ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT is made as of the 28th day of March, 1997,
by and among Xxx X. Xxxxxxxxx ("Xxxxxxxxx"), a resident of Xxxxxx County,
Texas, and Fort Bend Broadcasting Company, Inc. ("FBBC"), a Texas corporation
wholly owned by Xxx X. Xxxxxxxxx (Xxxxxxxxx and FBBC hereinafter referred to
jointly as "Seller"), and Xxxxxxxx Media System, Inc., a Texas corporation
("Purchaser").
W I T N E S S E T H:
WHEREAS, Xxxxxxxxx is the individual licensee of FM Radio Station KLTO-FM
f/k/a KMPQ-FM (the "Station") authorized by the Federal Communications
Commission (the "Commission" or "FCC"); and
WHEREAS, FBBC is a Texas corporation in good standing wholly owned and
controlled by Xxxxxxxxx that holds title to various assets which are used in
the operation of the Station; and
WHEREAS, the Purchaser and the Seller have previously entered into that
certain Option Agreement (the "Option Agreement") pursuant to which the
Seller granted to Purchaser an option to purchase (the "Purchase Option")
from Seller all of the radio station properties and assets used or useful in
the ownership and operation of the Station; and
WHEREAS, the FCC licenses used in the operation of the Station may not be
assigned to Purchaser without the prior written consent of the Commission; and
WHEREAS, the Seller desires to sell to Purchaser, and Purchaser desires
to purchase from the Seller, all of the radio station properties and assets
used or useful in the ownership and operation of the Station under the terms
and conditions herein set forth; and
WHEREAS, the Seller and the Purchaser have previously entered into a Time
Brokerage Agreement (as amended to date, the "Time Brokerage Agreement")
pursuant to which the Purchaser broadcasts or broadcasted certain programs on
the Station as of the effective date of the Time Brokerage Agreement (the
"Time Brokerage Date");
NOW, THEREFORE, in consideration of the premises and the mutual covenants
and agreements herein contained, the parties hereto agree as follows:
1. PURCHASE AND SALE OF ASSETS.
1.1 PURCHASE AND SALE OF STATION ASSETS. Subject to the conditions
set forth in this Agreement, at the Closing (as defined hereinafter), the
Seller shall assign, transfer, convey and deliver to Purchaser, and Purchaser
shall purchase from the Seller, all right, title and interest in and to the
following assets that are owned or held by Seller, whether or not on the
books and records of Seller (the "Station Assets"),
free and clear of all liens, security interests, charges, encumbrances and
rights of others, except those assets specifically listed on Exhibit "A"
attached hereto or which may be added to Exhibit "A" by mutual consent prior
to the Closing (the "Excluded Assets"):
(a) All licenses issued by or pending before the FCC together with all
other construction permits or authorizations issued by or pending before the
FCC to Seller for use at the Station or any other governmental authority for
the operation of the Station, together with any and all renewals, extensions
and modifications thereof ("Governmental Licenses");
(b) All real and personal property, tangible or intangible, owned by
Seller which is used or useful in the operation of the Station, including,
but not limited to, the real property described on Exhibit "B" hereto (the
"Real Property"), broadcast towers and antennas, transmitters and transmitter
equipment, studio equipment, tapes and record libraries, office equipment and
furniture (all as more particularly set forth on Exhibit "B" hereto),
together with replacements thereof and additions thereto made between the
date hereof and the Closing;
(c) All tradenames, trademarks, patents, service marks, call letters,
copyrights, logos and similar intangibles owned by Seller and used in Station
operations;
(d) All programming materials, programs, jingles and promotional
materials owned or held by Seller and used in the operation of the Station,
whether recorded on tape or any other substance or intended for live
performance, and whether completed or in production; and
(e) Unless as may be otherwise required by law, all books and records
related to the Station Assets or the operation of the Station, including all
financial, accounting and property tax records, computer data and programs,
market data, FCC logs, all materials maintained in the Seller's FCC public
file, technical data and records and all correspondence with and documents
pertaining to suppliers, governmental authorities and other third parties
(provided, however, that copies of the same may be retained by the Seller).
1.2 NO ASSUMED LIABILITIES. At the Closing, the Purchaser shall
assume (i) those specified contractual obligations of the Station listed on
Exhibit "C" hereto, as the same may be amended through the Closing Date with
the mutual consent of Seller and Purchaser, and (ii) those obligations and
liabilities incurred by Purchaser after the Time Brokerage Date
(collectively, the "Assumed Liabilities"), and the Purchaser agrees to pay
and perform the Assumed Liabilities after the Closing Date. Except as
specifically set forth on such Exhibit "C", Purchaser does not assume and
shall in no event be liable for any debt, obligation, responsibility or
liability of the Station, Seller,
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any subsidiary or any affiliate or successor of Seller, or any claim against
any of the foregoing, whether known or unknown, contingent or absolute, or
otherwise.
2. CONSIDERATION; CLOSING.
2.1 PURCHASE PRICE. The consideration to be received by the Seller in
exchange for the Station Assets (the "Purchase Price") shall be $3.08 million
in cash, of which $330,000 shall be paid on the date hereof as a prepayment
of the Purchase Price, and the balance shall be paid on the Closing Date.
2.2 STATION UPGRADE; UPGRADE PAYMENT.
(a) Purchaser intends to pursue an upgrade of the Station's broadcast
authorization to Class C1 status permitting Purchaser to relocate the
Station's transmitter site to a location at or near the Senior Road/McHard
Road transmitter "farm" location (such upgrade of the Station's broadcast
authorization is referred to herein as the "Full Upgrade"), and Seller will
cooperate with and assist Purchaser as described below and as reasonably
necessary in obtaining the same. The Seller shall withdraw or revise any
other present or future applications or rule making petitions filed by the
Seller, FBBC, or their affiliates, with the Commission, including but not
limited to those for changes in the broadcast authorizations of other radio
stations owned by the Seller, FBBC or their affiliates, to the extent such
applications or petitions might unfavorably impact the prospects of the
Commission's granting of the full upgrade or, in the circumstances described
below, the "Partial Upgrade". If the Full Upgrade and Construction Permit is
not economically or technically feasible (as determined in good faith by
Purchaser), then the Purchaser intends to pursue alternatives to improve the
Station's broadcast signal and to relocate the transmitter site to maximize
the number of persons living in the Houston metro area (as that term is
defined by Arbitron) covered by the Station's 70 dbu contour (such
improvement and relocation, if obtained, being referred to herein as a
"Partial Upgrade"). Purchaser's documented legal, engineering and similar
expenses incurred in obtaining the Full Upgrade or Partial Upgrade shall be
referred to herein as the "Upgrade Expenses."
