EXHIBIT 10.4
PURCHASE AGREEMENT
by and between
GUY GANNETT COMMUNICATIONS
and
XXXXXXXX COMMUNICATIONS, INC.
Dated as of September 4, 1998
TABLE OF CONTENTS
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Article 1. Sale of Assets; Assumption of Liabilities..........................1
1.1 Assets to Be Acquired.............................................1
1.2 Excluded Assets...................................................3
1.3 Assumption of Liabilities.........................................4
1.4 Retained Liabilities..............................................5
1.5 [Intentionally omitted............................................5
1.6 Closing and Closing Date..........................................5
1.7 Additional Closing Deliveries.....................................6
Article 2. Purchase Price.....................................................7
2.1 Purchase Price; Payment...........................................7
2.2 Post-Closing Adjustment...........................................8
2.3 Security Escrow..................................................11
2.4 Investment of Escrow Amounts.....................................11
2.5 Allocation of the Purchase Price.................................12
Article 3. Representations and Warranties Relating to the Company............12
3.1 Organization and Standing........................................12
3.2 Binding Agreement................................................12
3.3 Absence of Conflicting Agreements or Required Consents...........13
3.4 Equity Investments...............................................13
3.5 Financial Statements.............................................13
3.6 Title to Assets; Related Matters.................................14
3.7 Absence of Certain Changes, Events and Conditions................15
3.8 Litigation.......................................................16
3.9 Insurance........................................................16
3.10 Material Contracts..............................................16
3.11 Permits and Licenses; Compliance with Law.......................17
3.12 FCC Licenses....................................................17
3.13 Environmental Matters...........................................18
3.14 Employee Benefit Matters........................................18
3.15 Labor Relations.................................................19
3.16 Intellectual Property...........................................20
3.17 Taxes...........................................................20
3.18 Commissions.....................................................20
3.19 Affiliate Transactions..........................................21
Article 4. Representations and Warranties of Purchaser.......................21
4.1 Organization and Standing........................................21
4.2 Binding Agreement................................................21
4.3 Absence of Conflicting Agreements or Required Consents...........21
4.4 Litigation.......................................................22
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4.5 Commissions......................................................22
4.6 Financing........................................................22
4.7 Purchaser's Qualification........................................22
4.8 Accuracy and Completeness of Representations and Warranties......22
Article 5. Covenants and Agreements..........................................23
5.1 Conduct of the Business Prior to Closing; Access.................23
5.2 Post-Closing Covenants and Agreement, and Other Employee Benefit
Matters........................................................26
5.3 Cooperation......................................................32
5.4 Confidentiality..................................................35
5.5 Public Announcements.............................................35
5.6 No Solicitation..................................................35
5.7 No Additional Representations....................................35
5.8 Certain Payments.................................................36
5.9 Bulk Sales Laws..................................................36
5.10 Control of the Stations.........................................37
5.11 Use of Guy Gannett Name.........................................37
Article 6. Conditions to Obligations of Purchaser............................37
6.1 Representations and Warranties...................................37
6.2 Performance by the Company.......................................37
6.3 Certificate......................................................37
6.4 Consents; No Objections..........................................37
6.5 No Proceedings or Litigation.....................................38
6.6 [Intentionally omitted]..........................................38
6.7 FCC Consent......................................................38
6.8 No Material Adverse Change.......................................38
6.9 Opinions of Counsel..............................................38
6.10 Good Standing Certificate.......................................38
6.11 No Transmission Defects.........................................39
Article 7. Conditions to Obligations of the Company..........................39
7.1 Representations and Warranties...................................39
7.2 Performance by Purchaser.........................................39
7.3 Certificate......................................................39
7.4 Consents; No Objections..........................................39
7.5 No Proceedings or Litigation.....................................39
7.6 FCC Consent......................................................39
7.7 Opinion of Counsel...............................................40
7.8 Good Standing Certificate........................................40
Article 8. Indemnification...................................................40
8.1 Indemnification by the Company...................................40
8.2 Indemnification by Purchaser.....................................40
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8.3 Limitations on Indemnification Claims and Liability; Termination
of Indemnification.............................................40
8.4 Computation of Claims and Damages................................41
8.5 Notice of Claims.................................................42
8.6 Defense of Third Party Claims....................................42
8.7 Assignment of Indemnification and Other Rights...................43
Article 9. Definitions.......................................................44
Article 10. Miscellaneous Provisions.........................................57
10.1 Termination Rights..............................................57
10.2 Litigation Costs................................................58
10.3 Expenses........................................................58
10.4 Notices.........................................................58
10.5 Benefit and Assignment..........................................60
10.6 Waiver..........................................................60
10.7 Severability....................................................60
10.8 Amendment.......................................................61
10.9 Effect and Construction of this Agreement.......................61
10.10 Transfer and Conveyance Taxes..................................61
10.11 Specific Performance...........................................61
10.12 Survival of Representations, Warranties and Covenants..........62
Article 11. No Personal Liability for Representatives, Stockholders,
Directors or Officers..........................................62
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Exhibits
Exhibit A Xxxx of Sale, Assignment and Assumption Agreement
Exhibit B Adjustment Escrow Agreement
Exhibit C Security Escrow Agreement
Exhibit D-1 Opinion of Preti, Flaherty, Xxxxxxxx & Pachios
Exhibit D-2 Opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx
Exhibit D-3 Opinion of Dow, Xxxxxx & Xxxxxxxxx
Exhibit E [Intentionally omitted]
Exhibit F-1 Sharing Agreement
Exhibit F-2 Sublease Agreement
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PURCHASE AGREEMENT
This PURCHASE AGREEMENT (this "Agreement") made as of September 4, 1998 by
and between GUY GANNETT COMMUNICATIONS, a Maine corporation (the "Company") and
XXXXXXXX COMMUNICATIONS, INC., a Maryland corporation (together with its
successors and permitted assigns, "Purchaser").
W I T N E S S E T H :
WHEREAS, the Company owns or leases the assets used in connection with the
Company's broadcast television business and the operation of the Stations (as
hereinafter defined);
WHEREAS, the Company desires to sell, assign and transfer to Purchaser the
assets and business of the Business (as hereinafter defined) as described below,
and Purchaser desires to purchase and acquire the assets and business of the
Business as described below, on the terms and subject to the conditions set
forth in this Agreement;
WHEREAS, the Board of Directors and stockholders of the Company have
approved the execution, delivery and performance of this Agreement by the
Company and the Board of Directors of Purchaser has approved the execution,
delivery and performance of this Agreement by Purchaser.
NOW, THEREFORE, in consideration of the mutual promises and covenants
contained herein, the parties, intending legally to be bound, agree as follows:
[A list of defined terms is provided in Article 9 hereof]
Article 1. Sale of Assets; Assumption of Liabilities.
1.1 Assets to Be Acquired. Upon the terms and subject to the satisfaction
of the conditions set forth herein, at the Closing, the Company shall sell,
convey, assign, transfer and deliver to Purchaser, and Purchaser shall purchase,
acquire, accept and pay for, all of the Company's right, title and interest in
and to all of the real, personal and mixed properties, assets and other rights,
both tangible and intangible, (other than the Excluded Assets) owned or leased
by, or licensed to or used or useful by, the Company on the Closing Date in
connection with the Business (collectively, the "Assets").
Without limiting the generality of the foregoing, the Assets shall include
the following:
(a) the FCC Licenses;
(b) the Equipment;
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(c) all translators, earth stations and other auxiliary facilities,
and all applications therefor, owned, leased or otherwise used or useful by
the Company in connection with the Business;
(d) the Real Property and Leased Property as set forth in Section
1.1(d) of the Disclosure Schedule;
(e) all orders and agreements for the sale of advertising time on the
Stations for cash, and all trade, barter and similar agreements, excluding
Program Contracts (which are provided for below), for the sale of
advertising time on the Stations for any property or services in lieu of or
in addition to cash, and any other orders and agreements entered into
(other than in violation of this Agreement) between the date hereof and the
Closing Date;
(f) all film and program licenses and contracts under which the
Company has the right to broadcast film product or programs on the Stations
("Program Contracts"), including all cash and non-cash (barter) program
contracts and including, without limitation, the Program Contracts set
forth in Section 3.10 of the Disclosure Schedule and any other Program
Contracts entered into (other than in violation of this Agreement) between
the date hereof and the Closing Date;
(g) all other contracts and agreements related to the Business,
including, without limitation, network affiliation agreements, all
employment contracts entered into with television talent and other Business
Employees, all collective bargaining agreements with respect to any
Business Employees, any time brokerage agreements and all national or local
advertising representation agreements for the Stations, without limitation,
the contracts and agreements set forth in Section 3.10 of the Disclosure
Schedule, and any other such contracts and agreements entered into (other
than in violation of this Agreement) between the date hereof and the
Closing Date;
(h) the Intellectual Property, including, without limitation, the Call
Letters;
(i) all programs and programming materials owned by the Company and
used in connection with the Business, whether recorded on tape or any other
media or intended for live performance, and whether completed or in
production, and all related common law and statutory copyrights owned by or
licensed to the Company and used in connection with the Business;
(j) all FCC logs and other records that relate to the operation of the
Stations;
(k) except as set forth in Section 1.2(a) hereof, all files, books and
other records of the Company relating to the Business, including, without
limitation, written technical information, data, specifications, research
and development information, engineering, drawings, manuals, computer
programs, tapes and software relating directly to the Business, other than
duplicate copies of account books of original entry and duplicate copies of
such files and records, if any, that are maintained at the corporate
offices of the
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Company for tax and accounting purposes;
(l) all of the Company's goodwill in, and "going concern" value of,
the Business;
(m) all accounts, notes and accounts receivable of the Business
relating to or arising out of the business and operations of the Stations
immediately preceding the Closing;
(n) all deposits, reserves and prepaid expenses of the Business (other
than those relating to Excluded Assets or Liabilities that are not Assumed
Liabilities);
(o) to the extent transferable under applicable law, all franchises,
approvals, permits, licenses, orders, registrations, certificates,
exemptions, variances and similar rights obtained from Governmental
Authorities (other than the FCC License) in any jurisdiction that had
issued or granted such items to the Company, or that the Company otherwise
owns or uses, in each case relating to the Business, and all pending
applications therefor;
(p) the assets of the New Pension Plan and the Defined Contribution
Plan to the extent set forth in Sections 5.2(i) and 5.2(j), respectively;
(q) except as set forth in Section 1.2(h) hereof, all insurance
proceeds claims arising out of or related to damage, destruction or loss of
any property or asset used or useful in connection with the Business to the
extent of any damage or destruction that remains unrepaired, or to the
extent any property or asset remains unreplaced, at the Closing Date; and
(r) the Company's rights under the Non-Competition and
Non-Solicitation Agreements identified in Section 1.1(r) of the Disclosure
Schedules and, to the extent assignable, the Company's rights to enforce
any non-competition provisions relating to the Business, the Business
Employees or the Stations contained in any other written agreement with a
Corporate Office Employee.
1.2 Excluded Assets. Notwithstanding anything to the contrary herein, all
of the Company's right, title and interest in all of the following properties,
assets and other rights (collectively, the "Excluded Assets") shall be excluded
from the Assets:
(a) the corporate books and records of the Company, including minute
books and stock ledgers, and copies of business records included in the
Assets acquired by Purchaser that are reasonably required by the Company or
any Affiliate or stockholder of the Company in order to permit the Company
or any of its Affiliates or stockholders to prepare any Tax return or other
filing or report to be made after the Closing Date;
(b) the Excluded Names and any trademarks, service marks or trade
names incorporating any of the Excluded Names;
(c) shares of stock in KOZ inc.;
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(d) any of the properties, assets or other rights of the Maine Media
Business;
(e) the Corporate Office Lease and all furniture, fixtures, equipment,
office materials and supplies, vehicles and other assets located at the
Corporate Office or exclusively used by or relating to the Corporate Office
or Corporate Office Employees including, without limitation, all notes
receivable of the Corporate Office (none of which arise from the sale of
television advertising);
(f) all rights of the Company under this Agreement, the Xxxx of Sale,
Assignment and Assumption Agreement, the Maine Media Purchase Agreement,
the Contribution Agreement, the Adjustment Escrow Agreement and the
Security Escrow Agreement;
(g) cash, bank accounts, cash equivalents and other similar types of
investments, certificates of deposit, U.S. Treasury bills and other
marketable securities;
(h) all insurance policies, programs, reserves and related bonds of
any nature; any dividends payable in respect thereof; and any insurance
proceeds or claims that are compensation for the loss of an Excluded Asset
or for the loss of an asset that has been repaired or replaced (other than
in violation of this Agreement) prior to the Closing Date;
(i) all properties, assets or other rights sold by the Company prior
to the Closing Date as permitted by Section 5.1 hereof; and
(j) all claims, judgments and other rights of any nature to the extent
related to (i) the items set forth in clauses (a) through (i) above or (ii)
Retained Liabilities.
1.3 Assumption of Liabilities. (a) On and after the Closing Date, Purchaser
will assume and agree to perform and fully discharge when due all Liabilities of
the Company (i) solely related to or solely arising from or in connection with
the Assets or the Business and (ii) in the case of any Liabilities related to or
arising partly from or in connection with the Assets or the Business and partly
from any other assets or business of the Company, to the extent such Liabilities
relate to or arise from or in connection with the Assets or the Business (in
each case including, without limitation, any Claims and Damages arising from the
assignment to Purchaser of any contract or other agreement pursuant to the terms
of this Agreement), whether such Liabilities specified in clause (i) or (ii) are
incurred or arising prior to, on, or after the Closing Date, including, without
limitation, those obligations of the Company to be assumed by Purchaser pursuant
to Section 5.2 hereof, other than Retained Liabilities (collectively, the
"Assumed Liabilities"). Except as set forth in this Section 1.3 and except as
otherwise expressly provided in this Agreement, Purchaser will assume no other
Liabilities of any kind of description of the Company.
(b) Without limiting the generality of Section 1.3(a) hereof, and
notwithstanding any other provision hereof, each of the following is a "Retained
Liability" (except to the extent that it is a Liability that decreases Net
Financial Assets):
(i) any of the Company's obligations hereunder;
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(ii) any Liability for federal, state or local income taxes of
the Company, its stockholders and any other Person (other than payroll
withholding taxes to the extent that they decrease Net Financial
Assets, which shall constitute Assumed Liabilities);
(iii) Corporate Office expenses other than those liabilities for
certain Corporate Office Employees set forth in Section 5.2 hereof
(all of which shall constitute Assumed Liabilities);
(iv) any Liability of the Company arising from Indebtedness or
any overdrafts on any bank accounts of the Company;
(v) any Liability assumed or to be assumed by Newco under the
Contribution Agreement;
(vi) except for the Company's obligations under a sharing
agreement and sublease agreement in the form set forth as Exhibits F-1
and F-2 hereto, any of the Company's obligations under the
Contribution Agreement, the Maine Media Purchase Agreement, the
Adjustment Escrow Agreement or the Security Escrow Agreement;
(vii) any Liability for dividends; and
(viii) any Liabilities relating to current, former or inactive
Corporate Office Employees that are not to be assumed by Purchaser
pursuant to Section 5.2 hereof.
1.4 Retained Liabilities. The Company shall retain, and shall continue to
be responsible after the Closing Date for, all Retained Liabilities and all
other Liabilities of the Company that are not Assumed Liabilities.
1.5 [Intentionally omitted.]
1.6 Closing and Closing Date. Unless this Agreement shall have been
terminated and the transactions herein contemplated shall have been terminated
pursuant to Section 10.1 hereof, the closing (the "Closing") of the transactions
herein contemplated shall take place at 10:00 a.m., New York City time, on a
date not later than ten days following the satisfaction or waiver of the
conditions set forth in Articles 6 and 7 hereof, or at such other time and date
as the Company and Purchaser shall agree (such time and date being referred to
herein as the "Closing Date"), at the offices of Xxxxxxx Xxxxxxx & Xxxxxxxx, 425
Lexington Avenue, New York, New York, or at such other place as the Company and
Purchaser shall agree. At the Closing, each of the parties hereto shall take, or
cause to be taken, all such actions and deliver, or cause to be delivered, all
such documents, instruments, certificates and other items as may be required
under this Agreement or otherwise, in order to perform or fulfill all covenants
and agreements on its part to be performed at or prior to the Closing. The
Closing shall be effective as of 12:01 a.m., New York City time, on the day of
the Closing Date.
1.7 Additional Closing Deliveries. At the Closing:
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(a) The Company shall deliver to Purchaser:
(i) a duly executed counterpart of the Xxxx of Sale, Assignment
and Assumption Agreement substantially in the form set forth in
Exhibit A hereto (the "Xxxx of Sale, Assignment and Assumption
Agreement");
(ii) instruments of assignment with respect to all of the
Company's rights and interests in real property leases and special
warranty deeds (of a type equivalent to that known in New York as a
"bargain and sale deed with covenants against grantor's actions") in
recordable form sufficient to convey to Purchaser all of the Company's
rights and interests in the Real Property;
(iii) a duly executed counterpart of the Adjustment Escrow
Agreement and the Security Escrow Agreement;
(iv) all other instruments of conveyance and transfer sufficient
to convey the Assets to Purchaser; and
(v) all other documents, instruments and writings consistent with
the terms of this Agreement and required to be delivered by the
Company at or prior to the Closing Date pursuant to this Agreement.
(b) Purchaser shall deliver to Company:
(i) the Purchase Price in accordance with Section 2.1 hereof;
(ii) a duly executed counterpart of the Xxxx of Sale, Assignment
and Assumption Agreement;
(iii) a duly executed counterpart of the Adjustment Escrow
Agreement and the Security Escrow Agreement; and
(iv) all other documents, instruments and writings required to be
delivered by Purchaser at or prior to the Closing Date pursuant to
this Agreement.
(c) Notwithstanding clauses (ii) and (iv) of Section 1.7(a) hereof, at
the request of Purchaser, the Company shall deliver the instruments of
assignment, conveyance and transfer described in such clauses sufficient to
convey the Assets in respect of any Station or Stations to such other
Person as is designated by Purchaser that has obtained the FCC's consent to
the assignment of the FCC Licenses relating to such Station or Stations to
such Person. Notwithstanding anything to the contrary contained in this
Agreement, unless such Person is a wholly owned subsidiary of Purchaser,
such other Person shall be deemed not to be a party to this Agreement and
shall have no legal or equitable rights, benefits or remedies of any nature
whatsoever under or by reason of this Agreement.
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Article 2. Purchase Price.
2.1 Purchase Price; Payment. (a) In consideration of the sale of the Assets
and the Business hereunder, Purchaser shall (i) pay the Company in cash the
aggregate amount of (x) $310,000,000, plus (y) if the earnings before interest,
taxes, depreciation and amortization of the Stations for the fiscal year ending
December 26, 1998, calculated in conformity with GAAP and on a basis consistent
with the basis used in preparing the Unaudited Financial Statements as of, and
for year ended, December 27, 1997 referred to in Section 3.5 hereof, in each
case after adding back corporate overhead expense (to the extent otherwise
deducted in computing earnings) and film and program expenses and subtracting
actual cash payments on film and program contracts either made or due but not
yet made (in each case adjusted to include one month's payment for each month in
which any such payment is due) and in each case excluding the results of
operations of WOKR-TV (Rochester, New York) (the "1998 BCF"), exceeds
$12,700,000, an amount equal to 14.57 times the difference between the 1998 BCF
and $12,700,000 (but in no event shall the amount of the addition pursuant to
this clause (y) be more than $7,000,000), (the "Earnings Adjustment") plus (if
greater than or equal to zero) or minus (if less than zero), as the case may be,
(z) the amount of the Net Financial Assets as of 11:59 p.m., New York City time,
on the day immediately preceding the Closing Date, subject to adjustment
pursuant to Section 2.2 hereof (the "Purchase Price") and (ii) assume the
Assumed Liabilities.
(b) On or before five Business Days prior to the Closing, the Company
shall deliver to Purchaser (i) a statement setting forth the amount estimated in
good faith by the Company to be the amount of the Earnings Adjustment (the
"Proposed Earnings Adjustment") and the amount of the Net Financial Assets as of
the Closing Date (the "Estimated Net Financial Assets") and (ii) a notice
designating the accounts or accounts to which the payment to or on behalf of the
Company pursuant to clause (i) of Section 2.1(c) is to be made.
(c) At the Closing, Purchaser shall deliver
(i) the sum of (x) $299,000,000 plus (if the Estimated Net Financial
Assets is greater than or equal to zero) or minus (if the Estimated Net
Financial Assets is less than zero), as the case may be, (y) the Estimated
Net Financial Assets, by wire transfer in immediately available funds to
the account or accounts designated by the Company in accordance with
Section 2.1(b);
(ii) the sum of (x) $3,000,000 plus (y) the Proposed Earnings
Adjustment, if any, (collectively, the "Adjustment Escrow"); by wire
transfer in immediately available funds to the Adjustment Escrow Agent
pursuant to the Adjustment Escrow Agreement; and
(iii) $8,000,000 by wire transfer in immediately available funds to
the Security Escrow Agent pursuant to the Security Escrow Agreement.
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2.2 Post-Closing Adjustment.
(a) The parties agree that no later than 75 days after the Closing (or
such later date on which such statement reasonably can be prepared and delivered
in light of the compliance of Purchaser and the Company with their obligations
set forth in next two succeeding sentences), the Company shall cause to be
prepared and deliver to Purchaser (i) a statement of the actual Net Financial
Assets as of 11:59 p.m., New York City time, of the day immediately preceding
the Closing Date (the "Closing Statement") certified by PriceWaterhouseCoopers
L.L.P., independent accountants for the Company, to be prepared (except as
otherwise provided in Section 9 of the Disclosure Schedule) in conformity with
GAAP and on a basis consistent with the basis used in preparing the Unaudited
Financial Statements as of, and for the year ended, December 27, 1997 referred
to in Section 3.5 hereof and (ii) a determination (the "Proposed NFA
Adjustment") of the amount by which the Net Financial Assets as then determined
by the Company is less than or greater than the Estimated Net Financial Assets
(the amount of such excess or shortfall, together with the adjustment, if any,
for the amount of the Earnings Adjustment as described below, is referred to
herein as the "Adjustment"). Purchaser shall provide the Company and its
independent accountants access at all reasonable times to the relevant
personnel, properties, books and records of the Business for such purposes and
to assist the Company and its independent accountants in preparing the Closing
Statement. Purchaser's assistance shall include, without limitation, the closing
of the Business's books as of the Closing, the preparation of schedules
supporting the amounts set forth in the general ledger and other books and
records of the Business, and such other assistance as the Company or its
independent accountants may reasonably request. During the 30-day period
following the delivery by the Company of the Closing Statement and the Proposed
NFA Adjustment referred to in the first sentence of this Section 2.2(a),
Purchaser and its independent accountants will be permitted to review the
working papers of the Company and its independent accountants relating to the
preparation of the Closing Statement, the Proposed NFA Adjustment and the
Proposed Earnings Adjustment. If, within 30 days after delivery by the Company
of the Closing Statement and the Proposed NFA Adjustment, Purchaser notifies the
Company that it disagrees with the Closing Statement and the Proposed NFA
Adjustment and/or the Proposed Earnings Adjustment and the Company and Purchaser
cannot agree with respect to the Closing Statement and the Proposed NFA
Adjustment and/or the Proposed Earnings Adjustment, as the case may be, within
five days of the notice of disagreement provided by Purchaser to the Company,
then the determination shall be submitted for resolution (the "Resolution")
promptly to an independent nationally recognized accounting firm jointly
selected by the Company and Purchaser, whose determination (the "Accounting Firm
Determination") shall be instructed by the parties to be made within 20 days and
be binding upon all parties hereto, and the fees and expenses of which shall be
borne equally by Purchaser and the Company. In the event that (whether expressly
or by failure of Purchaser to provide notice of any disagreement within the
applicable period) the Company and Purchaser agree as to the amount of the
Adjustment (an "Adjustment Agreement") without submitting the matter for
Resolution, the parties shall deliver a joint certificate to the Adjustment
Escrow Agent setting forth the amount of the Adjustment Escrow to be paid to
each of the Purchaser and the Company pursuant to this Section 2.2. In the event
of an Accounting Firm Determination, the accounting firm shall deliver a
certificate to each of Purchaser, the Company and the Adjustment Escrow Agent
setting forth the amount of the Adjustment. The amount of Net Financial Assets
as of 11:59 p.m., New York City time, on the day immediately preceding the
Closing Date, as definitively determined pursuant to this Section 2.2(a) is
referred to herein as the "Actual Net Financial Assets."
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(b) At the Closing, the Company, Purchaser and such financial
institution as shall have been agreed by the parties prior to the Closing Date
(together with any successor jointly appointed by the Company and the Purchaser,
the "Adjustment Escrow Agent") shall execute and deliver an escrow agreement
substantially in the form set forth in Exhibit B hereto (the "Adjustment Escrow
Agreement"). From and after the Closing, the Adjustment Escrow Agent shall act
as escrow agent, pursuant to the Adjustment Escrow Agreement, in effecting the
payment of the amounts held in the Adjustment Escrow as set forth herein.
(c) As soon as practicable after the earlier of an Adjustment
Agreement or an Accounting Firm Determination (but in any event within two
Business Days after the Adjustment Agreement or the Accounting Firm
Determination):
(i) if the sum of the Actual Net Financial Assets and the Earnings
Adjustment, if any, used to determine the Adjustment is equal to or greater
than the sum of the Estimated Net Financial Assets and the Proposed
Earnings Adjustment, then:
(A) the Adjustment Escrow Agent shall pay to the Company from the
Adjustment Escrow the full amount of the Adjustment Escrow, and
(B) Purchaser shall pay to the Company the amount by which the
sum of the Actual Net Financial Assets and the Earnings Adjustment
used to determine the Adjustment exceeds the sum of the Estimated Net
Financial Assets and the Proposed Earnings Adjustment;
(ii) if the sum of the Actual Net Financial Assets and the Earnings
Adjustment, if any, used to determine the Adjustment is less than the sum
of the Estimated Net Financial Assets and the Proposed Earnings Adjustment
but the amount of such shortfall does not exceed the sum of $3 million plus
the Proposed Earnings Adjustment; then
(A) The Adjustment Escrow Agent shall pay to Purchaser from the
Adjustment Escrow an amount equal to the amount by which the sum of
the Estimated Net Financial Assets and the Proposed Earnings
Adjustment exceeded the sum of the Actual Net Financial Assets and the
Earnings Adjustment used to determine the Adjustment, and
(B) the Adjustment Escrow Agent shall pay to the Company from the
Adjustment Escrow the remaining amount of the Adjustment Escrow (after
giving effect to clause (A) above); and
(iii) if the sum of the Actual Net Financial Assets and the Earnings
Adjustment, if any, used to determine the Adjustment is less than the sum
of the Estimated Net Financial Assets and the Proposed Earnings Adjustment
and the amount of such shortfall exceeds the sum of $3 million plus the
Proposed Earnings Adjustment, then
(A) the Adjustment Escrow Agent shall pay to Purchaser from the
Adjustment Escrow the full amount of the Adjustment Escrow, and
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(B) the Security Escrow Agent shall pay to the Purchaser from the
Security Escrow an amount equal to the amount by which (x) the sum of
the Estimated Net Financial Assets and the Proposed Earnings
Adjustment exceeds (y) the sum of the Actual Net Financial Assets plus
the Earnings Adjustment used to determine the Adjustment plus $3
million plus the Proposed Earnings Adjustment.
Each of Purchaser and the Company shall timely give all necessary
instructions to the Adjustment Escrow Agent and the Security Agent so that the
Adjustment Escrow and (if applicable) the Security Escrow are paid and
distributed in accordance with this Section 2.2(c). All payments pursuant to
this Section 2.2(c) shall be by wire transfer in immediately available funds to
the account or accounts designated by the Company and/or Purchaser, as the case
may be, no later than two Business Days prior to such payment.
(d) Any interest or other investment income earned for the period from
the time that any portion of the Purchase Price is delivered to the Adjustment
Escrow Agent pursuant to this Agreement until all amounts held in the Adjustment
Escrow have been distributed in accordance with the Adjustment Escrow Agreement
while held by the Adjustment Escrow Agent shall be paid to the Company in
addition to, and at the same time as, payment of the Adjustment Escrow in
accordance with the terms of this Agreement; provided, however, that, to the
extent that any portion of the Adjustment Escrow is paid to Purchaser pursuant
to of Section 2.2(c) hereof, a pro rata portion of such interest or other
investment income (determined on the basis of the relative portions of the
Adjustment Escrow to be paid to Purchaser and the Company, respectively,
pursuant to Section 2.2(c) hereof) shall be instead paid to Purchaser. Any such
interest or other investment income shall be deemed not to constitute Adjustment
Escrow.
(e) The Company and Purchaser shall each be responsible for one-half
of the fees and expenses of the Adjustment Escrow Agent.
2.3 Security Escrow. (a) At the Closing, the Company, Purchaser and such
financial institution as shall have been agreed by the parties prior to the
Closing Date (together with any successor jointly appointed by the Company and
Purchaser, the "Security Escrow Agent") shall execute and deliver an escrow
agreement substantially in the form set forth in Exhibit C hereto (the "Security
Escrow Agreement"). From and after the Closing, the Security Escrow Agent shall
act as escrow agent, pursuant to the Security Escrow Agreement, in effecting the
payment of the amounts held in the escrow account (the "Security Escrow") under
the Security Escrow Agreement.
(b) Any interest or other investment income earned for the period from
the time that any portion of the Purchase Price is delivered to the Security
Escrow Agent pursuant to this Agreement until all amounts held in the Security
Escrow have been distributed in accordance with the Security Escrow Agreement
while held by the Security Escrow Agent shall be paid monthly to the Company or
the Fund Holder, as the case may be; provided that no such payments shall be
made until (i) a determination of whether any payment out of the Security Escrow
pursuant to Section 2.2(c)(iii)(B) is required and (ii) if so required, such
payment has been made; and provided further, that to the extent that any portion
of the Security Escrow is
11
paid to Purchaser pursuant to Section 2.2(c)(iii)(B) hereof, a pro rata portion
of such interest or other investment income earned through the date of such
payment (determined on the basis of the relative portions of the Security Escrow
so paid and that not so paid) shall be instead paid to Purchaser at the time
such portion of the Security Escrow is paid to Purchaser. Any interest or other
investment income earned on amounts held in the Security Escrow shall be deemed
not to constitute Security Escrow.
(c) The Company and Purchaser shall each be responsible for one-half
of the fees and expenses of the Security Escrow Agent.
2.4 Investment of Escrow Amounts. The Adjustment Escrow Agent and the
Security Escrow Agent shall each be authorized to invest the portion of the
Purchase Price held by it, on receipt of instructions from the Company, in:
(i) Commercial paper of any corporation rated at least A-1 by S&P and
P-1 by Xxxxx'x;
(ii) Negotiable certificates of deposit of United States banks having
(A) a long-term senior debt rating of at least A by S&P and Xxxxx'x, (B)
deposits in excess of $2,000,000,000 and (C) commercial paper rating
designations of at least A-1 by S&P and P-1 by Xxxxx'x;
(iii) Repurchase agreements with any United States bank which are
fully collateralized by direct obligations of the United States or
obligations of agencies or sponsored agencies of the United States
government, excluding in all cases collateralized mortgage obligations of
any kind; and
(iv) Money market instruments rated at least A-1 by S&P and P-1 by
Xxxxx'x that are restricted to investments described in clause (iii);
provided that in no event shall any investment of the types described in clause
(i), (ii) or (iv) exceed ten percent of the net assets of the issuer thereof and
provided further that all investments shall have maturity dates on or before the
anticipated dates of the relevant payments hereunder.
The Adjustment Escrow Agent and the Security Escrow Agent shall each be
authorized to register securities held by it in its name or in the name of a
nominee or in bearer form and may deposit any securities or other property in a
depository or a clearing corporation.
2.5 Allocation of the Purchase Price. No later than the Closing Date,
Purchaser and the Company shall jointly determine the proper allocation of the
Purchase Price among the Stations. No later than 90 days following the Closing
Date, Purchaser shall engage a nationally recognized appraiser to determine the
proper allocation of the Purchase Price allocated to, and the Assumed
Liabilities relating to, each Station among the Assets of each Station, in each
case in accordance with Section 1060 of the Code and the Treasury Regulations
promulgated thereunder (the "Allocation"), provided that the parties hereto
agree that no part of the Purchase Price shall be allocated to any of the
agreements referred to in Section 1.1(r) hereof. The Allocation shall be binding
upon Purchaser and the Company, and none of the parties hereto
12
shall file, or cause to be filed, any Tax Return, Internal Revenue Service Form
8594 or other form, or take a position with any Tax authority or jurisdiction,
that is inconsistent with the Allocation without obtaining the prior written
consent of the Company or Purchaser, as the case may be. The fees and
disbursements of appraiser engaged in connection with the Allocation shall be
paid by Purchaser.
Article 3. Representations and Warranties Relating to the Company.
The Company represents and warrants to Purchaser as follows:
3.1 Organization and Standing. The Company is a corporation duly
incorporated, validly existing, and in good standing under the laws of the State
of Maine and has all requisite corporate power and authority to own, lease and
operate its properties and assets and to conduct its business as it is now being
conducted. The Company is duly qualified to do business as a foreign corporation
and is in good standing under the laws of each state in which the operation of
its business or ownership of its assets makes such qualification necessary,
except where the failure to so qualify or be in good standing would not
reasonably be expected to have a Material Adverse Effect.
The Company has previously made available to Purchaser a complete and
correct copy of its articles of incorporation and by-laws, each as currently in
effect.
3.2 Binding Agreement. The Company has all requisite corporate power and
authority to enter into this Agreement, to execute and deliver this Agreement,
the Xxxx of Sale, Assignment and Assumption Agreement, to carry out its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement,
the Xxxx of Sale, Assignment and Assumption Agreement by the Company and the
consummation by the Company of its obligations hereunder and thereunder have
been duly and validly authorized by all necessary corporate and stockholder
action on the part of the Company. This Agreement has been, and on the Closing
Date the Xxxx of Sale, Assignment and Assumption Agreement will be, duly
executed and delivered on behalf of the Company and, assuming the due
authorization, execution and delivery by Purchaser, constitutes a legal, valid
and binding obligation of the Company enforceable in accordance with its terms,
subject to applicable bankruptcy and similar laws affecting the rights of
creditors generally and to general principles of equity (whether applied at law
or equity).
3.3 Absence of Conflicting Agreements or Required Consents. Except as set
forth in Section 3.3 of the Disclosure Schedule, the execution, delivery and
performance by the Company of this Agreement, the Xxxx of Sale, Assignment and
Assumption Agreement do not and will not (a) violate, conflict with or result in
the breach or default of any provision of the articles of incorporation or
by-laws of the Company, (b) conflict with or violate in any material respect any
material Law or material Governmental Order applicable to the Company or any of
its properties or assets, (c) except for (i) the notification requirements of
the HSR Act and (ii) such filings with, and orders of, the FCC as may be
required under the Communications Act and the FCC's rules and regulations in
connection with this Agreement and the transactions contemplated hereby, require
any material consent, approval, authorization or other order of, action by,
registration or filing with or declaration or notification to any Governmental
13
Authority, or (d) conflict with, result in any violation or breach of,
constitute a default (or event which with the giving of notice, or lapse of time
or both, would become a default) under, require any consent under, or give to
others any rights of termination, amendment, acceleration, suspension,
revocation or cancellation of, or result in the creation of any Encumbrance on
any of the Assets, or result in the imposition or acceleration of any payment,
time of payment, vesting or increase in the amount of compensation or benefit
payable, pursuant to any Material Contract.
3.4 Equity Investments. The Assets do not include any capital stock of any
corporation or any equity interest in any Person.
3.5 Financial Statements. (a) The Company has furnished to Purchaser
audited balance sheets for the Company (including the Maine Media Business) as
of December 28, 1996 and December 27, 1997, and audited statements of income and
retained earnings, and cash flows for the years then ended, all certified by
Coopers & Xxxxxxx L.L.P., independent accountants, whose opinions thereon are
included therein (collectively referred to herein as the "Audited Financial
Statements"). Except as otherwise disclosed in Section 3.5 of the Disclosure
Schedule, the Audited Financial Statements (including any notes thereto) present
fairly, in all material respects, the financial position of the Company
(including the Maine Media Business) as of December 28, 1996 and December 27,
1997, and the results of its operations and its cash flows for the years then
ended and have been prepared in conformity with GAAP.
(b) The Company has furnished to Purchaser (i) the consolidated
balance sheets for the Stations as of December 31, 1994, December 31, 1995,
December 31, 1996 and December 31, 1997 and consolidated statements of
operations for the years then ended, in each case as set forth on pages 114 and
115 of the Confidential Memorandum (excluding, without limitation, any
estimated, budgeted or projected information set forth therein) and (ii) the
consolidated balance sheets for the Stations as of June 30, 1998 and
consolidated statements of operations for the Stations for the six month period
then ended (the financial statements referred to in clauses (i) and (ii) are
collectively referred to herein as the "Unaudited Financial Statements" and,
together with the Audited Financial Statements, the "Financial Statements").
Except as otherwise disclosed in Section 3.5 of the Disclosure Schedule, the
Unaudited Financial Statements (including any notes thereto) present fairly, in
all material respects, the financial position of the Stations, as of the dates
thereof and the results of operations for the Stations for the periods then
ended and have been prepared in conformity with GAAP.
(c) Except as set forth in Section 3.5 of the Disclosure Schedule,
there are no liabilities or obligations, secured or unsecured (whether absolute,
accrued, contingent or otherwise, and whether due or to become due), of the
Company with respect to the Stations of a nature required by GAAP to be
reflected in a corporate balance sheet, except such liabilities and obligations
(i) that are adequately accrued or reserved against in the Financial Statements
or disclosed in the notes thereto (ii) that were incurred after June 30, 1998
either in the ordinary course of business consistent with past practice or in
connection with the transactions contemplated by this Agreement or (iii) that
are immaterial in amount.
3.6 Title to Assets; Related Matters. Except for Permitted Exceptions or as
disclosed in Section 3.6 of the Disclosure Schedule (i) the Company has good,
valid and marketable title (as measured in the context of their current uses)
to, or, in the case of leased or
14
subleased assets, valid and subsisting leasehold interests (as measured in the
context of their current uses) in, or otherwise has the right to use, all of the
Assets, free and clear of all Encumbrances (except for any assets sold or
otherwise disposed of, or with respect to which the lease, sublease or other
right to use such Asset has expired or has been terminated, in each case after
the date hereof solely to the extent permitted under Section 5.1(a) hereof),
(ii) each lease or sublease pursuant to which any Leased Property is leased by
the Company is legal, valid and binding on the Company and, to the Company's
Knowledge, the other parties thereto and grants the leasehold interest it
purports to grant, including, without limitation, any rights to nondisturbance
and peaceful and quiet enjoyment that may be contained therein, and the Company,
and to the Company's Knowledge each other party thereto, is in compliance in all
material respects with the provisions of such leases and subleases, (iii) the
Assets, together with the Excluded Assets, constitute all the assets and rights
of the Company and its Affiliates used in or necessary for the operation of the
Business as currently conducted, (iv) except for Equipment scheduled to be
replaced by the Company's capital expenditure budget, the Real Property, Leased
Property and Equipment is, in all material respects, in good operating condition
and repair (ordinary wear and tear excepted) taking into account the age
thereof, (v) there are no contractual or legal restrictions to which the Company
is a party or by which the Real Property is otherwise bound that preclude or
restrict in any material respect the Company's ability to use the Real Property
for the purposes for which it is currently being used and (vi) no portion of the
Real Property or Leased Property is the subject of, or affected by, any
condemnation, eminent domain or inverse condemnation proceeding currently
instituted or, to the Company's Knowledge, threatened. On the Closing Date, the
Company shall sell, convey, assign, transfer and deliver to Purchaser all of the
Company's right, title and interest in and to all of the Assets, free and clear
of all Encumbrances other than Permitted Exceptions, Encumbrances disclosed in
Section 3.6 of the Disclosure Schedule and Encumbrances arising from Purchaser's
acts. Schedule 1.1(d) contains a true and correct list of all Real Property
owned by the Company used in the Business (other than the Excluded Assets).
3.7 Absence of Certain Changes, Events and Conditions. Since June 30, 1998,
except as otherwise provided in or contemplated by this Agreement, as disclosed
in Section 3.7 of the Disclosure Schedule:
(a) Other than in the ordinary course of business consistent with past
practice, the Company has not sold, transferred, leased, subleased,
licensed or otherwise disposed of any material assets used in the Business,
other than the sale of obsolete Equipment;
(b) (i) the Company has not granted any increase, or announced any
increase, in the wages, salaries, compensation, bonuses, incentives,
pension or other benefits payable to any of the Business Employees,
including, without limitation, any increase or change pursuant to any
Employee Benefit Plan, or (ii) established, increased or accelerated the
payment or vesting of any benefits under any Employee Benefit Plan with
respect to Business Employees, in either case except (A) as required by
Law, (B) that involve only increases consistent with the past practices of
the Company or (C) as required under any existing agreement or arrangement;
(c) the Company has not made any material change in any method of
accounting or accounting practice or policy used by the Company, other than
changes required by
15
law or under GAAP;
(d) the Company has not suffered any extraordinary casualty loss or
damage with respect to any material assets used in the Business, whether or
not covered by insurance;
(e) there has not been any Material Adverse Effect;
(f) except in connection with the transactions contemplated hereby,
the Business has been conducted in all material respects only in the
ordinary and usual course consistent with past practice;
(g) the Company has not created, incurred, assumed or guaranteed any
Indebtedness, except for net borrowings under existing lines of credit;
(h) other than in the ordinary course of business, the Company has not
compromised, settled, granted any waiver or release relating to, or
otherwise adjusted any Action, material Liabilities or any other material
claims or material rights of the Business; and
(i) the Company has not entered into any agreement, contract,
commitment or arrangement to do any of the foregoing.
3.8 Litigation. Except as disclosed in Section 3.8 of the Disclosure
Schedule, as of the date hereof, (i) there are no Actions against the Company
relating to the Business or the Assets pending, or, to the Company's Knowledge,
threatened to be brought by or before any Governmental Authority, (ii) to the
Company's Knowledge, the Company is not subject to any Governmental Orders (nor,
are there any such Governmental Orders threatened to be imposed by any
Governmental Authority) relating to the Business or the Assets and (iii) there
is no Action pending, or, to the Company's Knowledge, threatened to be brought
before any Governmental Authority, that seeks to question, delay or prevent the
consummation of the transactions contemplated hereby.
3.9 Insurance. Section 3.9 of the Disclosure Schedule lists all insurance
policies of the Company as of the date hereof relating to the Assets or the
Business (the "Insurance Policies"). Except as set forth in either Section 3.9
or Section 3.14 of the Disclosure Schedule, (i) all insurance policies relating
to the Assets or Business to which the Company is a party or under which the
Assets or the Business is covered (or replacement policies therefor) are in full
force and effect, and the Company has paid all premiums due and is not in
default, (ii) no notice of cancellation or non-renewal with respect to, or
disallowance of any claim under, any such policy has been received by the
Company and (iii) to the Company's Knowledge, the Company has not been refused
insurance with respect to the Business or Assets, nor has coverage with respect
to the Business or Assets been previously canceled or limited, by an insurer to
which the Company has applied for such insurance, or with which the Company has
held insurance, within the last three years.
3.10 Material Contracts. Section 3.10 of the Disclosure Schedule sets forth
all Material Contracts, including, without limitation, all amendments thereof,
as of the date hereof.
16
Complete and accurate copies of all written Material Contracts listed in Section
3.10 of the Disclosure Schedule and accurate summaries of the material terms of
all oral Material Contracts have been delivered or made available to Purchaser
(except as otherwise noted therein). Except as set forth in Section 3.10 of the
Disclosure Schedule, (1) each Material Contract and each other contract or
agreement that is material to the Business is legal, valid and binding on the
Company and, to the Company's Knowledge, the other parties thereto, (2) the
Company is not in default under any Material Contract or other contract or
agreement that is material to the Business and no event has occurred or failed
to occur that, with or without the giving of notice or the lapse of time or
both, would result in such a default and (3) to the Company's Knowledge, no
other party to any Material Contract or other contract or agreement that is
material to the Business has breached or is in default thereunder.
3.11 Permits and Licenses; Compliance with Law. Except as disclosed in
Section 3.11 of the Disclosure Schedule, (i) the Company currently holds all the
material permits, licenses, authorizations, certificates, exemptions and
approvals of Governmental Authorities or other Persons including, without
limitation, Environmental Permits, necessary for the current operation and the
conduct (as it is being conducted prior to the Closing) of the Business, other
than the FCC Licenses (which are provided for in Section 3.12 hereof)
(collectively, "Permits"), and all material Permits are in full force and
effect, (ii) since November 1, 1996, the Company has not received any written
notice from any Governmental Authority revoking, canceling, rescinding,
modifying or refusing to renew any material Permit and (iii) the Company is in
material compliance with the requirements of all material Permits.
Except as disclosed in Section 3.11 of the Disclosure Schedule (i) the
Company is in compliance in all material respects with all Laws and Governmental
Orders, other than the FCC Licenses, the Communications Act and the rules and
regulations of the FCC (which are provided for in Section 3.12 hereof),
applicable to the conduct of the Business as it is being conducted prior to the
Closing and (ii) the Company has not been charged since November 1, 1996 by any
Governmental Authority with a violation of any Law or any Governmental Order
relating to the conduct of its business, which charge has not been fully
resolved and, to the extent required, accounted for.
3.12 FCC Licenses. Except as disclosed in Section 3.12 of the Disclosure
Schedule, (i) the Company holds the FCC Licenses listed in Section 3.12 of the
Disclosure Schedule, which FCC Licenses expire on the respective dates set forth
in Section 3.12 of the Disclosure Schedule; (ii) Section 3.12 of the Disclosure
Schedule sets forth a true and complete list of any and all pending applications
filed with the FCC by the Company, true and complete copies of which have been
delivered to Purchaser or made available for inspection by Purchaser; (iii) the
FCC Licenses listed in Section 3.12 of the Disclosure Schedule constitute all of
the licenses and authorizations required under the Communications Act and the
current rules and regulations of the FCC in connection with the operation of the
Stations as currently operated; (iv) the FCC Licenses are in full force and
effect through the dates set forth in Section 3.12 of the Disclosure Schedule,
and there is not pending or, to the Knowledge of the Company, threatened, any
action by or before the FCC to revoke, suspend, cancel, rescind, modify, or
refuse to renew in the ordinary course any of the FCC Licenses; (v) the Stations
are operating in compliance with the FCC Licenses and in compliance in all
material respects with the Communications Act and the current rules and
regulations of the FCC and have been assigned digital television
17
frequencies; and (vi) to the Company's Knowledge, there exist no facts,
conditions or events relating to the Company that would reasonably be expected
to cause the revocation of an FCC License or denial by the FCC of the
application for consent to the assignment of the FCC Licenses as provided in
this Agreement. The Company has filed all reports, forms and statements,
including, without limitation, construction permit applications for digital
television channels, required to be filed by the Company with the FCC and
maintained its public files in accordance with the rules and regulations of the
FCC.
3.13 Environmental Matters. Except as disclosed in Section 3.13 of the
Disclosure Schedule, to the Company's Knowledge, (i) Hazardous Materials have
not been Released on any Real Property except in material compliance with
applicable Law; (ii) there have been no events related to the Business or the
Real Property that would reasonably be expected to give rise to any material
liability under any Environmental Law; (iii) the Business, the Real Property and
the Leased Property is now, and for the past five years has been, in material
compliance with all applicable Environmental Laws and there are no extant
conditions that would reasonably be expected to constitute an impediment to such
compliance in the future; (iv) the Business has disposed of all wastes arising
from or otherwise relating to its business, including those wastes containing
Hazardous Materials, in material compliance with all applicable Environmental
Laws (including the filing of any required reports with respect thereto) and
Environmental Permits and (v) there are no pending or, to the Company's
Knowledge, threatened Environmental Claims against the Company relating to the
Real Property.
