upon Regent Broadcasting and Regent Licensee whether or not it
has specifically approved such action or executed such extension, waiver,
termination or amendment.
9.17 Disclosure Schedules.
(a) The Jacor Parties will deliver to American, on or before July 11,
1997, the Jacor Disclosure Schedule and all related documents required to be
delivered by Jacor pursuant to Article 3 of this Agreement. American shall be
permitted, for a period of ten (10) business days commencing upon its receipt of
the completed Jacor Disclosure Schedule and related documents to terminate this
Agreement, if (i) the Jacor Disclosure Schedule reveals any condition of which
the American Parties are unaware as of the date of this Agreement and/or any
breaches of Jacor' representations, warranties and/or covenants hereunder
(without regard to matters set forth in the Jacor Disclosure Schedule), which
unknown conditions and/or breaches in the aggregate would have a material
adverse effect on the value of the Jacor Assets or the Jacor Stations or on the
American Parties' ability to operate the Jacor Stations as they are currently
being operated, or (ii) the parties are unable to agree upon which Jacor
Material Agreements with respect to which a third-party consent to the
assignment thereof will be a condition to Closing.
(b) American will deliver to the Jacor Parties on or before July 11,
1997, the American Disclosure Schedule and all related documents required to be
delivered by American pursuant to Article 4 of this Agreement. The Jacor Parties
shall be permitted, for a period of ten (10) business days commencing upon its
receipt of the completed American Disclosure Schedule and related documents to
terminate this Agreement, if (i) the American Disclosure Schedule reveals any
condition of which Jacor is unaware as of the date of this Agreement and/or any
breaches of the American Parties' representations, warranties and/or covenants
hereunder (without regard to matters set forth in the American Disclosure
Schedule), which unknown conditions and/or breaches in the aggregate would have
a material adverse effect on the value of the American Assets or the American
Stations or on the Jacor Parties' ability to operate the American Stations as
they are currently being operated, or (ii) the parties are unable to agree upon
which American Material Agreements with respect to which a third-party consent
to the assignment thereof will be a condition to Closing.
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IN WITNESS WHEREOF, American, American License, Citicasters, Regent
Broadcasting and Regent Licensee have caused this Agreement to be executed as of
the date first written above by their respective officers thereunto duly
authorized.
American Radio Systems Corporation
By:_____________________________________
Name:
Title:
American Radio Systems License Corp.
By:_____________________________________
Name:
Title:
Citicasters Co.
By:______________________________________
Name:
Title:
Regent Broadcasting of Kansas City, Inc.
By:_____________________________________
Name:
Title:
Regent Licensee of Kansas City, Inc.
By:_____________________________________
Name:
Title:
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APPENDIX A
DEFINITIONS
Accounts Receivable shall mean any and all rights to the payment of
money or other forms of consideration of any kind at any time now or hereafter
owing or to be owing to American or Citicasters, as the case may be,
attributable to the sale of time or talent on one of its Stations (whether
classified under the Uniform Commercial Code of any state as accounts, contract
rights, chattel paper, general intangibles or otherwise).
adverse, adversely, shall mean any Event which has, or is reasonably
likely to, (a) adversely affect the validity or enforceability of this Agreement
or the likelihood of consummation of the Exchanges, or (b) adversely affect the
ownership or operation of the Jacor Assets or the American Assets or the conduct
of the business of the Jacor Stations or the American Stations, as the case may
be, or (c) impair any American Party's or any Jacor Party's, as the case may be,
ability to fulfill its obligations under the terms of this Agreement, or (d)
adversely affect the aggregate rights and remedies of the American Parties or
the Jacor Parties, as the case may be, under this Agreement. Notwithstanding the
foregoing, and anything in this Agreement to the contrary notwithstanding,
neither any general business or economic factor nor any Event affecting the
radio broadcasting industry generally shall be deemed to constitute an adverse
change, have an adverse effect or to adversely affect or effect.
Affiliate, Affiliated shall mean, with respect to any Person, any other
Person at the time directly or indirectly controlling, controlled by or under
direct or indirect common control with such Person.
Agreement shall mean this Agreement as originally in effect, including
this Appendix A, the American Disclosure Schedule, the Citicasters Disclosure
Schedule and all exhibits hereto, and as any of the same may from time to time
be supplemented, amended, modified or restated in the manner herein or therein
provided.
Alternative Transaction shall mean a transaction or series of related
transactions (other than the Exchanges and the other Transactions) resulting in
(a) any merger or consolidation of either party, regardless of whether it is the
surviving Entity unless the surviving Entity remains obligated under this
Agreement to the same extent as it was, or (b) any sale or other disposition of
all or any substantial part of the Assets owned by it or any of the Stations
owned by it.
American shall have the meaning given to it in the Preamble.
American Accounts Receivable shall mean the Accounts Receivables
arising in connection with the ownership or operation of any of the American
Assets or the conduct of the business of any of the American Stations prior to
the applicable Cut-off Date American Citicasters Accounts Receivable shall mean
the American Accounts Receivables arising in connection with the ownership or
operation of any of the American Citicasters Assets or the conduct of the
business of any of the American Citicasters Stations. American Regent Accounts
Receivable shall mean the American Accounts Receivables of American arising in
connection with the ownership or operation of any of the American Regent Assets
or the conduct of the business of any of the American Regent Stations.
American Assets shall mean all assets used or held for use in the
ownership or operation of or the conduct of the business of any of the American
Stations, including without limitation the American Real Property, the American
Personal Property, the American Private Authorizations, the American
Governmental Authorizations (including without limitation the American FCC
Licenses), the American Intangible Assets and the American Assumable Agreements,
and the logs, public files and other books, records, files and documents that
relate to any of the American Stations, but excluding the American Excluded
Assets. American Citicasters Assets shall mean the American Assets used or held
for use in the ownership or operation of or the conduct of the business of any
of the American Citicasters Stations. American Regent Assets shall mean the
American Assets used or held for use in the ownership or operation of or the
conduct of the business of any of the American Regent Stations.