(b) In the event that the Full Upgrade or Partial Upgrade is obtained
prior to April 1, 2004, the Purchaser shall pay to Seller, within 10 days
after such date (the "Determination Date") as the FCC has approved the
Upgrade Petition (provided, however, that the payment date may be extended as
necessary to determine the "Fair Market Value" as described herein), an
amount in cash equal to the following:
(i) In the case of the Full Upgrade, the amount of (W) $14 million
less (X) $3.08 million, less (Y) the Unearned Portion of prepayments (as
that term is defined in the Time Brokerage Agreement) made by Purchaser to
Seller pursuant to the Time Brokerage Agreement (which payments shall be
defined
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collectively herein the "TBA Prepayment") less (Z) Purchaser's Upgrade
Expenses.
(ii) In the case of the Partial Upgrade, the amount of (W) the
"Formula Price" less (X) $3.08 million less (Y) the TBA Prepayment less (Z)
Purchaser's Upgrade Expenses.
For the purposes of this Section 2.2 (b), the "Formula Price" shall be equal to
the following:
(i) If the "Fair Market Value" of the Station Assets is more than $14
million, then the Formula Price will be equal to the average of (X) $10
million and (Y) the Fair Market Value; and
(ii) If the Fair Market Value is less than $14 million, the Formula
Price will be equal to the greater of (X) 85% of the Fair Market Value and
(Y) $10 million.
In order to determine the "Fair Market Value" of the Station Assets, the
Seller and Purchaser shall each select an appraiser with at least five years
of experience in appraising companies engaged in the ownership and operation
of radio broadcast stations (collectively the "Two Appraisers"). Each of the
Two Appraisers shall determine the Fair Market Value as of the Determination
Date within 60 days of their selection and shall deliver to each of the
Seller and the Purchaser a copy of its appraisal within such 60 day period.
If the determination of each of the Two Appraisers is 90% or more but less
than 110% of the average of the two determinations, the Fair Market Value
shall be such average. If the determination of either of the Two Appraisers
is less than 90% or more than 110% of such average, then the Two Appraisers
shall, within five days thereafter, select a third appraiser with at least
five years' experience in appraising companies engaged in the ownership and
operation of radio broadcast stations. The determination of such third
appraiser (which shall be completed within 60 days of its selection and shall
not be higher than the higher of, nor lower than the lower of, the
determinations of the Two Appraisers), shall govern and shall be final and
binding on all parties. In determining the Fair Market Value, the appraisers
shall value the Station Assets on a "stick" or "base" value as if there were
no business or commercial operations of the Station and shall value the
Station's broadcast signal as of the Determination Date without any value
given to any potential improvement. Each of Seller and the Purchaser shall
cooperate with the appraisers to the extent required to complete the
appraisals on a timely basis, and the Seller and the Purchaser shall each pay
50% of the costs of all appraisals contemplated by this Agreement.
2.3 TBA PREPAYMENT. The earlier of (a) the payment of the Upgrade
Payment pursuant to Section 2.2 or (b) the seven year anniversary of the date
hereof shall be
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referred to herein as the "Maturity Date." If the Maturity Date is the date
on which the Upgrade Payment is paid, the TBA Prepayment shall reduce the
Upgrade Payment. If the Maturity Date is the seven year anniversary of the
date hereof, Seller shall pay to the Purchaser the TBA Prepayment on such
date.
2.4 TIME OF CLOSING.
(a) A closing (the "Closing") for the sale and purchase of the Station
Assets shall be held at the offices of Purchaser in Dallas, Texas (or such
other place as may be agreed upon by the parties in writing) on the date
which is the later of (i) the tenth business day after the Final Order (as
defined hereinafter) or (ii) the satisfaction of all of the conditions
precedent to the obligations of Purchaser and Seller hereunder, or on such
other date as may be agreed upon by the parties in writing (the "Closing
Date"). The Closing shall be deemed to be effective as of 12:01 a.m. on the
Closing Date.
(b) In order to consummate the transfer of the Station Assets, Seller
and Purchaser agree to use their best efforts to file, within five business
days after the date hereof, an assignment of license application (the
"Application") requesting FCC consent to the assignment from the Seller to
Purchaser of all Governmental Licenses relating to the operation of the
Station. The parties agree that the Application will be prosecuted in good
faith and with due diligence. The parties agree to use their reasonable best
efforts to file additional information or amendments requested by the FCC
orally or in writing within five business days after such request and, in any
event, to commence preparation of such additional information or amendments
immediately upon request and to complete and file the same with the FCC as
rapidly as practical. Each party will be solely responsible for the expenses
incurred by it in the preparation, filing and prosecution of the Application
(it being understood that the parties will bear equally the FCC filing fee).
As used herein, the term "Final Order" shall mean that the FCC has granted or
given its consent, without any condition materially adverse to Purchaser or
Seller, to the assignment of the Governmental Licenses and the time period
for filing any protests, requests for stay, reconsideration by the FCC,
petitions for rehearing or appeal of such order shall have expired, and that
no protest, request for stay, reconsideration by the FCC, petition for
rehearing or appeal of such order shall be pending.
2.5 CLOSING PROCEDURE. At the Closing, the Seller shall deliver to
Purchaser such bills of sale, instruments of assignment, transfer and
conveyance and similar documents as Purchaser shall reasonably request.
Against such delivery, Purchaser shall (i) issue and deliver to Seller the
purchase price in accordance with Section 2.1 above and (ii) execute and
deliver the assumption agreements with respect to the Assumed Liabilities as
are contemplated by Section 1.3 hereof. Each party will cause to be
prepared, executed and delivered all other documents required to be delivered
by such party pursuant to this Agreement and all other appropriate and
customary documents as another party or its counsel may reasonably request
for the purpose of
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consummating the transactions contemplated by this Agreement. All actions
taken at the Closing shall be deemed to have been taken simultaneously at the
time the last of any such actions is taken or completed.
3. REPRESENTATIONS AND WARRANTIES OF THE SELLER.
The Seller hereby represents and warrants to the Purchaser, except as
qualified by the Seller's Disclosure Schedule attached hereto as Exhibit "D"
(the "Disclosure Schedule"), as follows:
3.1 ORGANIZATION; GOOD STANDING. FBBC is a corporation, duly
incorporated, validly existing and in good standing under the laws of its
jurisdiction of incorporation, and has all requisite corporate power and
authority to own and lease its properties and assets and to carry on its
business as currently conducted.