3.14 Employee Benefit Matters. The Company has made available to Purchaser
copies of all material Employee Benefit Plans (including, without limitation,
all plans governed by ERISA, providing pension benefits or providing health,
life insurance or disability benefits), which plans are set forth in Section
3.14 of the Disclosure Schedule. Except as set forth in Section 3.14 of the
Disclosure Schedule, all such Employee Benefit Plans are in compliance with the
terms of the applicable plan and the requirements prescribed by applicable law
currently in effect with respect thereto (including Sections 4980B and 5000 of
the Code), and the Company has performed in all material respects all
obligations required to be performed by it under, and is not in default under or
in violation of, any of the terms of such Employee Benefit Plans where any such
noncompliance, nonperformance, default or violation would, individually or in
the aggregate, be reasonably expected to result in liability in excess of
$25,000. The Company has no post-retirement welfare obligations with respect to
the Business for other than Business Employees of WGME-TV and Corporate Office
Employees. The Company has not incurred, and, to the Knowledge of the Company,
no event, transaction or condition has occurred or exists which is reasonably
expected to result in the occurrence of, any liability to the Pension Benefit
Guaranty Corporation (other than contributions to the plan and premiums to the
Pension Benefit Guaranty Corporation, which in either event are not in default)
or any "withdrawal liability" within the meaning of Section 4201 of ERISA, or
any other liability pursuant to Title I or IV of ERISA or the penalty, excise
tax or joint and several liability provisions of the Code relating to employee
benefit plans, in any such case relating to any Employee Benefit Plan or any
pension plan maintained by any company that during the last five years was or
currently would be treated as a single employer with the Company under Section
4001 of ERISA or Section 414 of the Code (an "ERISA affiliate"), where
individually or in the aggregate, in any of such events, any such liability
would be in excess of $25,000. Except as set forth in Section 3.14 of the
Disclosure Schedule and except for such matters that would not, individually or
in the aggregate,
18
reasonably be expected to result in liability in excess of $25,000, each
Employee Benefit Plan intended to be "qualified" within the meaning of Section
401(a) of the Code has received a favorable determination letter that such plan
is so qualified and the trusts maintained thereunder are exempt from taxation
under Section 501(a) of the Code and, to the Company's Knowledge is so
qualified, and no such Employee Benefit Plan holds employer securities. Except
as set forth in Section 3.14 of the Disclosure Schedule, neither the Company nor
any ERISA Affiliate has ever made or been obligated to make, or reimbursed or
been obligated to reimburse another employer for, contributions to any
multiemployer plan (as defined in ERISA Section 3(37)). Except as set forth in
Section 3.14 of the Disclosure Schedule, the Employee Benefit Plans are not
presently under audit or examination (and have not received notice of a
potential audit or examination) by any governmental authority, and no matters
are pending with respect to the Qualified Plan under any governmental compliance
programs. With respect to each Employee Benefit Plan, there have been no
violations of Code Section 4975 or ERISA Sections 404 or 406 as to which
successful claims would, individually or in the aggregate, result in liability
in excess of $25,000 for the Company or any Person required to be indemnified by
it. Except as set forth in Section 3.14 of the Disclosure Schedule and except as
expressly provided in this Agreement, the consummation of the transactions
contemplated by this Agreement will not (i) entitle any current or former
employee or officer of the Company or any ERISA affiliate to severance pay,
unemployment compensation or other payment, or (ii) accelerate the time of
payment or vesting, or increase the amount of compensation due any such employee
or officer. There are no pending, or, to the Company's Knowledge, threatened or
anticipated claims by or on behalf of any Employee Benefit Plan, by any employee
or beneficiary covered under any such plan, or otherwise involving any such plan
(other than routine claims for benefits) where any such pending, threatened or
anticipated claims would, individually or in the aggregate, reasonably be
expected to result in liability in excess of $25,000. The $25,000 liability
threshold in this Section 3.14 is intended to apply only to this Section 3.14,
and is in no way intended to be used in defining materiality anywhere in this
Agreement.
3.15 Labor Relations. Section 3.15 of the Disclosure Schedule sets forth a
list of all labor organizations recognized as representing the employees of the
Business. Complete and accurate copies of all collective bargaining agreements
and other labor union contracts between the Company and any such labor
organizations have been delivered or made available to Purchaser. Other than as
set forth in Section 3.15 of the Disclosure Schedule, (i) the Company is not
party to any collective bargaining agreement or other labor union contract
applicable to employees of the Business, (ii) there are no strikes, slowdowns or
work stoppages pending or, to the Company's Knowledge, threatened between the
Company and any employees of the Business and the Company has not experienced
any such strike, slowdown, or work stoppage within the past two years, in each
case other than any such strike, slowdown or work stoppage after the date hereof
arising out of or relating to the transactions contemplated hereby, (iii) there
are no unfair labor practice complaints pending or, to the Company's Knowledge,
threatened against the Business relating to employees of the Business before the
National Labor Relations Board or any other Governmental Authority or, to the
Company's Knowledge, any current union representation questions involving
employees of the Business and (iv) the Company is in compliance in all material
respects with its obligations under all Laws and Governmental Orders governing
its employment practices with respect to employees of the Business, including,
without limitation, provisions relating to wages, hours and equal opportunity,
employment discrimination, workers' compensation, family and medical leave, the
Immigration Reform and Control Act, and
19
occupational safety and health requirements, (v) to the Company's Knowledge, all
Persons classified by the Company as independent contractors with respect to the
Business do satisfy the requirements of law to be so classified, and the Company
has fully and accurately reported their compensation on IRS Forms 1099 when
required to do so, and (vi) there is no charge or compliance proceeding actually
pending or, to the Company's Knowledge, threatened against the Company with
respect to employees of the Business before the Equal Employment Opportunity
Commission or any state, local, or foreign agency responsible for the prevention
of unlawful employment practices.
3.16 Intellectual Property. Section 3.16 of the Disclosure Schedule
includes a complete list of all call letters of the Stations (the "Call
Letters"). Except as disclosed in Section 3.16 of the Disclosure Schedule, (i)
the rights of the Company in or to the Call Letters and, to the Company's
Knowledge, the other Intellectual Property do not conflict with or infringe on
the rights of any other Person, (ii) the Company has not received any claim from
any Person that the rights of the Company in or to the Intellectual Property
conflict with or infringe on the rights of any other Person and, to the
Company's Knowledge, no such claim is threatened, (iii) the Company owns (free
and clear of any Encumbrances other than Permitted Exceptions), is licensed or
otherwise has the right to use all Intellectual Property necessary for the
conduct of the Business as currently conducted by the Company except where the
failure to have such rights would not reasonably be expected to impair the
operations of the Business in any material respect and (iv) to the Company's
Knowledge, no other Person is infringing or diluting the rights of the Company
with respect to the Intellectual Property.
3.17 Taxes. Except as disclosed in Section 3.17 of the Disclosure Schedule
and except relating exclusively to the Maine Media Business, (a) all material
Tax Returns required to be filed by the Company have been timely filed and all
such Tax Returns are correct and complete in all material respects; (b) all
Taxes required to be paid by the Company, whether or not shown as due on such
Tax Returns, have been timely paid other than such Taxes, if any, as are
described in Section 3.17 of the Disclosure Schedule and are being contested in
good faith and as to which adequate reserves (determined in accordance with
GAAP) have been provided in the Company's financial statements; (c) there is no
action, suit, proceeding, investigation, audit or claim pending or, to the
Company's Knowledge, threatened with respect to Taxes of the Company or for
which the Company may be liable, and no adjustment relating to such Taxes of the
Company has been proposed in writing by any Tax authority and remains
unresolved; (d) there are, and immediately prior to the Closing there will be,
no Tax liens on any of the assets of the Company (other than liens for Taxes
that are not yet due and payable); and (e) all Taxes that the Company is
required to withhold or collect have been duly withheld or collected and, to the
extent required, have been paid to the proper Tax authority.
3.18 Commissions. With the exception of any responsibility that the Company
has to Lazard Freres & Co. LLC, whose fee will be paid by the Company, and the
fees and incentive compensation set forth in Section 3.18 of the Disclosure
Schedule, which fees and compensation will be paid by the Company, there is no
broker or finder or other Person who has any valid claim against the Company,
Purchaser, or any of their respective Affiliates or any of their respective
assets for a commission, finders' fee, brokerage fee or other similar fee in
connection with this Agreement, or the transactions contemplated hereby, by
virtue of any actions taken by on or behalf of the Company, its stockholders or
the Company's officers,
20
employees or agents.
3.19 Affiliate Transactions. Except as set forth in Section 3.19 of the
Disclosure Schedule or as expressly otherwise provided or permitted in this
Agreement, since December 27, 1997 the Company has not engaged in any
transaction with any Affiliate thereof that was material to the Business, and
the Company is not a party to any material agreements or arrangements with any
Affiliates that will continue in effect after the Closing for the Purchaser that
are not immediately terminable by the Purchaser without payment of any penalty
or premium.
3.20 Accuracy and Completeness of Representations and Warranties. No
representation or warranty made by the Company in this Article 3 contains any
untrue statement of a material fact or omits a material fact necessary in order
to make the representation or warranty not misleading.
Article 4. Representations and Warranties of Purchaser.
Purchaser represents and warrants to the Company as follows:
4.1 Organization and Standing. Purchaser 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, lease and operate its properties and assets and to conduct its
business.
4.2 Binding Agreement. Purchaser has all requisite corporate power and
authority to enter into this Agreement, to execute and deliver this Agreement
and the Xxxx of Sale, Assignment and Assumption Agreement, to carry out its
obligations hereunder and thereunder and to consummate the transactions
contemplated hereby and thereby. The execution and delivery of this Agreement
and the Xxxx of Sale, Assignment and Assumption Agreement by Purchaser and the
consummation by Purchaser of its obligations hereunder and thereunder have been
duly and validly authorized by all necessary corporate and stockholder action on
the part of Purchaser. This Agreement has been and, on the Closing Date, the
Xxxx of Sale, Assignment and Assumption Agreement will be duly executed and
delivered on behalf of Purchaser and, assuming the due authorization, execution
and delivery by the Company, constitutes a legal, valid and binding obligation
of Purchaser enforceable in accordance with its terms, subject to applicable
bankruptcy and similar laws affecting the rights of creditors generally and to
general principles of equity (whether applied at law or equity).
4.3 Absence of Conflicting Agreements or Required Consents. Except as set
forth in Section 4.3 of the Disclosure Schedule, the execution, delivery and
performance by Purchaser of this Agreement and the Xxxx of Sale, Assignment and
Assumption Agreement do not and will not (a) violate, conflict with or result in
the breach or default of any provision of the certificate or articles of
incorporation or by-laws of Purchaser, (b) materially conflict with or
materially violate any material Law or material Governmental Order applicable to
Purchaser or any of its properties or assets, (c) except for (i) the
notification requirements of the HSR Act, (ii) such filings with, and orders of,
the FCC as may be required under the Communications Act and
21
the FCC's rules and regulations in connection with this Agreement and the
transactions contemplated hereby and (iii) such matters that would not
reasonably be expected to materially impair or delay the consummation of the
transactions contemplated hereby, require any consent, approval, authorization
or other order of, action by, registration or filing with or declaration or
notification to any Governmental Authority or any other Person or (d) except for
such matters that would not reasonably be expected to materially impair or delay
the consummation of the transaction contemplated hereby, conflict with, result
in any violation or breach of, constitute a default (or event which with the
giving of notice, or lapse of time or both, would become a default) under,
require any consent under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of, or result in
the creation of any Encumbrance on any of the Purchaser's assets pursuant to,
any note, bond, mortgage or indenture, contract, agreement, lease, sublease,
license or permit, or franchise to which Purchaser is a party or by which its
assets are bound.
4.4 Litigation. Except as described in Section 4.4 of the Disclosure
Schedule, there are no Actions pending or, to Purchaser's knowledge, any Action
threatened to be brought by or before any Governmental Authority, against
Purchaser or any of its Affiliates that (i) seeks to question, delay or prevent
the consummation of the transactions contemplated hereby or (ii) would
reasonably be expected to affect adversely the ability of Purchaser to fulfill
its obligations hereunder, including without limitation, Purchaser's obligations
under Articles 1 and 2 hereof.
4.5 Commissions. With the exception of any responsibility that Purchaser
has to Xxxxxxx Xxxxx Xxxxxx Inc. whose fees will be paid by Purchaser, there is
no broker or finder or other Person who has any valid claim against the Company,
Purchaser, any of their respective Affiliates or any of their respective assets
for a commission, finders' fee, brokerage fee or other similar fee in connection
with this Agreement, or the transactions contemplated hereby, by virtue of any
actions taken by on or behalf of Purchaser, or its officers, employees or
agents.
4.6 Financing. Purchaser will at Closing have sufficient funds to pay the
Purchase Price pursuant to this Agreement and otherwise to satisfy its
obligations hereunder.
4.7 Purchaser's Qualification. Except as set forth in Section 4.7 of the
Disclosure Schedule, (i) Purchaser does not know of any fact or circumstance
that could reasonably be expected to result in a finding by the FCC that
Purchaser is not qualified legally, financially or otherwise to be the licensee
of the Stations as its operations are now being conducted and (ii) except as set
forth in Section 4.7 of the Disclosure Schedule, Purchaser does not know of any
policy, rule, regulation or ruling of the FCC that could reasonably be expected
to be violated by the acquisition of the Stations by Purchaser.
4.8 Accuracy and Completeness of Representations and Warranties. No
representation or warranty made by Purchaser in this Article 4 contains any
untrue statement of a material fact or omits a material fact necessary in order
to make the representation or warranty not misleading.
22
Article 5. Covenants and Agreements.
5.1 Conduct of the Business Prior to Closing; Access. The Company covenants
as follows:
(a) Between the date hereof and the Closing, except as contemplated by
this Agreement or as described in either Section 3.7 or Section 5.1 of the
Disclosure Schedule, or except with the consent of Purchaser (which consent
shall not be unreasonably withheld), the Company will operate the Business
in the ordinary course of business consistent with past practice and shall
use commercially reasonable efforts to (1) preserve intact the Business and
preserve the Business's relationships with customers, suppliers, licensees,
licensors, the networks with whom the Stations are affiliated and others
having business dealings with the Stations, (2) maintain the Business's
inventory of supplies, parts and other materials and keep its books of
account, records and files, in each case in the ordinary course of business
consistent with past practice, (3) maintain the material items of Real
Property, Leased Property and Equipment substantially in their present
condition, ordinary wear and tear excepted, (4) pay or discharge all cash
and barter obligations in the ordinary course of business, (5) bring
current as of the Closing Date all payments due and payable under Program
Contracts in accordance with their terms as in effect on the date hereof
(with respect to Program Contracts existing as of the date hereof) or on
the date originally entered into (with respect to Program Contracts entered
into after the date hereof) and (6) maintain its corporate existence.
Without limiting the generality of the foregoing, between the date hereof
and the Closing, except as contemplated by this Agreement or as described
in either Section 3.7 or Section 5.1 of the Disclosure Schedule, or except
with the consent of Purchaser (which consent shall not be unreasonably
withheld, except in the case of any consent relating to the entering into
of any Program Contract providing for payments in excess of $30,000 or
having a term greater than one year (other than any Program Contract that
will be fully satisfied, discharged and performed prior to the Closing), in
which case Purchaser may grant or withhold its consent in its absolute
discretion (and the parties hereto further agree that no such consent
unreasonably withheld shall be taken into account in any determination of
whether a Material Adverse Effect has occurred), and any consent shall be
deemed given unless withheld in writing no later than four Business Days
after Purchaser's receipt of a written request for such consent), the
Company will not with respect to the Business:
(i) create, assume or subject any of the assets of the Business
to any Encumbrance, other than Permitted Exceptions and Encumbrances
that will be released at or prior to the Closing;
(ii) make any material changes in the operations of the Business;
(iii) other than, in each case, in the ordinary course of
business consistent with past practice, sell, transfer, lease,
sublease, license or otherwise dispose of any material assets of the
Business, other than the sale of obsolete Equipment that has been or
is replaced with Equipment of like kind;
23
(iv) (A) grant any increase, or announce any increase, in the
wages, salaries, compensation, bonuses, incentives, pension or other
benefits payable by the Company to any of the officers or key
employees of the Business, including, without limitation, any increase
or change pursuant to any Employee Benefit Plan, or (B) establish or
increase or promise to increase or accelerate the payment or vesting
of any benefits under any Employee Benefit Plan with respect to
officers or employees of the Business, in the case of either (A) or
(B) except (I) as required by Law, (II) that involve only increases
consistent with the past practices of the Company but in no event more
than 5%, (III) as required under any existing agreement or
arrangement, (IV) that involve increases related to promotions to the
extent such increases result in the compensation and benefits of the
relevant employee being consistent with the compensation and benefits
provided to the holder of such position in the past or (V) that relate
to the supplemental executive retirement plans identified in Section
3.14 of the Disclosure Schedule;
(v) make any change in any method of accounting or accounting
practice or policy used by the Company, other than as required by law
or under GAAP;
(vi) fail to maintain in full force and effect all of its
existing casualty, liability or other insurance through the Closing in
amounts at least equal to those in effect on the date hereof;
(vii) make any capital expenditures in excess of $500,000 in the
aggregate that are not contemplated in the capital improvements
budgeted for 1998;
(viii) (A) amend the payment terms of any Program Contract to
provide that payments that would otherwise be made prior to the
Closing are made after the Closing or (B) acquire, enter into, modify,
change or extend the term of (x) any Program Contract providing for
payments in excess of $10,000 or with a term greater than one year or
(y) Program Contracts not subject to clause (x) that in the aggregate
provide for payments in excess of $200,000;
(ix) acquire, enter into, modify, change or extend the term of
any Material Contract, provided that this clause (ix) will not apply
to the acquisition or entering into of any new Material Contract not
otherwise subject to clauses (i) to (viii) or clauses (x) to (xvi)
hereof with respect to which all Liabilities of the Company thereunder
will be fully satisfied, discharged and performed prior to the Closing
with no adverse effect on Purchaser;
(x) compromise, settle, grant any waiver or release relating to,
or otherwise adjust, any material Action, material Liabilities or any
other material claims or material rights;
(xi) enter into any new agreement, contract, commitment or
24
arrangement with any Affiliate of the Company that will be binding
upon Purchaser, the Assets or the Stations after the Closing;
(xii) apply to the FCC for any construction permit that would
adversely affect the Stations' present operations, or make any
material change in the Stations' buildings, leasehold improvements, or
fixtures;
(xiii) except with respect to promotion during ratings sweep
periods (which shall not be subject to this clause (xiii)), enter into
any trade, barter or similar agreements (other than Program Contracts)
for the sale of advertising time that would be binding on the Stations
after the Closing for any property or services in lieu of or in
addition to cash that requires the provision of broadcast time having
a value that exceeds $10,000 in any individual agreement or $200,000
in the aggregate;
(xiv) take any action, or refrain from taking any action, that
would constitute a material breach of, constitute a default (or event
which with the giving of notice, or lapse of time or both, would
become a default) under, or give to others any rights of termination,
amendment, acceleration, suspension, revocation or cancellation of,
any Material Contract;
(xv) enter into or renew any time sales agreement except in the
ordinary course of business for a term not exceeding 12 months; or
(xvi) enter into any agreement, contract, commitment or
arrangement to do any of the foregoing.
(b) Pending the Closing, the Company shall:
(1) Give to Purchaser and its representatives reasonable access
during normal business hours to all of the employees, properties,
books and records of the Company and furnish Purchaser and its
representatives with such information concerning the Company as
Purchaser may reasonably require, including such access and
cooperation as may be necessary to allow Purchaser and its
representatives to interview the employees, to examine the books and
records of the Company, and to inspect the Real Property and Equipment
(which right of access shall not be exercised in any way which would
unreasonably interfere with the normal operations, business or
activities of the Company);
(2) Furnish to Purchaser within 20 days after the end of each
month ending between the date of this Agreement and the Closing an
unaudited statement of income and expense and a balance sheet for each
Station for the month just ended; and
(3) From time to time, furnish to Purchaser such additional
information (financial or otherwise) concerning the Company as
Purchaser may reasonably request (which right to request information
shall not be exercised in any way
25
which would unreasonably interfere with the normal operations,
business or activities of the Company).
(c) Pending the Closing, the Company will maintain the validity of the
FCC Licenses and comply with all requirements and the rules and regulations
of the FCC in the operation of the Stations and will prepare and timely
file with the FCC and diligently prosecute any necessary applications for
renewal of the FCC Licenses and for construction permit applications for
digital television channels. The Company will deliver to Purchaser, within
ten Business Days after delivery or receipt, copies of any reports,
applications or communications to or from the FCC or its staff related to
the Stations which are delivered or received between the date of this
Agreement and the Closing Date.
(d) Pending the Closing, the Company will maintain the Business's
promotional activities and expenditures in the aggregate in all material
respects in accordance with the Company's budget and will use its
reasonable best efforts to maintain all affiliation agreements with
television networks for the Stations.
5.2 Post-Closing Covenants and Agreement, and Other Employee Benefit
Matters. (a) Purchaser shall at all reasonable times after reasonable notice to
Purchaser from and after the Closing, make available without cost, for
inspection and/or copying by the Company and any Person that was a stockholder
of the Company during any of the tax years (or portions thereof) immediately
preceding the Closing for which the relevant statute of limitations (including
any waiver thereof) has not expired, or their respective representatives, the
books and records of the Business for such tax years (or portions thereof). Such
books and records shall be preserved by Purchaser until the later of the closing
by tax audit of, or the expiration of the relevant statute of limitations
(including any waiver thereof) with respect to, all open tax periods of the
Company and such stockholders prior to and including the time immediately prior
to the Closing. After the period set forth above, Purchaser may destroy the
books and records in its possession unless, before expiration of such notice
period, a former stockholder objects in writing to the destruction of any or all
of such books and records, in which case such books and records shall be
delivered to the objecting Person at the expense of the objecting Person.
Notwithstanding the foregoing, Purchaser shall continue to preserve and, at all
reasonable times after the Closing, to make available without cost, for
inspection and/or copying by any Person that was a trustee or other fiduciary
under the Employee Benefit Plans identified in Section 5.2 of the Disclosure
Schedule, the books and records of such Employee Benefit Plan and the books and
records of the Business relating thereto.
(b) Effective as of the Closing, Purchaser shall offer employment to
all then employees of the Business, on such terms and conditions as Purchaser
shall establish (except that base cash compensation shall be comparable to their
existing base cash compensation), subject to the terms of any collective
bargaining agreement assumed by Purchaser under Section 5.2(e) and any
employment agreements with specific Business Employees, and shall assume
responsibility for all inactive employees of the Business, subject to the terms
of this Section 5.2 and the collective bargaining agreements assumed by
Purchaser under Section 5.2(e); provided, however, that any employee of the
Business who is not actively employed on the day of the Closing shall be offered
employment by Purchaser following the end of any inactive period (whether on
26
account of leave, layoff, injury or disability) but only to the extent that the
Company would have been obligated to offer active employment to such person upon
the end of such inactive period. Notwithstanding the foregoing, Purchaser shall
not have any obligation to offer employment to any employees of the Corporate
Office ("Corporate Office Employees"), as described in Section 5.2(b) of the
Disclosure Schedule, and its only obligations with respect to Corporate Office
Employees shall be to provide such benefits to Corporate Office Employees to
which they would be entitled under the benefit plans assumed by Purchaser under
Section 5.2(f), except under the New Pension Plan, and to provide COBRA benefits
to the extent set forth in Section 5.2(k). Nothing in this Section 5.2(b) is
intended to limit the ability of Purchaser to terminate the employment of any
employee after the Closing.
(c) Subject to applicable law and the terms of any collective
bargaining agreement assumed pursuant to this Agreement, Purchaser shall
establish and maintain for a period of one year after the Closing Date or the
term of their employment by Purchaser, whichever is less, for employees of the
Business as of the Closing Date, benefits that, in the aggregate, are no less
favorable than the benefits maintained by the Purchaser for similarly situated
employees of Purchaser, provided that the foregoing will not prohibit or in any
manner restrict Purchaser from terminating or changing the individual terms of
employment of any Business Employee or require Purchaser to maintain any
specific benefits or Employee Benefit Plans. Purchaser shall give employees of
the Business as of the Closing Date and former and inactive Business Employees
credit for their service with the Company or any of its Subsidiaries prior to
the Closing, to the same extent that such service would have been credited by
Purchaser (if they had been employed by Purchaser for such period of service),
for all purposes under all employee benefit plans or arrangements maintained by
Purchaser for current, former and inactive Business Employees (including any
waiting periods). In addition, Purchaser shall, if applicable, (i) cause any
pre-existing condition limitation to be waived and (ii) give effect, in
determining any deductible and maximum out-of-pocket limitations, to claims
incurred and amounts paid by, and amounts reimbursed to current, former and
inactive Business Employees with respect to similar plans maintained by the
Company prior to the Closing.
(d) Purchaser will assume and indemnify and hold harmless the Company
Indemnified Parties against all Liabilities with respect to severance benefits
arising in connection with or following the Closing pursuant to the agreements
set forth in Sections 3.14.1 and 3.14.2 of the Disclosure Schedule (subject to
the right of recovery set forth in Section 5.8(a)), or pursuant to any
collective bargaining agreement or other agreements with Business Employees
assumed either pursuant to this Agreement or by operation of law. With respect
to all current and inactive Business Employees immediately prior to the Closing
not covered by the agreements referenced in the immediately preceding sentence,
(x) for a period ending not less than one year after the Closing Purchaser will
provide such Business Employees with the same severance benefits as Purchaser
provides for similarly situated employees of Purchaser (which benefits, as of
the date hereof, are described in Section 5.2(d) of the Disclosure Schedule) and
(y) Purchaser will assume and indemnify and hold harmless the Company
Indemnified Parties against all Liabilities with respect to severance benefits
arising in connection with or following the Closing.
(e) From and after the Closing, Purchaser shall assume all of the
collective bargaining agreements (including, without limitation, pursuant to the
specified provisions of the
27
collective bargaining agreements set forth in Section 5.2 of the Disclosure
Schedule) and other labor contracts with respect to any Business Employees
existing immediately prior to the Closing.
(f) From and after the Closing, Purchaser shall assume sponsorship of
the WOKR-TV Partners 401(k) Plan, the New Pension Plan, and assume
responsibilities of all Employee Benefits Plans that provide post-retirement
life insurance or health, or short-term or long-term disability benefits and be
responsible for any benefits under such Employee Benefit Plans (i) to which any
current, former or inactive Business Employee or Corporate Office Employee, or a
beneficiary or dependent of any current, former or inactive Business Employee or
Corporate Office Employee (each a "Beneficiary"), has already become entitled,
(ii) which commenced or (iii) to which any current, former or inactive Business
Employee or Corporate Office Employee has already become qualified by reason of
age and years of service as of the Closing, to the extent such persons are
identified in Section 5.2(f) of the Disclosure Schedule (which section shall be
updated, if necessary, at Closing). From and after the Closing, Purchaser shall
also pay to the Business Employees and Corporate Office Employees listed in
Section 5.2(f) of the Disclosure Schedule the supplemental retirement benefits
provided under the applicable Guy Gannett supplemental retirement plan. The
Company shall cause such Employee Benefit Plans to be amended to the extent
necessary or appropriate to effect the foregoing.
(g) From and after the Closing, Purchaser shall assume and be
responsible for any workers' compensation benefits payable to a Business
Employee, Beneficiary or dependent of a Business Employee on or after the
Closing, including any such benefits that are attributable to any injury or
illness that occurred or existed prior to the Closing to the extent not covered
by the Company's workers' compensation insurance policy.
(h) For a period of 90 days after the Closing, Purchaser shall not
implement any employment terminations, layoffs or hours reductions or take any
other action which could result in a "plant closing" or "mass layoff," as those
terms are defined in the Worker Adjustment and Retraining Notification Act of
1988 ("WARN") or similar events under applicable state law, affecting in whole
or in part any facility, site of employment or operating unit, or any employee
employed by the Business, or which could require either Purchaser to give notice
or take any other action required by WARN or applicable state law.
(i) With respect to the Guy Gannett Retirement Plan (the "Seller
Pension Plan"), the Company and the Purchaser agree as follows:
(A) Prior to the Closing Date, the Company shall establish a spin off
defined benefit plan (the "New Pension Plan") and trust (the "Trust") for the
post-Closing benefit of the Business Employees and Beneficiaries who participate
in the Seller Pension Plan. With respect to the Seller Pension Plan, Business
Employees shall cease to accrue benefits and service credits under such Plan as
of the Closing. As soon as practicable following the Closing, the Company shall
cause its actuary to calculate the amount of assets to be allocated to the New
Pension Plan for the benefit of the Business Employees. Such allocation shall be
calculated under Section 414(l)(2) of the Code, without regard to paragraph 2(d)
thereof. The Company shall cause the amount of assets (the "Section 414 Amount")
(determined as of the end of the month in which the Closing occurs) to be
transferred to the Trust. The Company shall not amend the Seller
28
Pension Plan or the New Pension Plan to 100% vest Business Employees' benefits
under such Plans. Contingent upon the transfer of the Initial Transfer Amount
(as described in Section 5.2(i)(B) hereof) to the New Pension Plan, Purchaser
shall assume all liabilities of the Company and its affiliates with respect to
Business Employees and Beneficiaries under the Seller Pension Plan and Trust and
shall become with respect to such Business Employees and Beneficiaries
responsible for all acts, omissions and transactions under or in connection with
such Seller Pension Plan and Trust, whether arising before, on or after the
Closing, except (i) if the Company has obtained at or prior to the Closing a
prepaid fiduciaries' insurance and indemnification policy substantially on the
terms set forth in Section 5.2(i) of the Disclosure Schedule under which
Purchaser is a named insured (a" Prepaid Fiduciary Insurance Policy"), except
for liabilities arising out of willful misconduct or gross negligence of the
trustees before the Closing and (ii) if the Company is unable to obtain such
policy, except for liabilities arising out of willful misconduct, recklessness
or negligence of the trustees before the Closing.
(B) All transfers to the New Pension Plan shall be made in accordance
with the provisions of this Section 5.2(i). As soon as practicable, but in no
event after the later of (i) 30 days after the Closing Date or (ii) 45 days
after the filing of Form 5310A by each plan ("Initial Transfer Date"), the
Company shall cause its trust to make an initial transfer of assets in cash
(except as set forth in Section 5.1 of the Disclosure Schedule) equal to 80% of
the amount estimated by the Company in good faith to be equal to X (as defined
below) ("Initial Transfer Amount"). As soon as practicable after the final
determination of the amounts to be transferred ("True-Up Date"), the Company
shall, except as otherwise provided herein, cause a second transfer to be made
in cash (except as set forth in Section 5.1 of the Disclosure Schedule) of the
"True-Up Amount." The True-Up Amount shall be equal to the sum of the following
amount with respect to the Seller Pension Plan:
(X minus Initial Transfer Amount), minus benefit payments and reasonable
administration expenses attributable to Business Employees, adjusted for
Earnings,
where X equals the Section 414 Amount, as of the last day of the month in which
the Closing occurs. "Earnings" shall be calculated (i) from the last day of the
month following the Closing until the Initial Transfer Date on the amount equal
to the Initial Transfer Amount using the rate paid on a 90-day Treasury Xxxx on
the auction date coincident with or immediately preceding the Closing, (ii) on
an amount equal to X minus the sum of the Initial Transfer Amount plus benefit
payments and reasonable administrative expenses attributable to Business
Employees using (A) with respect to the period from the end of the month in
which the Closing Date occurs to the last day of the month preceding the True-Up
Date, the cumulative rate of return (considering both gain and loss) earned or
lost on the assets of the trust from which the True-Up Amount is being
transferred and (B) with respect to the period from the first day of the month
in which the True-Up Date occurs to the True-Up Date the rate paid on a 90-Day
Treasury Xxxx on the auction date coincident with or immediately preceding the
first day of the month in which the True-Up Date occurs. If the Initial Transfer
Amount increased by benefit payments and reasonable administrative expenses
attributable to Business Employees exceeds X, as soon as practicable following
such determination Purchaser shall cause a transfer to be made in cash (except
as set forth in Section 5.1 of the Disclosure Schedule) to the Seller Pension
Plan equal to the difference between (a) the Initial Transfer Amount increased
by the benefit payments and reasonable
29
administrative expenses attributable to Business Employees and (b) X as (i)
adjusted downward to reflect Earnings on X, minus benefits payments and
reasonable administrative expenses, from the last day of the month in which the
Closing occurs until the Initial Transfer Date using the rate paid on a 90-day
Treasury Xxxx on the auction date coincident with or immediately preceding the
Closing and (ii) adjusted upward to reflect Earnings on the Initial Transfer
Amount increased by the benefit payments and reasonable administrative expenses
attributable to Business Employees, and reduced by X from the Initial Transfer
Date until the True-Up Date, such Earnings shall be calculated using (A) with
respect to the period from that Initial Transfer Date to the last day of the
month preceding such True-Up Amount transfer, the cumulative rate of return
(considering both gain and loss) on the assets of the Seller Pension Plan and
(B) with respect to the period from the first day of the month in which the
True-Up Amount transfer occurs and the date of such True-Up Amount transfer, the
rate paid on a 90-Day Treasury Xxxx on the auction date coincident with or
immediately preceding the first day of the month in which the transfer occurs.
The Initial Transfer Amount and True-Up Amount shall be transferred in cash
(except as set forth in Section 5.1 of the Disclosure Schedule). Unless the
parties agree otherwise, all transfers will occur on the last business day of a
month. The amounts to be transferred pursuant to this Section 5.2(i) shall be
adjusted to the extent necessary to satisfy Section 414(l) of the Code, and any
regulations promulgated thereunder, ERISA Section 4044, and any regulations
promulgated thereunder.
(C) For the purposes of this Section 5.2(i), the Section 414 Amount
shall be determined by an enrolled actuary designated by the Company, using the
same assumptions and methodologies used by the Company for valuation of the
Seller Pension Plan for funding purposes under Sections 404 and 412 of the Code.
The Company shall provide any actuary designated by Purchaser with all
information reasonably necessary to review the calculation of the Section 414
Amount in all material respects and to verify that such calculations have been
performed in a manner consistent with the terms of this Agreement. If there is a
good faith dispute between the Company's actuary and the Purchaser's actuary as
to the amount to be transferred to any plan, and such dispute remains unresolved
for 15 days, the chief financial officers of the respective companies shall
endeavor to resolve the issue. Should such dispute remain unresolved for 20
days, the Company and Purchaser shall select and appoint a third actuary who is
mutually satisfactory to the parties hereto. Such third party actuary shall be
instructed to render its decision within 20 days and such decision shall be
conclusive as to any dispute for which the third party actuary was appointed.
The cost of such third party actuary shall be divided equally between the
Company and Purchaser. Each party shall be responsible for the cost of its own
actuary.
(D) Purchaser shall take all action necessary to qualify the New
Pension Plan under the applicable provisions of the Code and Purchaser and the
Company shall cooperate to make any and all filings and submissions to the
appropriate governmental agencies required to be made by Purchaser as are
appropriate in effectuating the provisions hereof.
(j) With respect to the Guy Gannet Voluntary Investment Plan (the
"Defined Contribution Plan"), the Company and Purchaser agree as follows:
(A) The Business Employees shall cease to accrue benefits and service
credits under the Defined Contribution Plan as of the Closing Date and,
effective as of the Closing Date,
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Purchaser shall designate a savings plan (or plans) (in accordance with this
Section 5.2(j)) ("Purchaser Savings Plan") and associated trust (or trusts) to
hold the assets of the plan for the Business Employees, to be effective as of
the Closing Date, and shall provide to the Company evidence reasonably
satisfactory to the Company that the Purchaser Savings Plan and the associated
trust have been established and that the Purchaser Savings Plan qualifies under
the requirements of Section 401(a) of the Code, and that the trust is exempt
from tax under Section 501(a) of the Code. The Company shall provide to
Purchaser evidence reasonably satisfactory to Purchaser that the Defined
Contribution Plan remains qualified under the requirements of Section 401(a) of
the Code. Provided that the Company and Purchaser have received evidence
reasonably satisfactory to them in accordance with the preceding sentences, as
soon as is reasonably practicable following the Closing Date, the Company shall
take or cause to be taken all action required or appropriate to transfer the
account balances of all Business Employees and Beneficiaries to the trust
associated with the Purchaser Savings Plan. Such transfers may be made in two
installments (the first such installment being the aggregate amount of the
applicable account balances as of the end of the last calendar quarter ended on
the date of or prior to such transfer, and the second such installment being the
aggregate amount of the remaining balances of such accounts, including, without
limitation, the earnings on such accounts from the end of the calendar quarter
used to determine the amount of the first transfer) and shall be made in cash
(or, if the parties agree, in kind) in an amount equal to the value of the
account balances to be transferred, determined as of the close of business on
the last Business Day immediately preceding each such transfer, except that to
the extent a Business Employee's or Beneficiary's account balance in the
transferor plan includes one or more promissory notes evidencing a participant
loan or loans, such promissory notes shall be transferred in kind for the
Business Employee's or Beneficiary's credit under the transferee plan. For the
period from the Closing Date until the transfer, Purchaser shall collect by
payroll deduction and promptly pay over to the Defined Contribution Plan all
loan payments required on participant loans made by the Defined Contribution
Plan to any Business Employee and the Company shall cause the Defined
Contribution Plan to administer and pay all distributions, withdrawals and loans
payable under the terms of the Defined Contribution Plan to any Business
Employee or Beneficiary until the transfer. Contingent upon the transfer of the
account balances to each of the Purchaser Savings Plans, Purchaser shall assume,
and Parent shall cause Purchaser to assume, all liabilities of Company and its
affiliates with respect to Business Employees and Beneficiaries under the
Defined Contribution Plan and shall become with respect to such Business
Employees and Beneficiaries responsible for all acts, omissions and transactions
under or in connection with such Defined Contribution Plan, whether arising
before, on or after the Closing, except (i) if the Company has obtained at or
prior to the Closing a Prepaid Fiduciary Insurance Policy, except for
liabilities arising out of willful misconduct or gross negligence of the
trustees before the Closing and (ii) if the Company is unable to obtain such
policy, except for liabilities arising out of willful misconduct, recklessness
or negligence of the trustees before the Closing.
(k) From and after the Closing, Purchaser shall assume the Company's
obligations and liabilities with respect to COBRA continuation coverage under
Section 4980B of the Code and Section 601 of ERISA ("Continuation Coverage")
with respect to Business Employees and Corporate Office Employees and shall
provide Continuation Coverage to the Business Employees and Corporate Office
Employees under Purchaser's health and medical plans (x) with respect to any
Business Employees and Corporate Office Employees who remain employed with the
Company through the Closing Date, for a period of eighteen months after the
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Closing or, if earlier, until becoming eligible for comparable coverage from
another employer and (y) with respect to any Business Employees and Corporate
Office Employees whose employment shall have terminated prior to the Closing,
for remainder of the period with respect to which Continuation Coverage would
otherwise have been available to them had the Company continued to maintain a
group health plan. Purchaser shall also assume the Company's obligation and
liability for reimbursement of COBRA premiums for six months to any Corporate
Office Employee to whom the Company is so liable as of the Closing Date.
5.3 Cooperation. Following the execution of this Agreement, Purchaser and
the Company agree as follows:
(a) The parties and their Affiliates shall each use their reasonable
efforts, and shall cooperate fully with each other in preparing, filing,
prosecuting, and taking any other actions with respect to, any filings
(other than filings with the FCC, which are provided for in clause (b)
below), applications, requests, or actions which are or may be necessary to
obtain the consents, approvals, authorizations or other orders of any
Governmental Authority which are or may be necessary in order to accomplish
the transactions contemplated by this Agreement; and, without limiting the
generality of the foregoing, the parties and their Affiliates shall use
their respective reasonable efforts to prepare and file as promptly as
practicable, but in any event no later than 15 Business Days after the date
hereof, all of the information called for in the Notification and Report
Form required under the HSR Act and to prepare and file any supplemental
information, also in a timely fashion, which may be required by the United
States Department of Justice or the Federal Trade Commission pursuant to
such Notification and Report Form Filings, and otherwise to use their
respective reasonable efforts to obtain the requisite clearances.
(b) The parties and their Affiliates shall cooperate fully with each
other in preparing, filing, prosecuting, and taking any other actions with
respect to filings with the FCC related to the transactions contemplated by
this Agreement, including, without limitation, preparation of an
application for the assignment of all of the FCC Licenses to Purchaser and
any filings by Purchaser requesting temporary waivers for no more than nine
months of the FCC's applicable ownership rules necessary to permit the
parties to consummate the transactions contemplated by this Agreement. As
promptly as practicable, but in any event not later than ten Business Days
following the execution of this Agreement, the Company and Purchaser shall
jointly file the application with the FCC requesting the FCC Consent. The
Company and Purchaser shall use their respective reasonable best efforts,
diligently take all necessary and proper actions and provide any additional
information requested by the FCC in order to obtain promptly the FCC
Consent, including, without limitation, requesting, consenting to, and
taking and otherwise seeking any action in connection with, a temporary
waiver of the FCC's applicable ownership rules or a divestiture order
relating to WOKR-TV (Rochester, New York), WICS-TV (Springfield, Illinois)
or any other Station where the ownership of such Station and any other
television or radio station that Purchaser or its Affiliates acquires (or
enters into an agreement to acquire) after the date hereof by Purchaser and
its Affiliates would reasonably be expected to materially impede or
materially delay the Closing (any such temporary waiver or divestiture
order, an "Agreed Divestiture").
32
Notwithstanding the foregoing or any other provision of this Agreement,
neither Purchaser nor its officers, directors or Affiliates shall request a
permanent waiver of the FCC's applicable ownership rules or request,
consent to, take or otherwise seek or pursue any action that is
inconsistent with the transactions contemplated by this Agreement or that
reasonably could be expected to materially impede or materially delay the
FCC Consent or otherwise materially impede or materially delay the
consummation of the transactions contemplated by this Agreement; and the
receipt of any permanent waiver of the foregoing FCC rules shall not be a
condition to the obligation of Purchaser to consummate the transactions
contemplated hereby; provided further that, prior to obtaining the FCC
Consent, neither Purchaser nor any of its officers, directors, or
Affiliates shall publicly disclose the identity of any third party (other
than any wholly owned subsidiary of Purchaser) that is contemplated as the
future owner of any of the Stations other than WOKR-TV, Rochester, New
York. Neither Purchaser nor any of its officers, directors or Affiliates
will take any action that would result in any change in the matters set
forth in Section 4.7 hereof that would reasonably be expected to materially
delay or otherwise materially impair Purchaser's ability to consummate the
transactions contemplated hereby; and the Company will not take any action
that would result in any change in the matter set forth in clause (vi) of
Section 3.12 hereof that would reasonably be expected to materially delay
or otherwise materially impair the Company's ability to consummate the
transactions contemplated hereby. After the date hereof, Purchaser or its
Affiliates may enter into transactions that implicate the FCC multiple
ownership rules so long as such transactions would not reasonably be
expected to materially impede or materially delay the Closing.
Notwithstanding the foregoing and except for the Agreed Divestitures,
neither Purchaser nor the Company shall have any obligation to take any
actions that would reasonably be expected to require (i) the divestiture of
any station owned or operated by Purchaser or its Affiliates on the date
hereof or (ii) the termination or material modification of any local
marketing agreement pursuant to which Purchaser or its Affiliates provides
as of the date hereof all or substantially all of the programming for any
stations ((i) and (ii) collectively a "Material Non-Agreed Divestiture").
(c) (i) If Purchaser (or its Affiliates) or the Company receives an
administrative or other order or notification relating to any violation or
claimed violation of the rules and regulations of the FCC, or of any
Governmental Authority, that could affect Purchaser's or the Company's
ability to consummate the transactions contemplated hereby, or (ii) should
Purchaser (or its Affiliates) become aware of any fact (including any
change in law or regulations (or any interpretation thereof by the FCC))
relating to the qualifications of Purchaser (and its controlling persons)
that reasonably could be expected to cause the FCC to withhold the FCC
Consent, Purchaser (in the case of clauses (i) and (ii)) or the Company (in
the case of clause (i)) shall promptly notify the other party or parties
thereof and shall use its reasonable best efforts to take such steps as may
be necessary to remove any such impediment to the transactions contemplated
by this Agreement; and no such notification shall affect the
representations or warranties of the parties or the conditions to their
respective obligations hereunder.
(d) The parties shall each use their reasonable best efforts to obtain
as promptly as reasonably practical all consents that may be required in
connection with the assignment to the Purchaser at Closing of all the
Company's right, title and interest in and
33
to all Material Contracts and all other agreements of the Business to which
the Company is a party, provided that neither the Company nor Purchaser
shall be required to make any payment to any party to any such Material
Contract or other agreement in order to obtain any such consent.
(e) To the extent that there are third-party insurance policies
maintained by the Company covering any Claims or Damages relating to the
assets, business, operations, conduct and employees (including, without
limitation, former employees) of the Business arising out of or relating to
occurrences prior to the Closing, the Company shall use all reasonable
efforts to cause Purchaser to be named as an additional insured with
respect to such policies.
(f) Subject to the terms and conditions of this Agreement, each of the
parties agrees to use its reasonable efforts to take, or cause to be taken,
all actions and to do, or cause to be done, all things necessary, proper or
advisable to consummate and make effective the Closing and the other
transactions contemplated hereby as soon as practicable.
(g) The Company shall cooperate and cause its accountants, including,
but not limited to, PriceWaterhouseCoopers L.L.P., to cooperate in all
reasonable respects with Purchaser's request to conduct an audit of the
Company's financial information as Purchaser may reasonably determine is
necessary to satisfy Purchaser's public company reporting requirements
pursuant to the Securities Act of 1933 or the Securities Exchange Act of
1934, including, without limitation, (i) using commercially reasonable
efforts to obtain the consent of the Company's auditors to permit Purchaser
and Purchaser's auditors to have access to such auditor's work papers, and
(ii) consenting to such access by Purchaser. All costs and expenses
incurred in connection with the preparation (and assimilation of relevant
information for) any such financial statements shall be paid by Purchaser.
5.4 Confidentiality.
(a) Prior to the Closing. The terms of the Confidentiality Agreement
are herewith incorporated by reference and shall continue in full force and
effect until the Closing and shall remain in effect in accordance with its terms
even if this Agreement is terminated.
(b) Financial and Tax Information. Before and after the Closing, each
of the parties shall maintain the confidentiality of the financial and tax
information of the Persons other than the Company in the possession of the
Company under terms similar to those set forth in the Confidentiality Agreement
with respect to "Evaluation Material" as though such terms continued after the
Closing.
5.5 Public Announcements. Except as otherwise required by law or the rules
of any stock exchange, the form and substance of the initial public announcement
of this Agreement and the transactions contemplated hereby, and the time of such
announcement, shall be approved in advance by the parties and the parties shall
not issue any other report, statement or press release or otherwise make any
public announcement with respect to this Agreement and the
34
transactions contemplated hereby without prior consultation in good faith with
the other party hereto.
5.6 No Solicitation. The Company shall not, and shall cause its officers,
directors, representatives, affiliates and associates not to, (a) initiate
contact with, solicit, encourage or respond to any inquiries or proposals by, or
(b) enter into any discussions or negotiations with, or disclose, directly or
indirectly, any information concerning the Business to, or afford any access to
the Company's properties, books and records to, any Person in connection with
any possible proposal for the acquisition (directly or indirectly, whether by
purchase, merger, consolidation or otherwise) of all or substantially all of the
Business. The Company agrees to terminate immediately any such discussions or
negotiations.
5.7 No Additional Representations. Purchaser acknowledges that it and its
representatives have been permitted access to books and records, facilities,
equipment, tax returns, contracts and agreements, insurance policies (or
summaries thereof), and other properties and assets of the Company and that they
and their representatives have had an opportunity to meet with the officers and
employees of the Company to discuss the Company and its business, properties and
assets. PURCHASER ACKNOWLEDGES THAT NEITHER THE COMPANY NOR ANY OTHER PERSON HAS
MADE ANY REPRESENTATION OR WARRANTY, EXPRESSED OR IMPLIED, AS TO THE ACCURACY OR
COMPLETENESS OF ANY INFORMATION REGARDING THE COMPANY FURNISHED OR MADE
AVAILABLE TO PURCHASER AND ITS REPRESENTATIVES EXCEPT AS EXPRESSLY SET FORTH IN
THIS AGREEMENT.