American Assumable Agreements shall mean the American Private
Authorizations, the American Trade Agreements, the American Leases and the
American Other Contracts. American Citicasters Assumable Agreements shall mean
the American Assumable Agreements that relate to the ownership or operation of
any of the American Citicasters Assets or the conduct of the business of any of
the American Citicasters Stations. American Regent Assumable Agreements shall
mean the American Assumable Agreements that relate to the ownership or operation
of any of the American Regent Assets or the conduct of the business of any of
the American Regent Stations.
American Disapproved Matters shall have the meaning given to it in
Section 5.2(e).
American Disclosure Schedule shall mean the American Disclosure
Schedule dated as of the date of this Agreement delivered by American and
American License to the Jacor Parties.
American Employee Plans shall have the meaning given to it in Section
4.11(a).
American Excluded Assets shall mean (i) all cash and cash equivalents
of American (ii) all American Accounts Receivable, (iii) the corporate names of
American, and its books, records and other documents that relate to its
corporate existence, organization and capitalization, (iv) all books and records
of American that relate to any of the American Stations and which American is
required by Applicable Law to retain, subject to the right of the other party to
have access and to copy for a period of three (3) years from the Closing Date,
(v) the American Employee Plans, (vi) all insurance policies that relate to the
American Assets, (vii) software programs and other assets used to provide
certain financial and accounting services for any of the American Stations, and
(viii) any and all products, profits and proceeds of, and including without
limitation any Claims with respect to, any of the foregoing.
American FCC Licenses shall have the meaning given to it in the second
Whereas paragraph. American Citicasters FCC Licenses shall mean the American FCC
Licenses with respect to the ownership and operation of the American Citicasters
Assets and the conduct of the business of the American Citicasters Stations.
American Regent FCC Licenses shall mean the American FCC Licenses with respect
to the ownership and operation of the American Regent Assets and the conduct of
the business of the American Regent Stations.
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American Financial Statements shall have the meaning given to it in
Section 4.2(a).
American Governmental Authorizations shall have the meaning given to it
in Section 4.7(a). American Citicasters Governmental Authorizations shall mean
the American Governmental Authorizations with respect to the ownership and
operation of any of the American Citicasters Assets and the conduct of the
business of any of the American Citicasters Stations. American Regent
Governmental Authorizations shall mean the American Governmental Authorizations
with respect to the ownership and operation of any of the American Regent Assets
and the conduct of the business of any of the American Regent Stations.
American Inspection shall have the meaning given to it in Section
5.2(h).
American Intangible Assets shall have the meaning given to it in
Section 4.8. American Citicasters Intangible Assets shall mean the American
Intangible Assets with respect to the ownership and operation of any of the
American Citicasters Assets and the conduct of the business of any of the
American Citicasters Stations. American Regent Intangible Assets shall mean the
American Intangible Assets with respect to the ownership and operation of any of
the American Regent Assets and the conduct of the business of any of the
American Regent Stations.
American Leases shall have the meaning given to it in Section 4.5(a).
American Citicasters Leases shall mean the American Leases with respect to the
ownership and operation of any of the American Citicasters Assets and the
conduct of the business of any of the American Citicasters Stations. American
Regent Leases shall mean the American Leases with respect to the ownership and
operation of any of the American Regent Assets and the conduct of the business
of any of the American Regent Stations.
American License shall have the meaning given to it in the Preamble.
American Material Agreements shall have the meaning given to it in
Section 4.12. American Citicasters Material Agreements shall mean the American
Material Agreements with respect to the ownership and operation of any of the
American Citicasters Assets and the conduct of the business of any of the
American Citicasters Stations. American Regent Material Agreements shall mean
the American Material Agreements with respect to the ownership and operation of
any of the American Regent Assets and the conduct of the business of any of the
American Regent Stations.
American Nonassumed Liabilities shall have the meaning given to it in
Section 2.3(c). American Citicasters Nonassumed Liabilities shall have the
meaning given to it in Section 2.3(b). American Regent Nonassumed Liabilities
shall have the meaning given to it in Section 2.3(c).
American Other Contracts shall mean (a) all American Material
Agreements set forth on Section 4.12 of the American Disclosure Schedule, (b)
all Contracts of American for the sale of time on any American Station for cash
entered into in the ordinary course of business consistent with prior practice,
and (c) Contracts not required to be listed on Section 4.12 of the American
Disclosure Schedule that have been entered into in the ordinary course of
business. American Citicasters Other
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Contracts shall mean the American Other Contracts with respect to the ownership
and operation of any of the American Citicasters Assets and the conduct of the
business of any of the American Citicasters Stations. American Regent Other
Contracts shall mean the American Other Contracts with respect to the ownership
and operation of any of the American Regent Assets and the conduct of the
business of any of the American Regent Stations.
American Owned Real Property shall have the meaning given to it in
Section 4.5(a). American Citicasters Owned Real Property shall mean the American
Owned Real Property with respect to the ownership and operation of any of the
American Citicasters Assets and the conduct of the business of any of the
American Citicasters Stations. American Regent Owned Real Property shall mean
the American Owned Real Property with respect to the ownership and operation of
any of the American Regent Assets and the conduct of the business of any of the
American Regent Stations.
American Parties shall have the meaning given to it in the Preamble.
American Permitted Title Exceptions shall have the meaning given to it
in Section 5.2(e).