3.2 DUE AUTHORIZATION; EXECUTION AND DELIVERY. Subject to the
issuance of the Final Order, the Seller has full power and authority to enter
into and perform this Agreement and to carry out the transactions
contemplated hereby. Prior to the Closing, the Seller will have taken all
requisite action to approve the execution and delivery of this Agreement and
the transactions contemplated hereby. This Agreement constitutes the legal,
valid and binding obligation of the Seller, enforceable against it in
accordance with its terms, except as may be limited by the availability of
equitable remedies or by applicable bankruptcy, insolvency, reorganization,
moratorium or other laws affecting creditors' rights generally. Neither the
execution and delivery by the Seller of this Agreement nor the consummation
by it of the transactions contemplated hereby will: (i) conflict with or
result in a breach of the articles of incorporation or bylaws of FBBC; (ii)
subject to the issuance of the Final Order, violate any statute, law, rule or
regulation or any order, writ, injunction or decree of any court or
governmental authority, which violation, either individually or in the
aggregate, might reasonably be expected to have a material adverse effect on
the business or operations of the Seller or Purchaser's ownership of the
Station Assets; or (iii) violate or conflict with or constitute a default
under (or give rise to any right of termination, cancellation or acceleration
under), or result in the creation of any lien on any of the Station Assets
pursuant to, any material agreement, indenture, mortgage or other instrument
to which the Seller is a party or by which it or its assets may be bound or
affected.
3.3 GOVERNMENTAL CONSENTS. No approval, authorization, consent, order
or other action of, or filing with, any governmental authority or
administrative agency is required in connection with the execution and
delivery by the Seller of this Agreement or the consummation of the
transactions contemplated hereby or thereby, other than those of the FCC.
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3.4 TITLE TO ASSETS. The Seller is the sole and exclusive legal owner
of all right, title and interest in, and has good and marketable title to,
all of the Station Assets, free and clear of liens, claims and encumbrances
except (i) liens, claims and encumbrances to be released at Closing and (ii)
liens for taxes not yet payable.
3.5 REAL ESTATE.
(a) With respect to the Real Property, Seller has good, indefeasible
and record title to the Real Property in fee simple absolute, and there is no
outstanding liens or encumbrances with respect to the Real Property or any
part thereof. Policies of liability insurance exist and will be effective as
of the Closing Date with respect to the Real Property, affording such
coverage and with limits as are reasonable and customary with respect to the
operation of property similar to the Real Property. There is no existing,
pending, or notice of threatened litigation, condemnation or sale in lieu
thereof, with respect to any portion of the Real Property relating to or
arising out of the ownership of the Real Property by any federal, state,
county, or municipal department, commission, board, bureau or agency or other
governmental instrumentality. There is no proceeding pending or presently
being prosecuted for the reduction or increase of the assessed valuation or
taxes or other impositions payable in respect of any portion of the Real
Property. Seller has not received any notice of a proposed increase in the
assessed valuation of the Real Property. Seller has no information or
knowledge of any change contemplated in any applicable law, ordinances, or
restrictions, or any judicial or administrative action, or any action by
adjacent landowners, or natural or artificial conditions upon the Real
Property, which would have a material adverse affect upon the Real Property
or its value. There is no significant adverse fact or condition relating to
the Real Property and Seller knows of no fact or condition of any kind or
character whatsoever which adversely affects Purchaser's intended use of the
Real Property. Seller has no knowledge of any fact or condition existing
which would result or could result in the termination or reduction of the
current access from the Real Property to existing highways and roads, or to
sewer or other utility services presently serving the Real Property. The
Real Property is not within any area determined by the Department of Housing
and Urban Development and other applicable governmental authorities to be
flood prone under the Federal Flood Disaster Protection Act of 1973, as
amended.
(b) Seller has not received any notice of, and has no knowledge of,
any material violation of any zoning, building, health, fire, water use or
similar statute, ordinance, law, regulation or code in connection with any
real property leased by the Seller and used in connection with the operation
of the Station and the Real Property (collectively, the "Real Estate"). To
the knowledge of Seller, no fact or condition exists which would result in
the termination or impairment of access of the Station to the Real Estate or
discontinuation of necessary sewer, water, electrical, gas, telephone or
other utilities or services.
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(c) No hazardous or toxic material (as hereinafter defined) exists in
any structure located on, or exists on or under the surface of, any of the
Real Estate which is, in any case, in material violation by Seller of
applicable environmental law. For purposes of this Section, "hazardous or
toxic material" shall mean waste, substance, materials, smoke, gas or
particulate matter designated as hazardous, toxic or dangerous under any
environmental law. For purposes of this Section, "environmental law" shall
include the Comprehensive Environmental Response Compensation and Liability
Act, the Clean Air Act, the Clean Water Act and any other applicable federal,
state or local environmental, health or safety law, rule or regulation
relating to or imposing liability or standards concerning or in connection
with hazardous, toxic or dangerous waste, substance, materials, smoke, gas or
particulate matter.
3.6 CONDITION OF ASSETS. All of the Station Assets viewed as a whole
and not on an asset by asset basis are in good condition and working order,
ordinary wear and tear excepted, and are suitable for the uses for which
intended, free from any known defects except such minor defects as do not
substantially interfere with the continued use thereof.
3.7 GOVERNMENTAL LICENSES. The Disclosure Schedule lists and
accurately describes all Governmental Licenses owned or held by the Seller
and necessary for the lawful ownership and operation of the Station and the
conduct of the Station's business, except where the failure to hold such
Governmental License would not have a material adverse effect on the Station.
The Seller has furnished to Purchaser true and accurate copies of all such
Governmental Licenses. Each Governmental License is in full force and effect
and is valid under applicable federal, state and local laws; the Station is
being operated in compliance in all material respects with all rules,
regulations and policies of the FCC; and, to the knowledge of Seller, no
event has occurred which (whether with or without notice, lapse of time or
the happening or occurrence of any other event) is reasonably likely to
result in the revocation or termination of any Governmental License or the
imposition of any restriction of such a nature as might adversely affect the
ownership or operation of the Station as now conducted, except for
proceedings of a legislative or rule-making nature intended to affect the
broadcasting industry generally. The Station, its physical facilities,
electrical and mechanical systems and transmitting and studio equipment are
being operated in all material respects in accordance with the specifications
of the Governmental Licenses.