5.8 Certain Payments. (a) Subject to the terms of this Section 5.8(a),
Purchaser shall (to the extent there are available funds in the Security Escrow)
have the right to recover from the Security Escrow 50% of any amount paid by
Purchaser to any Business Employee pursuant to the terms of the Severance
Agreements listed in Sections 3.14.1 and 3.14.2 of the Disclosure Schedule (as
in effect on the date hereof) (the "Scheduled Severance Agreements") (except to
the extent that any liability for such payment shall have decreased Net
Financial Assets, in which event Purchaser shall not be entitled to any recovery
under this Section 5.8 in respect of the portion of the payment for which there
was a liability that decreased Net Financial Assets) in the event that such
Business Employee's employment is terminated on or prior to 90 days after the
Closing Date, provided that the maximum amount that Purchaser shall be entitled
to recover pursuant to this Section 5.8(a) shall be $850,000 in the aggregate
for all Business Employees. Following the 90th day after the Closing Date,
Purchaser will deliver to the Company a certificate certifying as to the
relevant employees who were terminated on or prior to 90 days after the Closing,
the aggregate amount paid by Purchaser to all terminated employees pursuant to
the Scheduled Severance Agreements and the amount Purchaser is entitled to
recover pursuant to this Section 5.8(a). Promptly following the Company's
receipt of the certificate required pursuant to the immediately preceding
sentence, Purchaser and the Company shall provide joint written instructions to
the Security Escrow Agent providing for the transfer to the Purchaser of the
Security Escrow Funds required pursuant to this Section 5.8(a). Purchaser
acknowledges and agrees that its sole and exclusive recourse, remedy and source
of funds available to satisfy any recovery pursuant to this Section 5.8(a) will
be the Security Escrow.
35
(b) It is contemplated that subsequent to the Closing, the Company
will cease operations and vacate the Corporate Offices. Purchaser agrees that it
will pay, indemnify, and hold harmless the Company Indemnified Parties from and
against 50% of all Claims and Damages (including, without limitation, all rent
or other payments made under the Corporate Office Lease arising out of or
relating to the Corporate Office Lease) to the extent such Claims and Damages
arise out of or relate to (x) the termination of the Corporate Office Lease or
(y) the post-closing period after the date in which the Corporate Office
Employees cease using the Corporate Office, provided that the maximum amount
that Purchaser shall be liable for under this Section 5.8(b) is $200,000. All
payments by Purchaser hereunder shall be made as the related Claims and Damages
are incurred. Purchaser acknowledges and agrees that the Company may terminate
the Corporate Office Lease on such terms as the Company shall determine and
otherwise take such action as the Company determines in connection with its
vacating the Corporate Office.
5.9 Bulk Sales Laws. The parties agree to waive compliance with the
provisions of the bulk sales law of any jurisdiction. The Company will indemnify
and hold harmless Purchaser from and against any and all Liabilities which may
be asserted by third parties against Purchaser as a result of such
noncompliance.
5.10 Control of the Stations. Prior to the Closing, control of the Stations
(including, without limitation, control over their finances, personnel and
programming) shall remain with the Company. The Company and Purchaser
acknowledge and agree that neither Purchaser nor any of its employees, agents or
representatives, directly or indirectly, shall, or shall have any right to,
control, direct or otherwise supervise the Stations, it being understood that
supervision of all programs, equipment, operations and other activities of the
Stations shall be the sole responsibility of, and at all times prior to the
Closing remain under the complete control and direction of, the Company.
5.11 Use of Guy Gannett Name. After the Closing, neither Purchaser nor any
of its Affiliates shall use "Guy Gannett" or "Gannett" (collectively, the
"Excluded Names") or any name or term confusingly similar to "Guy Gannett" or
"Gannett" in any corporate name or in connection with the operation of any
business.
Article 6. Conditions to Obligations of Purchaser.
The obligations of Purchaser to consummate the transactions contemplated by
this Agreement to occur at the Closing are, at their option, subject to
satisfaction of each of the following conditions:
6.1 Representations and Warranties. The representations and warranties of
the Company contained herein shall be true and correct at and as of the Closing
Date as though each such representation and warranty were made at and as of such
time, other than such representations and warranties as are made as of a
specific date, in each case except for changes that are expressly contemplated
by this Agreement and except for such failures to be true and correct that would
not reasonably be expected to have a Material Adverse Effect.
36
6.2 Performance by the Company. All of the covenants and agreements to be
complied with and performed by the Company on or before the Closing Date shall
have been complied with or performed, except for such failures to comply with or
perform that would not reasonably be expected to have a Material Adverse Effect.
6.3 Certificate. The Company shall have delivered to Purchaser a
certificate, dated as of the Closing Date, executed on behalf of the Company by
its duly authorized officers or representatives to the effect of Sections 6.1
and 6.2.
6.4 Consents; No Objections. (i) The applicable waiting periods under the
HSR Act shall have expired or been terminated; and
(ii) The parties shall have received all the authorizations, consents,
orders and approvals from Governmental Authorities and consents from third
parties, in each case listed or described in Section 6.4 of the Disclosure
Schedule (which Section includes all of the Company's real estate leases for
towers, transmitters and television broadcasting studios).
(iii) The parties shall have received all authorizations, consents,
orders and approvals from Governmental Authorities necessary to transfer the
material Permits relating to the operation of the Stations' towers, transmitters
and television broadcasting studios as such facilities are operating on the date
hereof, except in each case where the failure to receive such authorizations,
consents, orders or approvals would not reasonably be expected to materially
adversely affect the operations of such facilities, or where such
authorizations, consents, orders or approvals are customarily obtained after the
Closing of a transaction of this nature.
6.5 No Proceedings or Litigation. No preliminary or permanent injunction or
other order or decree issued by any United States federal or state Governmental
Authority, nor any Law promulgated or enacted by any United States federal or
state Governmental Authority, that restrains, enjoins or otherwise prohibits the
transactions contemplated hereby or limits the ability in any material respect
of the rights of the Company to hold its assets (excluding the FCC Licenses) and
conduct its business as it is being conducted as of the Closing Date, or imposes
civil or criminal penalties on any stockholder, director or officer of Purchaser
if such transactions are consummated, shall be in effect.
6.6 [Intentionally omitted]
6.7 FCC Consent. The FCC Consent shall have been issued with respect to the
Stations without any conditions that are materially adverse to Purchaser
notwithstanding that it may not have yet become a Final Order, provided that, if
one or more pre-grant objections shall have been filed with respect to the
applications required by Section 5.3(b) hereof, it shall be a condition
precedent that the FCC Consent shall have become a Final Order. For purposes
hereof, any conditions to the FCC Consent requiring an Agreed Divestiture will
not be considered a condition materially adverse to Purchaser, and any such
condition requiring a Material Non-Agreed Divestiture will be considered a
condition materially adverse to Purchaser.
6.8 No Material Adverse Change. Since the date of this Agreement through
the Closing Date, there shall not have occurred any Material Adverse Effect.
37
6.9 Opinions of Counsel. Purchaser shall have received (a) an opinion of
Preti, Flaherty, Xxxxxxxx & Pachios, dated the Closing Date, substantially in
the form of Exhibit D-1 hereto, (b) an opinion of Xxxxxxx Xxxxxxx & Xxxxxxxx,
dated the Closing Date, substantially in the form of Exhibit D-2 hereto and (c)
an opinion of Dow, Xxxxxx & Xxxxxxxxx, dated the Closing Date, substantially in
the form of Exhibit D-3 hereto.
6.10 Good Standing Certificate. Purchaser shall have received a certificate
as to the formation and good standing of the Company issued by the Secretary of
State of Maine, dated not more than five days before the Closing Date.
6.11 No Transmission Defects. There shall not exist any loss or damage at
any of the Stations which has resulted in the regular broadcast transmission of
such Station (including its effective radiated power) to be diminished in any
material respect; provided, that if any such loss or damage does exist, then
either or both of the Company and Purchaser shall be entitled, by written notice
to the other, to postpone the Closing Date for a period of up to 60 days to
resume such Station's broadcast transmission.
Article 7. Conditions to Obligations of the Company.
The obligations of the Company to consummate the transactions contemplated
by this Agreement to occur at the Closing are, at its option, subject to
satisfaction of each of the following conditions:
7.1 Representations and Warranties. The representations and warranties of
Purchaser contained herein shall be true and correct in all material respects at
and as of the Closing Date as though each such representation and warranty were
made at and as of such time, other than such representations and warranties as
are made as of a specific date, in each case except for changes that are
expressly contemplated by this Agreement.
7.2 Performance by Purchaser. All of the covenants and agreements to be
complied with and performed by Purchaser on or prior to the Closing Date shall
have been complied with or performed, in all material respects, except for such
failures to comply with or perform that would not, individually or in the
aggregate, reasonably be expected to be materially adverse to the Company.
7.3 Certificate. Purchaser shall have delivered to the Company a
certificate, dated as of the Closing Date, executed on behalf of Purchaser by
its duly authorized officers or representatives to the effect of Sections 7.1
and 7.2.
7.4 Consents; No Objections. (i) The applicable waiting periods under the
HSR Act shall have expired or been terminated; and
(ii) The parties shall have received all the authorizations, consents,
orders and approvals from Governmental Authorities and consents from third
parties, in each case listed or described on Section 7.4 to the Disclosure
Schedule.
38
7.5 No Proceedings or Litigation. No preliminary or permanent injunction or
other order or decree issued by any United States federal or state Governmental
Authority, nor any Law promulgated or enacted by any United States federal or
state Governmental Authority, that restrains, enjoins or otherwise prohibits the
transactions contemplated hereby, or imposes civil or criminal penalties on any
stockholder, director or officer of the Company if such transactions are
consummated, shall be in effect.
7.6 FCC Consent. The FCC Consent shall have been issued with respect to the
Stations, notwithstanding that it may not have yet become a Final Order,
provided that, if one or more pre-grant objections shall have been filed with
respect to the applications required by Section 5.3(b) hereof, it shall be a
condition precedent that the FCC Consent shall have become a Final Order.
7.7 Opinion of Counsel. The Company shall have received an opinion of
Xxxxxx & Xxxxxxxx, P.A. dated the Closing Date, covering the same matters
covered by the opinions referred to in Section 6.9 hereof and in form and
substance reasonably satisfactory to the Company.
7.8 Good Standing Certificate. The Company shall have received a
certificate as to the formation and good standing of Purchaser issued by the
Secretary of State of Maryland, dated not more than five days before the Closing
Date.
Article 8. Indemnification
8.1 Indemnification by the Company. Subject in all respects to the
provisions of this Article 8, the Company hereby agrees to indemnify and hold
harmless on and after the Closing Date, Purchaser and its stockholders and
Affiliates and their respective officers, directors, employees and agents, and
their respective and successors and permitted assigns (the "Purchaser
Indemnified Parties") from and against any Claims and Damages asserted against
or incurred by them, directly or indirectly, in connection with, arising out of
or relating to (i) any breach on the part of the Company of any representation
or warranty made by the Company in Article 3 hereof or in any certificate
delivered pursuant to Section 6.3 of this Agreement, (ii) any breach on the part
of the Company of any covenant or agreement made by the Company in this
Agreement, (iii) any breach on the part of the Company of any representation or
warranty made by the Company in any special warranty deed delivered to Purchaser
pursuant to clause (ii) of Section 1.7(a) hereof and (iv) any Retained
Liabilities.
8.2 Indemnification by Purchaser. Subject in all respects to the provisions
of this Article 8, Purchaser hereby agrees to indemnify and hold harmless on and
after the Closing Date the Company and its stockholders and Affiliates and their
respective officers, directors, employees and agents, and their respective
successors and permitted assign (collectively the "Company Indemnified
Parties"), from and against any Claims and Damages asserted against or incurred
by them, directly or indirectly, in connection with, arising out of or relating
to (i) any breach on the part of Purchaser of any representation or warranty
made by Purchaser in Article 4 hereof or in any certificate delivered pursuant
to Section 7.3 of this Agreement, (ii) any breach
39
on the part of Purchaser of any covenant or agreement made by the Purchaser in
this Agreement or (iii) any Assumed Liabilities.
8.3 Limitations on Indemnification Claims and Liability; Termination of
Indemnification. (a) The obligations to indemnify and hold harmless a Person (i)
pursuant to Sections 8.1(i), 8.1(ii), 8.1 (iii), 8.2(i) or 8.2(ii) shall
terminate when the applicable representation, warranty, covenant or agreement
terminates pursuant to Section 10.12 and (ii) pursuant to Section 8.1(iv) or
8.2(iii) shall not terminate; provided, however, that as to clause (i) above the
obligation to indemnify and hold harmless shall not terminate with respect to
any claim as to which the Person to be indemnified shall have, before the
termination of the applicable representation, warranty, covenant or agreement,
previously made a claim for indemnification by delivering a notice to the
indemnifying party in accordance with Section 8.5.
(b) The Company shall not be obligated to indemnify or hold harmless
any Purchaser Indemnified Party under Sections 8.1(i), 8.1(ii) or 8.1(iii)
unless and until all Claims or Damages in respect of the indemnification
obligations of the Company under Sections 8.1(i), 8.1(ii) and 8.1(iii) exceed in
the aggregate $550,000, in which case the Company will (subject to the other
provisions of this Article 8) only be obligated to indemnify and hold harmless
the Purchaser Indemnified Parties for all of such Claims or Damages under
Sections 8.1(i), 8.1(ii) and 8.1(iii) in the aggregate in excess of $275,000,
provided that the provisions of this Section 8.3(b) will not apply to any breach
of any Post-Closing Agreements.
(c) Notwithstanding anything to the contrary in this Agreement and
except for fraud, the sole and exclusive recourse, remedy and source of funds
available to satisfy any claims for indemnification by the Purchaser Indemnified
Parties pursuant to Sections 8.1(i), 8.1(ii) and 8.1(iii) shall be the amount of
the Security Escrow then held on deposit with the Security Escrow Agent subject
to the terms and conditions of the Security Escrow Agreement, and the Purchaser
Indemnified Parties will have no recourse against the assets of the Company
(other than the Security Escrow then held on deposit with the Security Escrow
Agent) in respect of any such claim. Without limiting the foregoing, the maximum
aggregate liability of the Company with respect to all claims for
indemnification under Sections 8.1(i), 8.1(ii) and 8.1(iii) will be limited to
the amount of the Security Escrow held on deposit from time to time with the
Security Escrow Agent.
(d) Notwithstanding anything to the contrary in this Agreement, the
indemnifications in Sections 8.1 and 8.2 hereof will be the sole and exclusive
remedies available to Purchaser and the Company and their respective
stockholders and Affiliates and all of their respective officers, directors,
employees, agents, successors and assigns, after the Closing for any claims
arising out of or relating to any breaches of any representations or warranties
or any covenants or agreements contained in this Agreement, or any certificate
delivered pursuant to this Agreement or otherwise in connection with this
Agreement. Any claim for indemnification must be made as provided in Sections
8.5 and 8.6 hereof.
8.4 Computation of Claims and Damages. Whenever the Indemnitor is required
to indemnify and hold harmless the Indemnitee from and against and hold the
Indemnitee harmless from, or to reimburse the Indemnitee for, any item of Claim
or Damage, the Indemnitor will, subject to the provisions of this Article 8, pay
the Indemnitee the amount of the Claim or
40
Damage (i) reduced by any amounts to which the Indemnitee is entitled from third
parties in connection with such Claim or Damage ("Reimbursements"), (ii) reduced
by the Net Proceeds of any insurance policy payable to the Indemnitee with
respect to such Claim or Damage and (iii) reduced appropriately to take into
account any Tax Benefit to the Indemnitee with respect to such Claim or Damage
through and including the tax year in which the indemnification payment is made,
net of all income Taxes resulting or that will result from the indemnification
payment. For purposes of this Section 8.4, (x) "Net Proceeds" shall mean the
insurance proceeds payable, less any deductibles, co-payments, premium
increases, retroactive premiums or other payment obligations (including
attorneys' fees and other costs of collection) that relates to or arises from
the making of the claim for indemnification and (y) "Tax Benefit" shall mean any
benefit to be recognized by the Indemnitee in connection with the Claim or
Damage based upon the highest blended (federal, state, local and foreign)
marginal income Tax rate applicable to the Indemnitee during the taxable year
for which a return was most recently filed with the Internal Revenue Service
(based on the date of the claim for indemnification). The Indemnitor shall use
commercially reasonable efforts (the expenses of which shall be considered
Claims and Damages for purposes of the relevant indemnity claim) to pursue
Reimbursements or Net Proceeds that may reduce or eliminate Claims and Damages.
If any Indemnitee receives any Reimbursement, Tax Benefit or Net Proceeds after
an indemnification payment is made which relates thereto or if any Indemnitee
receives a Tax Benefit arising after the tax year in which an indemnification
payment is made which relates thereto, the Indemnitee shall promptly repay to
the Indemnitor (or to the Security Escrow if such repayment is made by a
Purchaser Indemnified Party prior to the termination of the Security Escrow)
such amount of the indemnification payment as would not have been paid had the
Reimbursement, Tax Benefit or Net Proceeds reduced the original payment (any
such repayment shall be a credit against any applicable indemnification
threshold or limitation set forth in Section 8.3(b) hereof) at such time or
times as and to the extent that such Reimbursement, Tax Benefit or Net Proceeds
is actually received.
8.5 Notice of Claims. Upon obtaining knowledge of any Claim or Damage which
has given rise to, or could reasonably give rise to, a claim for indemnification
hereunder, the Person seeking indemnification (the "Indemnitee") shall, as
promptly as reasonably practicable (but in no event later than 30 days)
following the date the Indemnitee has obtained such knowledge, give written
notice (a "Notice of Claim") of such claim to the other party (the
"Indemnitor"). The Indemnitee shall furnish to the Indemnitor in good faith and
in reasonable detail such information as the Indemnitee may have with respect to
such indemnification claim (including copies of any summons, complaint or other
pleading which may have been served on it and any written claim, demand,
invoice, billing or other document evidencing or asserting the same). No failure
or delay by the Indemnitee in the performance of the foregoing shall reduce or
otherwise affect the obligation of the Indemnitor to indemnify and hold the
Indemnitee harmless, except to the extent that such failure or delay shall have
adversely affected the Indemnitor's ability to defend against, settle or satisfy
any liability, damage, loss, claim or demand for which such Indemnitee is
entitled to indemnification hereunder. For purposes of this Section 8.5, a
Notice of Claim given in good faith must include a good faith estimate of the
amount of the claim to the extent it is reasonably practicable to determine such
estimate (and, if it is not practicable to determine such estimate and the claim
is made by a Purchaser Indemnified Party, the amount of the Security Escrow
proposed in good faith to be reserved with respect to such claim).
41
8.6 Defense of Third Party Claims. If any claim set forth in the Notice of
Claim given by an Indemnitee pursuant to Section 8.5 hereof is a claim asserted
by a third party, the Indemnitor shall have 30 days after the date that the
Notice of Claim is given by the Indemnitee to notify the Indemnitee in writing
of the Indemnitor's election to defend such third party claim on behalf of the
Indemnitee. If the Indemnitor elects to defend such third party claim, the
Indemnitee shall make available to the Indemnitor and its agents and
representatives all witnesses, pertinent records, materials and information in
the Indemnitee's possession or under the Indemnitee's control as is reasonably
required by the Indemnitor and shall otherwise cooperate with and assist the
Indemnitor in the defense of such third party claim, and so long as the
Indemnitor is defending such third party claim in good faith, the Indemnitee
shall not pay, settle or compromise such third party claim. If the Indemnitor
elects to defend such third party claim, the Indemnitee shall have the right to
participate in the defense of such third party claim, at the Indemnitee's own
expense. In the event, however, that the Indemnitee reasonably determines that
representation by counsel to the Indemnitor of both the Indemnitor and the
Indemnitee may present such counsel with a conflict of interest, then such
Indemnitee may employ separate counsel to represent or defend it in any such
action or proceeding and the Indemnitor will, subject to the provisions of this
Article 8, pay the reasonable fees and disbursements of such counsel. If the
Indemnitor does not elect to defend such third party claim or does not defend
such third party claim in good faith, the Indemnitee shall have the right, in
addition to any other right or remedy it may have hereunder, at the Indemnitor's
expense, to defend such third party claim; provided, however, that such
Indemnitee's defense of or its participation in the defense of any such third
party claim shall not in any way diminish or lessen the indemnification
obligations of the Indemnitor under this Article 8. If the Indemnitor shall
assume the defense of a third party claim, it shall not settle such claim
without the prior written consent of the Indemnitee (i) unless such settlement
includes as an unconditional term thereof the giving by the claimant of a
release of the Indemnitee from all Liability with respect to such claim or (ii)
if such settlement involves the imposition of equitable remedies or the
imposition of any obligations on such Indemnitee other than financial
obligations for which such Indemnitee will be indemnified hereunder. If the
Indemnitee is defending a third party claim it will not settle such claim
without prior written consent of the Indemnitor, which will not be unreasonably
withheld or delayed.
8.7 Assignment of Indemnification and Other Rights. (a) The parties hereto
acknowledge that the Company may at any time after the Closing assign (by
contract, dividend, distribution or otherwise) to its stockholders, or to any
other Person or Persons acting directly or indirectly on behalf of the Company
or such stockholders for such purpose, any or all of the Company's rights in and
to the Security Escrow, the Adjustment Escrow and/or any or all of the Company's
contractual rights to indemnification by the Purchaser under this Agreement.
(b) If all of the Company's rights to and in the Security Escrow shall
have been so assigned to the stockholders and/or such other Person or Persons
(the stockholders in such capacity or such other Person or Persons being
referred to herein as the "Fund Holder"), then the Fund Holder may exercise all
rights of the Company under this Article 8. For the avoidance of doubt, the Fund
Holder will not assume or have any obligation or liability under Section 8.1.
(c) Notwithstanding anything to the contrary in this Agreement,
Purchaser hereby agrees that any action, suit or proceeding brought with respect
to any indemnification obligation
42
under Section 8.2 hereof may be brought against Purchaser by the Company, the
Representatives or the Fund Holder.
(d) Each of the Purchaser Indemnified Parties and the Company
Indemnified Parties shall be third party beneficiaries, and entitled to enforce
the provisions of, this Article 8.
Article 9. Definitions.
Unless otherwise stated in this Agreement, the following capitalized terms
have the following meanings:
Accounting Firm Determination has the meaning set forth in Section 2.2
hereof.
Action means any action, suit, claim, arbitration, or proceeding or
investigation (of which the Company has knowledge) commenced by or pending
before any Governmental Authority.
Actual Net Financial Assets has the meaning set forth in Section 2.2.
Adjustment has the meaning set forth in Section 2.2 hereof.
Adjustment Escrow has the meaning set forth in Section 2.1 hereof.
Adjustment Escrow Agent has the meaning set forth in Section 2.2
hereof.
Adjustment Escrow Agreement has the meaning set forth in Section 2.2
hereof.
Adjustment Agreement has the meaning set forth in Section 2.2 hereof.
Affiliate means, with respect to any specified Person, any other
Person that directly, or indirectly through one or more intermediaries,
controls, is controlled by, or is under common control with such specified
Person.
Agreed Divestiture has the meaning set forth in Section 5.3 hereof.
Agreement or this Agreement means this Purchase Agreement dated as of
the date first above written (including the Exhibits hereto and the
Disclosure Schedule) and all amendments hereto made in accordance with the
provisions of Section 10.8 hereof.
Allocation has the meaning set forth in Section 2.5 hereof.
Assets has the meaning set forth in Section 1.1 hereof.
Assumed Liabilities has the meaning set forth in Section 1.3 hereof.
Audited Financial Statements has the meaning set forth in Section 3.5
hereof.
43
Beneficiary has the meaning set forth in Section 5.2 hereof.
Xxxx of Sale, Assignment and Assumption Agreement has the meaning set
forth in Section 1.7 hereof.
Business means the Company's broadcast television business, including
all business, operations and activities of the Stations.
Business Employees means all current, former and inactive employees of
the Business. For the avoidance of doubt, Corporate Office Employees will
not be considered Business Employees.
Business Day means any day that is not a Saturday, a Sunday or other
day on which banks are required or authorized by law to be closed in the
City of New York.
Call Letters has the meaning set forth in Section 3.16 hereof.
CERCLA means the Comprehensive Environmental Response, Compensation,
and Liability Act of 1980, as amended.
Claims and Damages means any and all losses, claims, demands,
liabilities, obligations, actions, suits, orders, statutory or regulatory
compliance requirements, or proceedings asserted by any Person (including,
without limitation, Governmental Authorities), and all damages, costs,
expenses, assessments, judgments, recoveries and deficiencies, including
interest, penalties, investigatory expenses, consultants' fees, and
reasonable attorneys' fees and costs (including, without limitation, costs
incurred in enforcing the applicable indemnity), of every kind and
description, contingent or otherwise, incurred by or awarded against a
party, provided that "Claims and Damages" shall not include any indirect,
consequential, incidental, exemplary or punitive damages or other special
damages or lost profits (except to the extent payable to a third party as a
result of a third party claim).
Closing has the meaning set forth in Section 1.6 hereof.
Closing Date has the meaning set forth in Section 1.6 hereof.
Closing Statement has the meaning set forth in Section 2.2 hereof.
Code means the Internal Revenue Code of 1986, as amended.
Communications Act means the Communications Act of 1934, as amended.
Company has the meaning specified in the introductory paragraph to
this Agreement.
Company Indemnified Parties shall have the meaning set forth in
Section 8.2.
44
Confidential Memorandum means the confidential information memorandum
relating to the Company's television broadcasting properties dated May 1998
distributed by Lazard Freres & Co. LLC on behalf of the Company.
Confidentiality Agreement means the confidentiality agreement dated
May 1998 between Purchaser and Lazard Freres & Co. LLC on behalf of the
Company.
Continuation Coverage has the meaning set forth in Section 5.2 hereof.
Contribution Agreement means the Amended and Restated Contribution
Agreement dated as of August 14, 1998 by and between Newco and the Company
as such agreement may be amended or modified.
Control (including the terms "controlled by" and "under common control
with"), with respect to the relationship between or among two or more
Persons, means the possession, directly or indirectly, of the power to
direct or to cause the direction of the affairs or management of a Person,
whether through the ownership of voting securities, by contract or
otherwise, including, without limitation, the ownership, directly or
indirectly, of securities having the power to elect a majority of the board
of directors or similar body governing the affairs of such Person.
Corporate Office means the corporate office of the Company located at
Xxx Xxxx Xxxxxx, Xxxxxxxx, Xxxxx, that provides certain support to the
Business and the Maine Media Business.
Corporate Office Employees has the meaning set forth in Section 5.2.
Corporate Office Lease means the Lease dated as of February 16, 1989
between the Company and One City Center Associates, and all addenda and
amendments thereto and memoranda relating thereto.
Defined Contribution Plan has the meaning set forth in Section 5.2
hereof.
Disclosure Schedule means the Disclosure Schedule, dated as of the
date hereof, delivered to Purchaser by the Company in connection with this
Agreement.
Employee Benefit Plans means all "employee benefit plans" within the
meaning of Section 3(3) of ERISA, all bonus, stock option, stock purchase,
incentive, deferred compensation, supplemental retirement, severance and
other employee benefit plans, programs, policies or arrangements,
employment agreements, severance agreements, severance pay policies, plant
closing benefits, executive compensation arrangements, sick leave, vacation
pay, salary continuation for disability, consulting, or other compensation
arrangements, worker's compensation, hospitalization, medical insurance,
life insurance, tuition reimbursement or scholarship programs, employee
discounts, employee loans, employee banking privileges, any plans subject
to Section 125 of the Code, and any plans providing benefits or payments in
the event of a change of control, change in ownership,
45
or sale of a substantial portion (including all or substantially all) of
the assets of any business or portion thereof, in each case with respect to
any present or former employees, directors, or agents and without regard to
whether the plan or arrangement was previously terminated (if potential
liabilities remain) or compensation agreements, in each case for the
benefit of, or relating to, any current employee or former employee of the
Business.
Encumbrance means any security interest, pledge, mortgage, lien
(including, without limitation, tax liens), charge, encumbrance, easement,
adverse claim, preferential arrangement, restriction or defect in title.
Environmental Claims means any and all actions, suits, demands, demand
letters, claims, liens, notices of non-compliance or violation,
investigations, proceedings, consent orders or consent agreements relating
in any way to any Environmental Law, any Environmental Permit, Hazardous
Materials or arising from alleged injury or threat of injury to health,
safety or the environment, including, without limitation (a) by
Governmental Authorities for enforcement, cleanup, removal, response,
remedial or other actions or damages and (b) by any Person for damages,
contributions, indemnification, cost recovery, compensation or injunctive
relief.
Environmental Law means any Law relating to the environment, health,
safety or Hazardous Materials, in force and effect on the date hereof or,
in the case of the Company's certificate to be delivered in accordance with
the provisions of Section 6.3 hereof, on the Closing Date (exclusive of any
amendments or changes to such Law or any regulations promulgated thereunder
or orders, decrees or judgments issued pursuant thereto which are enacted,
promulgated or issued after the date hereof, or in the case of such
certificate, on or after the Closing Date), including but not limited to
CERCLA; the Resource Conservation and Recovery Act of 1986 and Hazardous
and Solid Waste Amendments of 1984, 42 U.S.C. ss.ss.6901 et seq.; the
Hazardous Materials Transportation Act, 49 U.S.C. ss.ss.6901 et seq.; the
Clean Water Act, 33 U.S.C. ss.ss.1251 et seq.; the Toxic Substances Control
Act of 1976, 15 U.S.C. ss.ss.2601 et seq.; the Clean Air Act of 1966, as
amended, 42 U.S.C. ss.ss.7401 et seq.; the Safe Drinking Water Act, 42
U.S.C. ss.ss.300f et seq.; the Atomic Energy Act, 42 U.S.C. ss.ss.2011 et
seq.; the Federal Insecticide, Fungicide and Rodenticide Act, 7 U.S.C.
ss.ss.136 et seq.; and the Emergency Planning and Community Right-to-Know
Act of 1986, 42 U.S.C. ss.ss.1101 et seq.
Environmental Permits means all permits, approvals, identification
numbers, licenses and other authorizations required under any applicable
Environmental Law.
Equipment means all of the tangible personal property, machinery,
equipment, vehicles, rolling stock, furniture, and fixtures of every kind
and description in which the Company has an interest, by ownership or
lease, and used or useful in connection with the Business together with any
replacements thereof, or additions thereto made in the ordinary course of
business between the date hereof and the Closing Date.
ERISA means the Employee Retirement Income Security Act of 1974, as
amended.
46
Excluded Assets has the meaning set forth in Section 1.2 hereof.
Excluded Names has the meaning set forth in Section 5.11 hereof.
FCC means the Federal Communications Commission.
FCC Consent means a public notice of the FCC, or of the Chief, Mass
Media Bureau or Video Services Division, acting under delegated authority,
consenting to the assignment of the FCC Licenses to Purchaser.
FCC Licenses means all licenses, permits and other authorizations
issued by the FCC to the Company used for or in connection with the
Stations, and all applications therefor, together with any renewals,
extensions or modifications thereof and additions thereto between the date
hereof and the Closing.
Final Order means the FCC Consent as to which the time for filing a
request for administrative or judicial review, or for instituting
administrative review sua sponte, shall have expired without any such
filing having been made or notice of such review having been issued; or, in
the event of such filing or review sua sponte, as to which such filing or
review shall have been disposed of favorably to the grantee and the time
for seeking further relief with respect thereto shall have expired without
any request for such further relief having been filed.
Financial Statements has the meaning set forth in Section 3.5 hereof.
Fund Holder has the meaning set forth in Section 8.7 hereof.
GAAP means United States generally accepted accounting principles and
practices as in effect from time to time and applied consistently
throughout the periods involved.
Guy Gannett Trust means the trust created under the last will and
testament of Guy P. Gannett.
Governmental Authority means any United States federal, state or local
government or any foreign government, any governmental, regulatory,
legislative, executive or administrative authority, agency or commission or
any court, tribunal, or judicial body.
Governmental Order means any order, writ, judgment, injunction,
decree, stipulation, determination or award entered by or with any
Governmental Authority. Governmental Orders shall not include Permits.
Hazardous Materials means wastes, substances, materials (whether
solids, liquids or gases), petroleum and petroleum products, byproducts or
breakdown products, radioactive materials, and any other chemicals that are
deemed hazardous, toxic, pollutants or contaminants, or substances
designated, classified or regulated as being
47
"hazardous" or "toxic," or words of similar import, under any Environmental
Law.
HSR Act means the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of
1976, as amended, and the rules and regulations promulgated thereunder.
Indebtedness means obligations with regard to borrowed money and shall
expressly not include either accounts payable or accrued liabilities that
are incurred in the ordinary course of business or obligations under
operating leases regardless of how such leases may be classified or
accounted for on financial statements.
Indemnitee has the meaning set forth in Section 8.5 hereof.
Indemnitor has the meaning set forth in Section 8.5 hereof.
Initial Transfer Amount has the meaning set forth in Section 5.2
hereof.
Initial Transfer Date has the meaning set forth in Section 5.2 hereof.
Intellectual Property means all patents, trademarks, trade names,
service marks, copyrights and other similar intangible assets, and
applications, registrations, extensions and renewals for any of the
foregoing, and other intellectual property owned, leased or used by the
Company in the Business, including, without limitation, Call Letters,
computer software and programs, of the Company used in the Business,
whether owned or used by, or licensed to, the Company.
Knowledge with respect to the Company means, exclusively, information
of which the President and Chief Executive Officer or the Chief Financial
Officer of the Company, or any other employee of the Company designated as
a "vice president" or having primary responsibility for environmental,
employee benefits or labor matters has knowledge after conduct of
reasonable inquiry of the appropriate Company employees having supervisory
responsibility for the matter concerned, including, without limitation, the
general managers of the Stations.
Law means any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, order or other requirement or rule of
law including, without limitation zoning laws and housing, building, safety
or fire ordinances or codes.
Leased Property means all real property of every kind and description
leased by the Company and used in connection with the Business, together
(to the extent leased by the Company) with all buildings and other
structures, towers, antennae, facilities or improvements currently or
hereafter located thereon, all fixtures, systems, equipment and items of
personal property of the Company attached or appurtenant thereto and all
easements, licenses, rights and appurtenances relating to the foregoing,
including, without limitation, the leased property referred to in Section
1.1(c) of the Disclosure Schedule.
Liabilities means as to any Person all debts, adverse claims,
liabilities and obligations, whether accrued or fixed, absolute or
contingent, matured or unmatured,
48
determined or determinable, known or unknown, including, without
limitation, those arising under any federal, state, local or foreign
statute, law, ordinance, regulation, rule, code, order, writ, stipulation
or other governmental requirement (including, without limitation, any
environmental law), action, suit, arbitration, proceeding or investigation
or governmental permit, license, authorization, certificate or approval and
those arising under any contract, agreement, arrangement, commitment or
undertaking.
Maine Media Business means the newspaper publishing business which
publishes the Portland Press Herald and Maine Sunday Telegram, the Kennebec
Journal and the Central Maine Morning Sentinel, and certain related
businesses in Maine (including, without limitation, the "New Media
Development Group," an Internet-based media business; "Voice Information
Services," a telephone information and marketing service; "Guy Gannett
Direct," a direct marketing operation; a telephone directory business; an
integrated marketing group; and the Coastal Journal, a controlled
circulation weekly), and all assets, liabilities, operations and activities
of, and all rights of, the Company in the operations of such businesses
that are to be contributed to, or assumed by, Newco, all as more
particularly described in the Contribution Agreement. Notwithstanding
anything to the contrary in this Agreement, the Maine Media Business does
not include the WGME-TV television broadcasting station licensed to
Portland, Maine ("WGME") or rights to WGME's news and information content
provided via online or audiotext applications of the New Media Development
Group or Voice Information Services.
Maine Media Purchase Agreement means the Purchase Agreement dated as
of August 14, 1998 by and among the Company, Newco, Seattle Times Company
and Times Communications Co.
Material Adverse Effect means any circumstance, change in, or effect
on the Company that has a material adverse effect on the business, results
of operations or financial condition of the Business; provided, however,
that Material Adverse Effect shall not include adverse effects resulting
from (or, in the case of effects that have not yet occurred, reasonably
likely to result from) (i) general economic or industry conditions that
have a similar effect on other participants in the industry, (ii) regional
economic or industry conditions that have a similar effect on other
participants in the industry in such region, (iii) the failure of Purchaser
to give any requested consent pursuant to Section 5.1(a) or (iv) any act of
Purchaser.
Material Contracts means the written agreements (including, without
limitation, amendments thereto), contracts, policies, plans, mortgages,
understandings, arrangements or commitments relating to the Business, to
which the Company is a party or by which its assets are bound as described
below:
(i) any agreement or contract providing for payments to any
Person in excess of $50,000 per year or $250,000 in the aggregate over
the five-year period commencing on the date hereof;
(ii) all time brokerage agreements and affiliation agreements
with television networks;
49
(iii) any license or contract pursuant to which the Company is
authorized to broadcast film or taped programming supplied by others
in excess of $10,000 or having a term of more than one year;
(iv) any employment agreement, consulting agreement or similar
contract providing for payments to any individual in excess of $50,000
per year or $100,000 in the aggregate over the five-year period
commencing on the date hereof;
(v) any retention or severance agreement or contract with respect
to any Person who is to be employed by Purchaser following the
Closing;
(vi) all collective bargaining agreements or other union
contracts;
(vii) (A) any lease of Real Property or (B) any lease of
Equipment or license with respect to Intellectual Property (other than
licenses granted in connection with the purchase of equipment or other
assets) by the Company from another Person providing for payments to
another Person in excess of $25,000 per year or $75,000 in the
aggregate over the five-year period commencing on the date hereof;
(viii) any lease of Equipment or Real Property or license with
respect to Intellectual Property (other than licenses granted in
connection with the purchase of equipment or other assets) by the
Company to another Person providing for payments to the Company in
excess of $20,000 per year or $50,000 in the aggregate over the
five-year period commencing on the date hereof;
(ix) any joint venture, partnership or similar agreement or
contract;
(x) any agreement or contract under which the Company has loaned
any money in excess of $1,000,000 or issued or received any note,
bond, indenture or other evidence of indebtedness in excess of
$1,000,000 or directly or indirectly guaranteed indebtedness,
liabilities or obligations of others in an amount in excess of
$1,000,000;
(xi) any covenant not to compete or contract or agreement,
understanding, arrangement or any restriction whatsoever limiting in
any respect the ability of the Company to compete in any line of
business or with any Person or in any area; and
(xii) any agreement or contract between the Company and any
officer, director, stockholder or employee of the Business or any of
their family members providing for payments in excess of $5,000 (other
than agreements covered in clause (iv) (or that would have been
covered in clause (iv) but for the
50
monetary limits thereunder) or agreements or contracts containing
terms substantially similar to terms available to employees
generally).
Material Contracts shall not include any and all (w) contracts, purchase
orders, purchase commitments, leases and agreements entered into in the
ordinary course of business and relating to the Company (other than those
described in clauses (v), (vii), (viii) or (ix) above) that (A) are
terminable at will without payment of premium or penalty by the Company or
(B) are terminable on not more than 60 days' written notice without payment
of premium or penalty and do not involve the obligation of the Company to
make payments in excess of $10,000 during the 60-day period commencing on
the Closing; (x) contracts with respect to time sales (or other promotion
or sponsorship sales) to advertisers or advertising agencies (including,
without limitation, "trade" or "barter" agreements), sales agency or
advertising representation contracts, and barter obligations or commitments
to suppliers of programming; and (y) contracts with respect to the sale of
production time and/or production services relating to advertising or with
respect to other services.
Material Non-Agreed Divestiture has the meaning set forth in Section
5.3 hereof.
Net Financial Assets means the result of (i) the aggregate amount of
current assets of the Business to be assigned to Purchaser under this
Agreement, excluding for purposes of this calculation, the current portion
of program rights, less (ii) the aggregate amount of current liabilities of
the Business to be assumed by Purchaser under this Agreement, excluding for
purposes of this calculation the current portion of program obligations,
less (iii) the aggregate amount of the Company's liability for supplemental
retirement and deferred compensation under the Employee Benefit Plans set
forth in Section 9 of the Disclosure Schedule and for Continuation Coverage
with respect to Corporate Office Employees, in each case to the extent not
paid by the Company prior to the Closing and excluding the current portion
of such liability, if any, to the extent such portion is included as a
current liability in clause (ii), in each case as of the relevant date of
calculation and calculated (except as otherwise provided in Section 9 of
the Disclosure Schedule) in conformity with GAAP and on a basis consistent
with the basis used in preparing the Unaudited Financial Statements as of,
and for the year ended, December 27, 1997 referred to in Section 3.5
hereof. Net Financial Assets expressly shall not include television program
and film contract rights of the Business as either assets or liabilities;
provided, however, that notwithstanding any prior practice or lack thereof
relating thereto, the programming downpayments related to certain
television programs made prior to the date hereof in advance of customary
payment terms under television program rights contracts shall be expressly
included in prepaid assets to the extent not amortized as of the relevant
date of calculation as more fully described in the example set forth in
Section 9 of the Disclosure Schedule. Without limiting the generality of
the foregoing and subject to the immediately preceding sentence, for
purposes of determining the amount of Net Financial Assets, all revenues
and all expenses arising from the operation of any Station, including,
without limitation, tower rental, business and license fees, utility
charges, real and personal property taxes and assessments levied against
the Assets, property and equipment rentals, applicable copyright or other
fees, sales and service charges, Taxes (except for taxes arising from the
transfer of the Assets under this
51
Agreement and income taxes that constitute a Retained Liability under this
Agreement), employee compensation, including wages, salaries, commissions,
music license fees and similar prepaid and deferred items, shall be
prorated as of the relevant date of calculation in accordance with GAAP.
Net Proceeds has the meaning set forth in Section 8.4 hereof.
New Pension Plan has the meaning set forth in Section 5.2 hereof.
Newco means Media Properties of Maine, LLC, a Delaware limited
liability company, formed at the direction of the Company in connection
with the sale of the Maine Media Business.
Notice of Claim has the meaning set forth in Section 8.5 hereof.
Permits has the meaning set forth in Section 3.11 hereof.
Permitted Exceptions means each of the following:
(i) mortgages, security interests or other Encumbrances described
in Section 4.10 of the Disclosure Schedule;
(ii) liens for taxes, assessments and governmental charges or
levies not yet due and payable or the validity of which is being
contested in good faith by appropriate proceedings;
(iii) Encumbrances imposed by law, such as materialmen's,
mechanics', carriers', workmen's and repairmen's liens and other
similar liens, arising in the ordinary course of business;
(iv) pledges or deposits to secure obligations under workers'
compensation laws or similar legislation or to secure public or
statutory obligations;
(v) survey exceptions, rights of way, easements, reciprocal
easement agreements and other Encumbrances on title to real property
shown in the title insurance commitments April 28, 1998 (for the
property referred to as parcels 2-A, 15-L, 17, 18, 19-A and 19-B in
Section 1.1(d) of the Disclosure Schedule), April 24, 1998 (for the
property referred to as parcel 29 in Section 1.1(d) of the Disclosure
Schedule) and May 4, 1998 (for the property referred to as parcel 34-A
in Section 1.1(d) of the Disclosure Schedule) or that do not,
individually or in the aggregate, materially adversely affect the use
of such property in the conduct of the Company's business as it is
being conducted prior to the Closing;
(vi) zoning laws and other land use restrictions that do not in
any material respect (a) detract from or impair the value or the use
of the property
52
subject thereto, or (b) impair the operation of the Company's business
as it is being conducted prior to the Closing;
(vii) security interests in favor of suppliers of goods for which
payment has not been made in the ordinary course of business
consistent with past practice;
(viii) Encumbrances on the interests of the lessors of properties
in which the Company holds a leasehold interest; and
(ix) any and all other Encumbrances that do not materially
detract from or materially impair the value or the use of the property
subject thereto for the purposes currently utilized in the Business.
Person means any individual, partnership, firm, corporation, limited
liability company, association, trust, unincorporated organization or other
entity, as well as any syndicate or group that would be deemed to be a
person under Section 13(d)(3) of the Securities Exchange Act of 1934, as
amended.
Post-Closing Agreements means those covenants and agreements required
by this Agreement to be performed after the Closing.
Prepaid Fiduciary Insurance Policy has the meaning set forth in
Section 5.2 hereof.
Program Contracts has the meaning set forth in Section 1.1 hereof.
Proposed NFA Adjustment has the meaning set forth in Section 2.2
hereof.
Purchaser has the meaning specified in the introductory paragraph to
this Agreement.
Purchaser Indemnified Parties has the meaning set forth in Section 8.1
hereof.
Purchaser Savings Plan has the meaning set forth in Section 5.2
hereof.
Real Property means all real property of every kind and description
and related mineral rights owned by the Company and used in connection with
the Business, together with all buildings and other structures, towers,
antennae, facilities or improvements currently or hereafter located
thereon, all fixtures, systems, equipment and items of personal property of
the Company attached or appurtenant thereto and all easements, licenses,
rights and appurtenances relating to the foregoing, including, without
limitation, the owned property set forth in Section 1.1(c) of the
Disclosure Schedule.
Regulations means the Treasury Regulations (including Temporary
Regulations) promulgated by the United States Department of Treasury with
respect to the Code or other federal tax statutes.
53
Reimbursements has the meaning set forth in Section 8.4 hereof.
Release means disposing, discharging, injecting, spilling, leaking,
leaching, dumping, emitting, escaping, emptying, seeping, placing and the
like into or upon any land or water or air or otherwise entering into the
environment.
Representatives means Xxxxxxxxx X. Xxxxxx and Xxxx X. Xxxxxxx, not
individually, but solely in their capacity as the representatives of the
stockholders of the Company with respect to certain provisions of this
Agreement by virtue of being trustees of the Guy Gannett Trust and
attorneys-in-fact for the other stockholders of the Company.
Resolution has the meaning set forth in Section 2.2 hereof.
Retained Liability has the meaning set forth in Section 1.3(b) hereof.
Section 414 Amount has the meaning set forth in Section 5.2 hereof.
Security Escrow has the meaning set forth in Section 2.3 hereof.
Security Escrow Agent has the meaning set forth in Section 2.3 hereof.
Security Escrow Agreement has the meaning set forth in Section 2.3
hereof.
Seller Pension Plan has the meaning set forth in Section 5.2 hereof.
Stations means the following television broadcasting station
properties of the Company: WOKR-TV, Rochester, New York; WICS-TV,
Springfield, Illinois; WICD-TV, Champaign, Illinois; WGGB-TV, Springfield,
Massachusetts; WGME-TV, Portland, Maine; KGAN-TV, Cedar Rapids, Iowa; and
WTWC-TV, Tallahassee, Florida.
Subsidiary of any Person means (i) any corporation more than 50% of
whose stock of any class or classes having by the terms thereof ordinary
voting power to elect a majority of the directors of such corporation is
owned by such Person directly or indirectly, through Subsidiaries and (ii)
any partnership, limited partnership, limited liability company,
associates, joint venture or other entity in which such Person directly or
indirectly through Subsidiaries has more than a 50% equity interest.
Tax or Taxes means any and all taxes, fees, withholdings, levies,
duties, tariffs, imposts, and other charges of any kind (together with any
and all interest, penalties, additions to tax and additional amounts
imposed with respect thereto) imposed by any government or taxing
authority, including, without limitation, taxes or other charges on or with
respect to income, franchises, windfall or other profits, gross receipts,
property, sales, use, capital stock, payroll, employment, social security,
workers' compensation, unemployment compensation, or net worth, taxes or
other charges in the nature of excise, withholding, ad valorem, stamp,
transfer, value added or gains taxes, license, registration and
documentation fees, and customs duties, tariffs and similar charges.
54
Tax Benefit has the meaning set forth in Section 8.4 hereof.
Tax Return means any report, return, document, declaration or other
information or filing required to be supplied to any Tax authority or
jurisdiction (foreign or domestic) with respect to Taxes, including,
without limitation, information returns, any documents with respect to or
accompanying payments of estimated Taxes, or with respect to or
accompanying requests for the extension of time in which to file any such
report, return, document, declaration or other information.
Termination Date has the meaning set forth in Section 10.1 hereof.
True-Up Amount has the meaning set forth in Section 5.2 hereof.
True-Up Date has the meaning set forth in Section 5.2 hereof.
Trust has the meaning set forth in Section 5.2 hereof.
Unaudited Financial Statements has the meaning set forth in Section
3.5 hereof.
Article 10. Miscellaneous Provisions.