American Personal Property shall mean all items of Personal Property,
used or held for use in the ownership or operation or the conduct of the
business of any of the American Stations. American Citicasters Personal Property
shall mean the American Personal Property with respect to the ownership and
operation of any of the American Citicasters Assets and the conduct of the
business of any of the American Citicasters Stations. American Regent Personal
Property shall mean the American Personal Property with respect to the ownership
and operation of any of the American Regent Assets and the conduct of the
business of any of the American Regent Stations.
American Preliminary Title Report shall have the meaning given to it in
Section 5.2(e).
American Private Authorizations shall mean all Private Authorizations
obtained or held for use in the ownership or operation or the conduct of the
business of any of the American Stations. American Citicasters Private
Authorizations shall mean the American Private Authorizations with respect to
the ownership and operation of any of the American Citicasters Assets and the
conduct of the business of any of the American Citicasters Stations. American
Regent Private Authorizations shall mean the American Private Authorizations
with respect to the ownership and operation of any of the American Regent Assets
and the conduct of the business of any of the American Regent Stations.
American Proration Schedules shall mean the American Citicasters
Proration Schedule and the American Regent Proration Schedule. American
Citicasters Proration Schedule shall have the meaning given to it in Section
2.3(f). American Regent Proration Schedule shall have the meaning given to it in
Section 2.3(g).
American Real Property shall have the meaning given to it in Section
4.5(a). American Citicasters Real Property shall mean the American Real Property
with respect to the ownership and operation of any of the American Citicasters
Assets and the conduct of the business of any of the
A-4
American Citicasters Stations. American Regent Real Property shall mean the
American Real Property with respect to the ownership and operation of any of the
American Regent Assets and the conduct of the business of any of the American
Regent Stations.
American Survey shall have the meaning given to it in Section 5.2(e).
American Station Employees shall have the meaning given to it in
Section 4.11(b).
American Stations shall have the meaning given to it in the second
Whereas paragraph. American Citicasters Stations and American Regent Stations
shall mean the respective American Stations designated as such in the American
Disclosure Schedule.
American Stations TBA shall mean the American Citicasters Stations TBA
and the American Regent Stations TBA. American Citicasters Stations TBA shall
have the meaning given to it in Section 5.2(d). American Regent Stations TBA
shall have the meaning given to it in Section 5.2(d).
American Study shall have the meaning given to it in Section 5.2(f).
American Tower Adjustment shall mean an amount equal to the aggregate
amount of fees, expenses and other costs incurred by American in the upgrade and
improvement of its tower for WXEG-FM located in Dayton, Ohio which amount
American has advised Jacor is approximately $260,000. American will furnish to
Jacor such information as Jacor may reasonably request in order to substantiate
the aggregate amount of such fees, expenses and other costs and the parties will
agree on the exact amount thereof no later than five (5) days prior to the
Closing Date.
American Trade Agreements shall mean all Trade Agreements in effect on
the date hereof or entered into on or prior to the Cut-Off Date that relates to
the ownership or operation of any of the American Assets or the conduct of the
business of any of the American Stations. American Citicasters Trade Agreements
shall mean all American Trade Agreements that relate to the ownership or
operation of any of the American Citicasters Assets or the conduct of the
business of any of the American Citicasters Stations. American Regent Trade
Agreements shall mean all American Trade Agreements that relate to the ownership
or operation of any of the American Regent Assets or the conduct of the business
of any of the American Regent Stations.
American's knowledge (including the term "to the knowledge, information
and belief of American") means the actual knowledge of any executive officer of
either of the American Parties or any General Manager of any of the American
Stations.
Applicable Law shall mean any Law of any Authority, whether domestic or
foreign, including without limitation all federal and state securities and
Environmental Laws, to which a Person is subject or by which it or any of its
business or operations is subject or any of its property or assets is legally
bound.
Appraisals shall have the meaning given to it in Section 2.2(a).
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Assets shall mean the American Assets in the case of American and the
Citicasters Assets in the case of Citicasters.
Authority shall mean any governmental authority, whether
administrative, executive, judicial, legislative or other, or any combination
thereof, including without limitation any federal, state, territorial, county,
municipal or other government or governmental agency, arbitrator, authority,
board, body, branch, bureau, central bank or comparable agency or Entity,
commission, corporation, court, department, instrumentality, master, mediator,
panel, referee, system or other political unit or subdivision or other Entity of
any of the foregoing, whether domestic or foreign.
Citicasters shall have the meaning given to it in the Preamble.
Citicasters Kansas City Proration Schedule shall have the meaning given
to it in Section 2.3(f).
Claims shall mean any and all Legal Actions and claims, pending or
threatened, and judgments of whatever kind and nature relating debts,
liabilities, obligations, losses, damages, deficiencies, assessments and
penalties, together with thereto, and all fees, costs, expenses and
disbursements (including without limitation reasonable attorneys' and other
legal fees, costs and expenses) that relate to any of the foregoing.
Closing shall have the meaning given to it in Section 2.4.
Closing Date shall have the meaning given to it in Section 2.4.
Code shall mean the Internal Revenue Code of 1986, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
Collateral Document shall mean the American Citicasters Stations TBA,
the American Regent Stations TBA, the Citicasters Stations TBA, the Regent
Stations TBA, the conveyancing documents required to vest in the acquiring party
the Assets and Stations to be acquired by it pursuant to the Exchanges
(including without limitation a General Conveyance, ▇▇▇▇ of Sale, Assignment and
Assumption, assignments and assumptions of the Jacor Assumable Agreements and
American Assumable Agreements, assignments and assumptions of Intangible
Assets), and any agreement, certificate, contract, instrument, notice, opinion
or other document required to be delivered or delivered pursuant to the
provisions of this Agreement or any of the foregoing.
Collection Period shall have the meaning given to it in Section 2.5.