3.8 TAXES. All tax reports and returns required to be filed by or
relating to the Station Assets or operations (including sales, use, property
and employment taxes) have been filed with the appropriate federal, state and
local governmental agencies, and there have been paid all taxes, penalties,
interest, deficiencies, assessments or other charges due as reflected on the
filed returns or claimed to be due by such federal, state or local taxing
authorities (other than taxes, deficiencies, assessments or claims which are
being contested in good faith and which in the aggregate are not
8
material). There are no examinations or audits pending or unresolved
examinations or audit issues with respect to the Seller's federal, state or
local tax returns. All additional taxes, if any, assessed as a result of
such examinations or audits have been paid. There are no pending claims or
proceedings relating to, or asserted for, taxes, penalties, interest,
deficiencies or assessments against the Station Assets.
3.9 LITIGATION. There is no order of any court, governmental agency
or authority and no action, suit, proceeding or investigation, judicial,
administrative or otherwise that is pending or, to Seller's knowledge,
threatened against or affecting the Station which, if adversely determined,
might materially and adversely affect the business, operations, properties,
assets or conditions (financial or otherwise) of the Station or which
challenges the validity or propriety of any of the transactions contemplated
by this Agreement.
3.10 REPORTS. The Seller has duly filed all reports required to be
filed by law or applicable rule, regulation, order, writ or decree of any
court, governmental commission, body or instrumentality and has made payment
of all charges and other payments, if any, shown by such reports to be due
and payable, except where the failure to so file or make payment would not
have a material adverse effect upon the operations of the Station. All
reports required to be filed by the Seller with the FCC with respect to the
Station have been filed.
3.11 EMPLOYEE MATTERS.
(a) The Disclosure Schedule sets forth all liabilities of the Seller
under ERISA or similar laws with respect to employee benefit plans.
(b) There are no labor disputes of a material nature pending between
the Seller, on the one hand, and any of its employees, on the other hand, and
there are no known organizational efforts presently being made involving any
of such employees. The Seller has complied in all material respects with all
laws relating to the employment of labor, including any provisions thereof
relating to wages, hours, collective bargaining and the payment of social
security and other taxes, and is not liable for any material arrearages of
wages or any taxes or penalties for failure to comply with any of the
foregoing.
(c) The Seller has paid when due all salaries, bonuses, commissions
and deferred compensation expenses in connection with the employees of the
Station for all periods prior to such dates and has paid over to the proper
tax collecting agencies all taxes required to be withheld from or paid with
respect to such payments for all periods through the payroll date ended most
recently prior to the Time Brokerage Date.
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(d) Other than scheduled anniversary raises consistent with prior
practice (or as otherwise set forth on the Disclosure Schedule), no increases
in compensation to employees will occur or become due at any time prior to
the Time Brokerage Date.
3.12 CONTRACTS AND AGREEMENTS. The Disclosure Schedule contains a
list, complete and accurate in all material respects, of all of the following
categories of contracts and agreements to which the Station is bound at the
date hereof: (i) employee benefit plans, employment, consulting or similar
contracts; (ii) contracts that may not be canceled without penalty upon 30
days or less notice; (iii) insurance policies; and (iv) other contracts not
made in the ordinary course of business (collectively the "Material
Contracts"). The Station is not in default with respect to any of the
Material Contracts contained on Exhibit "B" hereto; and, as of the Time
Brokerage Date, the Station will have paid all sums and performed all
obligations under the Material Contracts included on Exhibit "B" which are
required to be paid or performed prior to such date.
3.13 INTELLECTUAL PROPERTY. The Seller has no knowledge of any claim
of infringement or other complaint that the operation of the Station violates
or infringes the rights or the trade names, copyrights or trademarks or
similar intangible rights of others.
3.14 THIRD PARTY CONSENTS. By the Closing Date, the Seller will have
obtained all consents from any person or entity which are required in
connection with the execution and delivery by Purchaser of this Agreement and
the consummation of the transactions contemplated hereby, which such consents
are described on the Disclosure Schedule.
3.15 FINDERS AND BROKERS. All negotiations relating to this Agreement
and the transactions contemplated herein have been carried on by the Seller
directly with the Purchaser. No person has as a result of any agreement or
action of the Seller any valid claim against any of the parties hereto for a
brokerage commission, finder's fee or other like payment except Xxxxxx
Xxxxxxxx, whose fee will be paid by Seller.
3.16 TRANSACTIONS WITH AFFILIATES. Upon the transfer of the Station
Assets as contemplated by this Agreement, neither FBBC, Xxxxxxxxx nor any of
their affiliates will have any interest in or will own any property used in
the conduct of the Station. Purchaser will acquire at the Closing all of the
real and personal property used in the operation of the Station, except as
otherwise agreed by the Purchaser.
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4. REPRESENTATIONS AND WARRANTIES OF PURCHASER.
Purchaser hereby represents and warrants to the Seller as follows:
4.1 ORGANIZATION AND GOOD STANDING. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the state
of its incorporation and has all requisite corporate power and authority to
own and lease its properties and carry on its business as currently conducted.
4.2 DUE AUTHORIZATION. Subject to the issuance of the Final Order,
Purchaser has full power and authority to enter into this Agreement and to
carry out its obligations hereunder. The execution and delivery of this
Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate action on the part of
Purchaser. This Agreement has been duly executed and delivered by Purchaser
and constitutes the legal, valid and binding obligation of Purchaser,
enforceable against it in accordance with its respective terms, except as may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium
or other laws affecting creditors' rights generally or general equitable
principles.
4.3 EXECUTION AND DELIVERY. Neither the execution and delivery by
Purchaser of this Agreement nor the consummation of the transactions
contemplated hereby will: (i) conflict with or result in a breach of the
Articles of Incorporation or Bylaws of Purchaser; (ii) subject to the
issuance of the Final Order, violate any law, statute, rule or regulation or
any order, writ, injunction or decree of any court or governmental authority;
or (iii) violate or conflict with or constitute a default under (or give rise
to any right of termination, cancellation or acceleration under) any
indenture, mortgage, lease, contract or other instrument to which Purchaser
is a party or by which it is bound or affected.
4.4 CONSENTS. No consent, approval, authorization, license, exemption
of, filing or registration with any court, governmental authority,
commission, board, bureau, agency or instrumentality, domestic or foreign, is
required by Purchaser in connection with the execution and delivery of this
Agreement or the consummation by it of any transaction contemplated hereby,
other than the consent of the FCC. No approval, authorization or consent of
any other third party is required in connection with the execution and
delivery by Purchaser of this Agreement and the consummation of the
transactions contemplated hereby, except as may have been previously obtained
by Purchaser. Purchaser warrants that it is legally qualified to become a
licensee of the Station (except as to matters previously disclosed to Seller
in writing) and is aware of no material impediment to the approval by the FCC
of the assignment of the Governmental Licenses.