10.1 Termination Rights. (a) Grounds for Termination. This Agreement may be
terminated:
(i) by mutual consent of the parties;
(ii) by either the Company or Purchaser, provided such party is not
then in material default hereunder, upon written notice to the other party,
if the Closing hereunder has not occurred on or before September 4, 1999
(the "Termination Date"), provided that if the FCC Consent is obtained
during the 15 days prior to September 4, 1999, the Termination Date will
not occur until the 15th day after receipt of the FCC Consent, provided
further that if either or both of the Company and Purchaser shall have
postponed the Closing Date pursuant to Section 6.11 hereof, the Termination
Date will occur no earlier than the end of the period of such postponement,
and provided further that if the Closing hereunder has not occurred on or
before September 4, 1999 due to a publicly announced federal governmental
shutdown affecting, or any other publicly announced freeze on the
processing of applications to transfer station licenses by, the FCC
(collectively, a "FCC Shutdown"), the Termination Date will be extended by
a period of time equal to the duration of the FCC Shutdown, but in no event
shall the Termination Date be extended to a date any later than the earlier
of (x) 60 days after the end of the FCC Shutdown or (y) December 4, 1999.
(iii) by either the Company or Purchaser, upon written notice to the
other party, if any Governmental Authority shall have issued a statute,
rule, regulation, order, decree or injunction or taken any other action
permanently restraining, enjoining or
55
otherwise prohibiting the Closing and such statute, rule, regulation,
order, decree or injunction or other action shall have become final and
nonappealable, provided that this clause (iii) will not be applicable to
actions of the FCC subject to clause (iv) below;
(iv) by either the Company or Purchaser, upon written notice to the
other party, if (i) the FCC, or the Chief, Mass Media Bureau of the FCC,
acting under delegated authority, shall have denied the application for
assignment of the FCC Licenses to Purchaser, (ii) the parties' request for
administrative or judicial review, or the FCC's administrative review sua
sponte, shall not have been disposed of favorably to the parties and (iii)
the parties have no further relief available to them;
(v) by Purchaser, by written notice to the Company, if there has been
a material breach by the Company of any representation, warranty, covenant
or agreement set forth in this Agreement such that the condition precedent
set forth in Section 6.1 or 6.2 hereof would not be satisfied, which breach
has not been cured within 20 Business Days following receipt by the
breaching party of written notice of such breach; or
(vi) by the Company by written notice to Purchaser if there has been a
material breach by Purchaser of any representation, warranty, covenant or
agreement set forth in this Agreement such that the condition precedent set
forth in Section 7.1 or 7.2 hereof would not be satisfied, which breach has
not been cured within 20 Business Days following receipt by the breaching
party of written notice of such breach; or
(vii) by Purchaser by written notice to the Company, if the FCC has
revoked the Company's FCC License for any Station.
(b) Post-Termination Liability. If this Agreement is terminated
pursuant to Subsection 10.1(a) hereof, this Agreement shall thereupon become
void and of no further effect whatsoever, and the parties shall be released and
discharged of all obligations under this Agreement, except (i) to the extent of
a party's liability for willful material breaches of this Agreement prior to the
time of such termination, (ii) as set forth in Section 5.4 hereof and (iii) the
obligations of each party for its own expenses incurred in connection with the
transactions contemplated by this Agreement as provided herein.
10.2 Litigation Costs. If any litigation with respect to the obligations of
the parties under this Agreement results in a final nonappealable order of a
court of competent jurisdiction that results in a final disposition of such
litigation, the prevailing party, as determined by the court ordering such
disposition, shall be entitled to reasonable attorneys' fees as shall be
determined by such court. Contingent or other percentage compensation
arrangements shall not be considered reasonable attorneys' fees.
10.3 Expenses. Except as otherwise specifically provided in this Agreement,
all costs and expenses, including, without limitation, fees and disbursements of
counsel, financial advisors and accountants, incurred in connection with this
Agreement and the transactions contemplated hereby shall be paid by the party
incurring such costs and expenses, whether or not the Closing shall have
occurred, provided that the Company and Purchaser shall each be responsible and
pay 50% of the HSR Act filing fee and the filing fees payable to the FCC in
56
connection with the filing of the application for assignment of the FCC
Licenses. It is understood and agreed that all costs and expenses incurred in
connection herewith and the transactions contemplated hereby by or on behalf of
the Company, its existing stockholders and the Representatives, including,
without limitation, the fees and disbursements of Lazard Freres & Co. LLC;
Preti, Flaherty, Xxxxxxxx & Pachios, LLC; Xxxxxxx Xxxxxxx & Xxxxxxxx; Seyfarth,
Shaw, Xxxxxxxxxxx & Xxxxxxxxx; Xxxxxxx, Xxxxxxx & X'Xxxxxxx; Dow, Xxxxxx &
Xxxxxxxxx, PLLC; PriceWaterhouseCoopers L.L.P.; and Xxxxxx Xxxxx & Company,
shall be paid by the Company.
10.4 Notices. Any notice, demand, claim, notice of claim, request or
communication required or permitted to be given under the provisions of this
Agreement shall be in writing and shall be deemed to have been duly given (i)
upon delivery if delivered in person, (ii) on the next Business Day after the
date of mailing if mailed by registered or certified mail, postage prepaid and
return receipt requested, (iii) on the next Business Day after the date of
delivery to a national overnight courier service, or (iv) upon transmission by
facsimile (if such transmission is confirmed by the addressee) if delivered
through such services to the following addresses, or to such other address as
any party may request by notifying in writing all of the other parties to this
Agreement in accordance with this Section 10.4.
If to the Company:
Guy Gannett Communications
Xxx Xxxx Xxxxxx
X.X. Xxx 00000
Xxxxxxxx, Xxxxx 00000-0000
Attention: Xxxxx X. Xxxxx
Chief Financial Officer
Facsimile No.: (000) 000-0000
with a copy to:
Xxxx X. Xxxxxxxx, Esq.
Preti, Flaherty, Xxxxxxxx & Pachios, LLC
X.X. Xxx 0000
Xxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxx 00000-0000
Facsimile No.: (000) 000-0000
and
Xxxxxx X. Xxxxx, Esq.
Xxxxxxx Xxxxxxx & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Facsimile No.: (000) 000-0000
57
If to Purchaser:
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: President
Facsimile No.: (410)
with copy to:
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: General Counsel
Facsimile No.: (000) 000-0000
and
Xxxxxx X. Xxxxxx, Esq.
Xxxxxx & Xxxxxxxx, P.A.
000 Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000-0000
Facsimile No.: (000) 000-0000
Any such notice shall be deemed to have been received on the date of
personal delivery, the date set forth on the Postal Service return receipt, or
the date of delivery shown on the records of the overnight courier, as
applicable.
10.5 Benefit and Assignment. This Agreement will be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns. Except as provided in Section 8.7, there shall be no
assignment of any interest under this Agreement by any party except that
Purchaser may assign its rights hereunder to any wholly owned subsidiary of
Purchaser and except that after the Closing the Company may assign its rights
hereunder to the Fund Holder; provided, however, that no such assignment shall
relieve the assignor of its obligations under this Agreement. Except as
expressly otherwise provided in Article 8 hereof, nothing herein, express or
implied, is intended to or shall confer upon any other Person any legal or
equitable right, benefit or remedy of any nature whatsoever under or by reason
of this Agreement.
10.6 Waiver. Any party to this Agreement may (a) extend the time for the
performance of any of the obligations or other acts of any other party, (b)
waive any inaccuracies in the representations and warranties of any other party
contained herein or in any document delivered by any other party pursuant hereto
or (c) waive compliance with any of the agreements or conditions of any other
party contained herein. Any such extension or waiver shall be valid
58
only if set forth in an instrument in writing signed by the party to be bound
thereby. Any waiver of any term or condition shall not be construed as a waiver
of any subsequent breach or a subsequent waiver of the same term or condition,
or a waiver of any other term or condition, of this Agreement. The failure of
any party to assert any of its rights hereunder shall not constitute a waiver of
any such rights.
10.7 Severability. If any term or other provision of this Agreement is
invalid, illegal or incapable of being enforced by any Law or public policy, all
other terms and provisions of this Agreement shall nevertheless remain in full
force and effect so long as the economic or legal substance of the transactions
contemplated hereby is not affected in any manner materially adverse to any
party. Upon such determination that any term or other provision is invalid,
illegal or incapable of being enforced, the parties hereto shall negotiate in
good faith to modify this Agreement so as to effect the original intent of the
parties as closely as possible in an acceptable manner in order that the
transactions contemplated hereby are consummated as originally contemplated to
the greatest extent possible.
10.8 Amendment. This Agreement may not be amended or modified except (a) by
an instrument in writing signed by, or on behalf of, the Company and Purchaser
or (b) by a waiver in accordance with Section 10.6 hereof.
10.9 Effect and Construction of this Agreement. This Agreement embodies the
entire agreement and understanding of the parties with respect to the subject
matter hereof and supersedes any and all prior agreements, arrangements and
understandings, whether written or oral, relating to matters provided for
herein; provided, however, that the Confidentiality Agreement shall remain in
effect until the Closing. The language used in this Agreement shall be deemed to
be the language chosen by the parties hereto to express their mutual agreement,
and this Agreement shall not be deemed to have been prepared by any single party
hereto. Disclosure of any fact or item in the Disclosure Schedule referenced by
a particular paragraph or section in this Agreement shall, should the existence
of the fact or item or its contents be relevant to any other paragraph or
section, be deemed to be disclosed with respect to that other paragraph or
section whether or not a specific cross reference appears, if the disclosure in
respect of the one paragraph or section is reasonably sufficient to inform the
reader of the information required to be disclosed in respect such other
paragraph or section. Disclosure of any fact or item in the Disclosure Schedule
shall not necessarily mean that such item or fact, individually or in the
aggregate, is material to the business, results of operations or financial
condition of the Company. Time shall be of the essence in enforcing and applying
the covenants and conditions set forth in this Agreement. The headings of the
sections and subsections of this Agreement are inserted as a matter of
convenience and for reference purposes only and in no respect define, limit or
describe the scope of this Agreement or the intent of any section or subsection.
This Agreement may be executed in one or more counterparts and by the different
parties hereto in separate counterparts, each of which when executed shall be
deemed to be an original but all of which taken together shall constitute one
and the same agreement. This Agreement and the rights and duties of the parties
hereunder shall be governed by, and construed in accordance with, the laws of
the State of New York.
10.10 Transfer and Conveyance Taxes. Purchaser and the Company shall each
be liable for and shall pay one-half of all applicable sales, transfer,
recording, deed, stamp and other
59
similar non-income taxes, imposed in connection with transfers and conveyances
of the Assets, including, without limitation, any real property transfer or
gains taxes (if any), resulting from the consummation of the transactions
contemplated by this Agreement.
10.11 Specific Performance. Each of the parties hereto acknowledges and
agrees that in the event of any breach of this Agreement, each non-breaching
party would be irreparably and immediately harmed and could not be made whole by
monetary damages. It is accordingly agreed that the parties hereto (i) waive, in
any action for specific performance, the defense of adequacy of a remedy at law
and (ii) shall be entitled, in addition to any other remedy to which they may be
entitled at law or in equity, to compel specific performance of this Agreement
in any action instituted in any state or federal court having jurisdiction
thereover.
10.12 Survival of Representations, Warranties and Covenants. The respective
representations and warranties of the Company and Purchaser contained herein or
in any certificate or special warranty deed delivered pursuant hereto and any
and all covenants and agreements herein or therein (other than those covenants
and agreements required by this Agreement to be performed after the Closing)
shall expire with, and be terminated and extinguished upon, the one year
anniversary of the Closing Date.
Article 11. No Personal Liability for Representatives, Stockholders,
Directors or Officers. Purchaser understands, acknowledges and agrees that the
directors and officers and consultants of the Company, the trustees under the
Employee Benefit Plans and the Representatives have performed, or may perform,
certain acts required or permitted under this Agreement on behalf of the Company
to facilitate the transactions among the parties to this Agreement contemplated
herein. Notwithstanding anything to the contrary contained herein, no
stockholder, director or officer of the Company, any such consultant, any such
trustee or any Representative (nor any Affiliate of the foregoing) shall, under
any circumstances, have, and the Purchaser hereby absolves all such Persons
from, any personal liability to the Purchaser (and each of their its Affiliates)
for such acts to the extent deemed to be actions by or on behalf of the Company.
60
IN WITNESS WHEREOF, the parties hereto have executed this Agreement as of
the day and year first above written.
GUY GANNETT COMMUNICATIONS
By:
Name:
Title:
XXXXXXXX COMMUNICATIONS, INC.
By:
Name:
Title:
Exhibit A to
Purchase Agreement
XXXX OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS XXXX OF SALE, ASSIGNMENT AND ASSUMPTION AGREEMENT (this "Agreement")
made as of __________________, 1998, by and between GUY GANNETT COMMUNICATIONS,
a Maine corporation ("the Company"), and XXXXXXXX COMMUNICATIONS, INC., a
Maryland corporation ("Purchaser").
WHEREAS, the Company and Purchaser are parties to a Purchase Agreement,
dated as of September 4, 1998 (the "Purchase Agreement");
WHEREAS, pursuant to the Purchase Agreement, the Company has agreed to
sell, assign, transfer and deliver to Purchaser all of the Company's right,
title and interest in and to all of the real, personal or mixed properties,
assets and other rights, both tangible and intangible (other than the Excluded
Assets as defined in the Purchase Agreement), owned or leased by, or licensed to
or used or useful by, the Company on the Closing Date (as defined in the
Purchase Agreement) in connection with the Company's broadcast television
business, including all business, operations and activities of the Station (as
defined in the Purchase Agreement) (collectively, the "Assets" and the
"Business," respectively), and Purchaser has agreed to purchase, acquire, accept
and pay for the Assets and assume and agree to perform and fully discharge when
due all Liabilities (as defined in the Purchase Agreement) and obligations of
the Company related to or arising from or in connection with the Assets or the
Business, other than Retained Liabilities (as defined in the Purchase Agreement)
(collectively, the "Assumed Liabilities");
WHEREAS, the parties wish to effect the sale, assignment, transfer and
delivery of the Assets, and assumption of the Assumed Liabilities by entering
into this Agreement.
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained herein, the parties hereto agree as follows:
Capitalized terms used herein and not otherwise defined are used as defined
in the Purchase Agreement.
1. Assignment of Assets. The Company hereby sells, conveys, assigns,
transfers and delivers to Purchaser, its successors and assigns, forever, all of
the Company's right, title and interest in and to all of the Assets. Without
limiting the generality of the foregoing, the Company is not selling, conveying,
assigning, transferring or delivering any of the Excluded Assets.
2. Acceptance of Assignment; Assumption of Liabilities. (a) Purchaser
hereby purchases, acquires, accepts and agrees to pay for all of the Assets, and
assumes and agrees to perform and fully discharge when due all Assumed
Liabilities.
(b) Purchaser is not assuming, nor shall Purchaser be deemed to have
assumed, the Retained Liabilities or any Liability or obligation whatsoever,
except as expressly provided for in this Agreement and the Purchase Agreement.
3. Purchase Agreement. The provisions of this Agreement are subject to the
provisions of the Purchase Agreement. To the extent that such provisions and the
provisions of this Agreement are inconsistent with one another or in conflict,
the provisions of the Purchase Agreement shall take precedence. This Agreement
shall in no event enlarge, reduce or otherwise affect the rights, warranties or
covenants of the parties as set forth in the Purchase Agreement. The Purchase
Agreement shall survive the execution and delivery of this Agreement.
4. Cooperation. The parties shall, from time to time, execute, acknowledge,
deliver and perform, or cause to be executed, acknowledged, delivered and
performed, all such further instruments, acts, assignments, transfers,
conveyances, powers of attorney and assurances as Purchaser may reasonably
request to more effectively convey, transfer and vest in Purchaser, and to put
Purchaser in possession and operating control of the Assets and the Business in
accordance with the Purchase Agreement.
5. Benefit and Assignment. This Agreement will be binding upon and inure to
the benefit of the parties hereto and their respective successors and permitted
assigns.
6. Construction of this Agreement. The headings of the sections of this
Agreement are inserted as a matter of convenience and for reference purposes
only and in no respect define, limit or describe the scope of this Agreement or
the intent of any section or subsection. This Agreement may be executed in one
or more counterparts and by the different parties hereto in separate
counterparts, each of which when executed shall be deemed to be an original but
all of which taken together shall constitute one and the same agreement. This
Agreement and the rights and duties of the parties hereunder shall be governed
by, and construed in accordance with, the laws of the State of New York.
7. Amendment. This Agreement may not be amended or modified except by an
instrument in writing signed by, or on behalf of, the Company and Purchaser.
[REST OF PAGE LEFT INTENTIONALLY BLANK,
SIGNATURE PAGE TO FOLLOW]
2
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first above written.
GUY GANNETT COMMUNICATIONS
By:
--------------------------
Name:
Title:
XXXXXXXX COMMUNICATIONS, INC.
By:
--------------------------
Name:
Title:
3
Exhibit B to
Purchase Agreement
ADJUSTMENT ESCROW AGREEMENT
This ADJUSTMENT ESCROW AGREEMENT (this "Agreement") made as of
____________________, 1998, by and among GUY GANNETT COMMUNICATIONS, a Maine
corporation (the "Company"), XXXXXXXX COMMUNICATIONS, INC., a Maryland
corporation ("Purchaser"), and [__________] Bank, a [________ Bank], as
Adjustment Escrow Agent (the "Adjustment Escrow Agent").
WHEREAS, the Company and Purchaser are parties to a Purchase Agreement
dated as of September 4, 1998 (the "Purchase Agreement");
WHEREAS, pursuant to the Purchase Agreement, the Company shall sell,
assign, transfer and deliver to Purchaser the assets and business of the
Business (as defined in the Purchase Agreement), and Purchaser shall purchase
and acquire such assets and business;
WHEREAS, pursuant to Section 2.1(c)(ii) of the Purchase Agreement,
Purchaser shall deliver to the Adjustment Escrow Agent on the Closing Date (as
defined in the Purchase Agreement), the sum of (x) $3,000,000 plus (y) the
Proposed Earnings Adjustment (as defined in the Purchase Agreement), if any,
(the "Adjustment Escrow Amount");
WHEREAS, as contemplated by the Purchase Agreement, the Adjustment Escrow
Agent shall hold the Adjustment Escrow Amount in escrow until the Actual Net
Financial Assets and the Earnings Adjustment (in each case as defined in the
Purchase Agreement) are determined, following which the Adjustment Escrow Amount
is to be distributed in accordance with the Section 2.2(c) of the Purchase
Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained herein, the parties hereto agree as follows:
Capitalized terms used herein and not otherwise defined are used as defined
in the Purchase Agreement.
1. Appointment of Adjustment Escrow Agent. The Company and Purchaser hereby
appoint [_____________ Bank] to act as Adjustment Escrow Agent hereunder, and
[____________ Bank] hereby accepts such appointment and agrees to act as
Adjustment Escrow Agent on the terms and conditions set forth hereinafter.
2. Adjustment Escrow Amount. (a) On the Closing Date, Purchaser shall
deliver to the Adjustment Escrow Agent by wire transfer of immediately available
funds (to account number [______________] of the Adjustment Escrow Agent (the
"Adjustment Escrow Account")) the Adjustment Escrow Amount, accompanied by
written notice from Purchaser identifying such amount as an amount being
delivered for deposit into the Adjustment Escrow Account. The Adjustment Escrow
Agent shall acknowledge to Purchaser the Adjustment Escrow
Agent's receipt of said amount.
(b) The Adjustment Escrow Amount, not including the interest and other
investment income earned thereon, shall only serve to pay the amounts set forth
in Section 4 hereof.
(c) The Adjustment Escrow Agent shall hold the balance of the
Adjustment Escrow Amount (the "Adjustment Escrowed Funds") in escrow and shall
not withdraw the Adjustment Escrowed Funds from the Adjustment Escrow Account or
use the Adjustment Escrowed Funds for any other purpose, except as provided in
this Agreement.
3. Investments of Adjustment Escrowed Funds. (a) The Adjustment Escrow
Agent shall invest and reinvest the Adjustment Escrowed Funds from time to time,
upon receipt of the written instructions thereto issued by the Company or the
Fund Holder (as defined in Section 6 hereof), as the case may be, in:
(i) Commercial paper of any corporation rated at least A-1 by S&P and P-1
by Moody's;
(ii) Negotiable certificates of deposit of United States banks having (A) a
long-term senior debt rating of at least A by S&P and Moody's, (B)
deposits in excess of $2,000,000,000 and (C) commercial paper rating
designations of at least A-1 by S&P and P-1 by Moody's;
(iii)Repurchase agreements with any United States bank which are fully
collateralized by direct obligations of the United States or
obligations of agencies or sponsored agencies of the United States
government, excluding in all cases collateralized mortgage obligations
of any kind; and
(iv) Money market instruments rated at least A-1 by S&P and P-1 by Moody's
that are restricted to investments described in clause (iii);
provided that in no event shall any investment of the types described in clause
(i), (ii) or (iv) exceed ten percent of the net assets of the issuer thereof and
provided further that all investments shall have maturity dates on or before the
anticipated dates of the relevant payments hereunder.
(b) To the extent the Adjustment Escrow Agent invests any funds in the
manner provided for in this Section 3 and in accordance with the written
instructions from the Company or the Fund Holder, as the case may be, no party
hereto shall be liable for any loss which may be incurred by reason of any such
investment. No investment shall exceed the term of this Agreement.
(c) The Adjustment Escrow Agent shall have the power to reduce, sell
or liquidate the foregoing investments whenever it shall be required to release
all or any portion of the Adjustment Escrowed Funds pursuant to Section 4
hereof.
2
(d) The Adjustment Escrow Agent is authorized to register securities
held by it in its name or in the name of a nominee or in bearer form and may
deposit any securities or other property in a depository or a clearing
corporation.
(e) Any interest or other investment income earned for the period from
the time that any portion of the Purchase Price is delivered to the Adjustment
Escrow Agent pursuant to the Purchase Agreement until all amounts held in the
Adjustment Escrow Account have been distributed in accordance with Section 4
hereof shall be paid to the Company or the Fund Holder, as the case may be, in
addition to, and at the same time as, payment of the Adjustment Escrowed Funds;
provided, however, that, to the extent that any portion of the Adjustment
Escrowed Funds is paid to Purchaser pursuant to of Section 4 hereof, a pro rata
portion of such interest or other investment income (determined on the basis of
the relative portions of the Adjustment Escrowed Funds to be paid to Purchaser
and the Company or the Fund Holder, as the case may be, respectively) shall be
instead paid to Purchaser. Any such interest or other investment income shall be
deemed not to constitute Adjustment Escrowed Funds.
4. Adjustment Escrowed Funds. (a) As soon as practicable after the earlier
of an Adjustment Agreement or an Accounting Firm Determination (but in any event
within two Business Days after the Adjustment Agreement or the Accounting Firm
Determination), (x) Purchaser and (y) the Company or the Fund Holder, as the
case may be, shall give the Adjustment Escrow Agent joint written instructions
(an "Instruction") to distribute amounts from the Adjustment Escrowed Funds and
the interest and other investment income earned to the Company or the Fund
Holder, as the case may be, and (if applicable) Purchaser respectively, in
accordance with Sections 2.2(c) and 2.2(d) of the Purchase Agreement.
(b) Each Instruction given by Purchaser and the Company or the Fund
Holder, as the case may be, to the Adjustment Escrow Agent shall be signed by an
authorized representative of Purchaser and the Company or the Fund Holder, as
the case may be.
(c) Promptly upon receipt of the Instruction from (x) Purchaser and
(y) the Company or the Fund Holder, as the case may be, the Adjustment Escrow
Agent shall distribute the Adjustment Escrowed Funds and the interest and other
investment income earned in accordance with the Instruction.
(d) The Adjustment Escrow Agent shall make no payment or delivery to
Purchaser and/or the Company or the Fund Holder, as the case may be, except
pursuant to (i) an Instruction signed by the authorized representatives of both
Purchaser and the Company or the Fund Holder, as the case may be or (ii) a final
nonappealable order, judgment, writ, decree of any Federal or State court of
competent jurisdiction.
(e) All payments to be made pursuant to this Section 4 shall be made
by wire transfer in immediately available funds to the Person or Persons
entitled thereto.
5. Purchase Agreement. The provisions of this Agreement are subject to the
provisions of the Purchase Agreement, including, without limitation, Article 2
thereof. To the extent that such provisions and the provisions of this Agreement
are inconsistent with one
3
another or in conflict, the provisions of the Purchase Agreement shall take
precedence.
6. Fund Holder. The parties hereto expressly acknowledge that the Company
may assign all of its rights and obligations under this Agreement and to and in
the Adjustment Escrowed Funds to the stockholders of the Company or to any
person or entity or any persons or entities acting directly or indirectly on
behalf of the Company or such stockholders. Upon such assignment and upon the
Company's delivery to the parties hereto of a notice thereof, the Company shall
be released from all of its obligations under this Agreement. As used herein,
the term "Fund Holder" means the person, persons, entity and/or entities to whom
the Company's rights and obligations hereunder have been assigned.
7. Settlement of Disputes. Any dispute which may arise under this Agreement
with respect to the delivery and/or ownership or right of possession of the
Adjustment Escrowed Funds (or other funds held by the Adjustment Escrow Agent
pursuant hereto) or any part thereof, or the duties of the Adjustment Escrow
Agent hereunder, shall be settled either by mutual agreement of the Company or
the Fund Holder, as the case may be, and Purchaser (evidenced by appropriate
instructions in writing to the Adjustment Escrow Agent, signed by such parties)
or, failing such agreement, either the Company or the Fund Holder, as the case
may be, or Purchaser shall have the right to submit the dispute to any federal
or state court located in Portland, Maine. Each party waives any objection which
it may now or hereafter have to the laying of venue of any such proceeding, and
irrevocably submits to the jurisdiction of such courts in any such suit, action
or proceeding. The Adjustment Escrow Agent shall be under no duty whatsoever to
institute or defend any such proceedings. Prior to the settlement of any such
dispute, the Adjustment Escrow Agent is authorized and directed to retain in its
possession, without liability to anyone, that portion of the Adjustment Escrowed
Funds and the interest and other investment income earned thereon which is the
subject of such dispute.
8. Concerning the Adjustment Escrow Agent. (a) The Adjustment Escrow Agent
shall have no duties or responsibilities except those expressly set forth
herein. The Adjustment Escrow Agent may consult with counsel and shall have no
liability hereunder except for its own bad faith, gross negligence or willful
misconduct. It may rely on any notice, instruction, certificate, statement,
request, consent, confirmation, agreement or other instrument which it
reasonably believes to be genuine and to have been signed or presented by a
proper Person or Persons.
(b) The Adjustment Escrow Agent shall have no duties with respect to
any agreement or agreements with respect to any or all of the Adjustment
Escrowed Funds and the interest and other investment income earned thereon other
than as provided in this Agreement. In the event that any of the terms and
provisions of any other agreement between any of the parties hereto (other than
the Purchase Agreement) conflict or is inconsistent with any of the terms and
provisions of this Agreement, the terms and provisions of this Agreement shall
govern and control in all respects. Notwithstanding any provision to the
contrary contained in any other agreement (including without limitation, the
Purchase Agreement), the Adjustment Escrow Agent shall have no interest in the
Adjustment Escrowed Funds or the interest and other investment income earned
thereon except as provided in this Agreement.
4
(c) So long as the Adjustment Escrow Agent shall have any obligation
to pay any amount to the Company or the Fund Holder, as the case may be, and/or
Purchaser from the Adjustment Escrowed Funds hereunder, the Adjustment Escrow
Agent shall keep proper books of record and account, in which full and correct
entries shall be made of all receipts, disbursements and investment activity in
the Adjustment Escrow Account.
(d) The Adjustment Escrow Agent shall furnish to the Company or the
Fund Holder, as the case may be, and Purchaser monthly statements of account
with respect to the Adjustment Escrowed Funds showing the dates and amounts of
all deposits, disbursements, interest and other investment income and the
balance remaining on deposit.
(e) The Adjustment Escrow Agent shall not be bound by any modification
of this Agreement affecting the rights, duties and obligations of the Adjustment
Escrow Agent, unless such modification shall be in writing and signed by the
other parties hereto, and the Adjustment Escrow Agent shall have given its prior
or contemporaneous written consent thereto. The Adjustment Escrow Agent shall
not be bound by any other modification of this Agreement unless the Adjustment
Escrow Agent shall have received written notice thereof.
(f) The Adjustment Escrow Agent may resign as escrow agent at any time
by giving 60 days written notice by registered or certified mail to the Company
or the Fund Holder, as the case may be, and Purchaser, and such resignation
shall take effect at the end of such 60 days or upon earlier appointment of a
successor Adjustment Escrow Agent. The Company or the Fund Holder, as the case
may be, and Purchaser may remove the Adjustment Escrow Agent at any time upon
written notice by the Company and Purchaser jointly to the Adjustment Escrow
Agent with immediate effect. The resignation or removal shall not be effective
unless and until a successor Adjustment Escrow Agent is appointed by the Company
or the Fund Holder, as the case may be, and Purchaser. The Company or the Fund
Holder, as the case may be, and Purchaser shall undertake to utilize their best
efforts to arrange for the appointment of a successor Adjustment Escrow Agent.
If any instrument of acceptance by a successor Adjustment Escrow Agent shall not
have been delivered to the Adjustment Escrow Agent within 60 days after the
delivery of its notice of resignation by the Adjustment Escrow Agent or its
receipt of the notice of removal, the resigning or removed Adjustment Escrow
Agent may, at the expense of the Company or the Fund Holder, as the case may be,
and Purchaser, petition any court of competent jurisdiction for the appointment
of a successor Adjustment Escrow Agent.
(g) If at any time hereafter the Adjustment Escrow Agent shall be
dissolved or otherwise become incapable of acting, or the bank or trust company
acting as the Adjustment Escrow Agent shall be taken over by any government
official, agency, department or board, or the position of the Adjustment Escrow
Agent shall become vacant for any of the foregoing reasons or for any other
reason, the Company or the Fund Holder, as the case may be, and Purchaser shall
jointly appoint a successor Adjustment Escrow Agent to fill such vacancy.
(h) Every successor Adjustment Escrow Agent appointed hereunder shall
execute, acknowledge and deliver to its predecessor, and also to the Company or
the Fund Holder, as the case may be, and Purchaser an instrument in writing
accepting such appointment hereunder, and thereupon such successor Adjustment
Escrow Agent, without any further act,
5
shall become fully vested with all the rights, immunities and powers and shall
be subject to all of the duties and obligations, of its predecessor Adjustment
Escrow Agent as if originally named herein; and every predecessor Adjustment
Escrow Agent shall deliver to its successor, all property and moneys held by it
hereunder and all information required to properly perform the obligations of
the Adjustment Escrow Agent set forth in this Agreement.
(i) The Adjustment Escrow Agent's fees shall be in the amounts set
forth on Exhibit A hereto. In addition, the Adjustment Escrow Agent shall be
reimbursed for its reasonable out of pocket costs incurred in performing its
obligations under this Agreement upon presentation of any invoices thereof.
(j) The Company and Purchaser shall each be responsible for one-half
of the fees and expenses of the Adjustment Escrow Agent.
(k) The Company or the Fund Holder, as the case may be, and Purchaser
shall jointly but not severally indemnify and hold the Adjustment Escrow Agent
harmless from and against any and all expenses (including reasonable attorneys'
fees), liabilities, claims, damages, actions, suits or other charges incurred by
or assessed against the Adjustment Escrow Agent for anything done or omitted by
the Adjustment Escrow Agent in the performance of the Adjustment Escrow Agent's
duties hereunder, except such which result from the Adjustment Escrow Agent's
bad faith, gross negligence or willful misconduct.
(1) Insofar as required by any Governmental Authority, the Adjustment
Escrow Agent shall provide all information and file all forms or returns and
withhold all Taxes required to be withheld with regard to the payments made
pursuant to this Agreement, including, without limitation, information and forms
and returns relating to income Taxes.
9. Termination of the Adjustment Escrow Agreement. This Agreement shall
terminate upon the distribution of all of the Adjustment Escrowed Funds and the
interest and other investment income earned thereon by the Adjustment Escrow
Agent, or its successor, if any.
10. Miscellaneous. (a) This Agreement and the rights and duties of the
parties hereunder shall be governed by, and construed in accordance with, the
laws of the State of New York.
(b) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their respective successors and assigns.
(c) This Agreement may be executed in one or more counterparts and by
the different parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement.
(d) Section headings contained herein have been inserted for reference
purposes only and shall not be construed as part of this Agreement.
6
(e) This Agreement may be modified or amended only by a written
instrument duly executed by all parties hereto or their respective successors or
assigns.
(f) Any notice, demand, claim, notice of claim, request or
communication required or permitted to be given under the provisions of this
Agreement shall be in writing and shall be deemed to have been duly given (i)
upon delivery if delivered in person, (ii) on the next Business Day after the
date of mailing if mailed by registered or certified mail, postage prepaid and
return receipt requested, (iii) on the next Business Day after the date of
delivery to a national overnight courier service, or (iv) upon transmission by
facsimile (if such transmission is confirmed by the addressee) if delivered
through such services to the following addresses, or to such other address as
any party may request by notifying in writing all of the other parties to this
Agreement in accordance with this Section l0(f):
If to the Company:
Guy Gannett Communications
Xxx Xxxx Xxxxxx
X. X. Xxx 00000
Xxxxxxxx, Xxxxx 00000-0000
Attention: Xxxxx X. Xxxxx
Chief Financial Officer
Facsimile No.: (000) 000-0000
with copy to:
Xxxx X. Xxxxxxxx, Esq.
Preti, Flaherty, Xxxxxxxx & Pachios, LLC
P. O. Box 9546
Xxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxx 00000-0000
Facsimile No.: (000) 000-0000
and
Xxxxxx X. Xxxxx, Esq.
Simpson, Thacher & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Facsimile No.: (000) 000-0000
If to Purchaser:
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: President
7
Facsimile No.: (000) 000-0000
with a copy to:
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: General Counsel
Facsimile No.: (000) 000-0000
and
Xxxxxx & Xxxxxxxx, P.A.
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Esquire
Facsimile No.: (000) 000-0000
Any such notice shall be deemed to have been received on the date of
personal delivery, the date set forth on the Postal Service return receipt, or
the date of delivery shown on the records of the overnight courier, as
applicable.
(g) The Adjustment Escrow Agent shall not be liable to pay any Tax, if
any, on any interest or other investment income earned on the Adjustment
Escrowed Funds, it being the understanding of the parties that any such Tax
shall be the responsibility of the party or parties entitled to receive the
Adjustment Escrowed Funds and any such interest or other investment income,
allocated between parties on the basis of the relative portions of the
Adjustment Escrow Account to be paid to Purchaser and the Company or the Fund
Holder, as the case may be, respectively, pursuant to Section 4(a) hereof
(h) If any party hereto refuses to comply with, or at any time
violates or attempts to violate, any term, covenant or agreement contained in
this Agreement, any other party hereto may, by injunctive action, compel the
defaulting party to comply with, or refrain from violating, such term, covenant
or agreement, and may, by injunctive action, compel specific performance of the
obligations of the defaulting party.
(i) Except as provided herein, the rights and obligations of the
parties under this Agreement shall not be assigned to any Person, without the
written consent of the other parties. This Agreement shall not confer any
benefits on any Persons other than the parties hereto.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,
SIGNATURE PAGE TO FOLLOW]
8
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered on the date first above written.
[____________]BANK, as Adjustment Escrow
Agent
By:
---------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
GUY GANNETT COMMUNICATIONS
By:
---------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
XXXXXXXX COMMUNICATIONS, INC.
By:
---------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
9
Exhibit B to
Adjustment Escrow Agreement
ADJUSTMENT ESCROW AGENT'S FEES
------------------------------
Exhibit C to
Purchase Agreement
SECURITY ESCROW AGREEMENT
This SECURITY ESCROW AGREEMENT (this "Agreement") made as of
[_____________], 1998, by and among GUY GANNETT COMMUNICATIONS, a Maine
corporation (the "Company"), XXXXXXXX COMMUNICATIONS, INC., a Maryland
Corporation (the "Purchaser"), and [_____________] Bank, a [_____________Bank],
as Security Escrow Agent (the "Security Escrow Agent").
WHEREAS, the Company and Purchaser are parties to a Purchase Agreement
dated as of September 4, 1998 (the "Purchase Agreement");
WHEREAS, pursuant to the Purchase Agreement, the Company shall sell,
assign, transfer and deliver to Purchaser the assets and business of the
Business (as defined in the Purchase Agreement), and Purchaser shall purchase
and acquire such assets and business;
WHEREAS, pursuant to Section 2.1(c)(iii) of the Purchase Agreement,
Purchaser shall deliver on the Closing Date (as defined in the Purchase
Agreement) an amount of $8,000,000 of the Purchase Price (as defined in the
Purchase Agreement) to the Security Escrow Agent as security for the payment of
certain amounts (i) as to which Purchaser may become entitled to indemnification
pursuant to Article 8 of the Purchase Agreement, (ii) as to which Purchaser may
become entitled to pursuant to Section 5.8(a) of the Purchase Agreement and
(iii) that may be payable to Purchaser pursuant to Section 2.2(c)(iii)(B) of the
Purchase Agreement;
NOW, THEREFORE, in consideration of the premises and of the mutual
covenants contained herein, the parties hereto agree as follows:
Capitalized terms used herein and not otherwise defined are used as defined
in the Purchase Agreement.
1. Appointment of Security Escrow Agent. The Company and Purchaser hereby
appoint [___________ Bank] to act as Security Escrow Agent hereunder, and
[______________ Bank] hereby accepts such appointment and agrees to act as
Security Escrow Agent on the terms and conditions set forth hereinafter.
2. Security Escrow Amount. (a) On the Closing Date, Purchaser shall deliver
to the Security Escrow Agent by wire transfer of immediately available funds (to
account number [__________] of the Security Escrow Agent (the "Security Escrow
Account")) the amount of $8,000,000 (the "Security Escrow Amount"), accompanied
by written notice from Purchaser identifying such amount as an amount being
delivered for deposit into the Security Escrow Account. The Security Escrow
Agent shall acknowledge to Purchaser the Security Escrow Agent's receipt of said
amount.
(b) The Security Escrow Amount, not including the interest and other
investment
income earned thereon, shall only serve to secure the performance of (i) the
indemnification obligations of the Company as set forth in Article 8 of the
Purchase Agreement, (ii) the obligations of the Company as set forth in Section
5.8(a) of the Purchase Agreement and (iii) certain of the obligations set forth
in Section 2.2(c)(iii)(B) of the Purchase Agreement.
(c) The Security Escrow Agent shall hold the balance of the Security
Escrow Amount (the "Security Escrowed Funds") in escrow and shall not withdraw
the Security Escrowed Funds from the Security Escrow Account or use the Security
Escrowed Funds for any other purpose, except as provided in this Agreement.
3. Investments of Security Escrowed Funds. (a) The Security Escrow Agent
shall invest and reinvest the Security Escrowed Funds from time to time, upon
receipt of the written instructions thereto issued by the Company or the Fund
Holder (as defined in Section 7 hereof), in:
(i) Commercial paper of any corporation rated at least A-1 by S&P and P-1
by Moody's;
(ii) Negotiable certificates of deposit of United States banks having (A) a
long-term senior debt rating of at least A by S&P and Moody's, (B)
deposits in excess of $2,000,000,000 and (C) commercial paper rating
designations of at least A-1 by S&P and P-1 by Moody's;
(iii)Repurchase agreements with any United States bank which are fully
collateralized by direct obligations of the United States or
obligations of agencies or sponsored agencies of the United States
government, excluding in all cases collateralized mortgage obligations
of any kind; and
(iv) Money market instruments rated at least A-1 by S&P and P-1 by Moody's
that are restricted to investments described in clause (iii);
provided that in no event shall any investment of the types described in clause
(i), (ii) or (iv) exceed ten percent of the net assets of the issuer thereof and
provided further that all investments shall have maturity dates on or before the
anticipated dates of the relevant payments hereunder.
(b) To the extent the Security Escrow Agent invests any funds in the
manner provided for in this Section 3 and in accordance with the written
instructions from the Company or the Fund Holder, as the case may be, no party
hereto shall be liable for any loss which may be incurred by reason of any such
investment. No investment shall exceed the term of this Agreement.
(c) The Security Escrow Agent shall have the power to reduce, sell or
liquidate the foregoing investments whenever it shall be required to release all
or any portion of the Security Escrowed Funds pursuant to Section 4 or 5 hereof.
(d) The Security Escrow Agent is authorized to register securities
held by it in its
2
name or in the name of a nominee or in bearer form and may deposit any
securities or other property in a depository or a clearing corporation.
(e) Any interest or other investment income earned for the period from
the time that the Security Escrow Amount is delivered to the Security Escrow
Agent until all the Security Escrowed Funds have been distributed in accordance
with Section 5 hereof, shall be paid monthly to the Company or the Fund Holder,
as the case may be, provided that no such payments shall be made until (i) a
determination of whether any payment out of the Security Escrow Account pursuant
to Section 2.2(c)(iii)(B) of the Purchase Agreement is required and (ii) if so
required, such payment has been made; provided further, that to the extent that
any portion of the Security Escrowed Funds is paid to Purchaser pursuant to
Section 2.2(c)(iii)(B) of the Purchase Agreement, a pro rata portion of such
interest or other investment income earned through the date of such payment
(determined on the basis of the relative portions of the Security Escrowed Funds
so paid and that not so paid) shall be instead paid to Purchaser at the time
such portion of the Security Escrowed Funds is paid to Purchaser; and provided
further that the Security Escrow Agent shall retain interest or investment
income to the extent necessary to replenish previous losses incurred by reason
of any investment under Section 3(a) that resulted in a reduction in the
principal amount of the Security Escrow Amount. Any such interest or other
investment income shall be deemed not to constitute Security Escrowed Funds.
4. Claim Notices. (a) During the period from the Closing Date until the
Scheduled Escrow Expiration Date (as defined in Section 10 hereof), Purchaser
acting on its own or, in the event set forth under (i) hereof, on behalf of any
other Purchaser Indemnified Party (together for the purposes of this Section 4,
"Purchaser") shall be entitled to give the Security Escrow Agent written notice
(a "Claim Notice") of (i) any Claims and Damages incurred by it or a Purchaser
Indemnified Party for which Purchaser claims that the Company is obligated to
indemnify Purchaser pursuant to Article 8 of the Purchase Agreement, (ii) 50% of
any payment made by Purchaser to any Business Employee pursuant to the terms of
the Severance Agreements listed in Sections 3.14.1 and 3.14.2 of the Disclosure
Schedule to the Purchase Agreement, which Purchaser is entitled to recover
pursuant to Section 5.8(a) of the Purchase Agreement or (iii) the amount that is
to be delivered to Purchaser pursuant to Section 2.2(c)(iii)(B) of the Purchase
Agreement.
(b) Each Claim Notice given by Purchaser to the Security Escrow Agent
shall be signed by an authorized representative of Purchaser and (i) shall
include the information required under Section 8.5 of the Purchase Agreement,
including, for as far as its concerns a Claim Notice for Claims and Damages, the
nature and details of such Claims and Damages, the section of the Purchase
Agreement pursuant to which the Claim Notice is made, the amount of Claims and
Damages, if reasonably ascertainable by Purchaser (or a statement that the
amount thereof is not then reasonably ascertainable by Purchaser and the basis
for such statement) and whether or not such Claims and Damages arise from the
assertion of liability by a third party or (ii) set forth Purchaser's claim
pursuant to Section 5.8(a) or 2.2(c)(iii)(B) of the Purchase Agreement.
(c) Promptly upon receipt of the Claim Notice, the Security Escrow
Agent shall give notice thereof to the Company or the Fund Holder, as the case
may be, by transmitting a copy of such Claim Notice to the Company or the Fund
Holder, as the case may be, in the
3
manner and to the address specified in Section 1l(f) hereof.
(d) The Security Escrow Agent shall make no payment or delivery to
Purchaser or any Purchaser Indemnified Party for which a Claim Notice has been
given to the Security Escrow Agent pursuant to this Section 4, or for the first
payment of interest or other investment income pursuant to Section 3(e), except
pursuant to (i) written instructions to the Security Escrow Agent signed by the
authorized representatives of Purchaser and of the Company or the Fund Holder,
as the case may be (the "Joint Order"), or (ii) a final nonappealable order,
judgment, writ, decree of any Federal or State court of competent jurisdiction
(the "Court Order"). Claims and Damages, or such portion of Claims and Damages,
that have not been paid to Purchaser or otherwise resolved by a Joint Order or a
Court Order, together with all unresolved claims with respect to Sections 5.8(a)
and 2.2(c)(iii)(B), are herein referred to collectively as "Pending Claims".
5. Distribution of the Security Escrowed Funds. All cash held in the
Security Escrow Account on the Scheduled Escrow Expiration Date shall be
distributed as follows:
(a) The Security Escrow Agent shall deliver to the Company or the Fund
Holder, as the case may be, by wire transfer to a bank account designated by the
Company or the Fund Holder, as the case may be, the amount by which the balance
in the Security Escrow Account as of the Scheduled Escrow Expiration Date
exceeds the aggregate amount for all indemnification or other payments claimed
under Pending Claims described in all Claim Notices with respect thereto (the
"Reserves") as of the Scheduled Escrow Expiration Date.
(b) An amount equal to the aggregate amount of the Reserves shall
continue to be held by the Security Escrow Agent as Security Escrowed Funds as
long as, and to the extent that, such Pending Claims have not been resolved by a
Joint Order or a Court Order.
(c) Whenever any Pending Claim is resolved by a Joint Order or a Court
Order, the amount of such Pending Claim shall be disposed of in accordance with
such Joint Order or Court Order.
(d) Upon a Joint Order or a Court Order, money may be distributed at
any time to Purchaser and the Company or the Fund Holder, as the case may be, or
both of them.
6. Purchase Agreement. The provisions of this Agreement are subject to the
provisions of the Purchase Agreement, including, without limitation, Sections
2.2(c), 2.3, 2.4 and 5.8(a) and Article 8 thereof. To the extent that such
provisions and the provisions of this Agreement are inconsistent with one
another or in conflict, the provisions of the Purchase Agreement shall take
precedence.
7. Fund Holder. The parties hereto expressly acknowledge that the Company
may assign all of its rights and obligations under this Agreement and to and in
the Security Escrowed Funds to the stockholders of the Company or to any person
or entity or any persons or entities acting directly or indirectly on behalf of
the Company or such stockholders. Upon such assignment and upon the Company's
delivery to the parties hereto of a notice thereof, the
4
Company shall be released from all of its obligations under this Agreement. As
used herein, the term "Fund Holder" means the person, persons, entity and/or
entities to whom the Company's rights and obligations hereunder have been
assigned.
8. Settlement of Disputes. Any dispute which may arise under this Agreement
with respect to the delivery and/or ownership or right of possession of the
Security Escrowed Funds or any part thereof, or the duties of the Security
Escrow Agent hereunder, shall be settled either by mutual agreement of the
Company or the Fund Holder, as the case may be, and Purchaser (evidenced by
appropriate instructions in writing to the Security Escrow Agent, signed by such
parties) or, failing such agreement, either the Company or the Fund Holder, as
the case may be, or Purchaser shall have the right to submit the dispute to any
federal or state court located in Portland, Maine. Each party waives any
objection which it may now or hereafter have to the laying of venue of any such
proceeding, and irrevocably submits to the jurisdiction of such courts in any
such suit, action or proceeding. The Security Escrow Agent shall be under no
duty whatsoever to institute or defend any such proceedings. Prior to the
settlement of any such dispute, the Security Escrow Agent is authorized and
directed to retain in its possession, without liability to anyone, that portion
of the Security Escrowed Funds and the interest and other investment income
earned thereon which is the subject of such dispute.
9. Concerning the Security Escrow Agent. (a) The Security Escrow Agent
shall have no duties or responsibilities except those expressly set forth
herein. The Security Escrow Agent may consult with counsel and shall have no
liability hereunder except for its own bad faith, gross negligence or willful
misconduct. It may rely on any notice, instruction, certificate, statement,
request, consent, confirmation, agreement or other instrument which it
reasonably believes to be genuine and to have been signed or presented by a
proper Person or Persons.