Contract, Contractual Obligation shall mean any agreement, arrangement,
commitment, contract, covenant, indemnity, undertaking or other obligation or
liability which involves the ownership and operation of the American Assets or
the Citicasters Assets or the conduct of the business of any of the American
Stations or the Citicasters Stations.
A-6
Control (including the terms "controlled," "controlled by" and "under
common control with") means the possession, directly or indirectly or as trustee
or executor, of the power to direct or cause the direction of the management or
policies of a Person, or the disposition of such Person's assets or properties,
whether through the ownership of stock, equity or other ownership, by contract,
arrangement or understanding, or as trustee or executor, by contract or credit
arrangement or otherwise.
Cut-off Date shall mean (i) with respect to any Contract to be assigned
and the rights and obligations to be assumed pursuant to any TBA (including all
items of revenue and expense that relate to such Contract), the applicable TBA
Date for such TBA and (ii) in all other cases, the Closing Date.
Dayton Proration Schedule shall have the meaning given to it in Section
2.3(e).
Disclosure Schedule shall mean the American Disclosure Schedule or the
Jacor Disclosure Schedule, as the case may be.
Encumber shall mean to suffer, accept, agree to or permit the
imposition of a Lien.
Entity shall mean any corporation, firm, unincorporated organization,
association, partnership, limited liability company, trust (inter vivos or
testamentary), estate of a deceased, insane or incompetent individual, business
trust, joint stock company, joint venture or other organization, entity or
business, whether acting in an individual, fiduciary or other capacity, or any
Authority.
Environmental Law shall mean any Law that relate to or otherwise
imposing liability or standards of conduct concerning pollution or protection of
the environment, including without limitation Laws that relate to emissions,
discharges, releases or threatened releases of Hazardous Materials into the
environment (including, without limitation, ambient air, surface water, ground
water, land surface or subsurface strata) or otherwise that relate to the
manufacture, processing, generation, distribution, use, treatment, storage,
disposal, cleanup, transport or handling of pollutants, contaminants, chemicals
or industrial, toxic or hazardous substances, materials or wastes. Environmental
Laws shall include without limitation the Comprehensive Environmental Response,
Compensation and Liability Act (42 U.S.C. Section 6901 et seq.), the Hazardous
Material Transportation Act (49 U.S.C. Section 1801 et seq.), the Resource
Conservation and Recovery Act (42 U.S.C. Section 6901 et seq.), the Federal
Water Pollution Control Act (33 U.S.C. Section 1251 et seq.), the Clean Air Act
(42 U.S.C. Section 7401 et seq.), the Toxic Substances Control Act (15 U.S.C.
Section 2601 et seq.), the Occupational Safety and Health Act (29 U.S.C. Section
651 et seq.), the Federal Insecticide Fungicide and Rodenticide Act (7 U.S.C.
Section 136 et seq.), and any analogous federal, state, local or foreign, Laws,
and the rules and regulations promulgated thereunder all as from time to time in
effect, and any reference to any statutory or regulatory provision shall be
deemed to be a reference to any successor statutory or regulatory provision.
Environmental Permit shall mean any Governmental Authorization required
by or pursuant to any Environmental Law.
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ERISA shall mean the Employee Retirement Income Security Act of 1974,
and the rules and regulations thereunder, all as from time to time in effect, or
any successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
Event shall mean the existence or occurrence of any act, action,
activity, circumstance, condition, event, fact, failure to act, omission,
incident or practice, or any set or combination of any of the foregoing.
Exchanges shall have the meaning given to it in the third Whereas
paragraph. Citicasters Exchange shall have the meaning given to it in the third
Whereas paragraph. Regent Exchange shall have the meaning given to it in the
third Whereas paragraph.
Exchange Act shall mean the Securities Exchange Act of 1934, and the
rules and regulations thereunder, all as from time to time in effect, or any
successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
FCA shall mean the Communications Act of 1934, and the rules and
regulations thereunder, all as from time to time in effect, or any successor
law, rules or regulations, and any reference to any statutory or regulatory
provision shall be deemed to be a reference to any successor statutory or
regulatory provision.
FCC shall mean the Federal Communications Commission and shall include
any successor Authority.
FCC Consents shall mean the written actions of the FCC (including
without limitation written actions of the FCC's Mass Media Bureau acting
pursuant to delegated authority) granting its consents to the assignment of the
Citicasters FCC Licenses to American License and the American FCC Licenses to
Citicasters.
FCC Licenses shall mean all Governmental Authorizations issued by the
FCC in connection with the ownership, operation and conduct of the business of
the Citicasters Stations and the American Stations, as the case may be.
Final Order shall mean, with respect to any consent, order or other
action of any Authority, including without limitation the FCC, one with respect
to which no appeal, no stay, no review, no petition or application for
rehearing, reconsideration, review or stay, whether on motion of the applicable
Authority or other Person or otherwise, is in effect or pending and as to which
the time or deadline for filing or taking any such stay, review, appeal,
petition or application has expired or, if filed, has been denied, dismissed or
withdrawn, and the time or deadline for instituting any further Legal Action has
expired.
GAAP shall mean generally accepted accounting principles as in effect
from time to time in the United States of America.
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Governmental Authorizations shall mean all approvals, concessions,
consents, franchises, licenses, permits, registrations and other authorizations
of all Authorities (including without limitation the FCC Licenses) issued by the
FCC, the Federal Aviation Administration and any other Authority in connection
with the ownership or operation of any of the Assets or conduct of the business
of any of the Stations.
Governmental Filings shall mean all filings, including franchise and
similar Tax filings, submissions, registrations, notices or declarations and the
payment of all fees, assessments, interest and penalties associated with such
filings, with all Authorities.
▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Act shall mean the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇ Antitrust
Improvements Act of 1976, and the rules and regulations thereunder, all as from
time to time in effect, or any successor law, rules or regulations, and any
reference to any such statutory or regulatory provision shall be deemed to be a
reference to any successor statutory or regulatory provision.
Hazardous Materials shall mean and include any substance, material,
waste, constituent, compound, chemical, natural or man-made element or force (in
whatever state of matter): (a) the presence of which requires investigation or
remediation under any Environmental Law, or (b) that is defined as a "hazardous
waste" "solid waste", "pollutant", "contaminant" or "hazardous substance" under
any Environmental Law; or (c) that is toxic, explosive, corrosive, etiologic,
▇▇▇▇ ▇▇▇▇▇, infectious, radioactive, carcinogenic, mutagenic or otherwise
hazardous and is regulated by any applicable Authority or subject to any
Environmental Law; or (d) that poses or threatens to pose a hazard to the health
of persons; or (e) that contains gasoline, diesel fuel or other petroleum
hydrocarbons, or any by-products or fractions thereof, natural gas,
polychlorinated biphenyls ("PCBs") and PCB-containing equipment or other
radioactive elements, ionizing radiation, radio frequency radiation, lead,
asbestos or asbestos-containing materials ("ACM"), or urea formaldehyde foam
insulation.
Indebtedness shall mean, with respect to any Person, (a) all items,
except items of capital stock or of surplus or of general contingency or
deferred tax reserves or any minority interest in any Subsidiary of such Person
to the extent such interest is treated as a liability with indeterminate term on
the consolidated balance sheet of such Person, which in accordance with GAAP
would be included in determining total liabilities as shown on the liability
side of a balance sheet of such Person, (b) all obligations secured by any Lien
to which any property or asset owned or held by such Person is subject, whether
or not the obligation secured thereby shall have been assumed, and (c) to the
extent not otherwise included, all Contractual Obligations of such Person
constituting capitalized leases and all obligations of such Person with respect
to Leases constituting part of a sale and leaseback arrangement.
Indebtedness for Money Borrowed shall mean, with respect to any Person,
money borrowed and Indebtedness represented by notes payable and drafts accepted
representing extensions of credit, all obligations evidenced by bonds,
debentures, notes or other similar instruments, the maximum amount currently or
at any time thereafter available to be drawn under all outstanding letters of
credit issued for the account of such Person, all Indebtedness upon which
interest charges are customarily paid by such Person, and all Indebtedness
(including capitalized lease obligations) issued or assumed as full or partial
payment for property or services, whether or not any such notes,
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drafts, obligations or Indebtedness represent Indebtedness for money borrowed,
but shall not include (a) trade payables, (b) expenses accrued in the ordinary
course of business, or (c) customer advance payments and customer deposits
received in the ordinary course of business.
Intangible Assets shall mean all assets and property lacking physical
properties the evidence of ownership of which must customarily be maintained by
independent registration, documentation, certification, recordation or other
means, and shall include, without limitation, concessions, copyrights,
franchises, license, permits and all Intellectual Property.
Intellectual Property shall mean any and all research, information,
inventions, designs, procedures, developments, discoveries, improvements,
patents and applications therefor, trademarks and applications therefor, service
marks, trade names copyrights and applications therefor, logos, trade secrets,
drawing, plans, systems, methods, specifications, computer software programs,
tapes, discs and related data processing software (including without limitation
object and source codes) owned by such Person or in which it has an ownership
interest and all other manufacturing, engineering, technical, research and
development data and know-how made, conceived, developed and/or acquired by such
Person, which relate to the manufacture, production or processing of any
products developed or sold by such Person or which are within the scope of or
usable in connection with such Person's business as it may, from time to time,
hereafter be conducted or proposed to be conducted.
Jacor and the Jacor Parties shall have the meaning given to it in the
Preamble.
Jacor Accounts Receivable shall mean the Accounts Receivables of
Citicasters arising in connection with the ownership or operation of any of the
Jacor Assets or the conduct of the business of any of the Jacor Stations prior
to the applicable Cut-off Date. Citicasters Accounts Receivable shall mean Jacor
Accounts Receivables arising in connection with the ownership or operation of
any of the Citicasters Assets or the conduct of the business of any of the
Citicasters Stations. Regent Accounts Receivable shall mean Jacor Accounts
Receivables arising in connection with the ownership or operation of any of the
Regent Assets or the conduct of the business of any of the Regent Stations prior
to the applicable Cut-off Date.
Jacor Assets shall mean (a) all assets used or held for use in the
ownership or operation of or the conduct of the business of the Jacor Stations
by any Jacor Party or any Entity Affiliated with any Jacor Party, including
without limitation the Jacor Personal Property, the Jacor Private
Authorizations, the Jacor Governmental Authorizations (including without
limitation the Jacor FCC Licenses), the Jacor Intangible Assets and the Jacor
Assumable Agreements, and the logs, public files and other books, records, files
and documents that relate to the Jacor Stations, but excluding the Jacor
Excluded Assets and (b) an amount of cash equal to the American Tower
Adjustment. Citicasters Assets shall mean the Jacor Assets used or held for use
in the ownership or operation of or the conduct of the business of any of the
Citicasters Stations by Citicasters or any Entity Affiliated with Citicasters.
Regent Assets shall mean the Jacor Assets used or held for use in the ownership
or operation of or the conduct of the business of any of the Regent Stations by
Regent or any Entity Affiliated with Regent.
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Jacor Assumable Agreements shall mean the Jacor Private Authorizations,
the Jacor Trade Agreements, the Jacor Leases and the Jacor Other Contracts.
