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EXHIBIT 10.67
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EXHIBIT 10.67
XXXXXX COMMUNICATIONS CORPORATION
February 24, 1996
Xx. Xxxx Oasis
New Age Broadcasting, Inc.
0000 Xxxxx Xxx
Xxxxx, XX 00000
Dear Mr. Oasis:
Xxxxxx Communications Corporation ("Xxxxxx"), or its assignee, whose
performance will be guaranteed by Xxxxxx ("Buyer"), hereby proposes to purchase
all of the assets, including real property, tangible and intangible personal or
mixed properties (the "Assets"), used or useful in the operation of Radio
Stations WXDJ-FM, Homestead, FL and WRMA-FM, Ft. Lauderdale, FL (the
"Stations") licensed to New Age Broadcasting, Inc. and The Seventies
Broadcasting Corporation respectively (collectively the "Seller"), free and
clear from all debts, liens, encumbrances or other liabilities, subject to the
following terms and conditions:
1. At the closing (the "Closing") to be held on a date set by Buyer
within ten (10) business days after the consent of the Federal
Communications Commission ("FCC") to the transfer of the broadcast
licenses for the Stations (and any auxiliary licenses) has become a
final order no longer subject to judicial or administrative review
(subject to waiver of such final order requirement in the sole
discretion of Buyer), Seller will sell the Assets to Buyer in
accordance with the provisions of a definitive Asset Purchase
Agreement as described in Paragraph 2 below (the "Purchase
Agreement").
2. The Purchase Agreement shall, among other terms customary in
transactions of this nature, include the following terms:
(a) The Purchase Price for the Assets shall be, at Seller's option
which is to be made prior to the execution of the Purchase
Agreement, either:
- ONE HUNDRED FIFTEEN MILLION DOLLARS ($115,000,000)
payable as follows at Closing: cash of NINETY-TWO
MILLION DOLLARS ($92,000,000) plus One Million Two
Hundred Seventy-Seven Thousand Seven Hundred Seventy
Eight (1,277,778) shares of Class A Common Stock of
Xxxxxx (the "Xxxxxx Stock") having a per share value
of Eighteen Dollars ($18.00) representing the
remaining TWENTY-THREE MILLION DOLLARS ($23,000,000)
of the Purchase Price. At Seller's election, to be
made thirty (30) days prior to Closing on the
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February 24, 1996
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Purchase Agreement, the cash portion of the Purchase
Price at Closing may be in the form of a Letter of
Credit with interest accruing on the cash security
deposit in Seller's favor. The Xxxxxx Stock shall
have a per share value of Eighteen Dollars ($18.00).
Should the per share value of the Xxxxxx Stock be
below $18.00 at Closing, Xxxxxx will fund the
difference with additional shares of Xxxxxx Class A
Common Stock. The Xxxxxx Stock will be unregistered
stock and Xxxxxx agrees to register the Xxxxxx Stock
on the same terms and conditions as its Preferred
stockholder, Sandler Media, Inc.; or
- ONE HUNDRED SEVEN MILLION FIVE HUNDRED THOUSAND
DOLLARS ($107,500,000) payable in cash at Closing.
At Seller's election, to be made thirty (30) days
prior to the Closing on the Purchase Agreement, this
sum may be in the form of a Letter of Credit with
interest accruing on the cash security deposit in
Seller's favor.
(b) The Assets shall not include Sellers' cash or cash
equivalents, insurance policies, prepayments and deposits,
accounts receivable, books and records pertaining to corporate
organization, employee pension and other benefit plans or
collective bargaining agreements.
(c) Buyer will review and agree to consider assuming certain
existing contracts of Seller relating to the Stations and the
assumed contracts shall be set forth in the Purchase
Agreement. Buyer wishes to enter into an employment agreement
with Xxxx Oasis on mutually acceptable terms and conditions to
be negotiated in connection with the Purchase Agreement.
(d) The Purchase Price shall be subject to normal closing
prorations.
(e) The obligations of the parties to consummate the proposed
transaction shall be subject to receipt of any required
consents or authorizations and other conditions usual and
customary in transactions of this nature.
(f) Representations, warranties and covenants shall be set forth
relating to the Assets that are usual and customary in
transactions of this nature and which shall survive the
Closing for twelve (12) months; provided, however, that there
is no time limitation on indemnification for third party
claims.
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February 24, 1996
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(g) Non-competition agreement shall be provided for, containing
terms and conditions mutually agreed upon by the parties,
including a restrictive covenant prohibiting Seller and Xxxx
Xxxxxxxx from competing against Buyer in the business of
Spanish radio broadcasting in any area served by the Stations
for a term of two (2) years, and 2% of the cash consideration
shall be attributable to the non-competition agreement. Xx.
Xxxx Oasis will become an employee of Buyer at the Stations.
(h) Buyer or Seller may terminate the Purchase Agreement without
penalty or liability (except in the event of a default of a
party) if for any reason the Closing thereunder has not taken
place by March 1, 1997.
(i) Buyer shall not be obligated to consummate the Purchase
Agreement if there is a material adverse change in the
Stations' tangible properties during the period from the date
of the Purchase Agreement until Closing.