(b) The Security Escrow Agent shall have no duties with respect to any
agreement or agreements with respect to any or all of the Security Escrowed
Funds and the interest and investment income earned thereon other than as
provided in this Agreement. In the event that any of the terms and provisions of
any other agreement between any of the parties hereto (other than the Purchase
Agreement) conflict or is inconsistent with any of the terms and provisions of
this Agreement, the terms and provisions of this Agreement shall govern and
control in all respects. Notwithstanding any provision to the contrary contained
in any other agreement (including, without limitation, the Purchase Agreement),
the Security Escrow Agent shall have no interest in the Security Escrowed Funds
or the interest and other investment income earned thereon except as provided in
this Agreement.
(c) So long as the Security Escrow Agent shall have any obligation to
pay any amount to the Company or the Fund Holder, as the case may be, and/or
Purchaser from the Security Escrowed Funds hereunder, the Security Escrow Agent
shall keep proper books of record and account, in which full and correct entries
shall be made of all receipts, disbursements and investment activity in the
Security Escrow Account.
(d) The Security Escrow Agent shall furnish to the Company or the Fund
Holder, as the case may be, and Purchaser monthly statements of account with
respect to the Security Escrowed Funds showing the dates and amounts of all
deposits, disbursements, interest and other
5
investment income and the balance remaining on deposit.
(e) The Security Escrow Agent shall not be bound by any modification
of this Agreement affecting the rights, duties and obligations of the Security
Escrow Agent, unless such modification shall be in writing and signed by the
other parties hereto, and the Security Escrow Agent shall have given its prior
or contemporaneous written consent thereto. The Security Escrow Agent shall not
be bound by any other modification of this Agreement unless the Security Escrow
Agent shall have received written notice thereof.
(I) The Security Escrow Agent may resign as escrow agent at any time
by giving 60 days written notice by registered or certified mail to the Company
or the Fund Holder, as the case may be, and Purchaser, and such resignation
shall take effect at the end of such 60 days or upon earlier appointment of a
successor Security Escrow Agent. The Company or the Fund Holder, as the case may
be, and Purchaser may remove the Security Escrow Agent at any time upon written
notice by the Company or the Fund Holder, as the case may be, and Purchaser
jointly to the Security Escrow Agent with immediate effect. The resignation or
removal shall not be effective unless and until a successor Security Escrow
Agent is appointed by the Company or the Fund Holder, as the case may be, and
Purchaser. The Company or the Fund Holder, as the case may be, and Purchaser
shall undertake to utilize their best efforts to arrange for the appointment of
a successor Security Escrow Agent. If any instrument of acceptance by a
successor Security Escrow Agent shall not have been delivered to the Security
Escrow Agent within 60 days after the delivery of its notice of resignation by
the Security Escrow Agent or its receipt of the notice of removal, the resigning
or removed Security Escrow Agent may, at the expense of the Company or the Fund
Holder, as the case may be, and Purchaser, petition any court of competent
jurisdiction for the appointment of a successor Security Escrow Agent.
(g) If at any time hereafter the Security Escrow Agent shall be
dissolved or otherwise become incapable of acting, or the bank or trust company
acting as the Security Escrow Agent shall be taken over by any government
official, agency, department or board, or the position of the Security Escrow
Agent shall become vacant for any of the foregoing reasons or for any other
reason, the Company or the Fund Holder, as the case may be, and Purchaser shall
jointly appoint a successor Security Escrow Agent to fill such vacancy.
(h) Every successor Security Escrow Agent appointed hereunder shall
execute, acknowledge and deliver to its predecessor, and also to the Company or
the Fund Holder, as the case may be, and Purchaser an instrument in writing
accepting such appointment hereunder, and thereupon such successor Security
Escrow Agent, without any further act, shall become fully vested with all the
rights, immunities and powers and shall be subject to all of the duties and
obligations, of its predecessor Security Escrow Agent as if originally named
herein; and every predecessor Security Escrow Agent shall deliver to its
successor, all property and moneys held by it hereunder and all information
required to properly perform the obligations of the Security Escrow Agent set
forth in this Agreement.
(i) The Security Escrow Agent's fees shall be in the amounts set forth
on Exhibit A hereto. In addition, the Security Escrow Agent shall be reimbursed
on demand for its reasonable out of pocket costs incurred in performing its
obligations under this Agreement upon
6
its presentation of any invoices thereof.
(j) The Company and Purchaser shall each be responsible for payment of
one half of the fees and expenses of the Security Escrow Agent, including the
expenses set forth in Section 9(i) hereof.
(k) The Company or the Fund Holder, as the case may be, and Purchaser
shall indemnify and hold the Security Escrow Agent harmless from and against any
and all expenses (including reasonable attorneys' fees), liabilities, claims,
damages, actions, suits or other charges incurred by or assessed against the
Security Escrow Agent for anything done or omitted by the Security Escrow Agent
in the performance of the Security Escrow Agent's duties hereunder, except such
which result from the Security Escrow Agent's bad faith, gross negligence or
willful misconduct.
(1) Insofar as required by any governmental agency or authority, the
Security Escrow Agent shall provide all information and file all forms or
returns and withhold all Taxes required to be withheld with regard to the
payments made pursuant to this Agreement, including, without limitation,
information and forms and returns relating to income Taxes.
10. Termination of the Security Escrow Agreement. This Agreement shall
terminate upon the earlier to occur of: (i) the first anniversary of the Closing
Date (the "Scheduled Escrow Expiration Date") and (ii) the distribution of all
of the Security Escrowed Funds and the interest and other investment income
earned thereon by the Security Escrow Agent pursuant to this Agreement;
provided, however, that if there are any unresolved or unsettled Claims and
Damages outstanding on the Scheduled Escrow Expiration Date, this Agreement will
not terminate until the resolution of all such Claims and Damages and the
distribution of all of the Security Escrowed Funds pursuant to Section 5 hereof.
11. Miscellaneous. (a) This Agreement and the rights and duties of the
parties hereunder shall be governed by, and construed in accordance with, the
laws of the State of New York.
(b) This Agreement shall be binding upon and shall inure to the
benefit of the parties hereto and their representative successors and assigns.
(c) This Agreement may be executed in one or more counterparts and by
the different parties hereto in separate counterparts, each of which when
executed shall be deemed to be an original but all of which taken together shall
constitute one and the same agreement.
(d) Section headings contained herein have been inserted for reference
purposes only and shall not be construed as part of this Agreement.
(e) This Agreement may be modified or amended only by a written
instrument duly executed by all parties hereto or their respective successors or
assigns.
(f) Any notice, demand, claim, notice of claim, request or
communication
7
required or permitted to be given under the provisions of this Agreement shall
be in writing and shall be deemed to have been duly given (i) upon delivery if
delivered in person, (ii) on the next Business Day after the date of mailing if
mailed by registered or certified mail, postage prepaid and return receipt
requested, (iii) on the next Business Day after the date of delivery to a
national overnight courier service, or (iv) upon transmission by facsimile (if
such transmission is confirmed by the addressee) if delivered through such
services to the following addresses, or to such other address as any party may
request by notifying in writing all of the other parties to this Agreement in
accordance with this Section l1(f):
If to the Company:
Guy Gannett Communications
Xxx Xxxx Xxxxxx
X. X. Xxx 00000
Xxxxxxxx, Xxxxx 00000-0000
Attention: Xxxxx X. Xxxxx
Chief Financial Officer
Facsimile No.: (000) 000-0000
with copy to:
Xxxx X. Xxxxxxxx, Esq.
Preti, Flaherty, Xxxxxxxx & Pachios, LLC
P. O. Box 9546
Xxx Xxxx Xxxxxx
Xxxxxxxx, Xxxxx 00000-0000
Facsimile No.: (000) 000-0000
and
Xxxxxx X. Xxxxx, Esq.
Simpson, Thacher & Xxxxxxxx
000 Xxxxxxxxx Xxxxxx
Xxx Xxxx, Xxx Xxxx 00000-0000
Facsimile No.: (000) 000-0000
If to Purchaser:
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: President
Facsimile No.: (000) 000-0000
8
with a copy to:
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: General Counsel
Facsimile No.: (000) 000-0000
and
Xxxxxx & Xxxxxxxx, P.A.
000 Xxxxx Xxxxxx, Xxxxx 0000
Xxxxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Esquire
Facsimile No.: (000) 000-0000
Any such notice shall be deemed to have been received on the date of
personal delivery, the date set forth on the Postal Service return receipt, or
the date of delivery shown on the records of the overnight courier, as
applicable.
(g) The Security Escrow Agent shall not be liable to pay any Tax, if
any, on any interest or other investment income earned on the Security Escrowed
Funds, it being the understanding of the parties that any such Tax shall be the
responsibility of the Company or the Fund Holder, as the case may be.
(h) If any party hereto refuses to comply with, or at any time
violates or attempts to violate, any term, covenant or agreement contained in
this Agreement, any other party hereto may, by injunctive action, compel the
defaulting party to comply with, or refrain from violating, such term, covenant
or agreement, and may, by injunctive action, compel specific performance of the
obligations of the defaulting party.
(i) Except as provided herein, the rights and obligations of the
parties under this Agreement shall not be assigned to any Person, without the
written consent of the other parties. This Agreement shall not confer any
benefits on any Persons other than the parties hereto and the Fund Holder.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK,
SIGNATURE PAGE TO FOLLOW]
9
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed and delivered on the date first above written.
[____________]BANK, as Adjustment Escrow
Agent
By:
---------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
GUY GANNETT COMMUNICATIONS
By:
---------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
XXXXXXXX COMMUNICATIONS, INC.
By:
---------------------------------------
Name:
---------------------------------------
Title:
---------------------------------------
10
Exhibit A to
Security Escrow Agreement
SECURITY ESCROW AGENT'S FEES
----------------------------
11
EXHIBIT D-1 TO
PURCHASE AGREEMENT
FORM OF PRETI, FLAHERTY, XXXXXXXX & PACHIOS LEGAL OPINION
---------------------------, ------
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Gentlemen:
We have acted as counsel to Guy Gannett Communications (the "Company") in
connection with the transactions contemplated by the Purchase Agreement dated
September 4, 1998 (the "Purchase Agreement") by the Company and Xxxxxxxx
Communications, Inc. (the "Buyer").
We have examined the originals or copies of such documents, certificates
and records as we have deemed relevant or necessary as the basis for the
opinions hereinafter expressed. We have assumed the genuineness of all
signatures, the authenticity of documents, certificates and records submitted to
us as originals, the conformity to the originals of all documents, certificates
and records submitted to us as certified or reproduction copies, the legal
capacity of all natural persons executing documents, certificates and records,
and the completeness and accuracy as of the date of this opinion letter of the
information contained in such documents, certificates and records.
The law, covered by the opinions expressed herein, is limited to the laws
of the State of Maine.
Based upon and subject to the foregoing, we are of the opinion that:
1. The Company is a corporation validly existing and in good standing under
the laws of the State of Maine. The Company has the corporate power and
authority to enter into and perform the Purchase Agreement.
2. The execution, delivery and performance of the Purchase Agreement have
been duly authorized by all necessary corporate action on the part of the
Company.
This opinion letter is delivered as of its date and without any undertaking
to advise you of any changes of law or fact that occur after the date of this
opinion letter even though the changes may affect a legal analysis or conclusion
or an information confirmation in this opinion letter.
Xxxxxxxx Communications, Inc.
_________________, 1998
Page 2 of 2
This opinion letter may be relied upon by you only in connection with the
transaction described in the initial paragraph of this opinion letter and may
not be used or relied upon by you for any other purpose or by any other person
for any purpose whatsoever without, in each instance, our prior written consent.
Very truly yours,
----------------------------
Exhibit D-2 to
Purchase Agreement
[Date of Closing]
Xxxxxxxx Communications, Inc.
0000 Xxxx 00xx Xxxxxx
Xxxxxxxxx, Xxxxxxxx 00000-0000
Ladies and Gentlemen:
We have acted as special New York counsel to Guy Gannett Communications, a
Maine corporation (the "Company"), in connection with the negotiation and
execution of the Purchase Agreement dated as of September 4, 1998 (the "Purchase
Agreement") by and between the Company and Xxxxxxxx Communications, Inc., a
Maryland corporation ("Xxxxxxxx").
This opinion is delivered pursuant to Section 6.9 of the Purchase
Agreement. All capitalized terms not otherwise defined herein have the meanings
specified in the Purchase Agreement.
We have examined a copy of the Purchase Agreement and originals or copies,
certified or otherwise identified to our satisfaction, of such other documents,
instruments or certificates as we have deemed relevant and necessary as a basis
for the opinions hereinafter set forth.
As to questions of fact we have relied upon the documents examined by us or
upon certificates and statements of officers of the Company. In our examination,
we have assumed the genuineness of all signatures, the authenticity of all
documents submitted to us as originals and the conformity to original documents
of all documents submitted to us as certified or photocopies and the
authenticity of the originals of such latter documents.
Xxxxxxxx Communications, Inc. [________________,] 1998
Page 2 of 3
In rendering the opinion set forth below, we have assumed, without any
independent investigation or verification of any kind, that (i) the Purchase
Agreement is a valid, legally binding enforceable agreement of Xxxxxxxx, (ii)
the Company is validly existing and in good standing under the laws of the State
of Maine and has duly authorized, executed and delivered the Purchase Agreement,
(iii) execution, delivery and performance by the Company does not violate the
laws of Maine or any other applicable laws (other than the laws of the State of
New York) and (iv) execution, delivery and performance by the company of the
Purchase Agreement does not constitute a breach or violation of any agreement or
instrument which is binding upon the Company.
Based upon the foregoing, and subject to the qualifications and limitation
stated herein, we are of the opinion that the Purchase Agreement constitutes a
valid and legally binding agreement of the Company enforceable against the
Company in accordance with its terms, subject to the effects of bankruptcy,
insolvency, fraudulent conveyance, reorganization, moratorium or other similar
laws relating to or affecting rights or creditors generally, general equitable
principles (whether considered in a proceeding in equity or at law) and an
implied covenant of good faith and fair dealing.
We express no opinion with respect to the enforceability of (A) Section
10.11 (Specific Performance) of the Purchase Agreement, (B) any provision of the
Purchase Agreement that time shall be of the essence in enforcing and applying
the covenants and conditions set forth in the Purchase Agreement, (C) any
provision of the Purchase Agreement which is intended to permit modification of
the Purchase Agreement only by means of an agreement signed in wiring by the
parties thereto or (D) any provision of the Purchase Agreement relating to
indemnification or exculpation in connection with violation of any securities
laws or relating to indemnification, contribution or exculpation in connection
with willful, reckless or criminal acts or gross negligence of the indemnified
or exculpated Person or the Person receiving contribution.
We are members of the Bar of the State of New York, and we do not express
any opinion herein concerning any law other than the law of the State of New
York.
Xxxxxxxx Communications, Inc. [________________,] 1998
Page 3 of 3
This opinion letter is rendered to you in connection with the
above-described transaction. This opinion letter may not be relied upon by you
for any other purpose or relied upon by or furnished to any other person, firm
or corporation for any purpose without our prior written consent.
Very truly yours,
XXXXXXX XXXXXXX & XXXXXXXX
EXHIBIT D-3
FORM OF FCC OPINION
1. The FCC has issued to the Company the licenses, permits and
authorizations specified on Attachment I hereto (the "FCC Licenses"). The FCC
Licenses are in full force and effect in that they are held by the Company and
are in effect in accordance with their terms.
2. The FCC Consent has been granted to permit the assignment of the FCC
Licenses by the Company to Purchaser and has not been reversed, stayed,
enjoined, set aside, annulled or suspended; [provided, however, that the time
under applicable FCC rules within which any formal request for reconsideration,
review or other regulatory or judicial action has not lapsed, but, to our
knowledge, no action or petition for such reconsideration or review has been
filed or is pending.]
3. There is no FCC order, judgment, decree, notice of apparent liability or
order of forfeiture outstanding, and to our knowledge, no action, suit of
apparent liability, order of forfeiture, investigation or other proceeding
pending by or before the FCC against the Company that might result in a
revocation, cancellation, suspension, non-renewal, short-term renewal or
materially adverse modification of the FCC Licenses, except FCC proceedings
generally affecting the television industry (including but not limited to the
proceedings which will require modification of all television licenses to
accommodate the transition to digital television).
Exhibit F-1 to
Purchase Agreement
AGREEMENT
THIS AGREEMENT is made as of this ___ day of _____, 1998 by and between Guy
Gannett Communications, a Maine corporation ("Gannett") and Media Properties of
Maine, LLC, a Delaware limited liability company ("Maine Media").
WITNESSETH
WHEREAS, Gannett owns and operates The Portland Newspapers, which includes
the Portland Press Herald, serving Cumberland County, Maine and parts of York
County, Maine and the Maine Sunday Telegram, a regional Sunday newspaper, both
published in Portland, Maine (collectively "The Portland Newspapers"); and
WHEREAS, Gannett owns and operates the Central Maine Newspapers, which
includes the daily Morning Sentinel, serving Waterville, Maine and environs, and
the Kennebec Journal, serving Augusta, Maine and environs, both published in
Augusta, Maine (collectively the "Central Maine Newspapers"); and
WHEREAS, Gannett owns and operates the Coastal Journal, a weekly newspaper
serving the mid-coast areas of Bath and Brunswick, Maine and environs (the
"Coastal Journal"); and
WHEREAS, Gannett owns and operates the New Media Development Group, a
Portland, Maine-based division that provides a variety of new media services,
including but not limited to web site development, on-line advertising,
sponsorships, directly sales, publication of Maine Today and related businesses
(collectively the "New Media"); and
WHEREAS, Gannett owns and operates Guy Gannett Voice Information Services,
a Portland, Maine-based telephone information and marketing medium providing
pre-recorded and customized information to callers under the name of PhoneME
(the "Voice Information Services"); and
WHEREAS, Gannett owns and operates Guy Gannett Direct, a Portland,
Maine-based division that provides direct mail marketing services to clients
both inside and outside of Maine (the "Guy Gannett Direct"); and
WHEREAS, Gannett owns and operates Integrated Marketing Group, a Portland,
Maine-based division that provides bundled sales and services of advertising
(the "Integrated Marketing"); and
WHEREAS, the businesses conducted by The Portland Newspapers, Central Maine
Newspapers, Coastal Journal, New Media, Voice Information Services, Guy Gannett
Direct and Integrated Marketing, and all assets, liabilities, operations and
activities of, and all rights of, Gannett in the operations of such businesses,
are collectively referred to herein as the "Maine Media Businesses"; and
WHEREAS, in addition to the Maine Media Businesses, Gannett owns and
operates a number of television broadcast divisions located both in and outside
of Maine, including WGME-TV, Portland, Maine ("WGME-TV"); and
WHEREAS, Gannett maintains a corporate office located at Xxx Xxxx Xxxxxx,
Xxxxxxxx, Xxxxx that provides certain support and other services to all Gannett
divisions and businesses (the "Corporate Office"); and
WHEREAS, Maine Media has been formed at the direction of Gannett for the
purpose of receiving the transfer by Gannett of the Maine Media Businesses in
anticipation of the sale of Maine Media to a third party (the "Sale of Maine
Media"); and
WHEREAS, Gannett also anticipates the sale of its broadcast and other
properties, including WGME-TV (the "Sale of Gannett"); and
WHEREAS, Maine Media and Gannett are parties to a certain Contribution
Agreement dated July __, 1998 (the "Contribution Agreement") in which Gannett
has agreed to transfer to Maine Media all of its assets primarily related to the
Maine Media Businesses, subject to Maine Media's assumption of the liabilities
primarily related thereto (the "Contribution"); and
WHEREAS, certain relationships between WGME-TV and the Maine Media
Businesses presently exist that Maine Media and Gannett wish to continue on the
same terms and conditions for an interim period after the Contribution and the
Sale of Maine Media; and
WHEREAS, Gannett has entered into agreements with certain customers making
commitments with respect to volume discounts on advertising in one or more of
the Maine Media Businesses and WGME-TV as listed in Schedule A hereto (the
"Joint Advertising Commitments"), and Gannett and Maine Media each wish to
obligate the other to comply with the terms of such agreements after the
Contribution and Sale of Maine Media;
NOW, THEREFORE, in consideration of the premises and mutual agreements and
covenants set forth herein, Gannett and Maine Media agree as follows:
1. Interim Agreements. Until the later of (i) March 31, 1999 or (ii) sixty
(60) days after the date of the Sale of Gannett, but in no event later than
December 31, 1999, Gannett and Maine Media agree that the following services
shall continue to be provided by and between them, without further consideration
other than the services to be provided, each to the other, and any payments
expressly provided for herein:
(a) Shared Facilities.
(i) Maine Media shall permit WGME-TV to continue to locate the
existing camera and transmission equipment (or similar
replacement equipment) at its present location on the roof of The
Portland Newspapers office building located at 000 Xxxxxxxx
Xxxxxx, Xxxxxxxx, Xxxxx.
(ii) WGME-TV shall permit The Portland Newspapers to continue to
locate the existing radio equipment (or similar replacement
equipment) on its tower located at Blackstrap Mountain, Falmouth,
Maine at a fee of $91.00 per month.
(b) Editorial Collaboration. WGME-TV and the Maine Media Businesses shall
continue (1) their collaborative efforts between WGME-TV and The
Portland Newspapers/Central Maine Newspapers relating to the Maine
Citizens Campaign as outlined in the Pew Grant received by The
Portland Newspapers, with WGME-TV's specific responsibility being to
provide video production (at an estimated cost of $2,500 to be
reimbursed by The Portland Newspapers); (2) sharing resources and
their joint coverage efforts of the 1998 elections between WGME-TV and
The Portland Newspapers/Central Maine Newspapers; (3) daily sharing of
stories between WGME-TV and The Portland Newspapers/Central Maine
Newspapers with an editor from The Portland Newspapers sitting in on
WGME-TV news meetings; (4) the practice of having the WGME-TV branded
weather page appearing daily in The Portland Newspapers and Central
Maine Newspapers publications, including the WGME-TV Weather Eye
column written by a WGME-TV meteorologist at WGME's expense; (5) the
practice of the occasional mention of stories appearing in the next
day's publication of The Portland Newspapers or the Central Maine
Newspapers on WGME-TV's 11:00 p.m. news as part of the "Tomorrow's
Headlines Tonight" feature; and (6) any other existing collaborative
efforts between the parties.
(c) Cross-Promotion. WGME-TV and the Maine Media Businesses shall continue
their practice of (1) providing advertising coverage in The Portland
Newspapers/Central Maine Newspapers publications for WGME-TV, which is
estimated (i) during February, May, July and November, to consist of
an average of approximately 2,600 column inches in The Portland
Newspapers and 1,300 column inches in The Central Maine Newspapers;
and (ii) during other months, to consist of an average of
approximately 400 column inches in The Portland Newspapers, and 200
column inches in The Central Maine Newspapers; (2) providing sale of
advertising on the WGME-TV web site by the New Media Division, with
50% of the revenue therefrom paid to each of the parties hereto, and
(3) providing (v) airing of promotional sports for all Maine Media
Businesses
by WGME-TV, to consist of approximately 115 30-second spots per month;
(w) cross-promotion of, and links between, WGME-TV's web site and
those Maine Media Businesses sites identified under the name Maine
Today; and (x) distribution of WGME-TV's NewsChannel 13 Hotline on the
PhoneME service, including news, weather updates and viewer
information.
(d) Servicemarks and Trademarks. Each of the parties may continue to use
servicemarks and trademarks of the other, provided that such use shall
be strictly in accordance with past practices or such other use as the
party owning the xxxx (the "Holder") may approve in writing. The
Holder retains the right to approve new operational and promotional
materials. At the request of the Holder, the party using such xxxx
pursuant to the rights granted under this Agreement shall promptly do
such acts and execute, acknowledge and deliver all those papers that
may be necessary or desirable to maintain, protect and/or vest in the
Holder the entire right, title and interest in and to such xxxx.
(e) Other Services. New Media shall continue its practices of (1)
providing consulting services relating to WGME-TV's web site and (2)
hosting WGME-TV's web site on the New Media server.
2. Combined Advertising Commitments. Gannett and Maine Media shall
continue to abide by the Joint Advertising Commitments for the balance
of the term of such contracts, and (subject to any limitations
contained therein) without regard to the percentage of advertising
that is required by the customer to be provided by either party. For
purposes only of determining whether the customers who are party to
the Joint Advertising Commitments have complied with their minimum
advertising commitment, (a) Maine Media and Gannett shall assess the
same as though the Maine Media businesses existing as of the date
hereof which continue to be properties of Gannett, and (b) the parties
shall share information concerning the aggregate sales to such
customers during the term of the applicable Joint Advertising
Commitment. Notwithstanding anything to the contrary, there shall be
no obligation between the parties hereto with respect to the pricing
of such services, except to the extent expressly set forth in the
applicable Joint Advertising Commitment.
3. Services Agreement. Maine Media, through The Portland Newspapers,
shall continue to provide to Gannett the following services:
(a) Telephone Support. For so long as such service is required by
Gannett, but in no event later than May 31, 2001, provided only
that Maine Media continues to provide similar services for itself
or for any of its properties or divisions, Maine Media shall
provide Gannett, for use by personnel at its Corporation Office
(1)
telephone equipment of a type and quantity used by the Corporate
Offices as of the date hereof, (2) telephone support services,
including voice mail, and all necessary technical support
thereafter and service thereof and (3) local and long distance
service. For so long as such services are being provided to
Gannett, Gannett shall pay to Maine Media a flat monthly fee of
$3,500 for the services described in Section 3(a)(1) and (2)
hereof, and shall reimburse Maine Media, at its direct cost, for
those services provided pursuant to Section 3(a)(3) hereof.
(b) Computer Support.For so long as such service is required by
Gannett, but in no event after the late of (i) one hundred twenty
(120) days after the date of the Sale of Gannett or December 31,
1998, provided only that Maine Media continues to provide similar
service for itself or for any of its properties or divisions, at
Gannett's request, Maine media shall provide network support for
Gannett's computer systems for use by its personnel at its
Corporate Office at a rate of Thirty Dollars ($30) per hour.
4. People of the Kennebec Campaign. Gannett and Maine Media shall continue
their participation in the "People of the Kennebec" sponsored promotional
campaign that extends into the fall of 1999.
5. Quality, Scope and Character of Services. Except as otherwise expressly
provided above, in all cases, the services to be provided under this Agreement
shall be of a character, scope and quality that are consistent with Gannett's
past practices, unless otherwise agreed by the parties hereto.
6. Contribution Agreement. This Agreement shall in no event enlarge, reduce
or otherwise affect the rights, warranties or covenants of the parties as set
forth in the Contribution Agreement. The Contribution Agreement shall survive
the execution and delivery of this Agreement.
7. Benefit and Assignment. This Agreement will be binding upon and inure to
the parties hereto and their respective successors and assigns.
8. Construction of this Agreement. The headings of the sections and
subsections of this Agreement are inserted as a matter of convenience and for
reference purposes only and in no respect define, limit or describe the scope of
this Agreement or the intent of any section or subsection. This Agreement shall
be governed by, and construed in accordance with, the laws of the State of
Maine, applicable to contracts executed in and to be performed entirely within
that State.
IN WITNESS WHEREOF, the parties hereto have caused this Agreement to be
executed as of the date first written above by their respective duly authorized
officers.
GUY GANNETT COMMUNICATIONS
By:
----------------------------------
Its
----------------------------------
MEDIA PROPERTIES OF MAINE, LLC
By: Guy Gannett Communications, Its Sole
Member
By:
----------------------------------
Its
----------------------------------
EXHIBIT F-2 TO
PURCHASE AGREEMENT
SUBLEASE AGREEMENT
THIS SUBLEASE AGREEMENT (the "Sublease") is entered into as of the ______
day of _________________, 1998, by and between GUY GANNETT COMMUNICATIONS
("Gannett") and MEDIA PROPERTIEESOF MAINE, LLC, a Delaware limited company
("Maine Media").
R E C I T A L S:
A. Gannett and Fleet Bank of Maine ("Landlord") are parties to a certain
lease dated June 20, 1995 (the "Lease") for certain office space and other
facilities in or near the building at 0 Xxxxxxxxxx Xxxxxx, Xxxxxxx, XX
("Building").
B. Maine Media desires to sublease a portion of the Building from Gannett;
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, Maine Media and Gannett hereby
agree as follows:
ARTICLE 1
DEMISE, DESCRIPTION, USE, TERM AND RENT
Gannett hereby subleases to Maine Media, and Maine Media hereby subleases from
Gannett, approximately 340 square feet of the Building, as more fully described
in Exhibit A attached hereto and made a part hereof (the "Premises"), for use as
office space and for no other use whatsoever, together with the rights of
ingress and egress to the Building and the right of use of the parking area
adjacent to the Building in common with Gannett (as that term is defined in the
Lease), for a term commencing on the date hereof and ending on April 30, 1999;
provided, further, that Maine Media may renew this Sublease for an additional
one (1) year term by written notice given to Gannett on or before February 28,
1999.
ARTICLE 2
RENT
Maine Media shall pay to Gannett the amount of Two Hundred Dollars
($200.00) per month as rent for the Premises during the term hereof. The rent is
due and payable in advance on the first day of each and every calendar month
during such term at the address specified in Article 10 hereof. If this Sublease
commences on other than the first day of a month, rent shall be prorated for
such partial month. A late fee of five percent (5%) of the overdue amount shall
be charged for rent received after the tenth day of the month for rent. All
payments shall be without set off or deduction, except as otherwise expressly
provided herein.
ARTICLE 3
THE LEASE
All of the terms and provisions of the Lease are incorporated by reference
as if fully rewritten herein. Maine Media shall conform to and shall use the
Premises in accordance with all the terms, covenants and conditions contained in
the Lease and will do no act which will result in a violation of such terms,
covenants and conditions. Maine Media shall perform all the terms, covenants and
conditions of the Lease on the part of tenant therein named to be performed
(except for payment of rent provided for in the Lease) insofar as such terms,
covenants and conditions relate to the Premises. This Sublease is expressly
subject to all the terms, covenants, conditions and provisions of the Lease, a
copy of which has been delivered to Maine Media.
ARTICLE 4
INSURANCE
Maine Media shall maintain comprehensive general liability insurance as
required under the Lease, naming Landlord as well as Gannett as additional named
insureds, which policy shall provide at least thirty (30) days cancellation
notice to Landlord and Gannett. Upon written demand therefor, Maine Media shall
provide Landlord and Gannett with a copy of such policy or a certificate
evidencing such insurance.
ARTICLE 5
ASSIGNMENT-SUBLEASING
Maine Media may not assign the Sublease or sublet any part of the Premises.
ARTICLE 6
DEFAULT AND BANKRUPTCY
In the event that Maine Media shall (a) default in the payment of any
installment of rent or other sums herein specified and such default shall
continue for ten (10) days after; (b) default in the observance or performance
of any other of the Maine Media covenants, agreements, or obligations hereunder
and such default shall not be corrected with thirty (30) days after written
notice thereof; or (c) be declared bankrupt or insolvent according to law, or,
if any assignment shall be made of Maine Media's property for the benefit of
creditors, then Gannett shall have the right thereafter, while such default
continues, to re-enter and take complete possession of the Premises, to declare
the term of this Sublease ended, and remove Maine Media's effects, without
prejudice to any remedies which might be otherwise used for arrears of rent or
other default. If Maine Media shall default, after reasonable notice thereof, in
the observance or performance of any conditions or covenants on Maine Media's
part to be observed or performed under or by virtue of any of the provisions in
any paragraph of this Sublease, Gannett, without being under any obligation to
do so and without thereby waiving such default, may remedy such default for the
account and at the expense of Maine Media. If Gannett makes any expenditures or
incurs any obligations for the payment of money in connection therewith,
including but not limited to, reasonable attorney's fees in the institution,
prosecuting or defending any action or proceeding,
such sums paid or obligations insured, with interest at the rate of ten (10)
percent par annum and costs, shall be paid to Gannett by Maine Media as
additional rent.
ARTICLE 7
SHORT FORM LEASE
Maine Media agrees not to record this Sublease or any memorandum thereof.
ARTICLE 8
INDEMNIFICATION
Maine Media shall hold Gannett and Landlord harmless and defend Gannett and
Landlord against any and all claims or liabilities for any injury or damage to
any person or property whatsoever: (a) occurring in, on or about the premises in
which the Building is located; or (b) occurring in, on or about the Building in
each case if such injury or damage is caused in part or in whole by the act,
neglect, fault, or omission of, and duty with respect to the same, by Maine
Media, its agents, employees or invitees.
ARTICLE 9
ENTIRE AGREEMENT
This instrument contains the entire and only agreement between the parties
and no oral statements or representations or prior written matter not contained
in this instrument shall have any force or affect. This Sublease shall not be
modified in any way except by a writing executed by both parties. It is
expressly agreed upon by the parties hereto, that the terms and provisions of
this Sublease are intended to apply only with respect to the sub-leasehold
estate created hereby.
ARTICLE 10
NOTICE
Any notices from Maine Media to Gannett shall be deemed duly served upon
receipt by Gannett at the following address: WGME-TV, X.X. Xxx 0000, Xxxxxxxx,
XX 00000, or such other address as Gannett may from time to time advise in
writing. Any notice from Gannett to Maine Media shall be deemed duly served upon
receipt by Maine Media at the following address: The Portland Newspapers, X.X.
Xxx 0000, Xxxxxxxx, XX 00000.
IN WITNESS WHEREOF, the parties hereto have caused this Sublease to be duly
executed and delivered as of the day and year first written above.
MEDIA PROPERTIES OF MAINE, LLC
By: GUY GANNETT COMMUNICATIONS,
its sole member
By:
---------------------------------- ----------------------------------
Witness Xxxxx X. Xxxxx
Vice President - Finance
GUY GANNETT COMMUNICATIONS
By:
---------------------------------- ----------------------------------
Witness Xxxxx X. Xxxxx
Vice President - Finance
PPPPPPPPPPPPPPPP
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
Section 1.1(d) - (Real Property)
See attached Section 1.1 (d) of the Disclosure Schedule.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 1.1(R) (NON-COMPETITION AGREEMENTS)
Xxxxx X. Xxxxxxx
Xxxxxxx X. Xxxx
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.3 (ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS)
--------------------------------------------------------------------
3.3(a): None.
3.3(b): None.
3.3(c): None.
3.3(d):
1. See Section 3.3.1 of the Disclosure Schedule for list of contracts
that require consent to the transactions.
2. The Company's Revolving Loan Agreement with BankBoston and others
and Note Purchase Agreement with its noteholders prohibit the
transfer of the Assets without the lenders' consent. The Company
expects to repay these obligations at or prior to Closing.
3. See Section 3.14 of the Disclosure Schedule concerning certain
retention and severance agreements with various employees
requiring certain payments to be accelerated at Closing.
4. See Section 3.14 of the Disclosure Schedule concerning certain
agreements with various retired employees that may be accelerated
upon Closing.
5. The annual management bonuses for WOKR-TV will be accelerated at
Closing. If the Closing is before the end of 1998, the portion of
the
SECTION 3.3 (ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS)
--------------------------------------------------------------------
payment relating to the period from the Closing Date through year
end will be accounted for as a prepaid expense.
6. Pursuant to the terms of the Company's Directors' Deferred
Compensation Plan, deferred directors fees are payable upon the
sale of substantially all of the assets of the Company, and will
be due upon Closing.
7. Most, if not all, of the Company's insurance policies are not
assignable.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.5 (FINANCIAL STATEMENTS)
----------------------------------
3.5(a): None.
3.5(b) & (c):
1. The Unaudited Financial Statements do not include all financial
statements (e.g., cash flow), financial elements (e.g., income
taxes and net income) or footnotes required under GAAP. Net
Financial Assets will not include any accruals for any severance
for employees terminated after the Closing. The Unaudited
Financial Statements were prepared on a pro forma basis to reflect
the Company's expectations as to how certain accounting matters
related to the sales of the Company and the Maine Media Business
would be handled, including without limitation: estimates of how
post-retirement liabilities would be allocated between Newco (as
defined in Section 3.7 of the Disclosure Schedule) and the
Company; none of the prepaid pension cost included in "other
assets" in the corporate balance sheet was allocated to Newco;
certain long-term incentive plans and supplemental retirement
benefits were not reflected on the balance sheet because it is
anticipated that they will be paid prior to Closing. Some monthly
financial statements may not include all accrued vacation
benefits. The treatment of downpayments on program rights as
described in Section 9.1 is not consistent with prior periods or
in accordance with GAAP. The consolidated statement of operations
is intended to display EBITDA and EBIT rather than net income. The
Guy Gannett Broadcast Group balance sheet shows no allocation or
apportionment of the post-retirement liability or of the prepaid
pension (except that the June 30, 1998 balance sheet does show the
post-retirement liability). As described above, the Unaudited
Financial Statements are not in conformance with GAAP nor are they
consistent with prior periods.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.5 (FINANCIAL STATEMENTS)
----------------------------------
2. The Unaudited Financial Statements do not include any assets or
liabilities that may result from a settlement in the future with
ASCAP regarding the dispute with the TV Music License Committee on
new fees and the license agreement.
3. Downpayments relating to certain program rights contracts set
forth in Section 9.1 of the Disclosure Schedule will be recorded
as prepaid expenses, while in the past some of these liabilities
have been recorded as reductions in the "film contract liability"
account.
4. The Company has an arrangement to pay a former WGME employee a
monthly sum, until May 1999, outside the terms of any supplemental
retirement plan. The Company accounts for this liability on a cash
basis.
3.5(c):
5. There are certain liabilities related to the sale of the Company
and its properties that are not recorded and have not been
incurred in the ordinary course including but not limited to (a)
fees for: attorneys, investment bankers, accountants, consultants,
etc.; (b) certain agreements with key employees for severance,
retention and closing benefits, and former employees for
supplemental retirement and deferred compensation benefits.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.6 (TITLE TO ASSETS; RELATED MATTERS)
----------------------------------------------
3.6(i):
1. The Company has possession of various assets owned by others,
including but not limited to personal items of employees and
officers. The Company also has possession of records, but does not
have any ownership interest in, the following groups or
organizations: Guy P. Gannett Foundation, The Portland Newspapers
Xxxxx Xxxxxxx Fund; Xxx Xxxxxxx Employees Credit Union; the Xxxx
X. Xxxxxxx Trust and the Gannett Family Forum.
2. WTWC entered into a conservation easement with Xxxx County,
Florida, dated June 16, 1998.
3. There is a possible encroachment onto abutting property of the
WICD satellite dishes at the station studio in Champaign,
Illinois.
4. The New York State Department of Transportation ("NYSDOT") has
taken, by eminent domain,: (1) a fee simple interest in a 0.136
acre parcel located at 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxx
Xxxx, along the property fronting Xxxx Xxxxxxxxx Road and crossing
the driveway accessing that property, and (2) a permanent easement
for traffic control devices on the driveway where the driveway
meets Xxxx Xxxxxxxxx Road. In return, NYSDOT has paid the Company
$12,400.
5. See Section 3.16 of the Disclosure Schedule for Intellectual
Property matters.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.6 (TITLE TO ASSETS; RELATED MATTERS)
----------------------------------------------
3.6(i) and (iii):
6. See Section 3.7 of the Disclosure Schedule for detail with respect
to sharing of certain assets between the broadcast and Maine Media
Business divisions pursuant to the terms of an Amended and
Restated Contribution Agreement dated August 14, 1998. In
addition, upon consummation of the sale of the Maine Media
Business, the Company will lose access to certain expertise in
areas such as marketing and research provided by personnel of the
Maine Media Business, and other relationships with these divisions
will be terminated.
3.6(ii) The Company has a lease with Xxxxx Xxxx for an Iowa City
translator site lease. Title work reveals that title to the leased
property is held by Xxxx Farms, Inc. The Company is in the process
of amending this lease to obtain a right of first refusal and
plans to correct this error at the same time.
3.6(iv):
7. The elevator on the WGME tower requires repair due to damage by
the Winter, 1998 ice storm. Xxxxx Towers has estimated the costs
of repairs at approximately $34,000. This loss is insured and the
repairs will be conducted shortly.
8. WGME purchased a software system including a street level mapping
system. The vendor went out of business before a proper interface
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.6 (TITLE TO ASSETS; RELATED MATTERS)
----------------------------------------------
between the street level mapping system and the WSI weather
reporting system was provided. WGME is working with WSI for a
substitution of software.
3.6(v): None.
3.6(vi): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
3.7(a):
1. An Amended and Restated Contribution Agreement dated August 14,
1998 (the "Contribution Agreement") between the Company and Newco
provides for transfer to Media Properties of Maine, LLC ("Newco"),
on or before the date of sale of the Maine Media Business, of all
assets and liabilities used or usable primarily in connection with
the Maine Media Business. The Company has also agreed to enter
into a services contract between the Company and Newco containing
certain agreements with respect to certain assets presently shared
by the broadcast divisions and Maine Media Business divisions,
including: a) continuation of certain relationships between the
Maine Media Business and WGME for an interim period; b) continued
joint sales of advertising until expiration of existing
commitments to customers; and c) continued occupancy by Newco of
the portion of the Sanford, Maine office space currently shared by
The Portland Newspapers and WGME. The Company expects to enter
into this service contract prior to the Closing. (See Section 5.1
of the Disclosure Schedule.) The services contract also provides
for the Corporate Office to obtain certain services from Newco.
Either the service contract will be rewritten to eliminate this
requirement therefrom, or the Company shall continue to be
entitled to these benefits (and liable for the related
obligations) after the Closing.
2. The Contribution Agreement also provides that the Company will
allocate the pension plan assets in its defined benefit plan
between the Company and Newco as further described in the
Contribution Agreement. The assets and liabilities of the Guy
Gannett Retirement Plan that relate to
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
employees of the Maine Media Business shall be transferred,
post-closing, to a trust that will be established to hold assets
of a new plan to be established for the Maine Media Business
The Contribution Agreement also provides that the Company will use
reasonable efforts to cause the following contracts in which
vendors provide goods or services to both the broadcast and Maine
Media Business divisions to be amended to reflect the split of the
operating divisions into two companies: KOZ, inc dated March 4,
1998, as amended; U.S. Fleet Leasing dated July 19, 1991; R.E.
Harington dated 6/28/94, as amended; KMS Solutions dated 4/25/97;
and Time/Warner Cable (undated). The replacement contracts
relating to the broadcast division will be assigned to, and the
obligations thereunder assumed by, Purchaser.
3.7(b): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
3. The Company has entered into a new employment agreement with Xxx
Xxxxxx. See Section 3.10.4 for date of agreement.
4. The Company has agreed to accelerate at Closing WOKR-TV annual
management bonuses. If the Closing is before year end, the portion
of the payment relating to the period from the Closing Date
through the end of 1998 will be accounted for as a prepaid
expense.
5. The Company has increased its Directors and Officers insurance
coverage (other than the employment practices coverage) to $5
million, and has increased its fiduciary insurance coverage to $25
million prior to Closing.
6. The Company has entered into settlement agreements with Xxxxx
Xxxxxx and Xxxx Xxxxx concerning their alleged rights to retiree
medical benefits. Settlement payments are expected to be made
shortly.
3.7(c): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
3.7(d):
7. The elevator on the WGME tower requires repair due to damage in
the Winter, 1998 ice storm. Xxxxx Towers has estimated the costs
of repairs at approximately $34,000. This loss is insured and the
repairs will be conducted shortly.
3.7(e): The Company may be below budget for 1998 by as much as $1,469,000
for all of the television stations other than WOKR-TV. Assuming a
cash flow reduction of $1,469,000, EBITDA for fiscal year 1998
would be $12,700,000.
3.7(f):
8. WGME and TPN have discontinued sponsorship of 3 on 3 basketball.
9. WGME and the Maine Media Business have discontinued certain joint
sales and promotional efforts in anticipation of the sale of the
Maine Media Business .
3.7(g): None.
3.7(h): None.
3.7(i): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.8 (LITIGATION)
------------------------
3.8(i):
1. The Company has four pending, and several threatened, defamation
and libel Actions. All are covered by insurance. In addition,
there are several insured automobile liability cases and various
workers' compensation claims currently pending.
2. There is a pending gender discrimination case against WGGB. This
matter is insured.
3. An employee stole services from the Station (see Section
5.1(a)(ix) of the Disclosure Schedule and was terminated as a
result. NABET has filed a grievance over the termination.
4. An on-air reporter has threatened to xxx WOKR in connection with
her recent discharge for reasons relating to work performance,
insubordination and violations of station policy. No suit has been
filed to date. This matter is insured.
3.8(ii):
5. WICD has agreed, pursuant to a settlement set forth in an Order of
the Champaign Human Rights Commission, to participate in the
Illinois Broadcasters Intern Program.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.8 (LITIGATION)
------------------------
3.8:
6.
WGGB has filed a motion in support of WWLP's Petition before the
FCC contesting the exercise by Hartford Station WVIT of an
exclusivity provision in its syndicated programming agreements and
requesting that relief be made market-wide.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.9 (INSURANCE)
-----------------------
See Section 3.9.1 of the Disclosure Schedule for a list of insurance policies
relating to the Business.
3.9(i): None.
3.9(ii): None.
3.9(iii): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10 (MATERIAL CONTRACTS)
---------------------------------
1. See Section 3.10.1 of the Disclosure Schedule for agreements
or contracts providing for payments in excess of $50,000 per
year or $250,000 over the five-year period commencing on the
date hereof.
Please note that detail on various insurance policies and
employee benefit plans insurance coverage has not been
provided.
2. See Section 3.10.2 of the Disclosure Schedule for all time
brokerage agreements and affiliation agreements with
television networks.
3. See Section 3.10.3 of the Disclosure Schedule for any
license or contract pursuant to which the Company is
authorized to broadcast film or taped programming supplied
by others in excess of $10,000 per year or having a term of
more than one year .
4. See Section 3.10.4 of the Disclosure Schedule for any
employment agreement, consulting agreement or similar
contract providing for payments to any Person in excess of
$50,000 per year or $100,000 in the aggregate over the
five-year period commencing on the date hereof.
5. See Section 3.14 of the Disclosure Schedule for any
retention or severance agreement or contract with respect to
any Person who is to be employed post-sale.
6. See Section 3.10.6 of the Disclosure Schedule for all
collective bargaining agreements or other union contracts.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10 (MATERIAL CONTRACTS)
---------------------------------
7. See Section 3.10.7 of the Disclosure Schedule for (a) any
lease of real property or (b) any lease of equipment or
license with respect to Intellectual Property (other than
licenses granted in connection with the purchase of
equipment or other assets) by the Company to another party
providing for payments to any Person in excess of $25,000
per year or $75,000 in the aggregate over the five-year
period commencing on the date hereof.
8. See Section 3.10.8 of the Disclosure Schedule for any lease
of equipment or real property or license with respect to
Intellectual Property (other than licenses granted in
connection with the purchase of equipment or other assets)
by the Company to another party providing for payments to
the Company in excess of $20,000 per year or $50,000 in the
aggregate over the five-year period commencing on the date
hereof.
9. Any joint venture, partnership or similar agreement or
contract. NONE.
10. See Section 3.10.10 for any agreement or contract under
which the Company has borrowed or loaned any money in excess
of $1,000,000 or issued or received any note, bond,
indenture or other evidence of indebtedness in excess of
$1,000,000 or directly or indirectly guaranteed
indebtedness, liabilities or obligations of others in an
amount in excess of $1,000,000.
11. Any covenant not to compete or contract or agreement,
understanding, arrangement or any restriction whatsoever
limiting in any respect the ability of the Company to
compete in any line of business or with any Person in any
area. NONE.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10 (MATERIAL CONTRACTS)
---------------------------------
12. See Section 3.10.12 of the Disclosure Schedule for any
agreement or contract between the Company and with any
officer, director, stockholder or employee of the Business
or any of their family members (other than employment
agreements covered above or agreements or contracts
containing terms substantially similar to terms available to
employees generally).
13. Amended and Restated Contribution Agreement by and between
the Company and Media Properties of Maine, LLC dated August
14, 1998, relating to the transfer of assets and liabilities
primarily related to the Maine Media Business. This contract
will not be assigned to Purchaser.
*Executed copies of certain contracts may not be available.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.11 (PERMITS)
----------------------
PERMITS:
--------
(i): None.
(ii): None.
(iii): None.