Citicasters Assumable Agreements shall mean the Jacor Assumable Agreements that
relate to the ownership or operation of any of the Citicasters Assets or the
conduct of the business of any of the Citicasters Stations. Regent Assumable
Agreements shall mean the Jacor Assumable Agreements that relate to the
ownership or operation of any of the Regent Assets or the conduct of the
business of any of the Regent Stations.
Jacor Disapproved Matters shall have the meaning given to it in Section
5.2(e).
Jacor Disclosure Schedule shall mean the Jacor Disclosure Schedule
dated as of the date of this Agreement delivered by the Jacor Parties to
American.
Jacor Employee Plans shall have the meaning given to it in Section
3.11(a).
Jacor Excluded Assets shall mean (i) all cash and cash equivalents of
any of the Jacor Parties, (ii) all Jacor Accounts Receivable, (iii) the
corporate names of each of the Jacor Parties, and its books, records and other
documents that relate to its corporate existence, organization and
capitalization, (iv) all books and records of any of the Jacor Parties that
relate to the Jacor Stations and which any Jacor Party is required by Applicable
Law to retain, subject to the right of the other party to have access and to
copy for a period of three (3) years from the Closing Date, (v) the Jacor
Employee Plans, (vi) all insurance policies that relate to the Jacor Assets,
(vii) assets comprising the traffic and accounting computer systems), (viii)
software programs and other assets used to provide certain financial and
accounting services for any of the Jacor Stations, and (ix) any and all
products, profits and proceeds of, and including without limitation any Claims
with respect to, any of the foregoing.
Jacor FCC Licenses shall mean the Citicasters FCC Licenses and the
Regent FCC Licenses. Citicasters FCC Licenses shall have the meaning given to it
in the first Whereas paragraph. Jacor FCC Licenses shall have the meaning given
to it in the first Whereas paragraph.
Jacor Financial Statements shall have the meaning given to it in
Section 3.2(a).
Jacor Governmental Authorizations shall have the meaning given to it in
Section 3.7(a). Citicasters Governmental Authorizations shall mean the Jacor
Governmental Authorizations with respect to the ownership and operation of any
of the Citicasters Assets and the conduct of any of the business of the
Citicasters Stations. Regent Governmental Authorizations shall mean the Jacor
Governmental Authorizations with respect to the ownership and operation of any
of the Regent Assets and the conduct of any of the business of the Regent
Stations.
Jacor Inspection shall have the meaning given to it in Section 5.2(h).
Jacor Intangible Assets shall have the meaning given to it in Section
3.8. Citicasters Intangible Assets shall mean the Jacor Intangible Assets with
respect to the ownership and operation of any of the Citicasters Assets and the
conduct of the business of any of the Citicasters Stations.
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Regent Intangible Assets shall mean the Jacor Intangible Assets with respect to
the ownership and operation of any of the Regent Assets and the conduct of the
business of any of the Regent Stations.
Jacor Kansas City Proration Schedule shall have the meaning given to it
in Section 2.3(f).
Jacor Leases shall have the meaning given to it in Section 3.5(a).
Citicasters Leases shall mean the Jacor Leases with respect to the ownership and
operation of any of the Citicasters Assets and the conduct of the business of
any of the Citicasters Stations. Regent Leases shall mean the Jacor Leases with
respect to the ownership and operation of any of the Regent Assets and the
conduct of the business of any of the Regent Stations.
Jacor Material Agreements shall have the meaning given to it in Section
3.12. Citicasters Material Agreements shall mean the Jacor Material Agreements
with respect to the ownership and operation of any of the Citicasters Assets and
the conduct of the business of any of the Citicasters Stations. Regent Material
Agreements shall mean the Jacor Material Agreements with respect to the
ownership and operation of any of the Regent Assets and the conduct of the
business of any of the Regent Stations.
Jacor Nonassumed Liabilities shall have the meaning given to it in
Section 2.3(a). Citicasters Nonassumed Liabilities shall have the meaning given
to it in Section 2.3(a). Regent Nonassumed Liabilities shall have the meaning
given to it in Section 2.3(a).
Jacor Other Contracts shall mean (a) all Jacor Material Agreements set
forth on Section 3.12 of the Jacor Disclosure Schedule, (b) all Contracts for
the sale of time on the Jacor Stations for cash entered into in the ordinary
course of business consistent with prior practice, and (c) Contracts not
required to be listed on Section 3.12 of the Jacor Disclosure Schedule that have
been entered into in the ordinary course of business. Citicasters Other
Contracts shall mean the Jacor Other Contracts with respect to any of the
ownership and operation of any of the Citicasters Assets and the conduct of the
business of any of the Citicasters Stations. Regent Other Contracts shall mean
the Jacor Other Contracts with respect to the ownership and operation of any of
the Regent Assets and the conduct of the business of any of the Regent Stations.
Jacor Owned Real Property shall have the meaning given to it in Section
3.5(a). Citicasters Owned Real Property shall mean the Jacor Owned Real Property
with respect to the ownership and operation of any of the Citicasters Assets and
the conduct of the business of any of the Citicasters Stations. Regent Owned
Real Property shall mean the Jacor Owned Real Property with respect to the
ownership and operation of any of the Regent Assets and the conduct of the
business of any of the Regent Stations.
Jacor Permitted Title Exceptions shall have the meaning given to it in
Section 5.2(e).
Jacor Personal Property shall mean all items of Personal Property, used
or held for use in the ownership or operation or the conduct of the business of
any of the Jacor Stations. Citicasters Personal Property shall mean the Jacor
Personal Property with respect to the ownership and operation of any of the
Citicasters Assets and the conduct of the business of any of the Citicasters
A-12
Stations. Regent Personal Property shall mean the Jacor Personal Property with
respect to the ownership and operation of any of the Regent Assets and the
conduct of the business of any of the Regent Stations.