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4.5 FINDERS AND BROKERS. All negotiations relating to this Agreement
and the transactions contemplated herein have been carried on by the
Purchaser directly with the Seller. No person has as a result of any
agreement or action of the Purchaser any valid claim against any of the
parties hereto for a brokerage commission, finder's fee or other like payment.
5. CERTAIN COVENANTS AND AGREEMENTS.
5.1 BEST EFFORTS. Each of the Seller and Purchaser shall take all
reasonable action necessary to consummate the transactions contemplated by
this Agreement and will use all necessary and reasonable means at its
disposal to obtain all necessary consents and approvals of other persons and
governmental authorities required to enable it to consummate the transactions
contemplated by this Agreement; provided, that the parties agree that such
reasonable efforts shall not include participating in hearings before the
FCC. Except as otherwise provided herein, each of the Seller and Purchaser
acknowledges and agrees that it shall pay all costs, fees and expenses
incurred by it in obtaining such necessary consents and approvals, including
those certain consents set forth on the Disclosure Schedule. Each party shall
make all filings, applications, statements and reports to all governmental
agencies or entities which are required to be made prior to the Closing Date
by or on its behalf pursuant to any statute, rule or regulation in connection
with the transactions contemplated by this Agreement, and copies of all such
filings, applications, statements and reports shall be provided to the other.
If the FCC determines that the transactions contemplated hereby or a portion
thereof are inconsistent or violative of FCC rules or regulations, the
parties agree that they will negotiate in good faith to amend, modify or
restructure the transactions contemplated hereby so as to be consistent with
FCC rules and regulations.
5.2 PUBLIC ANNOUNCEMENTS. Prior to the Closing Date, all notices to
third parties and other publicity relating to the transaction contemplated by
this Agreement shall be jointly planned and agreed to by the Seller and
Purchaser.
5.3 NON-COMPETITION AGREEMENT.
(a) The Seller covenants and agrees that during the Non-Competition
Period (as defined herein) it will not directly or indirectly, either as an
individual, a partner or a joint venturer, or in any other capacity, (i)
invest (other than investments in publicly owned companies which constitute
not more than 1% of the voting securities of any such company) or engage in
any business that is competitive with the Purchaser's Business (as defined
herein), (ii) accept employment with or render services to a competitor of
the Business as a director, officer, agent, employee or consultant, (iii)
contact, solicit or attempt to solicit or accept or direct business that is
competitive with the Business, or (iv) otherwise compete with the Business.
As used herein, the
12
term "Non-Competition Period" shall mean the period commencing on the date
hereof and terminating on the Maturity Date. As used herein, "Business"
shall mean the Spanish language radio business conducted by Purchaser in the
Houston metropolitan market (as defined by Arbitron) other than the business
conducted by the Seller in KFRD(AM) in Bellville, Texas.
(b) Each of Xxxxxxxxx and FBBC agree that during the Non-Competition
Period they will not (A) enter into any local area marketing agreement, time
brokerage agreement, purchase or sale agreement or similar agreement with
respect to the Station or (B) transfer or assign any of the Governmental
Licenses, unless in each instance such broker, purchaser, transferee,
assignee or other person or entity agrees to execute a document (the form and
substance of which shall be approved in advance by Purchaser) stating that it
will be bound by the covenants contained in this Section 5.3.
5.4 REAL PROPERTY ASSETS. If Purchaser elects, Purchaser shall not be
required to purchase the Real Property and may at its option lease the Real
Property from Seller for a 20-year term with the lease payments equal to
$1.00 per year. If Purchaser does not make such election, the Seller will
transfer the Real Property to Purchaser at the Closing and will provide a
title policy and survey of the Real Property on substantially the same terms
as provided for that certain Asset Purchase Agreement regarding AM Radio
Station KMPQ(AM).
6. CONDITIONS TO PURCHASER'S CLOSING.
All obligations of Purchaser under this Agreement shall be subject to the
fulfillment at or prior to the Closing of the following conditions, it being
understood that Purchaser may, in its sole discretion, waive any or all of
such conditions in whole or in part:
6.1 REPRESENTATIONS, ETC. The Seller shall have performed in all
material respects the covenants and agreements contained in this Agreement
that are to be performed by it at or prior to the Closing, and the
representations and warranties of the Seller contained in this Agreement
shall be true and correct in all material respects as of the Closing Date
with the same effect as though made at such time (except as contemplated or
permitted by this Agreement).
6.2 CONSENTS. All consents and approvals from the FCC and
governmental agencies and (unless the failure to obtain consent would not
have a material adverse effect on the Station) from other third parties
required to consummate the transactions
13
contemplated by this Agreement shall have been obtained without material cost
or other materially adverse consequence to Purchaser and shall be in full
force and effect, and the Final Order shall, at the Closing, be in full force
and effect.
6.3 NO ADVERSE LITIGATION. No order or temporary, preliminary or
permanent injunction or restraining order shall have been entered and no
action, suit or other legal or administrative proceeding by any court or
governmental authority, agency or other person shall be pending or threatened
on the Closing Date which may have the effect of (i) making any of the
transactions contemplated hereby illegal, (ii) materially adversely affecting
the value of the Station Assets or (iii) making Purchaser liable for the
payment of damages to any person.
6.4 CLOSING DELIVERIES. Purchaser shall have received each of the
documents or items required to be delivered to it pursuant to Section 8.1
hereof.
6.5 ENVIRONMENTAL AUDIT. The Phase I environmental audit of the real
estate on which the Station Assets are located shall not have revealed the
existence of any hazardous or toxic material at the real estate which is in
material violation of any applicable environmental law or which would require
remedial action involving a material cost to the Purchaser. The results of
such audit will be kept confidential and will not be disclosed to any third
party except (i) to Purchaser's lenders, (ii) as required by law or (iii) in
connection with any remediation agreed to by the parties.
7. CONDITIONS TO SELLER'S CLOSING.
All obligations of the Seller under this Agreement shall be subject to
the fulfillment at or prior to the Closing of the following conditions, it
being understood that the Seller may, in its sole discretion, waive any or
all of such conditions in whole or in part:
7.1 REPRESENTATIONS, ETC. Purchaser shall have performed in all
material respects the covenants and agreements contained in this Agreement
that are to be performed by Purchaser as of the Closing, and the
representations and warranties of Purchaser contained in this Agreement shall
be true and correct in all material respects as of the Closing Date with the
same effect as though made at such time (except as contemplated or permitted
by this Agreement).
