AGREEMENT
THIS AGREEMENT, made this 8th day of November, 2000, by and
between Delphi Communications, Inc., a Nevada Corporation
(hereinafter referred to as "Seller"), and World Shopping
Network, Inc., a publicly-traded Delaware corporation (hereinaf-
ter referred to as "Buyer"):
WITNESSETH:
WHEREAS, Seller is the holder of the license and other authoriza-
tions issued by the Federal Communications Commission (hereinaf-
ter referred to as "FCC"), for radio station XXXX, Banning,
California (hereinafter "Station"); and
WHEREAS, Seller is desirous of selling Station and related assets
to Buyer under the terms and conditions stated herein; and
WHEREAS, Buyer is desirous of acquiring said Station and related
assets, under the terms and conditions stated herein: and
WHEREAS, the consummation of this Agreement is subject to the
prior approval of the FCC;
NOW, THEREFORE, in consideration of the mutual covenants and
conditions herein contained, it is hereby agreed as follows:
1.
Subject to the prior approval of the FCC, which shall be obtained
by its grant of an appropriate application, Seller agrees to
sell, transfer, assign, convey and deliver to Buyer and Buyer
agrees to buy, free and clear of all liens, all broadcast studio
and transmission equipment, office furnishings, and related items
owned by Seller and used or useful in the operation of Station as
listed in Exhibit A hereto, all real property used or useful in
the operation of Station as listed in Exhibit B hereto, all
contracts as listed herein in Exhibit C (which Buyer agrees to
assume), and all good will and rights which Seller has in
frequencies, licenses and call letters of Station, and all
accounts receivable of Seller. In consideration thereof, Buyer
agrees to pay to Seller the total consideration shown in
Paragraph 2 below.
2.
In consideration for the assets to be conveyed to Buyer, Buyer
shall pay to Seller a total of SEVEN MILLION FOUR HUNDRED FIFTEEN
THOUSAND TWO HUNDRED FIFTY-FOUR (7,415,254) restricted shares of
Buyer, valued at ONE MILLION SEVEN HUNDRED FIFTY THOUSAND DOLLARS
($1,750,000.00) based on the averaged closing price of Buyer's
shares in the fifteen (15) trading days prior to the date of this
agreement, which is computed as $0.236. Immediately upon
Seller's receipt of shares of Buyer, Seller shall distribute all
share so received to its own shareholders in the ratio of 7.213
shares of Buyer for each share of Seller held on the Closing
date. In addition, Buyer shall assume all liabilities of Seller
existing on the closing date.
Neither party hereto shall not transfer, sell or hypothecate,
assign or distribute any of the assets in the possession of each
except upon the written agreement of the parties hereto, and will
continue operations in substantially the same manner as they are
presently functioning, between the date hereof and the Closing.
3.
Seller hereby warrants as follows:
(a) That it holds valid authorization from the FCC to operate
Station and there are no outstanding unsatisfied FCC citations or
cease and desist orders against Station and any such subsequently
issued shall be satisfied prior to closing.
(b) That it is aware of no ongoing investigation of Station by
the FCC or by any other federal or state governmental agency, or
any conditions at Station which are violative of any FCC rule or
policy;
(c) That it is aware of no litigation, proceeding or investigation
whatsoever pending or threatened against or relating to
Seller, its business, or the property to be transferred hereunder
and that it knows of no reason why the FCC would not find it
qualified to assign its license;
(d) That, as of the Closing Date, Station's physical assets shall
be in the same condition as at the date hereof, wear and tear and
ordinary usage excepted; any physical asset which deteriorates
further between the date hereof and the Closing Date shall be
repaired or replaced by Seller at its own expense;
(e) That it has good marketable title to all assets being sold
herein, other than those liens or claims disclosed to Buyer on
Exhibits A and B hereto;
(f) That all leases and contracts shown in Exhibit C hereto are
in full force and effect;
(g) That at present and on the closing date, Seller will have
full power and authority to enter into and perform this
Agreement, that the execution and delivery of this Agreement and
the performance of all obligations hereunder shall have been duly
authorized, and that this Agreement will constitute a valid and
binding agreement of the Seller, enforceable in accordance with
its terms;
(h) Seller is a corporation qualified to do business and in good
standing in the State of California, and Seller has paid all
taxes and fees due to the State of California and other
government bodies;
(i) To the best of Seller's knowledge, Seller has filed all forms
and reports with the FCC which are required to be filed, and has
placed in its public and political files all documents which are
required to be there.
(j) Seller will hold Buyer harmless from any and all claims of
trade creditors, judgment creditors, lien holders, purported
owners, or any other person making a claim by or through Seller
or asserting any claim on the assets purchased, other than those
liens disclosed herein, or having to do with Buyer's operation of
the Station subsequent to the Closing date.
Should any such claims as described in this paragraph be made
against Buyer, Seller further agrees to fully indemnify and hold
Buyer harmless for the value of such claims, plus any and all
costs, attorney's fees, expense, court costs, arbitration fees,
or any other costs incurred by the Buyer in the handling or
processing of any such claims that may be made.
4.
Buyer hereby warrants as follows:
(a) That at the time set for Closing of the transactions
contemplated herein, it will be legally, financially and
otherwise qualified to become the licensee of the Station. Buyer
knows of no reason why the FCC would not approve its acquisition
of the Station licenses.