Jacor Preliminary Title Report shall have the meaning given to it in
Section 5.2(e).
Jacor Private Authorizations shall mean all Private Authorizations
obtained or held for use in the ownership or operation or the conduct of the
business of the Citicasters Stations. Citicasters Private Authorizations shall
mean the Jacor Private Authorizations with respect to the ownership and
operation of any of the Citicasters Assets and the conduct of the business of
any of the Citicasters Stations. Regent Private Authorizations shall mean the
Jacor Private Authorizations with respect to the ownership and operation of any
of the Regent Assets and the conduct of the business of any of the Regent
Stations.
Jacor Proration Schedule shall have the meaning given to it in Section
2.3(e).
Jacor Real Property shall have the meaning given to it in Section
3.5(a). Citicasters Real Property shall mean the Jacor Real Property with
respect to the ownership and operation of any of the Citicasters Assets and the
conduct of the business of any of the Citicasters Stations. Regent Real Property
shall mean the Jacor Real Property with respect to the ownership and operation
of any of the Regent Assets and the conduct of the business of any of the Regent
Stations.
Jacor Stations shall have the meaning given to it in the first Whereas
paragraph. Citicasters Stations shall have the meaning given to it in the first
Whereas paragraph. Regent Stations shall have the meaning given to it in the
first Whereas paragraph.
Jacor Station Employees shall have the meaning given to it in Section
3.11(b).
Jacor Stations TBAs shall mean the Citicasters Stations TBA and the
Regent Stations TBA. Citicasters Stations TBA shall have the meaning given to it
in Section 5.2(d). Regent Stations TBA shall have the meaning given to it in
Section 5.2(d).
Jacor Study shall have the meaning given to it in Section 5.2(f).
Jacor Survey shall have the meaning given to it in Section 5.2(e).
Jacor Trade Agreements shall mean all Trade Agreements in effect on the
date hereof or entered into on or prior to the Cut-Off Date that relate to the
ownership or operation of any of the Jacor Assets or the conduct of the business
of any of the Jacor Stations. Citicasters Trade Agreements shall mean the Jacor
Trade Agreements that relate to the ownership or operation of any of the
Citicasters Assets or the conduct of the business of any of the Citicasters
Stations. Regent Trade Agreements shall mean the Jacor Trade Agreements that
relate to the ownership or operation of any of the Regent Assets or the conduct
of the business of any of the Regent Stations.
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Jacor' knowledge (including the term "to the knowledge, information and
belief of Jacor") means the actual knowledge of any executive officer of any
Jacor Party or any General Manager of any of the Jacor Stations.
Law shall mean any (a) administrative, judicial, legislative or other
action, code, consent decree, constitution, decree, directive, enactment,
finding, guideline, law, injunction, interpretation, judgment, order, ordinance,
policy statement, proclamation, promulgation, regulation, requirement, rule,
rule of law, rule of public policy, settlement agreement, statute, or writ of
any Authority, domestic or foreign; (b) the common law; or (c) arbitrator's,
mediator's or referee's award, decision, finding or recommendation; including,
in each such case or instance, any interpretation, directive, guideline or
request, whether or not having the force of law including, in all cases, without
limitation any particular section, part or provision thereof.
Lease shall mean any lease of property, whether real, personal or
mixed, and all amendments thereto.
Legal Action shall mean, with respect to any Person, any and all
litigation or legal or other actions, arbitrations, counterclaims,
investigations, proceedings, requests for material information by or pursuant to
the order of any Authority or suits, at law or in arbitration or equity.
Lien shall mean any mortgage; lien (statutory or other); or other
security agreement, arrangement or interest; hypothecation, pledge or other
deposit arrangement; assignment; charge; levy; executory seizure; attachment;
garnishment; encumbrance (including any easement, exception, reservation or
limitation, right of way, and the like); conditional sale, title retention or
other similar agreement, arrangement, device or restriction; preemptive or
similar right; any financing or capital lease involving substantially the same
economic effect as any of the foregoing; restriction on sale, transfer,
assignment, disposition or other alienation; or any option, equity, claim or
right of or obligation to, any other Person, of whatever kind and character.
Like-Kind Exchanges shall mean an Exchanges of assets of the nature
contemplated by the provisions of Section 1031 of the Code.
Loss and Expense shall have the meaning given to it in Section 8.2.
material or materiality for the purposes of this Agreement, shall,
unless specifically stated to the contrary, be determined without regard to the
fact that various provisions of this Agreement set forth specific dollar
amounts.
Material Agreement shall mean, with respect to any Person, any
Contractual Obligation which is in effect on the date hereof and (a) was not
entered into in the ordinary course of business, (b) was entered into in the
ordinary course of business which (i) involved annual consideration of more than
Ten Thousand Dollars ($10,000) during any of the last three fiscal years, (ii)
extends for more than three (3) months, or (iii) is not terminable on thirty
(30) days or less notice without penalty or other continuing financial
obligation, (c) involves Indebtedness for Money Borrowed, (d) is an employment
agreement, (e) is or otherwise constitutes a written agency, broker, dealer,
license, distributorship, sales representative or similar written agreement, or
(f) accounted for more than
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three percent (3%) of the revenues of the American Stations or the Jacor
Stations in any of the last three fiscal years or is likely to account for more
than three percent (3%) of revenues of the American Stations or the Jacor
Stations during the current fiscal year.
Notice of Disagreement shall have the meaning given to it in Section
2.3(e).
Organic Document shall mean, with respect to a Person which is a
corporation, its certificate or articles of incorporation or organization, its
by-laws and all stockholder agreements, voting trusts and similar arrangements
applicable to any of its capital stock.