7.2 NO ADVERSE LITIGATION. No order or temporary, preliminary or
permanent injunction or restraining order shall have been entered and no
action, suit or other legal or administrative proceeding by any court or
governmental authority, agency or other person shall be pending or threatened
on the Closing Date which may have the effect of making any of the
transactions contemplated hereby illegal.
14
7.3 CLOSING DELIVERIES. The Seller shall have received each of the
documents or items required to be delivered to it pursuant to Section 8.2.
8. DOCUMENTS TO BE DELIVERED AT CLOSING.
8.1 TO PURCHASER. At the Closing, there shall be delivered to
Purchaser:
(a) The bills of sale, agreements of assignment and similar instruments
of transfer to the Station Assets contemplated by Section 2.3 hereof.
(b) A certificate, signed by Xxxxxxxxx both individually and as an
executive officer of FBBC, as to the fulfillment of the conditions set forth in
Sections 6.1 through 6.3 hereof.
(c) A copy of all consents and approvals referred to in Section 6.2
hereof.
(d) All other items reasonably requested by Purchaser.
8.2 TO SELLER. At the Closing, there shall be delivered to the Seller:
(a) The purchase price contemplated by Section 2.1 hereof, in the form
of wire transfer or cashier's or certified check as the Seller may direct.
(b) A certificate, signed by an executive officer of Purchaser, as to
the fulfillment of the conditions set forth in Sections 7.1 and 7.2 hereof.
(c) An assumption agreement pursuant to which Purchaser shall assume the
Assumed Liabilities.
(d) All other items reasonably requested by the Seller.
9. SURVIVAL.
All representations, warranties, covenants and agreements made by any party
to this Agreement or pursuant hereto shall be deemed to be material and to have
been relied upon by the parties hereto and shall survive the Closing. The
representations and warranties hereunder shall not be affected or diminished by
any investigation at any time by or on behalf of the party for whose benefit
such representations and warranties were made. All statements contained herein
or in any certificate, exhibit, list or other document delivered pursuant hereto
or in connection with the transactions contemplated hereby shall be deemed to be
representations and warranties. No representation or warranty contained herein
shall be deemed to be made at any time
15
after the date of this Agreement or, if made in a certificate, the date of
such certificate.
10. INDEMNIFICATION OF PURCHASER.
Subject to the limitations set forth in Sections 9 and 12, the Seller shall
indemnify and hold Purchaser harmless from, against, for and in respect of:
(a) any and all damages, losses, settlement payments, obligations,
liabilities, claims, actions or causes of action and encumbrances suffered,
sustained, incurred or required to be paid by Purchaser because of the breach of
any written representation, warranty, agreement or covenant of the Seller
contained in this Agreement or any document, certificate or agreement executed
in connection with this Agreement;
(b) any and all liabilities, obligations, claims and demands arising out
of the ownership and operation of the Station at all times prior to the Closing
Date (other than the liabilities specifically assumed as set forth in Section
1.2 hereto and such liabilities incurred by the Purchaser between the Time
Brokerage Date and the Closing Date pursuant to its operation of the Station
under the Time Brokerage Agreement); and
(c) all reasonable costs and expenses (including, without limitation,
attorneys' fees, interest and penalties) incurred by Purchaser in connection
with any action, suit, proceeding, demand, assessment or judgment incident to
any of the matters indemnified against in this Section 10.
11. INDEMNIFICATION OF SELLER.
Subject to the limitations set forth in Sections 9 and 12, Purchaser shall
indemnify and hold the Seller harmless from, against, for and in respect of:
(a) any and all damages, losses, settlement payments, obligations,
liabilities, claims, actions or causes of action and encumbrances suffered,
sustained, incurred or required to be paid by the Seller because of the breach
of any written representation, warranty, agreement or covenant of Purchaser
contained in this Agreement or any document, certificate or agreement executed
in connection with this Agreement;
(b) any and all liabilities, obligations, claims and demands arising out
of the ownership and operation of the Station on and after the Closing Date or
incurred by the Purchaser between the Time Brokerage Date and the Closing Date
pursuant to its operation of the Station under the Time Brokerage Agreement,
except to the extent the same arises from a breach of any written
representation, warranty, agreement or
16
covenant of the Seller contained in this Agreement or any document,
certificate or agreement executed in connection with this Agreement;
(c) any of the liabilities specifically assumed as set forth in Section
1.2; and
(d) all reasonable costs and expenses (including, without limitation,
attorneys' fees, interest and penalties) incurred by the Seller in connection
with any action, suit, proceeding, demand, assessment or judgment incident to
any of the matters indemnified against in this Section 11.
12. GENERAL RULES REGARDING INDEMNIFICATION.
The obligations and liabilities of each indemnifying party hereunder with
respect to claims resulting from the assertion of liability by the other party
or indemnified third parties shall be subject to the following terms and
conditions:
(a) The indemnified party shall give prompt written notice (which in no
event shall exceed 30 days from the date on which the indemnified party first
became aware of such claim or assertion) to the indemnifying party of any claim
which might give rise to a claim by the indemnified party against the
indemnifying party based on the indemnity agreements contained in Section 10 or
11 hereof, stating the nature and basis of said claims and the amounts thereof,
to the extent known;
(b) If any action, suit or proceeding is brought against the indemnified
party with respect to which the indemnifying party may have liability under the
indemnity agreements contained in Section 10 or 11 hereof, the action, suit or
proceeding shall, upon the written acknowledgment by the indemnifying party that
it is obligated to indemnify under such indemnity agreement, be defended
(including all proceedings on appeal or for review which counsel for the
indemnified party shall deem appropriate) by the indemnifying party. The
indemnified party shall have the right to employ its own counsel in any such
case, but the fees and expenses of such counsel shall be at the indemnified
party's own expense unless (A) the employment of such counsel and the payment of
such fees and expenses both shall have been specifically authorized in writing
by the indemnifying party in connection with the defense of such action, suit or
proceeding, or (B) counsel to such indemnified party shall have reasonably
concluded and specifically notified the indemnifying party that there may be
specific defenses available to it which are different from or additional to
those available to the indemnifying party or that such action, suit or
proceeding involves or could have an effect upon matters beyond the scope of the
indemnity agreements contained in Sections 10 and 11 hereof, in any of which
events the indemnifying party, to the extent made necessary by such defenses,
shall not have the right to direct the defense of such action, suit or
proceeding on behalf of the indemnified party. In the latter such case only
that portion of such fees and expenses of the indemnified party's separate
17
counsel reasonably related to matters covered by the indemnity agreements
contained in Section 10 or 11 hereof shall be borne by the indemnifying
party. The indemnified party shall be kept fully informed of such action,
suit or proceeding at all stages thereof whether or not it is represented by
separate counsel.