(b) That at present and on the closing date, Buyer will have full
power and authority to enter into and perform this Agreement,
that the execution and delivery of this Agreement and the perfor-
xxxxx of all obligations hereunder shall have been duly
authorized, and that this Agreement will constitute a valid and
binding agreement of the Buyer, enforceable in accordance with
its terms;
(c) Buyer will hold Seller harmless from any and all claims of
having to do Buyer's operation of the Station subsequent to the
Closing date.
Buyer further agrees to fully indemnify and hold Seller harmless
for the value of such claims described in this paragraph, plus
any and all costs, attorney's fees, expense, court costs,
arbitration fees, or any other costs incurred by the Buyer in the
handling or processing of any such claim that may be made.
5.
In connection with preparing and filing of assignment
applications with FCC, the parties shall bear their respective
legal costs except that Seller shall be solely responsible for
all expenses arising from the Agreement relating to the post
consummation operations, including, legal and accounting fees,
escrow fees, filing, filing fees, printing, postage, delivery,
shipping, copying, telephone calls, overnight packages,
facsimiles and other related expenses. All FCC fees in
connection with the assignment application shall be paid by
Seller.
6.
Both parties hereto agree to join in an application to FCC for
assignment of Station's license to Buyer within ten (10) days
from the date of this Agreement, and to cooperate fully and
diligently in seeking FCC's consent to assignment of Station from
Seller to Buyer.
7.
Taxes, insurance, and prepaid expenses shall be pro-rated as of
the date of closing.
8.
Time is of the essence of this Agreement. If the FCC has refused
or failed to grant its written consent to assignment of all of
Station's license by April 15, 2000, Seller may either cancel
this agreement or extend this Agreement until August 15, 2001.
If FCC approval has not been obtained by that date, either party
may cancel this agreement by giving the other party two (2) weeks
prior written notice of such intent, by certified mail or
overnight delivery service in which a written receipt of delivery
is obtained; provided that the FCC has not granted its consent to
the Station's license assignment during that two-week interim
period, and provided further that the party seeking cancellation
is not in material breach of this Agreement.
9.
Closing shall take place at the main studio of Station, or at
another mutually agreed location, at any time subsequent to the
date of Commission consent, upon ten (10) days notice from Buyer
to Seller, but in no event shall the closing be more than ninety
(90) days following the date on which the FCC approves and grants
the parties' application for consent to assignment of license of
Station.
At closing, Seller will furnish Buyer:
(a) instruments of conveyance satisfactory to Buyer's counsel to
properly transfer the licenses, real property, personal property
and intangible assets to Buyer.
(b) a lease of the land on which the Station is currently
situated at a rental not ot exceed $1 per year. Said lease shall
be for one year, renewable each year at Buyere's option for an
additional thirty-nine (39) years at the same rate. Said lease
is a material term of this Agreement, and Sellers's failure to
obtain said lease shall relieve Buyer of all obligations under
this Agreement. In addition, Seller shall provide Buyer with all
other documents reasonably required by Buyer's counsel at
closing.
10.
Prior to closing, Seller shall have complete control over the
property and operation of the Station. However, Buyer shall have
the right to reasonable access to Station logs and papers prior
to closing, and to inspect Station property. Upon closing and
transfer as contemplated herein, Buyer shall have complete
control Station. Seller shall have no reversionary interest in
the license of Station.
The parties hereto will hold in confidence all information
obtained with respect to the other, and, except as required by
law, will not reveal such information to any person other than to
those to whom it may be necessary in order to complete the
transactions contemplated herein. If deemed appropriate by
either party, a separate Confidentiality Agreement shall be
executed by the parties to confirm the confidentiality provisions
and terms set forth in this paragraph.
11.
Buyer shall have the right to file any necessary change of
ownership forms with the Internal Revenue Service of the United
States of America and shall work in good faith with Seller to
fairly determine the allocation of the purchase price as to the
various assets purchased.
12.
Subject to the requirements of law, any news release or other
announcements prior to the Closing Date by either party hereto,
or its officers, directors, employees or other related parties,
pertaining to the transactions contemplated in this Agreement
shall be approved in writing by the parties hereto prior to
release.
13.
Notices which are to be sent to either party to the other under
or pursuant to the terms of this Agreement, shall be sent by
United States Certified Mail, return receipt request, as follows:
If to Seller:
Delphi Communications, Inc.
c/o Xxxx X. Tow
0000 Xxxxx Xxxxxx, Xxxxx 000
Xxx Xxxx Xxxxx, XX 00000
Telephone 000-000-0000
Telecopier 000-000-0000
Copy to:
Xxxxxxx Xxxxxx, Esq.
X.X. Xxx 00000
Xxxxxxxxxx, X.X. 00000
Telephone 000-000-0000
Telecopier 000-000-0000
If to Buyer:
World Shopping Network
0000 Xxxxxxxxxxx Xxxxx, Xxxxx X
Xxxxx Xxx, Xxxxxxxxxx 00000
14.
This document is the entire agreement between the parties hereto
and shall not be modified except in writing and with the consent
of all parties hereto. This document shall be binding on the
heirs, successors and assigns of the parties hereto and shall be
construed by the laws of the State of California. This Agreement
may be executed in counterpart copies. When exchanged, such
executed counterpart copies shall have the same force and effect
as a single executed Agreement.
IN WITNESS WHEREOF, we have hereunto set our hands and seals on
the date written above.
SELLER BUYER
DELPHI COMMUNICATIONS, INC. WORLD SHOPPING NETWORK, INC.
By: /s/ Marc TowBy: /s/ Xxxx X. Xxxxx
Xxxx Xxx, President Xxxx X. Xxxxx, President