Permitted Liens shall mean (a) any mechanic's or materialmen's Lien or
similar Lien with respect to amounts not yet due and payable or which are being
contested in good faith by appropriate proceedings and for which appropriate
reserves have been established, (b) Liens for taxes not yet due and payable or
which are being contested in good faith by appropriate proceeding, for which
appropriate reserves have been established, and (c) easements, licenses,
covenants, rights of way and similar Liens which, individually or in the
aggregate, would not materially and adversely affect the marketability or value
of the property encumbered thereby or materially interfere with the operations
of the Stations, it being understood that any Permitted Liens of a nature
referred to in clause (a) or (b) shall, to the extent they may involve the
payment of money, be taken into account in preparing the Citicasters Kansas City
Proration Schedule, the Regent Kansas City Proration Schedule and the Dayton
Proration Schedule.
Permitted Title Exceptions shall mean American Permitted Title
Exceptions and/or Jacor Permitted Title Exceptions, as the context may indicate.
Person shall mean any natural individual or any Entity.
Personal Property shall mean all of the machinery, equipment, tools,
vehicles, furniture, leasehold improvements, office and studio equipment, spare
parts and other tangible personal property, plus such additions thereto and
deletions therefrom arising in the ordinary course of business between the date
hereof and the Closing Date.
Preliminary Title Report shall have the meaning given to it in Section
5.2(e).
Private Authorizations shall mean all approvals, concessions, consents,
franchises, licenses, permits, and other authorizations of all Persons (other
than Authorities) including without limitation those with respect to copyrights,
computer software programs, patents, service marks, trademarks, trade names,
technology and know-how.
Pro Ratable Taxes shall mean real estate and other property Taxes, ad
valorem Taxes, gross receipts Taxes and similar Taxes, but shall not include
federal, state or local income Taxes, franchise Taxes or other Taxes measured by
or based upon income or gain on sale or other disposition of property or assets.
A-15
Real Property shall mean all of the fee estates and buildings and other
improvements thereon, leasehold interest, easements, licenses, rights to access,
right-of- way, and other real property interest (including without limitation
any of the foregoing that relate to the towers, transmitters, studio sites and
offices of the respective Stations).
Referee shall have the meaning given to it in Section 2.3(e).
Regent Broadcasting shall have the meaning given to it in the Preamble.
Regent Kansas City Proration Schedule shall have the meaning given to
it in Section 2.3(g).
Regent Licensee shall have the meaning given to it in the Preamble.
Regent Parties shall have the meaning given to it in the Preamble.
Regulations shall mean the federal income tax regulations promulgated
under the Code, as such Regulations may be amended from time to time. All
references herein to specific sections of the Regulations shall be deemed also
to refer to any corresponding provisions of succeeding Regulations, and all
references to temporary Regulations shall be deemed also to refer to any
corresponding provisions of final Regulations.
Representatives shall have the meaning given to it in Section 5.1(a).
SEC shall mean the United States Securities and Exchanges Commission,
or any successor Authority.
Securities Act shall mean the Securities Act of 1933, and the rules and
regulations of the SEC thereunder, all as from time to time in effect, or any
successor law, rules or regulations, and any reference to any statutory or
regulatory provision shall be deemed to be a reference to any successor
statutory or regulatory provision.
Stations shall mean, collectively, the Jacor Stations and the American
Stations.
Subsidiary shall mean, with respect to a Person, any Entity a majority
of the capital stock ordinarily entitled to vote for the election of directors
of which, or if no such voting stock is outstanding, a majority of the equity
interests of which, is owned directly or indirectly, legally or beneficially, by
such Person or any other Person controlled by such Person.
Tax and Taxes (and "Taxable", which shall mean subject to Tax), shall
mean, with respect to any Person, (a) all taxes (domestic or foreign), including
without limitation any income (net, gross or other including recapture of any
tax items such as investment tax credits), alternative or add-on minimum tax,
gross income, gross receipts, gains, sales, use, leasing, lease, user, ad
valorem, transfer, recording, franchise, profits, property (real or personal,
tangible or intangible), fuel, license, withholding on amounts paid to or by
such Person, payroll, employment, unemployment, social security, excise,
severance, stamp, occupation, premium, environmental or windfall profit tax,
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custom, duty or other tax, or other like assessment or charge of any kind
whatsoever, together with any interest, levies, assessments, charges, penalties,
addition to tax or additional amount imposed by any Taxing Authority, (b) any
joint or several liability of such Person with any other Person for the payment
of any amounts of the type described in (a), and (c) any liability of such
Person for the payment of any amounts of the type described in (a) as a result
of any express or implied obligation to indemnify any other Person.
Tax Claim shall mean any Claim which relates to Taxes, including
without limitation any Claim arising out of any breach of the representations
and warranties set forth in Section 3.10 or 4.10.
Tax Return or Returns shall mean all returns, consolidated or otherwise
(including without limitation information returns), required to be filed with
any Authority with respect to Taxes.
Taxing Authority shall mean any Authority responsible for the
imposition of any Tax.
TBA Date shall mean the date when operations under the TBAs shall
become effective (or in the event such date is not the same for all of the TBAs,
the applicable date of such effectiveness).
TBAs shall mean the American Citicasters Stations TBA, the American
Regent Stations TBA, the Citicasters Stations TBA and the Regent Stations TBA,
or the applicable one of such agreements.
Termination Date shall have the meaning given to it in Section 7.1.
Trade Agreements shall mean any Contract that relate to any of the
Stations pursuant to which American or any Jacor Party is required to provide
air time in exchange for property or services other than cash.
Transactions shall mean the Exchanges and all of the other transactions
contemplated by this Agreement to be consummated on or prior to the Closing
Date, including without limitation the execution, delivery and performance of
the Collateral Documents.
Valuation Schedule shall have the meaning given to it in Section
2.2(b).
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