COMPLIANCE WITH LAW:
--------------------
(i):
1. KGAN recently removed a 1,000 gallon underground diesel oil
storage tank at a tower site at a rural location in Walker,
Iowa. This previously unregistered tank has now been
registered with the Iowa Department of Natural Resources
("IDNR"). Soil testing has indicated very low levels of
hydrocarbons, which is determined to be "clean" under IDNR
Regulations. A confirmatory ground water monitoring well has
been installed. The borings showed no sign of soil
contamination.
2. See Section 3.13 of the Disclosure Schedule concerning
environmental matters.
(ii): See Section 3.8 of the Disclosure Schedule concerning the
Champaign Human Rights Commission.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
------------------
3.12(i):
CALL SIGN TYPE EXPIRATION DATE
--------- ---- ---------------
DATE
----
WOKR-TV, Rochester, NY 06/0l/99
----------------------
KR-9992 TV Pickup 06/0l/99
KR-7729 TV Pickup 06/01/99
KN-2237 TV Pickup 06/01/99
KP-2134 TV Pickup 06/01/99
WGI-226 TV Intercity Relay 06/01/99
WEF-58 TV STL 06/01/99
KGO-958 R/P Base Mobile System 06/01/99
KRG-613 R/P Base Mobile System 06/01/99
BLP-00293 Low Power Broadcast Auxiliary 06/01/99
E6537 Receive Only Earth Station 12/09/03
E860485 Receive Only Earth Station 05/16/06
KNBL-873 Weather Radar 02/13/01
KGAN-TV, Cedar Rapids, IA 02/01/06
-------------------------
K13MN VHF TV Translator 02/01/06
KAP-35 TV STL 02/01/06
WGR-817 TV Intercity Relay 02/01/06
KR-7773 TV Pickup 02/01/06
KR-9931 TV Pickup 02/01/06
KZ-2447 TV Pickup 02/01/06
KZ-2448 TV Pickup 02/01/06
KAP-318 R/P Base Mobile System 02/01/06
BLQ-780906MG Low Power Broadcast Auxiliary 02/01/06
E970014 Transmit/Receive Earth Station 12/06/06
WNAE-244 Weather Radar 01/02/00
WTWC-TV, Tallahassee, FL 02/01/05
------------------------
KB-55264 TV Pickup 02/01/05
WGGB-TV, Springfield, MA 04/01/99
------------------------
KPK-385 R/P Base Mobile System 04/01/99
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
------------------
KPJ-841 R/P Automatic Relay 04/01/99
WGV-791 TV Intercity Relay 04/01/99
KCK-48 TV STL 04/01/99
KCI-582 R/P Base Mobile System 04/01/99
KB-98007 TV Pickup 04/01/99
KB-55388* R/P Base Mobil System 04/01/99
E860424 Receive Only Earth Station 05/02/06
WNTX-565 Private Operational Fixed Microwave 01/31/00
WICD(TV), Champaign, IL 12/01/05
-----------------------
KC-26142 TV Pickup 12/01/05
KVM-77** TV STL 12/01/05
KTX-71 TV Intercity Relay 12/01/05
WMV-569 TV Intercity Relay 12/01/05
BLP-01160 Low Power Broadcast Auxiliary 12/01/05
WPHI-929 Business Radio 06/01/00
WICS(TV), Springfield, IL 12/01/05
-------------------------
WKZ-31 TV Intercity Relay 12/01/05
KSK-95 TV STL 12/01/05
WME-674 TV STL 12/01/05
KTZ-93 TV Intercity Relay 12/01/05
WLF-755 TV Intercity Relay 12/01/05
WAQ-265 TV Intercity Relay 12/01/05
KB-55668 TV Pickup 12/01/05
BLP-01105 Low Power Broadcast Auxiliary 12/01/05
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
WMV-573 TV Intercity Relay 12/01/05
WMV-570 TV Intercity Relay 12/01/05
WNQE-817 Business Radio 09/12/99
WGME-TV, Portland, ME 04/01/99
---------------------
WGME-TV Auxiliary Transmitter 04/01/99
WLG-289 TV Intercity Relay 04/01/99
WLF-619 TV Intercity Relay 04/01/99
WHY-291 TV Intercity Relay 04/01/99
WHY-292 TV Intercity Relay 04/01/99
WCO-23 TV Intercity Relay 04/01/99
WMF-737 TV Intercity Relay 04/01/99
XXX-00 XX XXX 00/00/00
XXX-000 TV Intercity Relay 04/01/99
WLF-620 TV Intercity Relay 04/01/99
KB-55395 TV Pickup 04/01/99
KB-97128 TV Pickup 04/01/99
KA-88998 TV Pickup 04/01/99
KPM-487 Remote Pickup 04/01/99
KPM-468 Remote Pickup 04/01/99
KPF-914 R/P Automatic Relay 04/01/99
KPF-913 R/P Automatic Relay 04/01/99
WPNB-978 TV Intercity Relay 04/01/99
WLG-347 TV Intercity Relay 04/01/99
WPJB-245 TV Intercity Relay 04/01/99
E950350 Transmit/Receive Earth Station 07/14/05
WPJB-738 Private Operational Fixed Microwave 01/16/01
*Copy of license not available.
**Construction Permit Only.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
ANTENNA STRUCTURE REGISTRATIONS
-------------------------- ---------------------- ---------------------------------------- ----------------------
MAIN STATION LOCATION TOWER OWNER REGISTRATION NO.
-------------------------- ---------------------- ---------------------------------------- ----------------------
WOKR-TV Rochester, NY Guy Gannett Communications 1011757
-------------------------- ---------------------- ---------------------------------------- ----------------------
KGAN-TV Cedar Rapids, IA Guy Gannett Communications 1012927
Iowa City, IA Guy Gannett Communications 1012925
Xxxxxx City, IA Guy Gannett Communications 1012926
-------------------------- ---------------------- ---------------------------------------- ----------------------
WTWC-TV Tallahassee, FL Guy Gannett Communications 1019324
-------------------------- ---------------------- ---------------------------------------- ----------------------
WGGB-TV Holyoke, MA Guy Gannett Communications 1018460
Holyoke, MA Guy Gannett Communications 1018461
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
WHYN-FM1 Holyoke, MA Guy Gannett Communications 1018462
-------------------------- ---------------------- ---------------------------------------- ----------------------
WICD(TV)2 Champaign, IL Guy Gannett Communications 1036562
Maroa, IL Guy Gannett Communications 1016052
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
WICS (TV)3 Springfield, IL Guy Gannett Communications 1008823
-------------------------- ---------------------- ---------------------------------------- ----------------------
WGME-TV4 Portland, ME Guy Gannett Communications 1024383
Xxxxxxx, ME Guy Gannett Communications 1014068
Portland, ME Guy Gannett Communications 1024384
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
--------
1 This station is not owned by the Company but leases one of the Company's
antenna structures.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
------------------
3.12(ii): None.
3.12(iii): None.
3.12(iv): None.
3.12(v): None.
3.12(vi): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.13 (ENVIRONMENTAL MATTERS)
------------------------------------
WGME-TV 1. 0000 Xxxxxxxxxx Xxxxxx, Xxxxxxxx, Xxxxx. Various potential
------- environmental matters as described in the entire "Phase I
Environmental Site Assessment - WGME-TV Studios -- 0000 Xxxxxxxxxx
Xxxxxx" (Dames & Xxxxx, 5/28/98).
2. Transmitter Site, Brownhill Road, Raymond, Maine. Various
potential environmental matters as described in the entire "Phase
I Environmental Site Assessment - WGME-TV Transmitter Site --
Brownhill Road (Dames & Xxxxx, 5/28/98).
WGME-TV 3. Blackstrap Road, Falmouth, Maine. Various potential environmental
------- matters as described in the entire Phase I Environmental Site
Assessment-WGME-TV Transmitter Building and Towers-325 Blackstrap
Road, Falmouth, Maine (Dames & Xxxxx, 5/28/98-ESA No. 6).
4. Xxxxx Xxxxxxxxxxx, Xxxx xx Xxxx, Xxxxx (easement parcel and tower
space). Various potential environmental matters as described in
the entire Phase I Environmental Site Assessment-WGME-TV Microwave
Receiver/Transmitter-115 Mountain Road, York, Maine (Dames &
Xxxxx, 5/28/98-ESA No. 7).
5. North Belfast Road, Augusta, Maine. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WGME-TV-Pilot Communications-North
Belfast Road, Augusta, Maine (Dames & Xxxxx, 5/28/98-ESA No. 9).
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
WGGB-TV
-------
6. 0000 Xxxxxxx Xxxxxx, Xxxxxxxxxxx, Xxxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WGGB-TV Studio- 1302 & 0000 Xxxxxxx
Xxxxxx, Xxxxxxxxxxx, Xxxx. (Dames & Xxxxx, 5/28/98-ESA No. 10).
7. Mt. Xxx, Holyoke, Mass. Various potential environmental matters as
described in the entire Phase I Environmental Site
Assessment-WGGB-TV Transmitter-29 Mount Xxx, Holyoke, Mass. (Dames
& Xxxxx , 5/28/98-ESA No. 11).
KGAN-TV
-------
8. Xxxxxx-000 Xxx Xxxxxx Xxxx, Xxxxx Xxxxxx, XX. Various potential
environmental matters as described in the entire "Phase I
Environmental Site Assessment - KGAN-TV Transmission Tower" (Dames
& Xxxxx, 5/28/98).
9. Transmission Tower, 0000 00xx Xxxxxx, Xxxxxx, XX. Various
potential environmental matters as described in the entire "Phase
I Environmental Site Assessment - KGAN-TV Transmission Tower --
0000 00xx Xxxxxx, Xxxxxx, XX" (Dames & Xxxxx, 5/28/98).
10. 0000 Xxxxxxx Xxxx, Xxxx Xxxx, Xxxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-KGAN-TV Iowa City Repeater Tower-
0000 Xxxxxxx Xxxx, Xxxx Xxxx, Xxxx (Dames & Xxxxx, 5/28/98-ESA No.
14).
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
11. 0000 Xxxxx 0xx. Xxxxxx, Xxxxxxxxxx, Xxxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-KGAN-TV Television Translator Site,
0000 Xxxxx 0xx. Xxxxxx, Xxxxxxxxxx, Xxxx (Dames & Xxxxx,
5/28/98-ESA No. 15).
WICS-TV
-------
12. 0000 X. Xxxx Xxxxxx, Xxxxxxxxxxx, Xxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WICS-TV Studio- 0000 X. Xxxx Xxxxxx,
Xxxxxxxxxxx, Xxxxxxxx (Dames & Xxxxx, 5/28/98-ESA No. 16).
13. Xxxxx 0, Xxxxxxx xx Xxxxxx, Xxxxxxxxxxx, Xxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WICS-TV Transmitter Building -Route
1, Village of Dawson, Springfield, Ill. (Dames & Xxxxx,
5/28/98-ESA No. 17).
WICD-TV
-------
14. 000 Xxxxx Xxxxxx Xxxx Xxxxx, Xxxxxxxxx, Xxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WICD-TV Xxxxxxx-000 Xxxxx Xxxxxx
Xxxx Xxxxx, Xxxxxxxxx, Xxx. (Dames & Xxxxx, 5/28/98-ESA No. 18).
15. Route 130 East, Xxxxx, Ill. Various potential environmental
matters as described in the entire Phase I Environmental Site
Assessment-WICD-TV Transmitter Building -Route 130 East, Xxxxx,
Ill. (Dames & Xxxxx, 5/28/98-ESA No. 19).
16. Xxxxx 00, Xxxxx, Xxx. Various potential environmental matters as
described in the entire Phase I Environmental Property Audit by
Xxxxxx Engineers, dated March/1993.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
WOKR-TV
-------
17. 0000 Xxxx Xxxxxxxxx Xxxx, Xxxxxxxxx, Xxx Xxxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WOKR-TV Xxxxxx-0000 Xxxx Xxxxxxxxx
Xxxx, Xxxxxxxxx, Xxx Xxxx (Dames & Xxxxx, 5/28/98-ESA No. 20).
18. Pinnacle Hill-State Route 31), Brighton, New York. Various
potential environmental matters as described in the entire Phase I
Environmental Site Assessment- WOKR-TV Transmitter Site-Pinnacle
Hill ( Dames & Xxxxx, 5/28/98-ESA No. 21.
WTWC-TV
-------
19. 0000 Xxxx Xxxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxxx. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WTWC-TV Channel 40-TV station and
Tower, 0000 Xxxx Xxxxxxxx Xxxx, Xxxxxxxxxxx, Xxxxxxx (Dames &
Xxxxx, 2/16/96)
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.14 (EMPLOYEE BENEFITS)
--------------------------------
1. The Company has entered into certain agreements with key employees
for severance, retention and other closing benefits which include
new benefits, as well as acceleration of certain existing
benefits. Pursuant to these agreements, employees will be paid
agreed amounts in lieu of existing obligations under short-term
incentive plans, individual TV managers' long-term incentive
plans, and the Company's 1997-2000 Long-Term Incentive Plan,
thereby fixing and accelerating existing obligations. The
agreements also require payment of certain base retention bonuses
and severance payments for selected employees. See Section 3.14.1
of the Disclosure Schedule for a list of division agreements
(other than division heads) and Section 3.14.2 of the Disclosure
Schedule for a list of division head agreements.
2. Certain agreements with various retired employees may be
accelerated upon Closing: Xxxx XxXxxxxx, Xxxx Xxxxxx, Xxxxxx
Xxxxxxxx and Xxxxxxx Xxxxxxxxx.
3. The Company has entered into several severance agreements in the
normal course of business which include periodic severance
payments and payment of medical and dental COBRA premiums.
4. The Company has an arrangement to pay a former employee a monthly
sum, until May 1999, outside the terms of any supplemental
retirement plan.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.14 (EMPLOYEE BENEFITS)
--------------------------------
5. The Company is in the process of amending certain summary plan
descriptions for its qualified plans and welfare benefit plans.
Amendments to qualified plans need to be written and filed prior
to 12/31/99 to comply with Tax Reform Act of 1997 and the Small
Business Job Protection Act of 1996.
6. The Guy Gannett Voluntary Investment Plan (401(k)) has recently
had several small operational matters which have been corrected
and documented according to the provisions of the IRS
self-correction program referred to as "APRSC."
7. The Guy Gannett Voluntary Investment Plan is currently involved in
a random 5500 audit by the IRS for the 1995 plan year. The results
of that audit cannot be predicted at this time.
8. The Company has agreed, under the terms of a severance agreement
with one former employee, to pay to him 75% of an individual
medical insurance premium until March 2003.
9. KGAN entered into a severance agreement with an employee.
Subsequently, there have been several letters of correspondence
with the former employee's attorney over a number of issues
including a modification that had to be made to the agreement in
order to comply with medical plan and COBRA eligibility. The
matter has not risen to the level of threatened litigation.
10. See Section 3.14.5 for list of employee benefit plans, Section
3.10.4 for list of material employment, consulting and similar
agreements, Section 3.10.6 for collective bargaining agreements
and Section 3.14.1, 3.14.2 and 3.3 for agreements providing for
payments upon a change of control.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.15 (LABOR RELATIONS)
------------------------------
See Section 3.10.6 for list of labor organizations representing
employees.
3.15(i): None.
3.15(ii): None.
3.15(iii): None.
3.15(iv): None.
3.15(v) None.
3.15(vi) None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.16 (INTELLECTUAL PROPERTY)
------------------------------------
See Section 3.16.1 for a list of call letters for the Stations.
3.16(i): None.
3.16(ii):
1. The tradename for "Newssource 13" used by WOKR has not yet
been transferred of record in the U.S. Patent & Trademark
Office.
2. The Company is investigating whether KGAN's "Weathereye"
website has all necessary copyrights for some of the
material published on its site.
3.16(iii): None.
3.16(iv): None.
Guy Gannett Communications
Purchase Agreement - Broadcasting
Section 3.16.1 - Call Letters
WGME-TV PORTLAND, MAINE
WGGB-TV SPRINGFIELD, MASSACHUSETTS
KGAN-TV CEDAR RAPIDS, IOWA
WICS-TV SPRINGFIELD, ILLINOIS
WICD-TV CHAMPAIGN, ILLINOIS
WOKR-TV ROCHESTER, NEW YORK
WTWC-TV TALLAHASSEE, FLORIDA
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.17 (TAXES)
--------------------
None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.18 (COMMISSIONS)
--------------------------
Certain of the Company executives have agreements for contingent
compensation tied to the sales price for the Company.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.19 (AFFILIATE TRANSACTIONS)
-------------------------------------
See Section 3.7 of the Disclosure Schedule concerning the
Contribution Agreement with respect to the Company's
transfer of the Maine Media Business to Newco.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
4.3 (ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS)
------------------------------------------------------------
None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
4.7 (PURCHASER'S QUALIFICATIONS)
--------------------------------
The following television stations overlap with Xxxxxxxx stations and would
require waivers of FCC ownership rules before they could be acquired by
Xxxxxxxx:
1. WOKR-TV Rochester, NY, has Grade A overlap with WUHF(TV), Rochester, NY
2. WICS-TV Springfield, IL, has Grade A overlap with WYZZ(TV), Bloomington,
IL, and Grade B overlap with KDNL(TV), St. Louis, MO.
3. WICD-TV Champaign, IL, has Grade B overlap with WYZZ(TV), Bloomington, IL.
4. KGAN-TV Cedar Rapids, IA, has Grade B overlap with KDSM(TV), Des Moines,
IA.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
5.1(a)(i): None.
5.1(a)(ii):
1. The Company has the right, under a contract with KOZ inc,
to provide on-line community publishing services in all
of its TV markets. The Company (as part of Maine Media
Business) presently provides this service only in Maine.
2. Some combined activities between and among the Company
and Newco may be suspended at or after the date of the
sale of the Maine Media Business.
3. KGAN plans to enter into a lease for a remote studio at a
mall.
4. The Company will modify the Guy Gannett Group Life and
Health Plan (#501) to vest those Business Employees and
Corporate Office Employees (1) who are currently retired
and covered by the plan ("Current Retirees") and (2) who
are currently employed and who meet the age and service
requirements for post-retirement coverage as of the
Closing Date ("Qualified Employees", with the Current
Retirees and Qualified Employees sometimes collectively
referred to as "Retirees") in post-retirement benefits
substantially equivalent to those offered by the plan as
of the Closing Date. The Coorporate Office Employees
eligible or deemed to be eligible for these
post-retirement benefits are listed on Schedule 5.1.1 and
the Business Employees eligible for these post-retirement
benefits are listed on Schedule 5.1.2.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
The percentage of premium paid by Current Retirees will remain
the same as the percentage that they pay as of the Closing
Date. Current Retirees and Qualified Employees shall pay 100%
of the premium for post-retirement medical coverage and the
Company shall pay 100% of the life insurance premium for such
Current Retirees and Qualified Employees.
Subject to the provisions of the existing plans concerning
premium sharing, the cost of such insurance coverages will be
deemed to be the same as the cost for active employees for so
long as the same benefit options are available to both active
employees and Retirees. At any time that active employees and
Retirees are not covered by the same health plan options, the
cost to Retirees will be deemed to be the community rate for
the same or similar coverage as determined by the insurance
provider covering the largest number of lives in the State of
Maine. The Group Companion Plan coverage will at all times be
based upon the current coverage option and at rates determined
from time to time by Blue Cross Blue Shield of Maine or its
successor and approved by the State of Maine, although the
actual insurance carrier may change.
See Section 3.7 of the Disclosure Schedule concerning
allocation of pension plan assets in the Company's defined
benefit plan between the Company and Newco, and the transfer
of certain plan assets related to the Maine Media Business to
Newco's plan.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
5. Under a contract with Cigna (G-R200), Cigna provides
guaranteed payments to retirees under the Guy Gannett
Retirement Plan with respect to benefits accrued until
January, 1970. The Company plans to cause the Cigna
contract to be modified to provide for the transfer to
the New Pension Plan that portion of the guaranteed
payments that relate to current and former Business
Employees.
6. WGME may move either Xxxxxxx or Entertainment Tonight to
an after-midnight time slot before Xxx Xxxxxx.
5.1(a)(iii): None.
5. The Company plans to enter into a lease amendment with
respect to the property located at the Northport Business
Park to address sub-letting of tower space.
6. The Company plans to donate certain items relating to the
Gannett family to non-profit organizations.
7. See Section 3.7 of the Disclosure Schedule for a
description of the contribution of the Maine Media
Business to Newco, and the related agreement concerning
certain shared assets, which the Company expects to enter
into prior to Closing.
5.1(a)(iv):
8. Trustees under the Guy Gannett Retirement Plan and the
Voluntary Investment Plan and Trusts will resign and will
be replaced by an institutional trustee.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
9. The Company expects to grant a premium holiday, and/or
provide employees a lump sum refund relating to prior
year overpayment of health care premiums.
5.1(a)(v): None.
5.1(a)(vi): None.
5.1(a)(vii): None.
5.1(a)(viii): No consent of the Purchaser will be required for
modification, change, renewal or extension of the
following Material Contracts, on terms consistent with
past practices of the Business:
o Modification of Lease with Xxxxx Xxxx (KGAN) to
obtain a right of first refusal in favor of the
Company and correct the landlord
o Entry into a new office lease in Waterloo, Iowa
(KGAN).
o Extension or renewal of Columbine Systems, Inc.
agreement (WICS), provided that the Company will use
reasonable efforts to extend this contract on a
month-to-month basis or to renew the same terminable
on 30 days' notice, but the obtaining of such an
extension or renewal on such terms shall not be a
condition of Closing. In no event shall this contract
be extended beyond December 31, 2000 without
Purchaser's consent, which consent shall not be
unreasonably withheld.
o Extension or renewal of Incentive Management, Inc.
agreement (WICS)
o New Personal Service Contract with Xxxx Xxxxxxx
(WGGB)
o New Personal Service Contract with Xxxxx Xxxxxxx
(KGAN)
o New Personal Service Contract with Xxxx Xxxx (WICS)
o New Personal Service Contract with Xxxx Xxxxxxx
(WICS)
o New Personal Service Contract with Xxx Bilone (WOKR)
o A new Personal Services Contract may be entered into
with Xxxx Xxxx.
o U.S. Fleet Lease will be amended to add a budgeted
news vehicle.
o See Section 5.1(a)(iii), Xx. 0, xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx lease amendment.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
5.1(a)(ix):
10. An employee of WGGB stole certain services from the
Station. The employee has been terminated. WGGB may
enter into a settlement agreement and a release with
regard to the services stolen.
5.1(a)(x):
11. The Company may enter into an agreement with CBS
reducing KGAN and WGME's network affiliation
compensation as a result of CBS's new NFL football
programming.
5.1(a)(xi): None.
5.1(a)(xii): None.
5.1(a)(xiii): None.
5.1(a)(xiv): None.
5.1(a)(xv): None.
5.1(a)(xvi): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.2 (POST-CLOSING COVENANTS AND AGREEMENTS)
---------------------------------------------------
5.2(a): Employee Benefit Plans, books and records to be available
for inspection without limit as to time relate to:
o Guy Gannett Retirement Plan and Trust
o WOKR-TV 401(k) Profit Sharing and Savings Plan
5.2(b): Corporate Office Employees are those individuals listed on
Section 5.2.1 of the Disclosure Schedule or any persons who,
at or prior to Closing, have replaced any of the listed
individuals in their positions.
5.2(d): Purchasers current severance policy is to provide severance
of one-half day's pay for each full month of continuous
service to those employees whose employment is terminated,
after six months of service, due to the elimination of the
employee's duties for reasons such as lack of work,
organizational changes or general reduction of force.
5.2(e):
1. Pursuant to Section 7 of the presently effective bargaining
agreement between "WGME-TV, a division of Guy Gannett
Communications Co. (Employer) and the American Federation of
Television and Radio Artists, Boston Local, AFL-CIO
(Union)".
2. Pursuant to Section C of the presently effective bargaining
agreement between "Guy Gannett Communications d/b/a WGME-TV
of Portland, Maine and Local Union No. 1837 of the
International Brotherhood of Electrical Workers [AFL-CIO]."
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.2 (POST-CLOSING COVENANTS AND AGREEMENTS)
---------------------------------------------------
3. Pursuant to Article V, Section 12 of the presently effective
bargaining agreement between "Guy Gannett Communications
d/b/a WICS-TV of Portland, Maine and Local Union No. 51 of
the International Brotherhood of Electrical Workers
[AFL-CIO]."
5.2(f): Xxxxxx Xxxxxxxxxx (retired), Xxx Xxxxxx (WOKR) and Xxxxx
Xxxxxxx (retired) have supplemental retirement plans. The
accrued liability therefor will be included in the Net
Financial Assets calculation.
5.2(i) See Section 5.2.2 of the Disclosure Schedule.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
Section 6.4 (Material Consents Required As A Condition
------------------------------------------------------
of the Purchaser's Obligation To Close)
---------------------------------------
1. The Affiliation Agreements listed on Section 3.10.1 of the
Disclosure Schedule.
2. Lease with Michigan Ave. National Bank of Chicago dated 4/19/77
for studio space and tower lease.
3. Obtaining of the following consents will not be a condition of
Closing if the Company has obtained, prior to Closing,
alternatives reasonably acceptable to Purchaser and on terms not
materially adverse to Purchaser as reasonably determined by
Purchaser:
A. Lease with Xxxxx Xxxx dated 2/25/98 for Iowa City translator
tower site.
B. Lease with Xxxx and Xxxxxxx Xxxxxxx dated 7/27/98 for
Washington, Iowa site.
C. Lease with Maine Public Broadcasting dated 10/23/95 for
Litchfield, Maine tower space.
D. Lease with Maine Bureau of Forestry dated 1/7/88 for
microwave tower site.
E. Lease with Fleet Bank dated 1/1/94 for Lewiston, Maine
space.
F. Lease with Fleet Bank dated 6/20/95 for Sanford, Maine
office space.
G. Excelltron Tower, Inc. lease dated 7/1/95 for tower located
in Sanford, Maine.
H. Intermedia (EMI Communications) dated 3/26/98 for video
service/tower lease for WOKR.
None of the leases described in this Section 3 are for main studio, main tower
or main transmission sites.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
*Northport Realty Trust for WGME office and studio lease (consent to assignment
not required).
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 7.4 (MATERIAL CONSENTS REQUIRED AS A CONDITION
------------------------------------------------------
OF THE COMPANY'S OBLIGATION TO CLOSE)
-------------------------------------
None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 9
---------
(CLOSING STATEMENT DIFFERENCES AND INCONSISTENCIES WITH GAAP)
-------------------------------------------------------------
1. The accounting method used to amortize downpayment of
certain program costs will be made in accordance with the
example shown in Section 9.1 of the Disclosure Schedule.
2. The Closing Statement may not include any assets or
liabilities that may result from a settlement in the future
with ASCAP regarding the dispute with the TV Music License
Committee on new fees and the license agreement.
3. The Closing Statement will not be in accordance with GAAP
and/or be consistent with the basis used in preparing the
Unaudited Financial Statements as of, and for the year
ended, December 27, 1997 in the following ways.
(a) The Closing Statement will not include any financial
statements or footnotes required under GAAP.
(b) The Closing Statement will not include any accruals
for severance for employees terminated after the
Closing.
(c) See Section 3.5 of the Disclosure Schedule for other
non-conformities with GAAP and inconsistencies with
prior practices.
4. The Company has an arrangement to pay a former WGME employee
a monthly sum, until May 1999, outside the terms of any
supplemental retirement plan. The Company accounts for this
liability on a cash basis.
5. A liability for vacation benefits for corporate employees
may exist at Closing. This will be recorded as a Net
Financial Asset, but is not in accordance with past
practices for interim financial statements.
6. Retirement and deferred compensation plans for the following
former executives will be included in the definition of Net
Financial Assets, unless such liabilities are satisfied
prior to Closing: Xxxxxx Xxxxxxxxxx; Xxxx Xxxxxx; Xxxxxx
Xxxxxxxx; Xxxxxxx Xxxxxxxxx and Xxxx XxXxxxxx.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT - BROADCASTING
SECTION 1.1(D) - REAL PROPERTY
------------------ -------------------------------------- --------------------------------------------------------------------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- --------------------------------------------------------------------------
MAINE FOR INFORMATION AND TITLE INFORMATION REGARDING
EASEMENTS, RIGHTS AND APPURTENANCES,
OUTCONVEYANCES AND OTHER ENCUMBRANCES, PLEASE
SEE THE TITLE INSURANCE COMMITMENT FOR EACH
PARCEL. FOR INCOME LEASES AFFECTING OWNED REAL
PROPERTY, SEE SECTION 3.10.8 OF THE DISCLOSURE
SCHEDULE
------------------ -------------------------------------- --------------------------------------------------------------------------
CUMBERLAND
COUNTY
------------------ -------------------------------------- --------------------------------------------------------------------------
LICENSE 000 Xxxxxxxx Xxxxxx Short-term license (to be created pursuant to WGME-TV
Portland (2-(A)) terms of Contribution Agreement)
Transmitter, antennae and sky camera
on roof of building
------------------ -------------------------------------- --------------------------------------------------------------------------
TENANCY AGREEMENT Cumberland County Civic Ctr (14(A)) Oral agreement for tower on roof WGME-TV
------------------ -------------------------------------- --------------------------------------------------------------------------
LEASED Northport Plaza Lease between Trustees of Northport Realty Trust WGME-TV
Portland (15L) and Guy Gannett Communications dated January 1, 1996;
WGME-TV
Studio, office, satellite antennae
and microwave dishes
------------------ -------------------------------------- --------------------------------------------------------------------------
OWNED Brownhill Road QUITCLAIM DEED from Guy Gannett Broadcasting Services WGME-TV
Xxxxxxx to Guy Gannett Publishing Co., dated 12/19/86,
WGME-TV (P17, 18) Cumberland Registry at Book 7720, Page 244;
Tower, sky camera and transmission
Building
(69 acre parcel)
------------------ -------------------------------------- --------------------------------------------------------------------------
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
OWNED Blackstrap Road WARRANTY DEED from Guy Gannett Broadcasting Services WGME-TV
Falmouth to Guy Gannett Publishing Co., dated 12/19/86,
WGME-TV (P 19) Cumberland Registry at Book 7679, Page 99;
2 parcels (one is raw land);
transmission building, tower and sky
camera
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
ORAL Maine Medical Center Sky cam lease WGME-TV
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
YORK COUNTY
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
LEASED Eight Washington Street, Stes. Lease Agreement between Fleet Bank of Maine as Landlord WGME-TV
209-212, 2nd Fl, Sanford and Guy Gannett Communications, dated 6/20/95, expires
WGME-TV 4/20/2000.
(23-L, 27-L)
Office, remote broadcast
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
LEASED Mt. Hope Road Tower Site Agreement between Excelltron Tower, Inc. WGME-TV
Xxxxxxx (York, Cty) and Guy Gannett Communications, dated 7/1/95, expires
WGME-TV (28-L) 4/30/2000, with option to renew for another 5 yrs.
Leased space on tower for 2
antennae microwave site
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
LEASED Mt. Agamenticus Lease Agreement between Maine Bureau of Forestry and WGME-TV
WGME-TV, dated 1/7/88
Leased tower space
WGME-TV (29-A)
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
OWNED Town of York, WARRANTY DEED from Guy Gannett Broadcasting Services WGME-TV
Agamenticus Mountain: to Guy Gannett Publishing Co., dated 12/19/86, York
WGME-TV (29-E) registry at Book 4220, Page 210.
Easement to maintain a 4' x 8' cinder block building with
relay antenna on Forestry tower(microwave site)
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
------------------ -------------------------------------- ----------------------------------------------------------- --------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- ----------------------------------------------------------- --------------
KENNEBEC COUNTY
------------------ -------------------------------------- ----------------------------------------------------------- --------------
OWNED North Belfast Road Xxxxx X. Xxxxx to Gannett Publishing Co., Inc., WGME-TV
Augusta (34(A)) 6/12/44, at 804/4991;
Land only owned; tower space GGPC to Guy Gannett Broadcasting Services, 11/22/65,
leased to Pilot Communications at 1403/461;
Leased to Augusta-Waterville Broadcasters: Lease dated
3/1/85 (now Pilot Communications)
------------------ -------------------------------------- ----------------------------------------------------------- --------------
TENANCY AGREEMENT State House Building, Unwritten agreement: WGME-TV
Augusta (36-L)
------------------ -------------------------------------- ----------------------------------------------------------- --------------
TENANCY AGREEMENT 0 X. Xxxxxxxx Xxxxxx, Xxxxxxxx, unwritten agreement for skycam site WGME-TV
Augusta (Kennebec Valley
Medical Center) (40-L)
------------------ -------------------------------------- ----------------------------------------------------------- --------------
TENANCY AGREEMENT Quaker Hill No written agreement-use of tower space with WABI WGME-TV
Sidney, Maine (40(A))
Agreement for WABI for antenna
space; WABI provides backup power
use of their receiver antenna
------------------ -------------------------------------- ----------------------------------------------------------- --------------
ANDROSCOG. COUNTY
------------------ -------------------------------------- ----------------------------------------------------------- --------------
LEASED 00 Xxx Xxxxxx, Lease between Fleet Bank of Maine and Guy Gannett WGME-TV
Lewiston (32-L) Communications, d/b/a WGME-TV, dated 1/1/94,
ending 12/31/99
Leased studio, office for news
bureau; transmitter and tower
with 2 antennae on top of
building
------------------ -------------------------------------- ----------------------------------------------------------- --------------
------------------ -------------------------------------- ----------------------------------------------------------- --------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- ----------------------------------------------------------- --------------
LEASED Oak Hill Road Lease Agreement between Maine Public WGME-TV
Litchfield (39-L) Broadcasting Corporation and Guy Gannett Communications,
WGME-TV, dated 10/23/95, expires 10/23/99
Small leased building and tower
space microwave site (WCBB Tower)
------------------ -------------------------------------- ----------------------------------------------------------- --------------
PENOBSCOT
COUNTY
------------------ -------------------------------------- ----------------------------------------------------------- --------------
ORAL WABI Tower ORAL agreement regarding use of WABI tower space WGME-TV
Dixmont, ME (40(B))
Transmitter located in WABI bldg.
------------------ -------------------------------------- ----------------------------------------------------------- --------------
ORAL Xxxxxxxx Street ORAL agreement with WABI regarding use of WGME transmitter WGME-TV
Bangor, ME (40(C))
Transmitter
------------------ -------------------------------------- ----------------------------------------------------------- --------------
MASS.
------------------ -------------------------------------- ----------------------------------------------------------- --------------
OWNED 0000 Xxxxxxx Xxxxxx, XXXXXXXXX DEED from The WHYN Stations Corporation to WGGB-TV
Springfield, MA Guy Gannett Publishing Co., dated 12/19/86
(Hampden Cty.) and recorded in the Hampden County Registry
(60, 61) of Deeds at Book 6662, Page 407.
Studio, office
------------------ -------------------------------------- ----------------------------------------------------------- --------------
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
IDENTIFIER/TITLE COMMITMENT PARCEL
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
LEASED Chestnut Park Associates - Leased Tower space for WGGB WGGB-TV
radio equipment, effective date - 8/1/85; with Amendment
to extend term and rate (dated 5/1/93)
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
OWNED Mt. Xxx QUITCLAIM DEED from The WHYN Stations Corporation to WGGB-TV
Holyoke, MA (64) Guy Gannett Publishing Co., dated 12/19/86 and recorded
in the Hampden County Registry of Deeds at Book 6662,
Transmitter building and parcel of Page 407 (rec. on 10/23/87) parcel #4
land
-Easement from Mountain Park Amusement Co., Inc. to The
WHYN Stations Corporation, dated 10/14/68, recorded in
Hampden Cty. at 3373/381;
-Lease Agreement between The WHYN stations Broadcasting
Corp. & Affiliated Broadcasting, Inc. dated 6/13/80
(space in transmitter building on Mt. Xxx)
- Assumption between New England Radio Corp. (successor
Tenant) who wishes to assign said Lease to Radio Equity
Partners, and Guy Gannett Publishing Co. as Landlord,
dated 10/13/93 (Consent to Assignment of Lease, Estoppel
Certificate and Lease Assumption, dated October 13, 1993)
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
IOWA
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
OWNED KGAN-TV WARRANTY DEED from WHYN Stations Corporation to Guy KGAN-TV
Cedar Rapids, Iowa Gannett Publishing Co., dated 12/19/86, recorded Linn
000 Xxx Xxxxxx Xxxx County at Book 1907, Page 272
Linn County (2 parcels)
(70, 71) STUDIO LEASE AGREEMENT between KGAN-TV and WMT, Inc.,
dated October 16, 1981 (6,579 SF);
Own 6.95 acres and lease studio
space; studio and office, TOWER LEASE AGREEMENT between KGAN-TV and WMT, Inc. dated
and 700' tower KGAN-TV October 16, 1981
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
OWNED Xxxxxxx 000, Xxxx xx Xxxxxx, Xxxxxx XXXXXXXX DEED from The WHYN Stations Corporation to Guy KGAN-TV
County, Iowa Gannett Publishing Co. dated 12/19/86, recorded Xxxxxx
(72, 72-L, 73) County Recorder at Book 216, Page 458;
156.5 acres
ASSIGNMENT OF LEASE: Lease between WMT, Inc. and
Transmitter building, 1335' tower Xxxxxxxxx Xxxxx Xxxxxxx and WMT, Inc. dated Sept. 15,
and 40 x 60 metal garage 1975 assigned KGAN-TV
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
LEASED Iowa City LEASE between Xxxxx Xxxx and Guy Gannett Communications KGAN-TV
Xxxxxxx County d/b/a KGAN-TV, dated 2/25/98;
(74, 74-L)
[Own building and lease land; KGAN in process of
Leased land by KGAN; repeater attempting to obtain Right of First Refusal on land
building co-owned with ILLOWA on correction of land correction of Landlord to Xxxx
Communications Co. Farms, Inc.
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
LEASED 0000 0xx Xxxxxx LEASE between Xxxx X. Xxxxxxx and Xxxxxxx Xxxxxx Xxxxxxx KGAN-TV
Washington County, Iowa as landlords and Guy Gannett Communications d/b/a
(75, 75-L) KGAN-TV, dated July 27, 1998 (automatic renewal feature)
Translator building
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
LEASED 000 Xxxxxxxx Xxxxxx, LEASE between Midtown Development Partnership and KGAN-TV
Suite 706, KGAN, dated 11/1/96
Waterloo, IA
[228 Waterloo Building] Lease expires 10/98
(76-L)
Space no longer in use
-- bureau office
------------------ -------------------------------------- ---------------------------------------------------------- ---------------
------------------ -------------------------------------- --------------------------------------------------------- ----------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- --------------------------------------------------------- ----------------
LEASED 000 00xx Xxxxxx LEASE between Zorah Asadzadehfard d/b/a Afsie Dental KGAN-TV
Unit #3 (77-L) Clinic and KGAN TV Co., dated 1/30/96 as amended
Coralville, IA
Bureau office
------------------ -------------------------------------- --------------------------------------------------------- ----------------
RENTAL AGREEMENT 000 00xx Xxxxxx This is storage space on an
"As-needed" basis for large KGAN-TV Cedar Rapids (78-L)
equipment short term agreements only
Warehouse space
------------------ -------------------------------------- --------------------------------------------------------- ----------------
ILLINOIS:
------------------ -------------------------------------- --------------------------------------------------------- ----------------
OWNED WICS-TV WARRANTY DEED from Guy Gannett Broadcasting Services WICS-TV
0000 X. Xxxx Xxxxxx Co. to Guy Gannett Publishing Co., dated 12/19/86,
Springfield, Ill. recorded SANGAMON County, IL Instrument #59708
(2 parcels) Studio, office (80) [Source: Warranty Deed from WICS-RV, Inc. to Guy
Gannett Broadcasting
Services (Co.), dated
3/12/85 and recorded
in the Sangamon County
Records at Instrument
#980885
------------------ -------------------------------------- --------------------------------------------------------- ----------------
OWNED Route 1 WARRANTY DEED from Guy Gannett Broadcasting Services WICS-TV
Village of Dawson, IL (81) Co. to Guy Gannett Publishing Co., dated 12/19/86,
recorded SANGAMON County, IL Instrument #59708
Transmitter building [Source: Warranty Deed from WICS-RV, Inc. to Guy
(WICS-TV) Gannett Broadcasting Services (Co.), dated 3/12/85 and
recorded in the Sangamon County Records at Instrument
#980885
------------------ -------------------------------------- --------------------------------------------------------- ----------------
LEASED 000 Xx. Xxxxxx Xxxx Xxxxx LEASE Agreement between Michigan Avenue National Bank of WICD-TV
Champaign (82-L) Chicago, (as Trustee) and Plains Television Partnership,
dated 4/19/77;
Plains Television Partnership Memorandum of Lease recorded
3/30/78 as document 78 R WICD-TV; 6323 (landlord-according to
insurance list, now Mgmt.
Co. of Illinois, Inc.)
studio, office/tower lease
------------------ -------------------------------------- --------------------------------------------------------- ----------------
------------------ -------------------------------------- ----------------------------------------------------------- -------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- ----------------------------------------------------------- -------------
OWNED Route 51 TRUSTEES DEED from LaSalle National Trust to GGC, for WICD-TV
Maroa, IL (Macon Cty.) Macon Cty., IL parcel, dated 9/25/94 and recorded at
microwave site Book 2565, Page 92
(WICD-TV) (84)
------------------ -------------------------------------- ----------------------------------------------------------- -------------
TENANCY AGREEMENT Springfield, IL Oral agreement for office space; no documentation available WICD-TV
------------------ -------------------------------------- ----------------------------------------------------------- -------------
LEASED Eight Ridgeview Road, LEASE between First Appraisal Co. and Guy Gannett WICD-TV
Danville, IL (85-L) Communications, dated 1/19/98, expires 1/31/2000
Bureau office (WICD-TV)
----------------- -------------------------------------- --------------------------------------------------------------------------
NEW YORK:
------------------ -------------------------------------- ----------------------------------------------------------- -------------
OWNED 0000 X. Xxxxxxxxx Xxxx BARGAIN AND SALE DEED from WOKR-TV Partners, G.P. to WOKR-TV
Rochester, NY (90, 91) Guy Gannett Communications, dated July 10, 1998 and
recorded in the Monroe County Clerk's Office at Book
9036, Page 71.
WOKR-TV
Channel 13
studio and office, inc., and
Xxxxxxxx Xxxx, Xxxxx Xxxxx 00
(Brighton) transmitter and
tower site
------------------ -------------------------------------- ----------------------------------------------------------- -------------
LEASED One Chase Square, LEASE between Lincoln First Bank, NA and WOKR-Inc., WOKR-TV
Chase Manhattan Bank dated 1/10/80; also: Extension Agreement between Chase
Rochester, NY Lincoln First Bank, NA and WOKR Partners, dated
(92-L) 9/12/89;
and:
Second Extension Agreement between The Chase Manhattan
Bank and WOKR
Tower and receiver site Partners, dated 11/14/94, through 12/31/99;
NOTE: Xxxxxxx ABT, Inc. is now responsible for this lease
administration for billing and collections
------------------ -------------------------------------- ----------------------------------------------------------- -------------
------------------ -------------------------------------- ------------------------------------------------------------------------
IDENTIFIER/TITLE COMMITMENT
OWNED/LEASED PARCEL NUMBER DOCUMENTATION OF OWNERSHIP ENTITY ID
------------------ -------------------------------------- ------------------------------------------------------------------------
FLORIDA:
------------------ -------------------------------------- ------------------------------------------------------------------------
OWNED 0000 Xxxx Xxxx Xxxx, XXXXXXXXX XXXXXXXX DEED from T.O.N. Realty Partnership WTWC-TV
Tallahassee, Florida to Guy Gannett Communications, dated 4/10/96 and
WTWC-TV recorded in the Public Records of Xxxx County, FL at
Studio and office (100) OR 1896, Pg. 956;
MODIFICATION OF GRANT OF EASEMENT between Killearn
Lakes Plantation Home Owners Assn., Inc. and T.O.N.
Realty Partnership
------------------ -------------------------------------- ------------------------------------------------------------------------
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT
MATERIAL CONTRACTS - BROADCASTING
SECTION 3.10.1
DIVISION DOC. # COMPANY NAME PURPOSE
Corp 100400.00 BMI Group Television Blanket License
Corp 100500.00 XXXX & SELTEL Master Representation Agreement
Corp 100500.01 XXXX & SELTEL Interpretive letter
Corp 100500.02 XXXX & SELTEL Amendment to Master Rep Agt.