(c) The indemnified party shall make available to the indemnifying party
and its attorneys and accountants all books and records of the indemnified party
relating to such proceedings or litigation and the parties hereto agree to
render to each other such assistance as they may reasonably require of each
other in order to ensure the proper and adequate defense of any such action,
suit or proceeding.
(d) The indemnified party shall not make any settlement of any claims
without the written consent of the indemnifying party, which consent shall not
be unreasonably withheld or delayed.
(e) If any claims are made by third parties against an indemnified party
for which an indemnifying party would be liable, and it appears likely that such
claims might also be covered by the indemnified party's insurance policies, the
indemnified party shall make a timely claim under such policies and to the
extent that such party obtains any recovery from such insurance, such recovery
shall be offset against any sums due from an indemnifying party (or shall be
repaid by the indemnified party to the extent that an indemnifying party has
already paid any such amounts). The parties acknowledge, however, that if an
indemnified party is self-insured as to any matters, either directly or through
an insurer which assesses retroactive premiums based on loss experience, then to
the extent that the indemnified party bears the economic burden of any claims
through self-insurance or retroactive premiums or insurance ratings, the
indemnifying party's obligation shall only be reduced by any insurance recovery
in excess of the amount paid or to be paid by the indemnified party in insurance
premiums.
(f) Except as herein expressly provided, the remedies provided in
Sections 10 through 12 hereof shall be cumulative and shall not preclude
assertion by any party of any other rights or the seeking of any other rights or
remedies against any other party hereto.
13. FAILURE TO CLOSE BECAUSE OF DEFAULT.
In the event that the Closing is not consummated by virtue of a material
default made by a party in the observance or in the due and timely performance
of any of its covenants or agreements herein contained ("Default"), the parties
shall have and retain all of the rights afforded them at law or in equity by
reason of that Default. In addition, the parties hereto acknowledge that the
Station Assets and the transactions contemplated hereby are unique, that a
failure by the Seller to complete such
18
transactions will cause irreparable injury to the Purchaser and that actual
damages for any such failure may be difficult to ascertain and may be
inadequate. Consequently, the parties agree that the Purchaser shall be
entitled, in the event of a Default by the Seller, to specific performance of
any of the provisions of this Agreement in addition to any other legal or
equitable remedies to which the Purchaser may otherwise be entitled. In the
event any action is brought, the prevailing party shall be entitled to
recover court costs, arbitration expenses and reasonable attorneys' fees.
14. TERMINATION AND RESCISSION RIGHTS; RISK OF LOSS.
14.1 TERMINATION PRIOR TO CLOSING. This Agreement may be terminated by
either Purchaser or the Seller (as set forth below), if either such party is not
then in Default upon written notice to the other upon the occurrence of any of
the following:
(a) By the non-Defaulting party, if the other party Defaults and such
Default has not been cured within 30 days of written notice of such Default by
the other party;
(b) Subject to the provisions of Sections 6 and 7 hereof, by the Seller
or the Purchaser if on the Closing Date any of the conditions precedent to the
obligations of the Seller or the Purchaser, respectively, set forth in this
Agreement have not been satisfied or waived by such party; or
(c) By mutual consent of the Seller and the Purchaser; or
(d) If the Commission designates the Application contemplated by Section
2.2(b) hereof for hearing, either party shall have the option of terminating
this Agreement by notice to the other party prior to the commencement of the
hearing if the terminating party shall not be in default under the provisions of
this Agreement.
Notwithstanding the foregoing, the parties acknowledge that the covenants
contained in Sections 5.3 and 15.14 hereof shall continue after the termination
of this Agreement, except as otherwise provided in Section 5.3.
14.2 RISK OF LOSS. Except as set forth in the Time Brokerage Agreement,
the Seller shall bear the risk of all damage to, loss of or destruction of any
of the Station Assets between the date of this Agreement and the Closing Date.
If any material portion of the Station Assets shall suffer any material damage
or destruction prior to the Closing Date (other than any such damage or
destruction caused by the action or negligence of Purchaser after the Time
Brokerage Date), the Seller shall promptly notify the Purchaser in writing of
such damage or destruction, shall promptly take all necessary steps to restore,
repair or replace such assets at its sole expense, and shall advise the
Purchaser in writing of the estimated cost to complete such restoration,
19
repair or replacement and all amounts actually paid as of the date of the
estimate. The Purchaser may extend the Closing Date for a period not
exceeding 45 days to accomplish such restoration, repair or replacement, but
is not required to do so. If such restoration, repair or replacement is not
accomplished prior to the Closing Date, whether or not extended as provided
herein, the Purchaser may, at its option:
(a) terminate this Agreement upon written notice to Seller; or
(b) receive all insurance proceeds paid or payable to Seller in excess
of amounts actually applied towards such restoration, repair or replacement,
close this Agreement and thereafter complete such restoration, repair or
replacement at its sole expense; provided, however, Seller shall have no further
liabilities with respect to such damage or destruction after payment to
Purchaser of such insurance proceeds.
15. MISCELLANEOUS PROVISIONS.
15.1 EXPENSES. Except as otherwise expressly provided herein, each
party shall pay the fees and expenses incurred by it in connection with the
transactions contemplated by this Agreement. If any action is brought for
breach of this Agreement or to enforce any provision of this Agreement, the
prevailing party shall be entitled to recover court costs, arbitration expenses
and reasonable attorneys' fees.
15.2 PRORATIONS. Except as otherwise provided in the Time Brokerage
Agreement, all items of income and expense arising from the operation of the
Station with respect to the Station Assets and the Assumed Liabilities on or
before the close of business on the Time Brokerage Date shall be for the account
of the Seller and thereafter shall be for the account of the Purchaser.
Proration of the items described below between the Seller and the Purchaser
shall be effective as of 11:59 p.m., local time, on such date and shall occur as
follows with respect to those rights, liabilities and obligations of the Seller
transferred to and assumed by the Purchaser hereunder and except as otherwise
provided in the Time Brokerage Agreement:
(a) Liability for state and local taxes assessed on the Station Assets
payable with respect to the tax year in which the Time Brokerage Date falls
shall be prorated as between the Seller and the Purchaser on the basis of the
number of days of the tax year elapsed to and including such date, appropriately
adjusted with respect to improvements to the Station Assets effected by
Purchaser after the Time Brokerage Date.