(j) Seller shall pay all federal, state and local sales or
transfer taxes arising from the conveyance of the Assets to
Buyer. Buyer and Seller shall split all filing fees for the
FCC and the Federal Trade Commission.
3. Buyer shall deposit with First Union National Bank, a sum equal to
five percent (5%) of the Purchase Price in cash along upon execution
of the Purchase Agreement, (the "Deposit") pursuant to an Escrow
Deposit Agreement, among the parties. The Deposit will increase to
ten percent (10%) of the Purchase Price if Closing has not occurred
prior to August 1, 1996. In the event that the Buyer wrongfully fails
to close and Seller has fully complied with the terms of the Purchase
Agreement, then only in that event Buyer shall forfeit the Deposit to
Seller as liquidated damages and as the exclusive remedy of Seller
against Buyer.
4. The parties shall in good faith endeavor to prepare and negotiate a
Purchase Agreement acceptable to each party in its discretion, to be
executed by Seller and Buyer no later than March 22, 1996. If the
Purchase Agreement is not executed by March 22, 1996, then the terms
of this letter shall expire without any liability to either Seller or
Buyer.
5. From the date of its execution of this letter until the sooner of (i)
the execution of a Purchase Agreement or (ii) the termination of the
obligations of the parties hereunder, Seller shall not seek to
transfer, convey or otherwise dispose of, with or without
consideration, any assets used or useful in or relating to the
Stations other than in the ordinary course of business.
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February 24, 1996
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6. Each Party shall be afforded, from and after the date hereof,
reasonable opportunity to inspect the books and records of the other.
Until such a time as a Purchase Agreement may be executed which shall
supersede this letter, this proposal is contingent upon and subject to
proper confirmation and verification by each party of the financial
and other information made available to such party by the other,
review of further financial or other information relating to the
purchase of the Assets and operation of the Stations and Buyer as may
be requested by each party, and inspection of the assets and technical
facilities of the Stations, all to the satisfaction of each party in
its sole discretion. Finally, on or before March 7, 1996, Seller
shall use its best efforts to supply to Buyer the information called
for on Attachment I hereto relating to the Stations.
7. Buyer and Seller each agree that it will use its best efforts to keep
confidential (except for disclosure requirements of federal or state
securities laws and securities markets along with such disclosure to
attorneys, bankers, underwriters investors, etc. as may be appropriate
in the furtherance of this transaction) all information of a
confidential nature obtained by it from the other (including the terms
of this proposal and the identity of Buyer) in connection with the
transactions contemplated by this letter, and in the event that such
transactions are not consummated, will return to the other all
documents and other materials and/or copies obtained from the other in
connection therewith. If the transaction which is the subject of this
Letter of Intent is not consummated for whatever reason, Buyer agrees
not to hire any current employees of Seller for the period of one year
from the date of termination.
8. Buyer and Seller shall jointly prepare and determine the timing of,
any press release, or other announcement to the public or the news
media relating to the execution of this letter. No party hereto will
issue any press release or make any other public announcement relating
to the transactions contemplated by this letter without the prior
consent of each other party hereto, except that any party may make any
disclosure required to be made by it under applicable law (including
federal or state securities laws and the regulations of securities
markets) if it determines in good faith that it is appropriate to do
so and gives prior notice to each other party hereto.
9. Seller agrees that until March 22, 1996, or earlier if the parties
mutually determine that they are unable to enter into the Purchase
Agreement, it shall not offer or seek to offer, or entertain or
discuss any offer, to sell the Stations, nor shall it permit its
owners to offer, to seek to offer, or entertain or discuss any offer
to sell, any interest in the Stations to third parties.
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February 24, 1996
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10. Except for paragraphs 4, 5, 6, 7, 8, and Paragraph 9 which shall be
legally binding in accordance with their respective terms, neither
this letter nor the acceptance hereof is intended to, and nor shall it
create a binding legal obligation, and the understanding set forth
herein is subject to the execution of the Purchase Agreement.
11. Buyer may assign its rights and obligations under this letter to a
third party so long as Xxxxxx guarantees such party's obligations
under the Purchase Agreement.
12. This proposal shall expire at 5:00 P.M., Eastern Standard Time on
February 26, 1996, unless earlier accepted by Seller. Acceptance by
Seller shall be evidenced by the signatures of authorized personnel of
Seller on this Letter of Intent provided to Buyer prior to 5:00 P.M.,
February 26, 1996.
This letter may be signed in counterparts, all of which taken together shall
constitute one instrument, and any of the parties hereto may execute this
letter by signing any such counterpart. This letter shall become effective
upon execution by all parties hereto.
Please indicate your acceptance of the terms and conditions of this proposal by
signing in the space provided below.
Xxxxxx Communications Corporation New Age Broadcasting, Inc.
By: /s/ Xxxxxx X. Xxxxxx By: /s/ Xxxxxxx Oasis
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Its: Chairman Its: President
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The Seventies Broadcasting Corporation
By: /s/ Xxxxxxx Oasis
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Its: President
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