Corp 109999.99 Employee Benefit Plans (See Section 3.14.3)
KGAN 1471010.00 ASCAP Music License
KGAN 1471170.00 XxXxxx TMO phone service agmt
WGGB 1270020.00 X. X. Xxxxxxx Company Station Index Service Agreement
WGGB 1271640.00 ASCAP Music license
WGME 1171560.00 Xxxxxxx Media Research, Inc. Station Index Service
WGME 1171700.00 ASCAP Music License
WICS 1370290.00 Incentive Management Inc Caribbean Escape Incentive Program
WICS 1373341.00 X. X. Xxxxxxx Company Nielsen Station Index Service Agreement
WICS 1373343.00 X. X. Xxxxxxx Company Ratings Service
WICS 1373950.00 ASCAP music license
WOKR 1670080.00 X. X. Xxxxxxx Company Index Service
WOKR 1670140.00 Audience Research & Development news consulting/audience research
Corporation
WOKR 1670260.00 ASCAP music license
WOKR 1670770.00 Xxx Xxxxxx & Assoc. Inc. customized newspaper production
WOKR 1671000.00 Frontier Communications long Distance/T-1/cellular
DIVISION DOC. # COMPANY NAME CONTRACT EFFECTIVE COPY IMPERFECTIONS
DATE DATE
Corp 100400.00 BMI 4/17/97 4/3/97
Corp 100500.00 XXXX & SELTEL 4/27/98 1/1/98 original
Corp 100500.01 XXXX & SELTEL 8/17/98
Corp 100500.02 XXXX & SELTEL 8/28/98
Corp 109999.99 Employee Benefit Plans
KGAN 1471010.00 ASCAP 4/1/98 under negotiation
KGAN 1471170.00 XxXxxx TMO 5/24/96
WGGB 1270020.00 X. X. Xxxxxxx Company 5/3/91 5/1/91
WGGB 1271640.00 ASCAP 4/1/98 under negotiation
WGME 1171560.00 Xxxxxxx Media Research, Inc. 8/23/82 1/19/97
WGME 1171700.00 ASCAP 10/1/95 4/1/98 under negotiation
WICS 1370290.00 Incentive Management Inc 11/25/97
WICS 1373341.00 X. X. Xxxxxxx Company 4/25/91 10/1/91 not fully executed
WICS 1373343.00 X. X. Xxxxxxx Company 3/7/97 10/1/96
WICS 1373950.00 ASCAP 10/1/95 10/1/95 under negotiation
WOKR 1670080.00 X. X. Xxxxxxx Company 4/4/98 6/1/98 not fully executed
WOKR 1670140.00 Audience Research & Development 1/1/98
Corporation
WOKR 1670260.00 ASCAP 4/1/98 under negotiation
WOKR 1670770.00 Xxx Xxxxxx & Assoc. Inc. 4/17/96
WOKR 1671000.00 Frontier Communications 8/6/97 10/31/97
GUY GANNETT
PURCHASE AGREEMENT - BROADCASTING
MATERIAL CONTRACTS
SECTION 3.10.4 - EMPLOYMENT AGREEMENTS
CONTRACT EFFECTIVE
DIV. EMPLOYEE NAME TITLE DATE DATE MATERIAL CONF SUCC
--------------------------------------------------------------------------------------------------------------------------------
KGAN XXXX, XXXXXXXX ANCHOR/REP/WEATHER 11/1/98 00/0/00 X X X
XXXX XXXX, XXXXX METEOROLOGIST/MANAGER 4/1/97 4/1/97 Y N N
KGAN XXXXXXX-XXXXX, XXX ANCHOR/REPORTER 1/1/98 1/1/98 Y N N
KGAN XXXXXX, XXX SPORTS DIRECTOR 8/21/97 8/21/97 Y N N
KGAN XXXXXXXX, XXXXXX REPORTER/ANCHOR 6/1/97 6/1/97 Y N N
KGAN ROCHE, XXXXX XXXXXXX ANCHOR/REPORTER 8/14/98 9/1/98 Y N N
KGAN XXXXX, XXXX METEOROLOGIST 4/14/97 4/14/97 Y N N
KGAN XXXXXXXX, XXXXX CHIEF METEOROLOGIST 6/1/97 6/1/97 Y N N
KGAN XXXXXX, XXXX REPORTER/ANCHOR 4/20/98 6/1/98 Y N N
WGGB XXXXXXXX, XXX NEWSPERSON N/A 9/8/96 Y N N
WGGB XXXXXXX, XXXX NEWSPERSON 10/31/95 11/1/98 Y N N
WGGB XXXX, XXXXX NEWSPERSON 4/22/98 4/27/98 Y N N
WGGB XXXXXX, XXXX NEWSPERSON N/A 7/11/96 Y N N
WGME BLOCK, XXXXXXXX XXXXXX ANCHOR 6/18/96 6/1/96 Y N SEC 14.3
WGME XXXXXXX, XXXX WEATHER ANCHOR/REPORTER 4/4/94 4/4/94 Y N SEC 14.3
WGME XXX, XXXXX SPORTS DIRECTOR 9/4/97 4/1/97 Y N SEC 14.3
WGME XXXXXXXX-XXXXXX, ANCHOR/SPEC SERIES REP 9/4/97 1/1/97 Y N SEC 14.3
WGME XXXXXXXXXX, XXXXX ANCHOR/REPORTER 2/19/98 2/23/98 Y N SEC 14.3
WGME XXXXXXXX, XXXXXXX NEWS ANCHOR/REPORTER 9/3/97 4/1/97 Y N SEC 14.3
WGME XXXXXXX, XXXXX NEWS WEATHER ANCHOR/REP. 1/1/98 Y N SEC 14.3
WGME XXXXXX, XXX WEATHER ANCHOR/REPORTER 6/1/96 8/1/96 Y N SEC 14.3
WGME XXXXXXX, XXXXXXXX NEWS ANCHOR 2/6/98 2/23/98 Y N SEC 14.3
WICD XXXXXXX XXXX ASST NEW DIR/ANCHOR/REP N/A 12/13/97 Y N N
WICS XXXXXX-XXXXXXXXXX ANCHOR/REPORTER 9/18/95 Y N N
WICS XXXXXX, XXXXXXX WEATHER ANCHOR 2/1/98 Y N N
WICS XXXXXXX, XXXXX STAFF REPORTER 9/11/95 Y N N
WOKR XXXXXX, XXXXXX W ANCHOR/ASSOC NEWS DIR 8/1/92 8/1/92 Y N SEC 13
WOKR XXXXXXXX, XXXXXXX SPORTS DIRECTOR 8/25/95 6/19/95 Y N SEC 13
WOKR XXXXXX, ANCHOR/REPORTER 6/1/94 6/1/94 Y N SEC 13
WOKR XXXXXXXX, XXXXXXX N ANCHOR/REPORTER 10/27/94 1/1/95 Y N SEC 13
WOKR XXXXXXX, XXXXX STAFF METEROLOGIST 6/26/95 7/1/95 Y N SEC 13
WOKR XXXXXXXX, XXXXXXX WEATHERCASTER/CHIEF METEOROLOGIST 12/22/94 1/1/95 Y N SEC 13
WOKR XXXXXXX, XXXXX NEWS DIRECTOR 12/17/96 10/14/96 Y N SEC 13
WTWC XXXXXXXXXXX, XXXXX ANCHOR 2/3/97 2/17/97 Y N SEC 15.3
WTWC XXXXXX, XXXX METEOROLGIST/ANCHOR 1/15/96 1/6/97 Y N SEC 15.3
CORP XXXXXXX, XXXXX CORPORATE EXECUTIVE 3/28/96 Y
CORP XXXXXX, XXXXXXX CORPORATE EXECUTIVE 7/7/97 Y
CORP XXXXXXX, XXXXX CORPORATE EXECUTIVE 7/7/97 Y
CORP XXXXXXX, XXXX CORPORATE EXECUTIVE 3/31/95 Y
GUY GANNETT
PURCHASE AGREEMENT - BROADCASTING
MATERIAL CONTRACTS
SECTION 3.10.4 - EMPLOYMENT AGREEMENTS
DIV. EMPLOYEE NAME TITLE CONT DATE EST EFF DATE NOTES:
-----------------------------------------------------------------------------------------------------------------------------------
KGAN XXXX, XXXXXXXX ANCHOR/REP/WEATHER
KGAN XXXX, XXXXX METEOROLOGIST/MANAGER
KGAN XXXXXXX-XXXXX, XXX ANCHOR/REPORTER
KGAN XXXXXX, XXX SPORTS DIRECTOR
KGAN XXXXXXXX, XXXXXX REPORTER/ANCHOR
KGAN ROCHE, XXXXX XXXXXXX ANCHOR/REPORTER
KGAN XXXXX, XXXX METEOROLOGIST
KGAN XXXXXXXX, XXXXX CHIEF METEOROLOGIST
KGAN XXXXXX, XXXX REPORTER/ANCHOR
WGGB XXXXXXXX, XXX NEWSPERSON
WGGB XXXXXXX, XXXX NEWSPERSON
WGGB XXXX, XXXXX NEWSPERSON
WGGB XXXXXX, XXXX NEWSPERSON
WGME BLOCK, XXXXXXXX XXXXXX ANCHOR
WGME XXXXXXX, XXXX WEATHER ANCHOR/REPORTER
WGME XXX, XXXXX SPORTS DIRECTOR
WGME XXXXXXXX-XXXXXX, ANCHOR/SPEC SERIES REP
WGME XXXXXXXXXX, XXXXX ANCHOR/REPORTER
WGME XXXXXXXX, XXXXXXX NEWS ANCHOR/REPORTER
WGME XXXXXXX, XXXXX NEWS WEATHER ANCHOR/REP.
WGME XXXXXX, XXX WEATHER ANCHOR/REPORTER
WGME XXXXXXX, XXXXXXXX NEWS ANCHOR
WICD XXXXXXX XXXX ASST NEW DIR/ANCHOR/REP
WICS XXXXXX-XXXXXXXXXX ANCHOR/REPORTER
WICS XXXXXX, XXXXXXX WEATHER ANCHOR
WICS XXXXXXX, XXXXX STAFF REPORTER
WOKR XXXXXX, XXXXXX W ANCHOR/ASSOC NEWS DIR
WOKR XXXXXXXX, XXXXXXX SPORTS DIRECTOR
WOKR XXXXXX, ANCHOR/REPORTER 12/28/95 1/1/96
WOKR XXXXXXXX, XXXXXXX N ANCHOR/REPORTER
WOKR XXXXXXX, XXXXX STAFF METEROLOGIST 4/2/97 7/1/97
WOKR XXXXXXXX, XXXXXXX WEATHERCASTER/CHIEF METEOROLOGIST
WOKR XXXXXXX, XXXXX NEWS DIRECTOR
WTWC XXXXXXXXXXX, XXXXX ANCHOR
WTWC XXXXXX, XXXX METEOROLGIST/ANCHOR
CORP XXXXXXX, XXXXX CORPORATE EXECUTIVE
CORP XXXXXX, XXXXXXX CORPORATE EXECUTIVE
CORP XXXXXXX, XXXXX CORPORATE EXECUTIVE
CORP XXXXXXX, XXXX CORPORATE EXECUTIVE
GUY GANNETT
PURCHASE AGREEMENT - BROADCASTING
MATERIAL CONTRACTS
SECTION 3.10.4 - EMPLOYMENT AGREEMENTS
PERSONAL SERVICE AGREEMENTS CONTRACT DATE EFFECTIVE DATE
-----------------------------
full listing including not material - TV only
KGAN XXXX, XXXXXXXX ANCHOR/REP/WEATHER 11/1/98 11/1/98
KGAN XXXX, XXXXX METEOROLOGIST/MANAGER 4/1/97 4/1/97
KGAN XXXXXXX-XXXXX, XXX ANCHOR/REPORTER 1/1/98 1/1/98
KGAN XXXXXX, XXX SPORTS DIRECTOR 8/21/97 8/21/97
KGAN XXXXXXXX, XXXXXX REPORTER/ANCHOR 6/1/97 6/1/97
KGAN ROCHE, XXXXX XXXXXXX ANCHOR/REPORTER 8/14/98 9/1/98
KGAN XXXXX, XXXX METEOROLOGIST 4/14/97 4/14/97
KGAN XXXXXXXX, XXXXX CHIEF METEOROLOGIST 6/1/97 6/1/97
KGAN XXXXXX, XXXX REPORTER/ANCHOR 4/20/98 6/1/98
WGGB XXXXXXXX, XXX NEWSPERSON N/A 9/8/96
WGGB XXXXXXX, XXXX NEWSPERSON 10/31/95 11/1/98
WGGB XXXX, XXXXX NEWSPERSON 4/22/98 4/27/98
WGGB XXXXXXX, XXX NEWSPERSON 5/14/98 5/16/98
WGGB XXXXXX, XXXX NEWSPERSON N/A 7/11/96
WGME XXXX, XXXXXXX REPORTER 6/1/96 10/3/96
WGME BLOCK, XXXXXXXX XXXXXX ANCHOR 6/18/96 6/1/96
WGME XXXXXXX, XXXX WEATHER ANCHOR/REPORTER 4/4/94 4/4/94
WGME XXX, XXXXX SPORTS DIRECTOR 9/4/97 4/1/97
WGME XXXXXXXX-XXXXXX, ANCHOR/SPEC SERIES REP 9/4/97 1/1/97
WGME XXXXXXXXXX, XXXXX ANCHOR/REPORTER 2/19/98 2/23/98
WGME XXXXXXX, XXXXXX NEWS ANCHOR/REPORTER 1/21/96 1/21/96
WGME XXXXXX, XXXXXXXX REPORTER/ANCHOR 8/25/96 8/26/96
WGME XXXXXXXX, XXXXXXX NEWS ANCHOR/REPORTER 9/3/97 4/1/97
WGME XXXXXXX, XXXXX NEWS WEATHER ANCHOR/REP. 1/1/98
WGME XXXXXX, XXX WEATHER ANCHOR/REPORTER 6/1/96 8/1/96
WGME XXXXXXX, XXXXXXXX NEWS ANCHOR 2/6/98 2/23/98
WICD XXXXXX, XXXXXXXXX ANCHOR/PRODUCER/REP N/A 3/25/98
WICD CASE, XXXXX NEWS BROADCASTER N/A 8/14/95
WICD XXXXXXXX, XXXXX NEWS BROADCASTER N/A 1/1/97
WICD XXXXXXXX, XXXX ANCHOR/REPORTER/PRODUN/A 8/21/98
WICD XXXXXXX, XXXXXX WEATHER ANCHOR N/A 8/4/97
WICS XXXXXX-XXXXXXXXXX ANCHOR/REPORTER 9/18/95
WICS XXXXXX, XXXXXXX WEATHER ANCHOR 2/1/98
WICS XXXX, XXXX SPORTS DIRECTOR 10/30/95
WICS XXXXXXX, XXXXX STAFF REPORTER 9/11/95
WOKR XXXXXX, XXXXXX W ANCHOR/ASSOC NEWS DIR 8/1/98 8/1/98
WOKR XXXXXXXX, XXXXXXX SPORTS DIRECTOR 6/29/98 7/1/98
WOKR XXXXXX, VIRGINIA ANCHOR/REPORTER 6/1/94 6/1/94
WOKR XXXXXXXX, XXXXXXX N ANCHOR/REPORTER 10/27/94 1/1/95
WOKR XXXXXXX, XXXXX STAFF METEROLOGIST 6/26/95 7/1/95
WOKR XXXXXXXX, XXXXXXX WEATHERCASTER/CHIEF METEOROLOGIST 12/22/94 1/1/95
WOKR XXXXXXX, XXXXX NEWS DIRECTOR 12/17/96 10/14/96
WTWC XXXXXXXXXXX, XXXXX ANCHOR 2/3/97 2/17/97
WTWC XXXXXX, XXXX METEOROLGIST/ANCHOR 1/15/96 1/6/97
GUY GANNETT
PURCHASE AGREEMENT - BROADCASTING
MATERIAL CONTRACTS
SECTION 3.10.4 - EMPLOYMENT AGREEMENTS
PERSONAL SERVICE AGREEMENTS MATERIAL CONF SUCC NOTES:
---------------------------------------------------------
full listing including not material - TV only
KGAN XXXX, XXXXXXXX ANCHOR/REP/WEATHER Y Y N
KGAN XXXX, XXXXX METEOROLOGIST/MANAGER Y Y N
KGAN XXXXXXX-XXXXX, XXX ANCHOR/REPORTER Y Y N
KGAN XXXXXX, XXX SPORTS DIRECTOR Y Y N
KGAN XXXXXXXX, XXXXXX REPORTER/ANCHOR Y Y N
KGAN ROCHE, XXXXX XXXXXXX ANCHOR/REPORTER Y Y N
KGAN XXXXX, XXXX METEOROLOGIST Y Y N
KGAN XXXXXXXX, XXXXX CHIEF METEOROLOGIST Y Y N
KGAN XXXXXX, XXXX REPORTER/ANCHOR Y Y N
WGGB XXXXXXXX, XXX NEWSPERSON Y Y N
WGGB XXXXXXX, XXXX NEWSPERSON Y Y N
WGGB XXXX, XXXXX NEWSPERSON Y Y N
WGGB XXXXXXX, XXX NEWSPERSON Y N
WGGB XXXXXX, XXXX NEWSPERSON Y Y N
WGME XXXX, XXXXXXX REPORTER Y 14.3
WGME BLOCK, XXXXXXXX XXXXXX ANCHOR Y Y 14.3
WGME XXXXXXX, XXXX WEATHER ANCHOR/REPORTER Y Y 14.3
WGME XXX, XXXXX SPORTS DIRECTOR Y Y 14.3
WGME XXXXXXXX-XXXXXX, ANCHOR/SPEC SERIES REP Y Y 14.3
WGME XXXXXXXXXX, XXXXX ANCHOR/REPORTER Y Y 14.3
WGME XXXXXXX, XXXXXX NEWS ANCHOR/REPORTER Y 14.3
WGME XXXXXX, XXXXXXXX REPORTER/ANCHOR Y 14.3
WGME XXXXXXXX, XXXXXXX NEWS ANCHOR/REPORTER Y Y 14.3
WGME XXXXXXX, XXXXX NEWS WEATHER ANCHOR/REP. Y Y 14.3
WGME XXXXXX, XXX WEATHER ANCHOR/REPORTER Y Y 14.3
WGME XXXXXXX, XXXXXXXX NEWS ANCHOR Y Y 14.3
WICD XXXXXX, XXXXXXXXX ANCHOR/PRODUCER/REP Y N
WICD CASE, XXXXX NEWS BROADCASTER Y N
WICD XXXXXXXX, XXXXX NEWS BROADCASTER Y N
WICD XXXXXXXX, XXXX ANCHOR/REPORTER/PRODUN/X X X
WICD XXXXXXX, XXXXXX WEATHER ANCHOR Y N
WICS XXXXXX-XXXXXXXXXX ANCHOR/REPORTER Y Y N
WICS XXXXXX, XXXXXXX WEATHER ANCHOR Y Y N
WICS XXXX, XXXX SPORTS DIRECTOR Y N
WICS XXXXXXX, XXXXX STAFF REPORTER Y Y N
WOKR XXXXXX, XXXXXX W ANCHOR/ASSOC NEWS DIR Y Y 13
WOKR XXXXXXXX, XXXXXXX SPORTS DIRECTOR Y Y 13
WOKR XXXXXX, VIRGINIA ANCHOR/REPORTER Y Y 13 Written Assumption by
Assignee required
WOKR XXXXXXXX, XXXXXXX N ANCHOR/REPORTER Y Y 13
WOKR XXXXXXX, XXXXX STAFF METEROLOGIST Y Y 13
WOKR XXXXXXXX, XXXXXXX WEATHERCASTER/CHIEF METEOROLOGIST Y Y 12
WOKR XXXXXXX, XXXXX NEWS DIRECTOR Y Y 13
WTWC XXXXXXXXXXX, XXXXX ANCHOR Y Y 15.3 Co. remains liable
WTWC XXXXXX, XXXX METEOROLGIST/ANCHOR Y Y 15.3
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT - BROADCASTING
SECTION 3.3.1 CONSENTS REQUIRED
DIVISION COMPANY NAME DOC. # PURPOSE CONTRACT EFFECTIVE
DATE DATE
Corp U.S. Fleet Leasing 100090.00 Master Lease vehicle leases 7/19/91
Corp various credit card providers 100900.00 Divisions' credit card agreements
Corp Panasonic 170080.00 group pricing discount 5/11/98
KGAN Midtown Development Partnership 1483340.00 Waterloo office 11/1/96
KGAN Zoreh Asadzadehfard 1483400.00 Coralville office lease 1/30/96 2/1/96
KGAN ADT Company 1470525.00 Protective signaling system 6/10/87 6/10/87
KGAN Xxxxxxxx Xxxxxxx & Xxxxxxxxx, Inc. 1470740.00 market research consulting 6/1/98 6/1/98
KGAN Xxxxxx-Xxxxxx 1471130.00 financial information 11/30/95
KGAN XxXxxx TMO 1471170.00 phone service agmt 5/24/96
KGAN Xxxxxxxx Xxxxxxx & Xxxxxxxxx, Inc. 1471740.00 market research consulting 6/1/98 6/1/98
KGAN Pravden & Company 1471760.00 promotion license 2/24/97 1/1/98
KGAN Associated Press 1473130.00 AP Newsdesk Software 12/27/89 1/22/90
KGAN Associated Press 1473170.00 News service 5/20/87 6/15/87
KGAN Associated Press 1473180.00 member agreement 5/20/87 6/15/87
KGAN Associated Press 1473181.00 Membership Agreement 5/1/93
KGAN Associated Press 1473190.00 Audiotex services - Iowa City 4/3/91 3/25/91
KGAN Associated Press 1473191.00 Audiotex services - Dubuque 4/3/91 3/25/91
KGAN Associated Press 1473192.00 Audiotex services - Waterloo 4/3/91 3/25/91
KGAN Associated Press 1473193.00 Audiotex services - Cedar Rapids 4/3/91 3/25/91
KGAN Columbine Systems, Inc. 1470590.00 License Agreement 3/22/95 1/1/95
KGAN IBM Corp. 1470620.00 Agreement for IBM Licensed Programs 1/15/82 1/25/82
DIVISION COMPANY NAME DOC. # PURPOSE CONTRACT EFFECTIVE
DATE DATE
KGAN Marketing Resources Plus 1470640.00 BMP software license and Data Services 11/1/91
Agreement
KGAN Xxxxxxx Media Research 1471121.00 Special Target Area Reporter 3/18/94 2/1/94
KGAN Data Center Mgmt., Inc. (DCM) 1471180.00 Software License & Support 7/15/96
KGAN CBS Television Network 1470510.00 Television Affiliation Agreement 1/1/95
KGAN Jacor Broadcasting of Iowa 1480570.00 WMT Tower Lease Agreement 10/16/81 10/17/81
WGGB PageNet 1283010.00 Pagers lease & service 2/13/97 2/13/97
WGGB Associated Press 1271550.00 AP news service 10/1/81
WGGB Associated Press 1271551.00 AP On-Line 5/28/97 5/1/97
WGGB Fox Broadcasting Company 1271560.00 Program Carriage agmt 2/5/96 8/1/96
WGGB Conus Communications 1271570.00 Sports World Attack Team License 2/23/96 1/25/96
WGGB Killer Tracks 1271590.00 library license 5/18/98 4/14/98
WGGB Republican Company 1271620.00 Tomorrow's headlines Tonight 5/1/98 5/12/98
WGGB Columbine Systems, Inc. 1271430.00 License, HW support + supplement 3/7/88 1/1/95
WGGB Data Center Management (DCM) 1271580.00 Software License & Support 9/19/96
WGGB The Weather Underground 1271720.00 weather info SWL & service 10/22/97 11/15/97
WGGB ABC Television Network 1270010.00 Network Affiliation Agreement 1/6/95 1/1/95
WGGB ABC American Broadcasting Companies 1270011.00 ABC NewsOne Service Agreement 4/2/92 1/1/93
WGGB Home Shopping Network 1271760.00 affiliation agreement 8/27/91 9/9/91
WGME Fleet Bank 1181530.00 35 Ash St. Lewiston Lease 1/1/94 1/1/94
WGME Maine Public Broadcasting 1181550.00 Tower space Litchfield, ME 10/23/95 10/23/95
WGME Fleet Bank of Maine 1181800.00 Sanford office lease 6/20/95 6/21/95
WGME Excelltron Tower, Inc. 1181810.00 Sanford Tower lease 7/1/95
WGME Maine Bureau of Forestry 1181860.00 Moicrowave Site lease 1/7/88 1/1/88
WGME WSI Corp. 1181590.00 Weather Graphics equip lease/service 3/14/88 4/1/88
DIVISION COMPANY NAME DOC. # PURPOSE CONTRACT EFFECTIVE
DATE DATE
WGME Danka Industries, Inc.dba KEMCO 1181730.00 Equipment maint & supply 2/26/97 2/26/97
WGME Tapscan, Inc. 1170780.00 Ratings Analysis License 3/18/96 4/1/96
WGME Nielsen Media Research, Inc. 1171560.00 Station Index Service 8/23/82 1/19/97
WGME Associated Press 1171610.00 AP news service 8/26/93 5/1/93
WGME Firstcom Music 1171620.00 Library license 12/27/96 1/1/97
WGME Columbine Systems, Inc. 1170670.00 License Agreement-Data Processing System 1/1/95
Service Contract
WGME Columbine Systems, Inc. 1170670.01 Addendum to data processing license 1/1/95
WGME CBS Television Network 1170010.00 Affiliate Agreement 1/31/94 1/1/95
WGME Hilite, Inc. 1181770.00 VBI lease 4/25/95
WICD Minolta Leasing Service 1580070.00 copier lease & service 3/25/97
WICD Associated Press 1570140.00 AP membership 8/16/95
WICD Associated Press 1570140.01 Supplemental Agreement 3/26/92 8/16/95
WICD Consolidated Communications 1570150.00 Long Distance phone carrier 4/29/96
WICD Weather Central Inc. 1570170.00 Software-Hardware maint. 12/1/95
WICD Data Center Mgmt, Inc. (DCM) 1574000.00 Software License 12/20/96 2/1/97
WICD NBC TV Network 1500010.00 Affiliation Agreement 1/16/96 7/1/95
WICD NBC TV Network 1500010.01 Incentive payments 1/16/96
WICS AT&T Capital Leasing 1380010.00 Inacom Equip Lease 3/15/96 3/15/96
WICS G.E. Capital 1380020.00 copier lease 1/16/98
WICS IOS Capital (IKON) 1380030.00 Canon copier lease 11/26/97
WICS Vyvx 1380050.00 equipment lease 6/11/98 6/11/98
WICS The Mediacenter 1370280.00 Mediacenter On-line subscription 1/1/98
WICS Incentive Management Inc 1370290.00 Caribbean Escape Incentive Program 11/25/97
WICS IBM 1370300.00 AS 400 support 3/26/98
DIVISION COMPANY NAME DOC. # PURPOSE CONTRACT EFFECTIVE
DATE DATE
WICS IBM 1370310.00 6400 support 4/2/98
WICS George Alarm Co., Inc. 1371560.00 burglar electrical protection apparatus 11/18/87 11/18/87
WICS SESAC, Inc. 1371630.00 Broadcasting Performance License For TV 3/14/88 12/1/87
Stations
WICS The Electronic Media Machine 1371650.00 voice over agreement 7/20/98 8/3/98
WICS A. C. Nielsen Company 1373342.00 Special Target Area Reporter (S.T.A.R) 10/1/96
WICS A.C. Nielsen Company 1373344.00 Station Index includes WICD 9/8/93 2/1/94
WICS Cellular One 1373800.00 cellular phone service J.V.C. 7/13/90 7/31/90
WICS Cellular One 1373801.00 cellular phone service-various
WICS Associated Press 1373830.00 Agreements for news wire 7/22/85 12/1/87
WICS Associated Press 1373831.00 On-Line Service 5/15/98
WICS FirstCom Music 1373870.00 Music Library License WICS/CD 11/13/97 11/15/97
WICS Columbine Systems, Inc. 1373360.00 D P Systems 2/1/94 2/1/94
WICS Columbine Systems, Inc. 1373361.00 Addendum for Closed Loop 6/1/94 6/1/94
WICS Columbine Systems, Inc. 1373362.00 Adden. purchase of Broadcast Mgmt Plus 10/1/95
WICS Columbine Systems, Inc. 1373363.00 software license 11/1/91
WICS Data Center Mgmt, Inc. (DCM) 1374000.00 Software License & Support 11/14/96 2/1/97
WICS Griffin Radio Research 1374030.00 The Griffin reports license 11/1/97
WICS Enterprise Systems Group, Inc. 1374040.00 Software license-Traffic 4/23/98 4/27/98
WICS NBC TV Network 1370010.00 Affiliation Agreement 1/1/81 7/1/95
WICS NBC News Channel 1370060.00 News Channel Participation Agreement 1/1/91 1/1/91
WICS NBC, Inc. 1370070.00 News Excerpt License Agreement 1/1/91
WOKR Collier ABR, Inc. 1681100.00 Roof lease 11/14/94 1/1/95
WOKR GMAC d/b/a/ The Valley Cadillac Corp 1680600.00 97 Cadillac Lease (Alhart) 1/1/97
WOKR GMAC d/b/a Vincent Buick, Inc. 1681010.00 Buick Park Ave lease - 97 8/1/94 1/14/97
DIVISION COMPANY NAME DOC. # PURPOSE CONTRACT EFFECTIVE
DATE DATE
WOKR Volvo Car Finance (Best Motors) 1681020.00 96 volvo lease - Neilsen 4/18/96
WOKR Toshiba/Rochester Copier 1681050.00 office equip lease 2/19/98
WOKR SportsTicker 1670110.00 sports info service 5/15/98 5/15/98
WOKR Associated Press 1670120.00 NewsPower & GraphicsBank services 7/27/94 7/1/94
WOKR FirstCom/Music House 1670290.00 music library license 11/30/97
WOKR Rochester Copier 1670690.00 main office office fax maint 12/23/97 1/15/98
WOKR Rochester Copier Inc. 1670693.00 GM fax maint 1/28/98 2/1/98
WOKR Dun & Bradstreet 1670760.00 business information services 5/6/98 6/30/98
WOKR Associated Press 1670830.00 Radio simulcast services 9/15/97
WOKR Weatherline Inc. 1670970.00 Weather Service 5/11/95
WOKR Frontier Communications 1671000.00 long Distance/T-1/cellular 8/6/97 10/31/97
WOKR WSI Corp. 1670130.00 Weather Services SWL & subscription 4/1/94
WOKR Peter Storer & Assoc., Inc. 1670250.00 S.W.L. Program & Accounting Manager Software 6/9/94 7/1/97
WOKR Data Center Management Inc 1670750.00 Software License & Support 1/1/98
WOKR Columbine JDS Systems, Inc. 1670800.00 License - DP system 11/13/97 11/13/97
WOKR ABC Inc. Capital Cities 1670010.00 Affiliation Agreement 1/24/91 1/2/95
WOKR ABC, Inc. Capital Cities 1670020.00 NewOne Service 7/8/88 9/14/88
WOKR ABC Television Network 1670030.00 Satelite earth Station 7/31/87
WTWC Pitney Bowes 1780100.00 Postage meter rental 11/1/96
WTWC Associated Press 1700230.00 News Wire & Graphics 3/20/97
WTWC First Com Music 1700250.00 Music License 2/1/97
WTWC Danka 1700340.00 copier supplies & maint 7/14/97 7/3/97
WTWC ADT Security systems Inc. 1700360.00 security services 12/22/97 1/1/98
WTWC PageNet 1700450.00 pager lease & services 1/22/97 1/22/97
DIVISION COMPANY NAME DOC. # PURPOSE CONTRACT EFFECTIVE
DATE DATE
WTWC Sprint Centel-Florida 1700460.00 LD phone services 7/25/96 7/25/96
WTWC Talquin Electric Cooperative 1700490.00 power services agreement 7/31/96 8/1/96
WTWC AT&T/North Florida Branch 1701000.00 Long Distance Discount 7/10/97
WTWC Columbine JDS 1700100.00 License Agreement 11/3/95 12/1/95
WTWC Data Center Mgmt (DCM) 1700200.00 Software License & Support 1/15/97
WTWC Baron Services 1700380.00 software license 1/21/97 1/21/97
WTWC NBC TV Network 1700010.00 Network Affiliation 2/1/97 1/1/97
WTWC WMLO FM (now WFLY) 1780200.00 Tower lease 11/6/89 10/2/90
WTWC WSNI FM 1780210.00 Tower lease 3/27/91 3/27/91
WTWC Paxson Communications of Tallahassee, Inc. 1780210.01 Assignment of lease 9/30/97
WTWC FL Dept. LE 1780220.00 Tower lease 1/10/94
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT - BROADCASTING
SECTION 3.3.1. CONSENTS REQUIRED - BARTER PROGRAMMING
WOKR - TV
Written
Contract Term Consent
------------------ Req'd to
Distributor Package Start End Assign
---------------------- ----------------------- ----- ---- ------
Buena Vista Television Bill Nye the Science Guy Sep-97 Sep-00 YES
Hearst Entertainment, Inc. Popular Mechanics: For Kids Sep-97 Sep-99 YES
New World / Genesis Access: Hollywood Sep-96 Sep-98 YES
Paramount Hard Copy 98 Sep-98 Sep-99 YES
Maury Povich Sep-98 Sep-98 YES
Wild Things Sep-97 Sep-98 YES
Worldvision Enterprises Pictionary Sep-97 Sep-98 YES
New York State Lottery Lottery Drawings May-98 Apr-01 YES
Dr. Bob Lanier 60 Second Housecall- News Insert Open
WRMM DJs Family Weekend - News Insert Open NL
Triple Seven Concepts Inc., a Assorted 1/2 hour programs Jun-98 Jun-99 YES
subsidiary of Grey Advertising
NL - No specific assignment language in agreement.
THE ACKERLEY GROUP
PURCHASE AGREEMENT
DISCLOSURE SCHEDULE
SCHEDULE 3.9.1
----------------------------------------------- ----------------------------------------------------- ----------------------
TYPE INSURER LIABILITY LIMIT POLICY PERIOD
----------------------------------------------- ----------------------------------------------------- ----------------------
Package Commercial Union 19,491,552 05/01/98 - 05/01/99
----------------------------------------------- ----------------------------------------------------- ----------------------
Comm'l. Gen'l. Liability Commercial Union 2,000,000 05/01/98 - 05/01/99
[incl. w/Package Policy]
----------------------------------------------- ----------------------------------------------------- ----------------------
Communication Eqpt Commercial Union 58,615,300 05/01/98 - 05/01/99
----------------------------------------------- ----------------------------------------------------- ----------------------
Broadcasting Loss of Income Commercial Union 13,487,696 05/01/98 - 05/01/99
[incl. w/Comm. Eqpt. Policy]
----------------------------------------------- ----------------------------------------------------- ----------------------
Automobile Commercial Union 1,000,000 05/01/98 - 05/01/99
----------------------------------------------- ----------------------------------------------------- ----------------------
Energy Systems Federal Insurance Co. 25,000,000 05/01/98 - 05/01/99
----------------------------------------------- ----------------------------------------------------- ----------------------
Libel/Slander Employers Reinsurance 15,000,000 10/09/97 - 10/09/98
----------------------------------------------- ----------------------------------------------------- ----------------------
Umbrella Federal Insurance Co. 25,000,000 05/01/98 - 05/01/99
----------------------------------------------- ----------------------------------------------------- ----------------------
Non-Owned Aircraft National Union Fire 20,000,000 10/24/97 - 10/24/98
----------------------------------------------- ----------------------------------------------------- ----------------------
Crime Bond Federal Insurance Co. 1,000,000 05/01/98 - 05/01/99
----------------------------------------------- ----------------------------------------------------- ----------------------
Fiduciary Responsibility Federal Insurance Co. 25,000,000 11/10/97 - 11/10/98
----------------------------------------------- ----------------------------------------------------- ----------------------
Directors & Officers Federal Insurance Co. 5,000,000 02/06/98 - 02/06/99
Includes:
Outside Directors 5,000,000 02/06/98 - 02/06/99
Employment Practices 5,000,000 02/06/98 - 02/06/99
Liability
----------------------------------------------- ----------------------------------------------------- ----------------------
Workers Compensation 100,000 12/31/97 - 12/31/98
Maine MEMIC
Illinois Iowa Commercial Union
Florida Commercial Union
Massachusetts Commercial Union
New York Commercial Union
----------------------------------------------- ----------------------------------------------------- ----------------------
Travel/Accident Reliance Standard Life 10,000 10/01/97 - 10/01/98
----------------------------------------------- ----------------------------------------------------- ----------------------
Foreign Policy CIGNA Ins. Co. 1,000,000 05/20/98 - 05/20/99
----------------------------------------------- ----------------------------------------------------- ----------------------
Special (K&R) Aetna Life & Casualty 3,000,000 09/12/95 - 09/12/98
----------------------------------------------- ----------------------------------------------------- ----------------------
Maine Turnpike Bond Travelers Casualty & Surety 5,000 09/16/97 - 09/16/98
----------------------------------------------- ----------------------------------------------------- ----------------------
GUY GANNETT COMMUNICATIONS
EXAMPLES OF "PREPAID" PROGRAMMING COSTS AT DEC. 1998 FOR PROGRAMS FOR WHICH DOWNPAYMENTS WERE MADE
WGME
"FRIENDS"
Start Date Sept. 98
License Fee 169 wks. @ $6,950/wk. $1,174,550
(587,275) 50 % downpayment - Sept. 1996
------------
587,275 balance payable over 39 months beginning Sept.98 (587,275 /39 =15,058)
Total
Thru Thru
Dec-97 Jan-Aug 98 Sep-98 Oct-98 Nov-98 Dec-98 Dec-98
---------
Actual payments 587,275 0 15,058 15,058 15,058 15,058 647,508
Payments without downpayment 0 0 30,117 30,117 30,117 30,117 120,467
(1,174,550 / 39 = 30,117) --------
"Prepayment" @ 12/31/98 527,042
========
Note - the prepayment is reduced by $ 15,058 per month beginning Sept. 1998.
"FRASIER"
Start Date Sept. 97
License Fee 169 wks. @ $5,750/wk. $ 971,750
(97,175) 10% downpayment - Jan. 1997
------------
874,575 balance payable over 39 months beginning Sept.97 (874,575 / 39 = 22,425)
Total
Thru Thru
Jan-97 Jan-Aug 97 Sep-97 Oct-97 Nov-97 Dec-97 Jan-Dec 98 Dec-98
--------
Actual payments 97,175 0 22,425 22,425 22,425 22,425 269,100 455,975
Payments without downpayment 0 0 24,917 24,917 24,917 24,917 299,004 398,671
-------
(874,575 / 39 = 24,917)
"Prepayment" @ 12/31/98 57,304
=======
Note - the prepayment is reduced by $ 2,492 per month beginning Sept. 1997.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
Section 1.1(d) - (Real Property)
See attached Section 1.1 (d) of the Disclosure Schedule.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 1.1(R) (NON-COMPETITION AGREEMENTS)
James B. Shaffer
Michael L. Bock
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.3 (ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS)
--------------------------------------------------------------------
3.3(a): None.
3.3(b): None.
3.3(c): None.
3.3(d):
1. See Section 3.3.1 of the Disclosure Schedule for list of contracts
that require consent to the transactions.
2. The Company's Revolving Loan Agreement with BankBoston and others
and Note Purchase Agreement with its noteholders prohibit the
transfer of the Assets without the lenders' consent. The Company
expects to repay these obligations at or prior to Closing.
3. See Section 3.14 of the Disclosure Schedule concerning certain
retention and severance agreements with various employees
requiring certain payments to be accelerated at Closing.
4. See Section 3.14 of the Disclosure Schedule concerning certain
agreements with various retired employees that may be accelerated
upon Closing.
5. The annual management bonuses for WOKR-TV will be accelerated at
Closing. If the Closing is before the end of 1998, the portion of
the
SECTION 3.3 (ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS)
--------------------------------------------------------------------
payment relating to the period from the Closing Date through year
end will be accounted for as a prepaid expense.
6. Pursuant to the terms of the Company's Directors' Deferred
Compensation Plan, deferred directors fees are payable upon the
sale of substantially all of the assets of the Company, and will
be due upon Closing.
7. Most, if not all, of the Company's insurance policies are not
assignable.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.5 (FINANCIAL STATEMENTS)
----------------------------------
3.5(a): None.
3.5(b) & (c):
1. The Unaudited Financial Statements do not include all financial
statements (e.g., cash flow), financial elements (e.g., income
taxes and net income) or footnotes required under GAAP. Net
Financial Assets will not include any accruals for any severance
for employees terminated after the Closing. The Unaudited
Financial Statements were prepared on a pro forma basis to reflect
the Company's expectations as to how certain accounting matters
related to the sales of the Company and the Maine Media Business
would be handled, including without limitation: estimates of how
post-retirement liabilities would be allocated between Newco (as
defined in Section 3.7 of the Disclosure Schedule) and the
Company; none of the prepaid pension cost included in "other
assets" in the corporate balance sheet was allocated to Newco;
certain long-term incentive plans and supplemental retirement
benefits were not reflected on the balance sheet because it is
anticipated that they will be paid prior to Closing. Some monthly
financial statements may not include all accrued vacation
benefits. The treatment of downpayments on program rights as
described in Section 9.1 is not consistent with prior periods or
in accordance with GAAP. The consolidated statement of operations
is intended to display EBITDA and EBIT rather than net income. The
Guy Gannett Broadcast Group balance sheet shows no allocation or
apportionment of the post-retirement liability or of the prepaid
pension (except that the June 30, 1998 balance sheet does show the
post-retirement liability). As described above, the Unaudited
Financial Statements are not in conformance with GAAP nor are they
consistent with prior periods.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.5 (FINANCIAL STATEMENTS)
----------------------------------
2. The Unaudited Financial Statements do not include any assets or
liabilities that may result from a settlement in the future with
ASCAP regarding the dispute with the TV Music License Committee on
new fees and the license agreement.
3. Downpayments relating to certain program rights contracts set
forth in Section 9.1 of the Disclosure Schedule will be recorded
as prepaid expenses, while in the past some of these liabilities
have been recorded as reductions in the "film contract liability"
account.
4. The Company has an arrangement to pay a former WGME employee a
monthly sum, until May 1999, outside the terms of any supplemental
retirement plan. The Company accounts for this liability on a cash
basis.
3.5(c):
5. There are certain liabilities related to the sale of the Company
and its properties that are not recorded and have not been
incurred in the ordinary course including but not limited to (a)
fees for: attorneys, investment bankers, accountants, consultants,
etc.; (b) certain agreements with key employees for severance,
retention and closing benefits, and former employees for
supplemental retirement and deferred compensation benefits.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.6 (TITLE TO ASSETS; RELATED MATTERS)
----------------------------------------------
3.6(i):
1. The Company has possession of various assets owned by others,
including but not limited to personal items of employees and
officers. The Company also has possession of records, but does not
have any ownership interest in, the following groups or
organizations: Guy P. Gannett Foundation, The Portland Newspapers
Bruce Roberts Fund; Guy Gannett Employees Credit Union; the Anne
M. Gannett Trust and the Gannett Family Forum.
2. WTWC entered into a conservation easement with Leon County,
Florida, dated June 16, 1998.
3. There is a possible encroachment onto abutting property of the
WICD satellite dishes at the station studio in Champaign,
Illinois.
4. The New York State Department of Transportation ("NYSDOT") has
taken, by eminent domain,: (1) a fee simple interest in a 0.136
acre parcel located at 4225 West Henrietta Road, Rochester, New
York, along the property fronting West Henrietta Road and crossing
the driveway accessing that property, and (2) a permanent easement
for traffic control devices on the driveway where the driveway
meets West Henrietta Road. In return, NYSDOT has paid the Company
$12,400.
5. See Section 3.16 of the Disclosure Schedule for Intellectual
Property matters.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.6 (TITLE TO ASSETS; RELATED MATTERS)
----------------------------------------------
3.6(i) and (iii):
6. See Section 3.7 of the Disclosure Schedule for detail with respect
to sharing of certain assets between the broadcast and Maine Media
Business divisions pursuant to the terms of an Amended and
Restated Contribution Agreement dated August 14, 1998. In
addition, upon consummation of the sale of the Maine Media
Business, the Company will lose access to certain expertise in
areas such as marketing and research provided by personnel of the
Maine Media Business, and other relationships with these divisions
will be terminated.
3.6(ii) The Company has a lease with Elden Moss for an Iowa City
translator site lease. Title work reveals that title to the leased
property is held by Moss Farms, Inc. The Company is in the process
of amending this lease to obtain a right of first refusal and
plans to correct this error at the same time.
3.6(iv):
7. The elevator on the WGME tower requires repair due to damage by
the Winter, 1998 ice storm. Kline Towers has estimated the costs
of repairs at approximately $34,000. This loss is insured and the
repairs will be conducted shortly.
8. WGME purchased a software system including a street level mapping
system. The vendor went out of business before a proper interface
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.6 (TITLE TO ASSETS; RELATED MATTERS)
----------------------------------------------
between the street level mapping system and the WSI weather
reporting system was provided. WGME is working with WSI for a
substitution of software.
3.6(v): None.
3.6(vi): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
3.7(a):
1. An Amended and Restated Contribution Agreement dated August 14,
1998 (the "Contribution Agreement") between the Company and Newco
provides for transfer to Media Properties of Maine, LLC ("Newco"),
on or before the date of sale of the Maine Media Business, of all
assets and liabilities used or usable primarily in connection with
the Maine Media Business. The Company has also agreed to enter
into a services contract between the Company and Newco containing
certain agreements with respect to certain assets presently shared
by the broadcast divisions and Maine Media Business divisions,
including: a) continuation of certain relationships between the
Maine Media Business and WGME for an interim period; b) continued
joint sales of advertising until expiration of existing
commitments to customers; and c) continued occupancy by Newco of
the portion of the Sanford, Maine office space currently shared by
The Portland Newspapers and WGME. The Company expects to enter
into this service contract prior to the Closing. (See Section 5.1
of the Disclosure Schedule.) The services contract also provides
for the Corporate Office to obtain certain services from Newco.
Either the service contract will be rewritten to eliminate this
requirement therefrom, or the Company shall continue to be
entitled to these benefits (and liable for the related
obligations) after the Closing.
2. The Contribution Agreement also provides that the Company will
allocate the pension plan assets in its defined benefit plan
between the Company and Newco as further described in the
Contribution Agreement. The assets and liabilities of the Guy
Gannett Retirement Plan that relate to
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
employees of the Maine Media Business shall be transferred,
post-closing, to a trust that will be established to hold assets
of a new plan to be established for the Maine Media Business
The Contribution Agreement also provides that the Company will use
reasonable efforts to cause the following contracts in which
vendors provide goods or services to both the broadcast and Maine
Media Business divisions to be amended to reflect the split of the
operating divisions into two companies: KOZ, inc dated March 4,
1998, as amended; U.S. Fleet Leasing dated July 19, 1991; R.E.
Harington dated 6/28/94, as amended; KMS Solutions dated 4/25/97;
and Time/Warner Cable (undated). The replacement contracts
relating to the broadcast division will be assigned to, and the
obligations thereunder assumed by, Purchaser.
3.7(b): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
3. The Company has entered into a new employment agreement with Don
Alhart. See Section 3.10.4 for date of agreement.
4. The Company has agreed to accelerate at Closing WOKR-TV annual
management bonuses. If the Closing is before year end, the portion
of the payment relating to the period from the Closing Date
through the end of 1998 will be accounted for as a prepaid
expense.
5. The Company has increased its Directors and Officers insurance
coverage (other than the employment practices coverage) to $5
million, and has increased its fiduciary insurance coverage to $25
million prior to Closing.
6. The Company has entered into settlement agreements with Allan
Eggers and Carl Lehne concerning their alleged rights to retiree
medical benefits. Settlement payments are expected to be made
shortly.
3.7(c): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.7 (ABSENCE OF CERTAIN CHANGES, EVENTS AND CONDITIONS)
---------------------------------------------------------------
3.7(d):
7. The elevator on the WGME tower requires repair due to damage in
the Winter, 1998 ice storm. Kline Towers has estimated the costs
of repairs at approximately $34,000. This loss is insured and the
repairs will be conducted shortly.
3.7(e): The Company may be below budget for 1998 by as much as $1,469,000
for all of the television stations other than WOKR-TV. Assuming a
cash flow reduction of $1,469,000, EBITDA for fiscal year 1998
would be $12,700,000.
3.7(f):
8. WGME and TPN have discontinued sponsorship of 3 on 3 basketball.
9. WGME and the Maine Media Business have discontinued certain joint
sales and promotional efforts in anticipation of the sale of the
Maine Media Business .
3.7(g): None.
3.7(h): None.
3.7(i): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.8 (LITIGATION)
------------------------
3.8(i):
1. The Company has four pending, and several threatened, defamation
and libel Actions. All are covered by insurance. In addition,
there are several insured automobile liability cases and various
workers' compensation claims currently pending.
2. There is a pending gender discrimination case against WGGB. This
matter is insured.
3. An employee stole services from the Station (see Section
5.1(a)(ix) of the Disclosure Schedule and was terminated as a
result. NABET has filed a grievance over the termination.
4. An on-air reporter has threatened to sue WOKR in connection with
her recent discharge for reasons relating to work performance,
insubordination and violations of station policy. No suit has been
filed to date. This matter is insured.
3.8(ii):
5. WICD has agreed, pursuant to a settlement set forth in an Order of
the Champaign Human Rights Commission, to participate in the
Illinois Broadcasters Intern Program.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.8 (LITIGATION)
------------------------
3.8:
6.
WGGB has filed a motion in support of WWLP's Petition before the
FCC contesting the exercise by Hartford Station WVIT of an
exclusivity provision in its syndicated programming agreements and
requesting that relief be made market-wide.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.9 (INSURANCE)
-----------------------
See Section 3.9.1 of the Disclosure Schedule for a list of insurance policies
relating to the Business.
3.9(i): None.
3.9(ii): None.
3.9(iii): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10 (MATERIAL CONTRACTS)
---------------------------------
1. See Section 3.10.1 of the Disclosure Schedule for agreements
or contracts providing for payments in excess of $50,000 per
year or $250,000 over the five-year period commencing on the
date hereof.
Please note that detail on various insurance policies and
employee benefit plans insurance coverage has not been
provided.
2. See Section 3.10.2 of the Disclosure Schedule for all time
brokerage agreements and affiliation agreements with
television networks.
3. See Section 3.10.3 of the Disclosure Schedule for any
license or contract pursuant to which the Company is
authorized to broadcast film or taped programming supplied
by others in excess of $10,000 per year or having a term of
more than one year .
4. See Section 3.10.4 of the Disclosure Schedule for any
employment agreement, consulting agreement or similar
contract providing for payments to any Person in excess of
$50,000 per year or $100,000 in the aggregate over the
five-year period commencing on the date hereof.
5. See Section 3.14 of the Disclosure Schedule for any
retention or severance agreement or contract with respect to
any Person who is to be employed post-sale.
6. See Section 3.10.6 of the Disclosure Schedule for all
collective bargaining agreements or other union contracts.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10 (MATERIAL CONTRACTS)
---------------------------------
7. See Section 3.10.7 of the Disclosure Schedule for (a) any
lease of real property or (b) any lease of equipment or
license with respect to Intellectual Property (other than
licenses granted in connection with the purchase of
equipment or other assets) by the Company to another party
providing for payments to any Person in excess of $25,000
per year or $75,000 in the aggregate over the five-year
period commencing on the date hereof.
8. See Section 3.10.8 of the Disclosure Schedule for any lease
of equipment or real property or license with respect to
Intellectual Property (other than licenses granted in
connection with the purchase of equipment or other assets)
by the Company to another party providing for payments to
the Company in excess of $20,000 per year or $50,000 in the
aggregate over the five-year period commencing on the date
hereof.
9. Any joint venture, partnership or similar agreement or
contract. NONE.
10. See Section 3.10.10 for any agreement or contract under
which the Company has borrowed or loaned any money in excess
of $1,000,000 or issued or received any note, bond,
indenture or other evidence of indebtedness in excess of
$1,000,000 or directly or indirectly guaranteed
indebtedness, liabilities or obligations of others in an
amount in excess of $1,000,000.