(b) Prepaid items and accruals such as fees under the Time Brokerage
Agreement, water, electricity, telephone, other utility and service charges,
lease expenses, license fees (if any) and payments under any contracts to be
assumed by
20
the Purchaser shall be prorated between the Seller and the Purchaser on the
basis of the period of time to which such liabilities, prepaid items and
accruals apply.
All prorations shall be made and paid insofar as feasible on the Time Brokerage
Date with a final settlement to be made on the Closing Date. The Seller and the
Purchaser agree to assume, pay and perform all costs, liabilities and expenses
allocated to each of them pursuant to this Section 15.2.
15.3 AMENDMENT. This Agreement may be amended at any time but only by an
instrument in writing signed by the parties hereto.
15.4 NOTICES. All notices and other communications hereunder shall be in
writing and shall be deemed given if mailed by certified mail, return receipt
requested, or by nationally recognized "next-day" delivery service, to the
parties at the addresses set forth below (or at such other address for a party
as shall be specified by like notice), or sent by facsimile to the number set
forth below (or such other number for a party as shall be specified by proper
notice hereunder):
If to the Purchaser:
c/o Heftel Broadcasting Corporation
000 Xxxxxxxx Xxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
ATT: XxXxxxx X. Xxxxxxxx, Xx.
Fax: (000)000-0000
With a copy (which shall not constitute notice) to:
Xxxxxx & Xxxxxxx, L.L.P.
000 Xxxxx Xxxxxxx Xxxxxx, Xxxxx 0000
Xxxxxx, Xxxxx 00000
ATT: Xxxxx X. Xxxxxxx
Fax: (000)000-0000
If to the Seller:
Xxx X. Xxxxxxxxx
00000 Xxxxxx Xxxxx Xxxx
Xxxxxxx, Xxxxx 00000
21
With a copy (which shall not constitute notice) to:
Xxxxx X. Xxxxxxxx, Esq.
Suite 900
0000 Xxxxxxxxxxx Xxxxxx, X.X.
Xxxxxxxxxx, X.X. 00000
15.5 ASSIGNMENT. This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors, heirs and
permitted assigns. The parties hereto acknowledge and agree that Purchaser may
assign its rights and obligations hereunder to an affiliated corporation and
such affiliated corporation shall be deemed the "Purchaser" pursuant hereto;
provided, however, if such assignment occurs, Xxxxxxxx Media System, Inc. will
continue to have ultimate responsibility for all obligations, representations
and duties contained herein and shall guarantee the obligations of such assignee
hereunder.
15.6 COUNTERPARTS. This Agreement may be executed in any number of
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same instrument.
15.7 HEADINGS. The headings of the Sections of this Agreement are
inserted for convenience only and shall not constitute a part hereof.
15.8 ENTIRE AGREEMENT. This Agreement and the documents referred to
herein contain the entire understanding of the parties hereto in respect of the
subject matter contained herein. There are no restrictions, promises,
warranties, conveyances or undertakings other than those expressly set forth
herein. This Agreement supersedes any prior agreements and understandings
between the parties with respect to the subject matter.
15.9 WAIVER. No attempted waiver of compliance with any provision or
condition hereof, or consent pursuant to this Agreement, will be effective
unless evidenced by an instrument in writing by the party against whom the
enforcement of any such waiver or consent is sought.
15.10 GOVERNING LAW. This Agreement shall be governed by and construed in
accordance with the laws of the State of Texas.
15.11 CERTAIN DEFINITIONS. As used in this Agreement, "affiliates" of a
party shall mean persons or entities that directly, or indirectly through one or
more intermediaries, control or are controlled by, or are under common control
with, such party.
22
15.12 INTENDED BENEFICIARIES. The rights and obligations contained in
this Agreement are hereby declared by the parties hereto to have been provided
expressly for the exclusive benefit of such entities as set forth herein and
shall not benefit, and do not benefit, any unrelated third parties.
15.13 MUTUAL CONTRIBUTION. The parties to this Agreement and their
counsel have mutually contributed to its drafting. Consequently, no provision
of this Agreement shall be construed against any party on the ground that such
party drafted the provision or caused it to be drafted or the provision contains
a covenant of such party.
15.14 RELATED AGREEMENTS. Pending the occurrence of the Closing, the
Option Agreement and the Time Brokerage Agreement shall remain in full force and
effect. Each of the parties acknowledges that the other is not in default
thereunder or under any related agreements or waives any such default. Upon the
occurrence of the Closing, each of such agreements shall terminate immediately.
In the event of the termination of this Agreement prior to the Closing the
$330,000 portion of the purchase price paid on the date hereof shall be deemed
to be a prepayment of fees under the Time Brokerage Agreement for an additional
three-year period, (ii) the term of the Time Brokerage Agreement shall be
correspondingly extended to November 30, 2004, and (iii) in the event that
Seller exercises its right to terminate the Time Brokerage Agreement, pursuant
to the second sentence of Section 2.2 hereof, the payment otherwise required to
be made to TMS in consideration of such early termination shall be increased by
$300,000 (which payment shall be in addition to, and not as a credit towards,
the Unearned Portion referenced in the Second Addendum to the Time Brokerage
Agreement or the $750,000 referenced in Section 2.2 of such agreement).
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the date first above written.
XXXXXXXX MEDIA SYSTEM, INC.
By: /s/ XxXxxxx X. Xxxxxxxx, Xx.
----------------------------------------
XxXxxxx X. Xxxxxxxx, Xx.
President
23
XXX X. XXXXXXXXX
By: /s/ Xxx X. Xxxxxxxxx
----------------------------------------
Xxx X. Xxxxxxxxx
FORT BEND BROADCASTING COMPANY, INC.
By: /s/ Xxx X. Xxxxxxxxx
----------------------------------------
Xxx X. Xxxxxxxxx
President
24
INDEX TO EXHIBITS
A Excluded Assets
B Description of Real and Personal Property included in the Station Assets
C Assumed Liabilities
D Seller's Disclosure Schedule
Exhibit A
Excluded Assets
1. The cash and cash equivalents of the Seller
2. Seller's corporate seal, minute books, charter documents, corporate stock
record books and other books and records that pertain to the organization
or Seller
Exhibit B
Real Property and Tangible Property
DESCRIPTION OF REAL PROPERTY
1.5 acres out of 17.382, X.X. Xxxxxx Survey AB-205, Fort Bend County
LISTING OF OTHER TANGIBLE PROPERTY
Transmitter, antenna, transmission tower and other equipment located at the
transmitter site.
Other equipment to be provided.
Exhibit C
Assumed Liabilities
None.