11. Any covenant not to compete or contract or agreement,
understanding, arrangement or any restriction whatsoever
limiting in any respect the ability of the Company to
compete in any line of business or with any Person in any
area. NONE.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10 (MATERIAL CONTRACTS)
---------------------------------
12. See Section 3.10.12 of the Disclosure Schedule for any
agreement or contract between the Company and with any
officer, director, stockholder or employee of the Business
or any of their family members (other than employment
agreements covered above or agreements or contracts
containing terms substantially similar to terms available to
employees generally).
13. Amended and Restated Contribution Agreement by and between
the Company and Media Properties of Maine, LLC dated August
14, 1998, relating to the transfer of assets and liabilities
primarily related to the Maine Media Business. This contract
will not be assigned to Purchaser.
*Executed copies of certain contracts may not be available.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.11 (PERMITS)
----------------------
PERMITS:
--------
(i): None.
(ii): None.
(iii): None.
COMPLIANCE WITH LAW:
--------------------
(i):
1. KGAN recently removed a 1,000 gallon underground diesel oil
storage tank at a tower site at a rural location in Walker,
Iowa. This previously unregistered tank has now been
registered with the Iowa Department of Natural Resources
("IDNR"). Soil testing has indicated very low levels of
hydrocarbons, which is determined to be "clean" under IDNR
Regulations. A confirmatory ground water monitoring well has
been installed. The borings showed no sign of soil
contamination.
2. See Section 3.13 of the Disclosure Schedule concerning
environmental matters.
(ii): See Section 3.8 of the Disclosure Schedule concerning the
Champaign Human Rights Commission.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
------------------
3.12(i):
CALL SIGN TYPE EXPIRATION DATE
--------- ---- ---------------
DATE
----
WOKR-TV, Rochester, NY 06/0l/99
----------------------
KR-9992 TV Pickup 06/0l/99
KR-7729 TV Pickup 06/01/99
KN-2237 TV Pickup 06/01/99
KP-2134 TV Pickup 06/01/99
WGI-226 TV Intercity Relay 06/01/99
WEF-58 TV STL 06/01/99
KGO-958 R/P Base Mobile System 06/01/99
KRG-613 R/P Base Mobile System 06/01/99
BLP-00293 Low Power Broadcast Auxiliary 06/01/99
E6537 Receive Only Earth Station 12/09/03
E860485 Receive Only Earth Station 05/16/06
KNBL-873 Weather Radar 02/13/01
KGAN-TV, Cedar Rapids, IA 02/01/06
-------------------------
K13MN VHF TV Translator 02/01/06
KAP-35 TV STL 02/01/06
WGR-817 TV Intercity Relay 02/01/06
KR-7773 TV Pickup 02/01/06
KR-9931 TV Pickup 02/01/06
KZ-2447 TV Pickup 02/01/06
KZ-2448 TV Pickup 02/01/06
KAP-318 R/P Base Mobile System 02/01/06
BLQ-780906MG Low Power Broadcast Auxiliary 02/01/06
E970014 Transmit/Receive Earth Station 12/06/06
WNAE-244 Weather Radar 01/02/00
WTWC-TV, Tallahassee, FL 02/01/05
------------------------
KB-55264 TV Pickup 02/01/05
WGGB-TV, Springfield, MA 04/01/99
------------------------
KPK-385 R/P Base Mobile System 04/01/99
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
------------------
KPJ-841 R/P Automatic Relay 04/01/99
WGV-791 TV Intercity Relay 04/01/99
KCK-48 TV STL 04/01/99
KCI-582 R/P Base Mobile System 04/01/99
KB-98007 TV Pickup 04/01/99
KB-55388* R/P Base Mobil System 04/01/99
E860424 Receive Only Earth Station 05/02/06
WNTX-565 Private Operational Fixed Microwave 01/31/00
WICD(TV), Champaign, IL 12/01/05
-----------------------
KC-26142 TV Pickup 12/01/05
KVM-77** TV STL 12/01/05
KTX-71 TV Intercity Relay 12/01/05
WMV-569 TV Intercity Relay 12/01/05
BLP-01160 Low Power Broadcast Auxiliary 12/01/05
WPHI-929 Business Radio 06/01/00
WICS(TV), Springfield, IL 12/01/05
-------------------------
WKZ-31 TV Intercity Relay 12/01/05
KSK-95 TV STL 12/01/05
WME-674 TV STL 12/01/05
KTZ-93 TV Intercity Relay 12/01/05
WLF-755 TV Intercity Relay 12/01/05
WAQ-265 TV Intercity Relay 12/01/05
KB-55668 TV Pickup 12/01/05
BLP-01105 Low Power Broadcast Auxiliary 12/01/05
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
WMV-573 TV Intercity Relay 12/01/05
WMV-570 TV Intercity Relay 12/01/05
WNQE-817 Business Radio 09/12/99
WGME-TV, Portland, ME 04/01/99
---------------------
WGME-TV Auxiliary Transmitter 04/01/99
WLG-289 TV Intercity Relay 04/01/99
WLF-619 TV Intercity Relay 04/01/99
WHY-291 TV Intercity Relay 04/01/99
WHY-292 TV Intercity Relay 04/01/99
WCO-23 TV Intercity Relay 04/01/99
WMF-737 TV Intercity Relay 04/01/99
KRV-46 TV STL 04/01/99
WLJ-643 TV Intercity Relay 04/01/99
WLF-620 TV Intercity Relay 04/01/99
KB-55395 TV Pickup 04/01/99
KB-97128 TV Pickup 04/01/99
KA-88998 TV Pickup 04/01/99
KPM-487 Remote Pickup 04/01/99
KPM-468 Remote Pickup 04/01/99
KPF-914 R/P Automatic Relay 04/01/99
KPF-913 R/P Automatic Relay 04/01/99
WPNB-978 TV Intercity Relay 04/01/99
WLG-347 TV Intercity Relay 04/01/99
WPJB-245 TV Intercity Relay 04/01/99
E950350 Transmit/Receive Earth Station 07/14/05
WPJB-738 Private Operational Fixed Microwave 01/16/01
*Copy of license not available.
**Construction Permit Only.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
ANTENNA STRUCTURE REGISTRATIONS
-------------------------- ---------------------- ---------------------------------------- ----------------------
MAIN STATION LOCATION TOWER OWNER REGISTRATION NO.
-------------------------- ---------------------- ---------------------------------------- ----------------------
WOKR-TV Rochester, NY Guy Gannett Communications 1011757
-------------------------- ---------------------- ---------------------------------------- ----------------------
KGAN-TV Cedar Rapids, IA Guy Gannett Communications 1012927
Iowa City, IA Guy Gannett Communications 1012925
Walker City, IA Guy Gannett Communications 1012926
-------------------------- ---------------------- ---------------------------------------- ----------------------
WTWC-TV Tallahassee, FL Guy Gannett Communications 1019324
-------------------------- ---------------------- ---------------------------------------- ----------------------
WGGB-TV Holyoke, MA Guy Gannett Communications 1018460
Holyoke, MA Guy Gannett Communications 1018461
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
WHYN-FM1 Holyoke, MA Guy Gannett Communications 1018462
-------------------------- ---------------------- ---------------------------------------- ----------------------
WICD(TV)2 Champaign, IL Guy Gannett Communications 1036562
Maroa, IL Guy Gannett Communications 1016052
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
WICS (TV)3 Springfield, IL Guy Gannett Communications 1008823
-------------------------- ---------------------- ---------------------------------------- ----------------------
WGME-TV4 Portland, ME Guy Gannett Communications 1024383
Raymond, ME Guy Gannett Communications 1014068
Portland, ME Guy Gannett Communications 1024384
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
-------------------------- ---------------------- ---------------------------------------- ----------------------
--------
1 This station is not owned by the Company but leases one of the Company's
antenna structures.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.12 (FCC)
------------------
3.12(ii): None.
3.12(iii): None.
3.12(iv): None.
3.12(v): None.
3.12(vi): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.13 (ENVIRONMENTAL MATTERS)
------------------------------------
WGME-TV 1. 1335 Washington Avenue, Portland, Maine. Various potential
------- environmental matters as described in the entire "Phase I
Environmental Site Assessment - WGME-TV Studios -- 1335 Washington
Avenue" (Dames & Moore, 5/28/98).
2. Transmitter Site, Brownhill Road, Raymond, Maine. Various
potential environmental matters as described in the entire "Phase
I Environmental Site Assessment - WGME-TV Transmitter Site --
Brownhill Road (Dames & Moore, 5/28/98).
WGME-TV 3. Blackstrap Road, Falmouth, Maine. Various potential environmental
------- matters as described in the entire Phase I Environmental Site
Assessment-WGME-TV Transmitter Building and Towers-325 Blackstrap
Road, Falmouth, Maine (Dames & Moore, 5/28/98-ESA No. 6).
4. Mount Agamenticus, Town of York, Maine (easement parcel and tower
space). Various potential environmental matters as described in
the entire Phase I Environmental Site Assessment-WGME-TV Microwave
Receiver/Transmitter-115 Mountain Road, York, Maine (Dames &
Moore, 5/28/98-ESA No. 7).
5. North Belfast Road, Augusta, Maine. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WGME-TV-Pilot Communications-North
Belfast Road, Augusta, Maine (Dames & Moore, 5/28/98-ESA No. 9).
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
WGGB-TV
-------
6. 1300 Liberty Street, Springfield, Mass. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WGGB-TV Studio- 1302 & 1306 Liberty
Street, Springfield, Mass. (Dames & Moore, 5/28/98-ESA No. 10).
7. Mt. Tom, Holyoke, Mass. Various potential environmental matters as
described in the entire Phase I Environmental Site
Assessment-WGGB-TV Transmitter-29 Mount Tom, Holyoke, Mass. (Dames
& Moore , 5/28/98-ESA No. 11).
KGAN-TV
-------
8. Studio-600 Old Marion Road, Cedar Rapids, IA. Various potential
environmental matters as described in the entire "Phase I
Environmental Site Assessment - KGAN-TV Transmission Tower" (Dames
& Moore, 5/28/98).
9. Transmission Tower, 5012 31st Avenue, Walker, IA. Various
potential environmental matters as described in the entire "Phase
I Environmental Site Assessment - KGAN-TV Transmission Tower --
5012 31st Avenue, Walker, IA" (Dames & Moore, 5/28/98).
10. 1837 Dubuque Road, Iowa City, Iowa. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-KGAN-TV Iowa City Repeater Tower-
1837 Dubuque Road, Iowa City, Iowa (Dames & Moore, 5/28/98-ESA No.
14).
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
11. 1704 North 4th. Street, Washington, Iowa. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-KGAN-TV Television Translator Site,
1704 North 4th. Street, Washington, Iowa (Dames & Moore,
5/28/98-ESA No. 15).
WICS-TV
-------
12. 2680 E. Cook Street, Springfield, Ill. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WICS-TV Studio- 2680 E. Cook Street,
Springfield, Illinois (Dames & Moore, 5/28/98-ESA No. 16).
13. Route 1, Village of Dawson, Springfield, Ill. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WICS-TV Transmitter Building -Route
1, Village of Dawson, Springfield, Ill. (Dames & Moore,
5/28/98-ESA No. 17).
WICD-TV
-------
14. 250 South County Fair Drive, Champaign, Ill. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WICD-TV Station-250 South County
Fair Drive, Champaign, Ill. (Dames & Moore, 5/28/98-ESA No. 18).
15. Route 130 East, Homer, Ill. Various potential environmental
matters as described in the entire Phase I Environmental Site
Assessment-WICD-TV Transmitter Building -Route 130 East, Homer,
Ill. (Dames & Moore, 5/28/98-ESA No. 19).
16. Route 51, Maroa, Ill. Various potential environmental matters as
described in the entire Phase I Environmental Property Audit by
Hanson Engineers, dated March/1993.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
WOKR-TV
-------
17. 4225 West Henrietta Road, Rochester, New York. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WOKR-TV Studio-4225 West Henrietta
Road, Rochester, New York (Dames & Moore, 5/28/98-ESA No. 20).
18. Pinnacle Hill-State Route 31), Brighton, New York. Various
potential environmental matters as described in the entire Phase I
Environmental Site Assessment- WOKR-TV Transmitter Site-Pinnacle
Hill ( Dames & Moore, 5/28/98-ESA No. 21.
WTWC-TV
-------
19. 8440 West Deerlake Road, Tallahassee, Florida. Various potential
environmental matters as described in the entire Phase I
Environmental Site Assessment-WTWC-TV Channel 40-TV station and
Tower, 8440 West Deerlake Road, Tallahassee, Florida (Dames &
Moore, 2/16/96)
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.14 (EMPLOYEE BENEFITS)
--------------------------------
1. The Company has entered into certain agreements with key employees
for severance, retention and other closing benefits which include
new benefits, as well as acceleration of certain existing
benefits. Pursuant to these agreements, employees will be paid
agreed amounts in lieu of existing obligations under short-term
incentive plans, individual TV managers' long-term incentive
plans, and the Company's 1997-2000 Long-Term Incentive Plan,
thereby fixing and accelerating existing obligations. The
agreements also require payment of certain base retention bonuses
and severance payments for selected employees. See Section 3.14.1
of the Disclosure Schedule for a list of division agreements
(other than division heads) and Section 3.14.2 of the Disclosure
Schedule for a list of division head agreements.
2. Certain agreements with various retired employees may be
accelerated upon Closing: Xxxx XxXxxxxx, Xxxx Xxxxxx, Xxxxxx
Xxxxxxxx and Xxxxxxx Xxxxxxxxx.
3. The Company has entered into several severance agreements in the
normal course of business which include periodic severance
payments and payment of medical and dental COBRA premiums.
4. The Company has an arrangement to pay a former employee a monthly
sum, until May 1999, outside the terms of any supplemental
retirement plan.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.14 (EMPLOYEE BENEFITS)
--------------------------------
5. The Company is in the process of amending certain summary plan
descriptions for its qualified plans and welfare benefit plans.
Amendments to qualified plans need to be written and filed prior
to 12/31/99 to comply with Tax Reform Act of 1997 and the Small
Business Job Protection Act of 1996.
6. The Guy Gannett Voluntary Investment Plan (401(k)) has recently
had several small operational matters which have been corrected
and documented according to the provisions of the IRS
self-correction program referred to as "APRSC."
7. The Guy Gannett Voluntary Investment Plan is currently involved in
a random 5500 audit by the IRS for the 1995 plan year. The results
of that audit cannot be predicted at this time.
8. The Company has agreed, under the terms of a severance agreement
with one former employee, to pay to him 75% of an individual
medical insurance premium until March 2003.
9. KGAN entered into a severance agreement with an employee.
Subsequently, there have been several letters of correspondence
with the former employee's attorney over a number of issues
including a modification that had to be made to the agreement in
order to comply with medical plan and COBRA eligibility. The
matter has not risen to the level of threatened litigation.
10. See Section 3.14.5 for list of employee benefit plans, Section
3.10.4 for list of material employment, consulting and similar
agreements, Section 3.10.6 for collective bargaining agreements
and Section 3.14.1, 3.14.2 and 3.3 for agreements providing for
payments upon a change of control.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.15 (LABOR RELATIONS)
------------------------------
See Section 3.10.6 for list of labor organizations representing
employees.
3.15(i): None.
3.15(ii): None.
3.15(iii): None.
3.15(iv): None.
3.15(v) None.
3.15(vi) None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.16 (INTELLECTUAL PROPERTY)
------------------------------------
See Section 3.16.1 for a list of call letters for the Stations.
3.16(i): None.
3.16(ii):
1. The tradename for "Newssource 13" used by WOKR has not yet
been transferred of record in the U.S. Patent & Trademark
Office.
2. The Company is investigating whether KGAN's "Weathereye"
website has all necessary copyrights for some of the
material published on its site.
3.16(iii): None.
3.16(iv): None.
Guy Gannett Communications
Purchase Agreement - Broadcasting
Section 3.16.1 - Call Letters
WGME-TV PORTLAND, MAINE
WGGB-TV SPRINGFIELD, MASSACHUSETTS
KGAN-TV CEDAR RAPIDS, IOWA
WICS-TV SPRINGFIELD, ILLINOIS
WICD-TV CHAMPAIGN, ILLINOIS
WOKR-TV ROCHESTER, NEW YORK
WTWC-TV TALLAHASSEE, FLORIDA
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.17 (TAXES)
--------------------
None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.18 (COMMISSIONS)
--------------------------
Certain of the Company executives have agreements for contingent
compensation tied to the sales price for the Company.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.19 (AFFILIATE TRANSACTIONS)
-------------------------------------
See Section 3.7 of the Disclosure Schedule concerning the
Contribution Agreement with respect to the Company's
transfer of the Maine Media Business to Newco.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
4.3 (ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS)
------------------------------------------------------------
None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
4.7 (PURCHASER'S QUALIFICATIONS)
--------------------------------
The following television stations overlap with Xxxxxxxx stations and would
require waivers of FCC ownership rules before they could be acquired by
Xxxxxxxx:
1. WOKR-TV Rochester, NY, has Grade A overlap with WUHF(TV), Rochester, NY
2. WICS-TV Springfield, IL, has Grade A overlap with WYZZ(TV), Bloomington,
IL, and Grade B overlap with KDNL(TV), St. Louis, MO.
3. WICD-TV Champaign, IL, has Grade B overlap with WYZZ(TV), Bloomington, IL.
4. KGAN-TV Cedar Rapids, IA, has Grade B overlap with KDSM(TV), Des Moines,
IA.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
5.1(a)(i): None.
5.1(a)(ii):
1. The Company has the right, under a contract with KOZ inc,
to provide on-line community publishing services in all
of its TV markets. The Company (as part of Maine Media
Business) presently provides this service only in Maine.
2. Some combined activities between and among the Company
and Newco may be suspended at or after the date of the
sale of the Maine Media Business.
3. KGAN plans to enter into a lease for a remote studio at a
mall.
4. The Company will modify the Guy Gannett Group Life and
Health Plan (#501) to vest those Business Employees and
Corporate Office Employees (1) who are currently retired
and covered by the plan ("Current Retirees") and (2) who
are currently employed and who meet the age and service
requirements for post-retirement coverage as of the
Closing Date ("Qualified Employees", with the Current
Retirees and Qualified Employees sometimes collectively
referred to as "Retirees") in post-retirement benefits
substantially equivalent to those offered by the plan as
of the Closing Date. The Coorporate Office Employees
eligible or deemed to be eligible for these
post-retirement benefits are listed on Schedule 5.1.1 and
the Business Employees eligible for these post-retirement
benefits are listed on Schedule 5.1.2.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
The percentage of premium paid by Current Retirees will remain
the same as the percentage that they pay as of the Closing
Date. Current Retirees and Qualified Employees shall pay 100%
of the premium for post-retirement medical coverage and the
Company shall pay 100% of the life insurance premium for such
Current Retirees and Qualified Employees.
Subject to the provisions of the existing plans concerning
premium sharing, the cost of such insurance coverages will be
deemed to be the same as the cost for active employees for so
long as the same benefit options are available to both active
employees and Retirees. At any time that active employees and
Retirees are not covered by the same health plan options, the
cost to Retirees will be deemed to be the community rate for
the same or similar coverage as determined by the insurance
provider covering the largest number of lives in the State of
Maine. The Group Companion Plan coverage will at all times be
based upon the current coverage option and at rates determined
from time to time by Blue Cross Blue Shield of Maine or its
successor and approved by the State of Maine, although the
actual insurance carrier may change.
See Section 3.7 of the Disclosure Schedule concerning
allocation of pension plan assets in the Company's defined
benefit plan between the Company and Newco, and the transfer
of certain plan assets related to the Maine Media Business to
Newco's plan.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
5. Under a contract with Cigna (G-R200), Cigna provides
guaranteed payments to retirees under the Guy Gannett
Retirement Plan with respect to benefits accrued until
January, 1970. The Company plans to cause the Cigna
contract to be modified to provide for the transfer to
the New Pension Plan that portion of the guaranteed
payments that relate to current and former Business
Employees.
6. WGME may move either Xxxxxxx or Entertainment Tonight to
an after-midnight time slot before Xxx Xxxxxx.
5.1(a)(iii): None.
5. The Company plans to enter into a lease amendment with
respect to the property located at the Northport Business
Park to address sub-letting of tower space.
6. The Company plans to donate certain items relating to the
Gannett family to non-profit organizations.
7. See Section 3.7 of the Disclosure Schedule for a
description of the contribution of the Maine Media
Business to Newco, and the related agreement concerning
certain shared assets, which the Company expects to enter
into prior to Closing.
5.1(a)(iv):
8. Trustees under the Guy Gannett Retirement Plan and the
Voluntary Investment Plan and Trusts will resign and will
be replaced by an institutional trustee.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
9. The Company expects to grant a premium holiday, and/or
provide employees a lump sum refund relating to prior
year overpayment of health care premiums.
5.1(a)(v): None.
5.1(a)(vi): None.
5.1(a)(vii): None.
5.1(a)(viii): No consent of the Purchaser will be required for
modification, change, renewal or extension of the
following Material Contracts, on terms consistent with
past practices of the Business:
o Modification of Lease with Xxxxx Xxxx (KGAN) to
obtain a right of first refusal in favor of the
Company and correct the landlord
o Entry into a new office lease in Waterloo, Iowa
(KGAN).
o Extension or renewal of Columbine Systems, Inc.
agreement (WICS), provided that the Company will use
reasonable efforts to extend this contract on a
month-to-month basis or to renew the same terminable
on 30 days' notice, but the obtaining of such an
extension or renewal on such terms shall not be a
condition of Closing. In no event shall this contract
be extended beyond December 31, 2000 without
Purchaser's consent, which consent shall not be
unreasonably withheld.
o Extension or renewal of Incentive Management, Inc.
agreement (WICS)
o New Personal Service Contract with Xxxx Xxxxxxx
(WGGB)
o New Personal Service Contract with Xxxxx Xxxxxxx
(KGAN)
o New Personal Service Contract with Xxxx Xxxx (WICS)
o New Personal Service Contract with Xxxx Xxxxxxx
(WICS)
o New Personal Service Contract with Xxx Bilone (WOKR)
o A new Personal Services Contract may be entered into
with Xxxx Xxxx.
o U.S. Fleet Lease will be amended to add a budgeted
news vehicle.
o See Section 5.1(a)(iii), Xx. 0, xxxxxxxxxx Xxxxxxxxx
Xxxxxxxx Xxxx lease amendment.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.1 (COVENANTS AND AGREEMENTS)
--------------------------------------
5.1(a)(ix):
10. An employee of WGGB stole certain services from the
Station. The employee has been terminated. WGGB may
enter into a settlement agreement and a release with
regard to the services stolen.
5.1(a)(x):
11. The Company may enter into an agreement with CBS
reducing KGAN and WGME's network affiliation
compensation as a result of CBS's new NFL football
programming.
5.1(a)(xi): None.
5.1(a)(xii): None.
5.1(a)(xiii): None.
5.1(a)(xiv): None.
5.1(a)(xv): None.
5.1(a)(xvi): None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.2 (POST-CLOSING COVENANTS AND AGREEMENTS)
---------------------------------------------------
5.2(a): Employee Benefit Plans, books and records to be available
for inspection without limit as to time relate to:
o Guy Gannett Retirement Plan and Trust
o WOKR-TV 401(k) Profit Sharing and Savings Plan
5.2(b): Corporate Office Employees are those individuals listed on
Section 5.2.1 of the Disclosure Schedule or any persons who,
at or prior to Closing, have replaced any of the listed
individuals in their positions.
5.2(d): Purchasers current severance policy is to provide severance
of one-half day's pay for each full month of continuous
service to those employees whose employment is terminated,
after six months of service, due to the elimination of the
employee's duties for reasons such as lack of work,
organizational changes or general reduction of force.
5.2(e):
1. Pursuant to Section 7 of the presently effective bargaining
agreement between "WGME-TV, a division of Guy Gannett
Communications Co. (Employer) and the American Federation of
Television and Radio Artists, Boston Local, AFL-CIO
(Union)".
2. Pursuant to Section C of the presently effective bargaining
agreement between "Guy Gannett Communications d/b/a WGME-TV
of Portland, Maine and Local Union No. 1837 of the
International Brotherhood of Electrical Workers [AFL-CIO]."
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 5.2 (POST-CLOSING COVENANTS AND AGREEMENTS)
---------------------------------------------------
3. Pursuant to Article V, Section 12 of the presently effective
bargaining agreement between "Guy Gannett Communications
d/b/a WICS-TV of Portland, Maine and Local Union No. 51 of
the International Brotherhood of Electrical Workers
[AFL-CIO]."
5.2(f): Xxxxxx Xxxxxxxxxx (retired), Xxx Xxxxxx (WOKR) and Xxxxx
Xxxxxxx (retired) have supplemental retirement plans. The
accrued liability therefor will be included in the Net
Financial Assets calculation.
5.2(i) See Section 5.2.2 of the Disclosure Schedule.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
Section 6.4 (Material Consents Required As A Condition
------------------------------------------------------
of the Purchaser's Obligation To Close)
---------------------------------------
1. The Affiliation Agreements listed on Section 3.10.1 of the
Disclosure Schedule.
2. Lease with Michigan Ave. National Bank of Chicago dated 4/19/77
for studio space and tower lease.
3. Obtaining of the following consents will not be a condition of
Closing if the Company has obtained, prior to Closing,
alternatives reasonably acceptable to Purchaser and on terms not
materially adverse to Purchaser as reasonably determined by
Purchaser:
A. Lease with Xxxxx Xxxx dated 2/25/98 for Iowa City translator
tower site.
B. Lease with Xxxx and Xxxxxxx Xxxxxxx dated 7/27/98 for
Washington, Iowa site.
C. Lease with Maine Public Broadcasting dated 10/23/95 for
Litchfield, Maine tower space.
D. Lease with Maine Bureau of Forestry dated 1/7/88 for
microwave tower site.
E. Lease with Fleet Bank dated 1/1/94 for Lewiston, Maine
space.
F. Lease with Fleet Bank dated 6/20/95 for Sanford, Maine
office space.
G. Excelltron Tower, Inc. lease dated 7/1/95 for tower located
in Sanford, Maine.
H. Intermedia (EMI Communications) dated 3/26/98 for video
service/tower lease for WOKR.
None of the leases described in this Section 3 are for main studio, main tower
or main transmission sites.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
*Northport Realty Trust for WGME office and studio lease (consent to assignment
not required).
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 7.4 (MATERIAL CONSENTS REQUIRED AS A CONDITION
------------------------------------------------------
OF THE COMPANY'S OBLIGATION TO CLOSE)
-------------------------------------
None.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 9
---------
(CLOSING STATEMENT DIFFERENCES AND INCONSISTENCIES WITH GAAP)
-------------------------------------------------------------
1. The accounting method used to amortize downpayment of
certain program costs will be made in accordance with the
example shown in Section 9.1 of the Disclosure Schedule.
2. The Closing Statement may not include any assets or
liabilities that may result from a settlement in the future
with ASCAP regarding the dispute with the TV Music License
Committee on new fees and the license agreement.
3. The Closing Statement will not be in accordance with GAAP
and/or be consistent with the basis used in preparing the
Unaudited Financial Statements as of, and for the year
ended, December 27, 1997 in the following ways.
(a) The Closing Statement will not include any financial
statements or footnotes required under GAAP.
(b) The Closing Statement will not include any accruals
for severance for employees terminated after the
Closing.
(c) See Section 3.5 of the Disclosure Schedule for other
non-conformities with GAAP and inconsistencies with
prior practices.
4. The Company has an arrangement to pay a former WGME employee
a monthly sum, until May 1999, outside the terms of any
supplemental retirement plan. The Company accounts for this
liability on a cash basis.
5. A liability for vacation benefits for corporate employees
may exist at Closing. This will be recorded as a Net
Financial Asset, but is not in accordance with past
practices for interim financial statements.
6. Retirement and deferred compensation plans for the following
former executives will be included in the definition of Net
Financial Assets, unless such liabilities are satisfied
prior to Closing: Xxxxxx Xxxxxxxxxx; Xxxx Xxxxxx; Xxxxxx
Xxxxxxxx; Xxxxxxx Xxxxxxxxx and Xxxx XxXxxxxx.
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10.10 (LOAN AGREEMENTS)
---------- ------------------- ----------------------------------------------------------- -----------------------------------------
DIVISION DOCUMENT NUMBER COMPANY NAME PURPOSE CONTRACT EFFECTIVE COPY
DATE DATE IMPERFECTIONS
---------- ------------------- ----------------------------------------------------------- -----------------------------------------
---------- ------------------- ----------------------------------------------------------- -----------------------------------------
Corp. 100020.00 Northwestern Mutual Life Insurance Senior Notes N/A N/A N/A
---------- ------------------- ----------------------------------------------------------- -------------------------------------
Corp. 100021.00 UNUM Life Insurance Company Senior Notes N/A N/A N/A
---------- ------------------- ----------------------------------------------------------- -------------------------------------
Corp. 100022.00 Massachusetts Mutual Life Ins. Co. Senior Notes N/A N/A N/A
---------- ------------------- ----------------------------------------------------------- -------------------------------------
Corp. 100025.00 First National Bank of Boston (primary) Revolving Credit 08/18/81 08/18/81 N/A
Agreement
---------- ------------------- ----------------------------------------------------------- -------------------------------------
Corp. 100026.00 Bank of New York (participating) Revolving Credit 08/18/81 08/18/81 N/A
Agreement
---------- ------------------- ----------------------------------------------------------- -------------------------------------
Corp. 100027.00 Fleet Bank (participating) Revolving Credit 08/18/81 08/18/81 N/A
Agreement
---------- ------------------- ----------------------------------------------------------- -------------------------------------
Corp. 100028.00 Key Bank (participating) Revolving Credit 08/18/81 08/18/81 N/A
Agreement
---------- ------------------- ----------------------------------------------------------- -------------------------------------
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10.2 (AFFILIATION AGREEMENT)
--------------------------------------
-----------------------------------------------------------------------------------------------------------------------------------
DOCUMENT CONTRACT EFFECTIVE COPY
DIVISION NUMBER COMPANY NAME PURPOSE DATE DATE IMPERFECTIONS
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
KGAN 1470510.00 CBS Television Network Television Affiliation Agreement 1/1/95
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WGGB 1270010.00 ABC Television Network Network Affiliation Agreement 1/6/95 1/1/95
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WGME 1170010.00 CBS Television Network Affiliate Agreement 1/31/94 1/1/95
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WICD 1500010.00 NBC TV Network Affiliation Agreement 1/16/96 7/1/95
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WICD 1500010.01 NBC TV Network Incentive payments 1/16/96
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WICS 1370010.00 NBC TV Network Affiliation Agreement 1/1/81 7/1/95
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WOKR 1670010.00 ABC Inc. Capital Cities Affiliation Agreement 1/24/91 1/2/95
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WOKR 1670010.00 ABC Inc. Capital Cities consent to assignment to GGC 4/20/98 4/26/98
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WOKR 1670020.00 ABC Inc. Capital Cities NewOne Service 7/8/88 9/14/88
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
WTWC 1700010.00 NBC TV Network Network Affiliation 2/1/97 1/1/97
---------------------------- ------------------------- ----------------------------------- ------------- --------------------------
---------------------------- -------------------------------- ---------------------------------------------------------------------
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10.7.A (REAL PROPERTY LEASES)
--------------------------- -------------------------------- --------------------------------------------
DOCUMENT
DIVISION NUMBER COMPANY NAME PURPOSE
--------------------------- -------------------------------- --------------------------------------------
KGAN 1480010.00 Xxxxx Xxxx Iowa City Translator Tower Site Lease*
--------------------------- -------------------------------- --------------------------------------------
KGAN 1480010.01 Xxxxx Xxxx Amdt to lease - right of 1st refusal
--------------------------- -------------------------------- --------------------------------------------
KGAN 1483330.00 Xxxx & Xxxxxxx Xxxxxxx Washington Iowa site lease
--------------------------- -------------------------------- --------------------------------------------
KGAN 1483340.00 Midtown Development Waterloo office
Partnership
--------------------------- -------------------------------- --------------------------------------------
KGAN 1483400.00 Zoreh Asadzadehfard Coralville office lease
--------------------------- -------------------------------- --------------------------------------------
WGGB 1282000.00 Chestnut Park Assoc. Tower space for WGGB radio equipment
--------------------------- -------------------------------- --------------------------------------------
WGGB 1282000.01 Chestnut Park Assoc. Amendment to lease to extend term & rais
--------------------------- -------------------------------- --------------------------------------------
WGME 1181490.00 Northport Realty Trust Northport Office/Studio Lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181491.00 Northport Realty Trust Memorandum of Lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181492.00 UNUM Life Insurance Company Subordination, Non-Disturbance & Attorn
--------------------------- -------------------------------- --------------------------------------------
WGME 1181530.00 Fleet Bank 00 Xxx Xx. Xxxxxxxx Lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181550.00 Maine Public Broadcasting Tower space Litchfield, ME
--------------------------- -------------------------------- --------------------------------------------
WGME 1181800.00 Fleet Bank of Maine Sanford office lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181810.00 Excelltron Tower, Inc. Sanford Tower lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181860.00 Maine Bureau of Forestry Microwave Site lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181870.00 State of Maine Office lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181880.00 Kennebec Valley med. Ctr. Sky cam site lease
--------------------------- -------------------------------- --------------------------------------------
WGME 1181900.00 Maine Medial Center sky cam lease
--------------------------- -------------------------------- --------------------------------------------
WICD 1580000.00 Michigan Ave. National Bank of Studio Space and Tower Lease
Chic
--------------------------- -------------------------------- --------------------------------------------
WICD 1580090.00 First Appraisal Co. Danville office lease
--------------------------- -------------------------------- --------------------------------------------
WOKR 1681100.00 Xxxxxxx ABR, Inc. Roof lease
--------------------------- -------------------------------- --------------------------------------------
WOKR 1681130.00 Intermedia (EMI Communications) Video Service/Tower Lease
--------------------------- -------------------------------- --------------------------------------------
--------------------------- -------------------------------- ------------- ------------- --------------------
DOCUMENT CONTRACT EFFECTIVE COPY
DIVISION NUMBER COMPANY NAME DATE DATE IMPERFECTIONS
--------------------------- -------------------------------- ------------- ------------- --------------------
KGAN 1480010.00 Xxxxx Xxxx 2/25/98 1/1/98
--------------------------- -------------------------------- ------------- ------------- --------------------
KGAN 1480010.01 Xxxxx Xxxx not signed
--------------------------- -------------------------------- ------------- ------------- --------------------
KGAN 1483330.00 Xxxx & Xxxxxxx Xxxxxxx 7/27/98 6/1/98
--------------------------- -------------------------------- ------------- ------------- --------------------
KGAN 1483340.00 Midtown Development 11/1/96
Partnership
--------------------------- -------------------------------- ------------- ------------- --------------------
KGAN 1483400.00 Zoreh Asadzadehfard 1/30/96 2/1/96
--------------------------- -------------------------------- ------------- ------------- --------------------
WGGB 1282000.00 Chestnut Park Assoc. 8/1/85
--------------------------- -------------------------------- ------------- ------------- --------------------
WGGB 1282000.01 Chestnut Park Assoc. 5/1/93
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181490.00 Northport Realty Trust 1/1/96 1/1/96
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181491.00 Northport Realty Trust 3/20/96
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181492.00 UNUM Life Insurance Company 3/20/96 1/1/96
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181530.00 Fleet Bank 1/1/94 1/1/94
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181550.00 Maine Public Broadcasting 10/23/95 10/23/95
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181800.00 Fleet Bank of Maine 6/20/95 6/21/95
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181810.00 Excelltron Tower, Inc. 7/1/95 not fully executed
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181860.00 Maine Bureau of Forestry 1/7/88 1/1/88
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181870.00 State of Maine oral
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181880.00 Kennebec Valley med. Ctr. 8/12/96
--------------------------- -------------------------------- ------------- ------------- --------------------
WGME 1181900.00 Maine Medial Center oral
--------------------------- -------------------------------- ------------- ------------- --------------------
WICD 1580000.00 Michigan Ave. National Bank of 4/19/77 11/15/77
Chic
--------------------------- -------------------------------- ------------- ------------- --------------------
WICD 1580090.00 First Appraisal Co. 1/19/98 2/1/98
--------------------------- -------------------------------- ------------- ------------- --------------------
WOKR 1681100.00 Xxxxxxx ABR, Inc. 11/14/94 1/1/95
--------------------------- -------------------------------- ------------- ------------- --------------------
WOKR 1681130.00 Intermedia (EMI Communications) 3/26/98 3/26/98
--------------------------- -------------------------------- ------------- ------------- --------------------
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT [BROADCAST]
DISCLOSURE SCHEDULE
SECTION 3.10.8 (INCOME LEASES)
------------------------------
---------------------------- -------------------------------- --------------------------------------------
DOCUMENT
DIVISION NUMBER COMPANY NAME PURPOSE
---------------------------- -------------------------------- --------------------------------------------
KGAN 1480580.00 Jacor Broadcasting of Iowa, WMT Studio Space Lease Agreement
Inc.
---------------------------- -------------------------------- --------------------------------------------
KGAN 1480581.00 Xxxxxx Broadcasting Limited consent to assignment
Partners
---------------------------- -------------------------------- --------------------------------------------
KGAN 1480582.00 Xxxxxx Broadcasting Limited Memorandum of Lease
Partners
---------------------------- -------------------------------- --------------------------------------------
KGAN 1480583.00 Norwest Bank Iowa N.A. collateral assignment
---------------------------- -------------------------------- --------------------------------------------
KGAN 1480590.00 Jacor Broadcasting of Iowa, Assumption &
renewal of leases Inc.
---------------------------- -------------------------------- --------------------------------------------
WGGB 1281240.00 Motorola Communications and Mt. Xxx Tower lease; bldg. space
Elect.
---------------------------- -------------------------------- --------------------------------------------
WGGB 1281290.01 WGBY-TV (WGBH Educational Fou Mt. Xxx Tower lease; bldg. space and land
---------------------------- -------------------------------- --------------------------------------------
WGGB 1281390.00 Northeast Utilities Mt. Xxx Lease
---------------------------- -------------------------------- --------------------------------------------
WGME 1181460.00 WTHT-Xxxxxx Communications Sublease office space - Northport
---------------------------- -------------------------------- --------------------------------------------
WGME 1181461.00 Beacon Broadcasting Consent to Assignment
---------------------------- -------------------------------- --------------------------------------------
WGME 1181462.00 Beacon Broadcasting Consent and Acknowledgement
---------------------------- -------------------------------- --------------------------------------------
WGME 1181463.00 Beacon Broadcasting Assignment of Leases, contracts & agreem
---------------------------- -------------------------------- --------------------------------------------
WGME 1181464.00 Great Casco Bay Wireless Assignment of Beacon sublease
Talking M
---------------------------- -------------------------------- --------------------------------------------
WGME 1181465.00 Great Casco Bay Wireless acknowledgement of new Prime Lease
---------------------------- -------------------------------- --------------------------------------------
WGME 1181470.00 WBLM-Xxxxxx Communications Xxxxxxx Tower Space Lease
---------------------------- -------------------------------- --------------------------------------------
WGME 1181471.00 General Broadcasting of assignment of leases, contracts & agreeme
Florida, Inc.
---------------------------- -------------------------------- --------------------------------------------
WGME 1181472.00 Xxxxxx-Xxxxxxx Broadcasting Assignment of Leases
---------------------------- -------------------------------- --------------------------------------------
WGME 1181473.00 Xxxxxx-Xxxxxxx Broadcasting consent to assignment and amendment of
---------------------------- -------------------------------- --------------------------------------------
WGME 1181474.00 Xxxxxx-Xxxxxxx Broadcasting Lessor consent and Estoppel
---------------------------- -------------------------------- --------------------------------------------
WGME 1181475.00 Xxxxxx-Xxxxxxx Broadcasting Amendment to Lease
Corp.
---------------------------- -------------------------------- --------------------------------------------
WOKR 1681090.00 WXXI-Rochester Area Ed. TV Brighton land lease
Assoc.
---------------------------- -------------------------------- --------------------------------------------
WOKR 1681090.01 WXXI-Rochester Area Ed. TV First Amendment of lease
Assoc.
---------------------------- -------------------------------- --------------------------------------------
WTWC 1780200.00 WMLO FM (now WFLY) Tower lease
---------------------------- -------------------------------- --------------------------------------------
WTWC 1780210.00 WSNI FM Tower lease
---------------------------- -------------------------------- --------------------------------------------
---------------------------- -------------------------------- ------------- ------------- --------------
DOCUMENT CONTRACT EFFECTIVE COPY
DIVISION NUMBER COMPANY NAME DATE DATE IMPERFECTIONS
---------------------------- -------------------------------- ------------- ------------- --------------
KGAN 1480580.00 Jacor Broadcasting of Iowa, 10/16/81 10/17/81
Inc.
---------------------------- -------------------------------- ------------- ------------- --------------
KGAN 1480581.00 Xxxxxx Broadcasting Limited 1/5/96
Partners
---------------------------- -------------------------------- ------------- ------------- --------------
KGAN 1480582.00 Xxxxxx Broadcasting Limited 1/5/96
Partners
---------------------------- -------------------------------- ------------- ------------- --------------
KGAN 1480583.00 Norwest Bank Iowa N.A. 1/4/96
---------------------------- -------------------------------- ------------- ------------- --------------
KGAN 1480590.00 Jacor Broadcasting of Iowa, 3/18/97
Inc.
---------------------------- -------------------------------- ------------- ------------- --------------
WGGB 1281240.00 Motorola Communications and 4/1/89 4/1/89 Tenant at Will
Elect.
---------------------------- -------------------------------- ------------- ------------- --------------
WGGB 1281290.01 WGBY-TV (WGBH Educational Fou 1/1/79 1/1/89
---------------------------- -------------------------------- ------------- ------------- --------------
WGGB 1281390.00 Northeast Utilities 1/1/95
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181460.00 WTHT-Xxxxxx Communications 10/25/83 10/25/83
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181461.00 Beacon Broadcasting 11/30/89
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181462.00 Beacon Broadcasting 12/1/89
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181463.00 Beacon Broadcasting 12/6/89
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181464.00 Great Casco Bay Wireless 11/17/94 no copy
Talking M
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181465.00 Great Casco Bay Wireless 3/15/96
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181470.00 WBLM-Xxxxxx Communications 10/25/83 10/25/83
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181471.00 General Broadcasting of 12/6/89
Florida, Inc.
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181472.00 Xxxxxx-Xxxxxxx Broadcasting 12/6/89
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181473.00 Xxxxxx-Xxxxxxx Broadcasting 12/1/89
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181474.00 Xxxxxx-Xxxxxxx Broadcasting 5/14/92
---------------------------- -------------------------------- ------------- ------------- --------------
WGME 1181475.00 Xxxxxx-Xxxxxxx Broadcasting 8/31/98
Corp.
---------------------------- -------------------------------- ------------- ------------- --------------
WOKR 1681090.00 WXXI-Rochester Area Ed. TV 10/23/79 10/24/79
Assoc.
---------------------------- -------------------------------- ------------- ------------- --------------
WOKR 1681090.01 WXXI-Rochester Area Ed. TV 4/14/89
Assoc.
---------------------------- -------------------------------- ------------- ------------- --------------
WTWC 1780200.00 WMLO FM (now WFLY) 11/6/89 10/2/90
---------------------------- -------------------------------- ------------- ------------- --------------
WTWC 1780210.00 WSNI FM 3/27/91 3/27/91
---------------------------- -------------------------------- ------------- ------------- --------------
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT
DISCLOSURE SCHEDULE
SCHEDULE 3.9.1
-------------------------------------------------------------------------------------------- -------------------------------------
TYPE INSURER IABILITY LIMIT POLICY PERIOD
-------------------------------------------------------------------------------------------- -------------------------------------
Package Commercial Union 19,491,552 05/01/98 - 05/01/99
-------------------------------------------------------------------------------------------- -------------------------------------
Comm'l. Gen'l. Liability Commercial Union 2,000,000 05/01/98 - 05/01/99
[incl. w/Package Policy]
-------------------------------------------------------------------------------------------- -------------------------------------
Communication Eqpt. Commercial Union 58,615,300 05/01/98 - 05/01/99
-------------------------------------------------------------------------------------------- -------------------------------------
Broadcasting Loss of Income Commercial Union 13,487,696 05/01/98 - 05/01/99
[incl. w/Comm. Eqpt. Policy]
-------------------------------------------------------------------------------------------- -------------------------------------
Automobile Commercial Union 1,000,000 05/01/98 - 05/01/99
-------------------------------------------------------------------------------------------- -------------------------------------
Energy Systems Federal Insurance Co. 25,000,000 05/01/98 - 05/01/99
-------------------------------------------------------------------------------------------- -------------------------------------
Libel/Slander Employers Reinsurance 15,000,000 10/09/97 - 10/09/98
-------------------------------------------------------------------------------------------- -------------------------------------
Umbrella Federal Insurance Co. 25,000,000 05/01/98 - 05/01/99
-------------------------------------------------------------------------------------------- -------------------------------------
Non-Owned Aircraft National Union Fire 20,000,000 10/24/97 - 10/24/98
-------------------------------------------------------------------------------------------- -------------------------------------
Crime Bond Federal Insurance Co. 1,000,000 05/01/98 - 05/01/99
-------------------------------------------------------------------------------------------- -------------------------------------
Fiduciary Responsibility Federal Insurance Co. 25,000,000 11/10/97 - 11/10/98
-------------------------------------------------------------------------------------------- -------------------------------------
Directors & Officers Federal Insurance Co. 5,000,000 02/06/98 - 02/06/99
Includes:
Outside Directors 5,000,000 02/06/98 - 02/06/99
Employment Practices 5,000,000 02/06/98 - 02/06/99
Liability
-------------------------------------------------------------------------------------------- -------------------------------------
Workers Compensation 100,000 12/31/97 - 12/31/98
Maine MEMIC
Illinois Iowa Commercial Union
Florida Commercial Union
Massachusetts Commercial Union
New York Commercial Union
-------------------------------------------------------------------------------------------- -------------------------------------
Travel/Accident Reliance Standard Life 10,000 10/01/97 - 10/01/98
-------------------------------------------------------------------------------------------- -------------------------------------
Foreign Policy CIGNA Ins. Co. 1,000,000 05/20/98 - 05/20/99
-------------------------------------------------------------------------------------------- -------------------------------------
Special (K&R) Aetna Life & Casualty 3,000,000 09/12/95 - 09/12/98
-------------------------------------------------------------------------------------------- -------------------------------------
Maine Turnpike Bond Travelers Casualty & Surety 5,000 09/16/97 - 09/16/98
-------------------------------------------------------------------------------------------- -------------------------------------
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT - BROADCASTING
SECTION 3.10.3 - BARTER PROGRAMMING
KGAN - TV
Written
Contract Term Consent
------------------- Req'd to
Distributor Package Start End Assign
----------- ------- ------ --- ------
Paramount Nick news (96-99 Seasons) Sep-96 Sep-99 YES
Wild Things Sep-97 Sep-98 YES
Hearst Entertainment Popular Mechanics for Kids Xxx-00 Xxx-00 XX
Popular Mechanics for Kids (Year 2) Sep-98 Sep-99 YES
Secrets of the Animal Sep-98 Sep-99 YES
Kingdom
Hallmark Entertainment Jan-98 Dec-99 YES
Presents
Universal Team Knight Rider Oct-97 Oct-98 YES
Columbia Tristar Party of Five Sep-98 Sep-00 NL
Eyemark PSI Factor Sep-97 Sep-99 YES
Xxxxxx Syndications Xxxx Xxxxx Animal Sep-97 Sep-98 NL
Adventures
Buena Vista Disney's Sing Me A Story With Belle Sep-97 Sep-98 YES
T.J.Sports Television Golf 2000 Jun-98 Sep-99 XX
Xxxxxx Media, Inc. Prime Targets IV Movies Sep-98 Feb-00 NL
ITC Distribution, Inc. Movie of the Month Network Feb-98 Feb-99 YES
VII
Telepictures Warner Bros. Vol. 34 (movie Aug-98 Nov-04 YES
Distribution package)
Xxxxxx Legends IV (movies) Oct-97 Dec-98 YES
Qualitron Media, Inc. AG Day Sep-97 Sep-98 YES
Warner Bros. People's Court Jan-98 Sep-99 YES
CNN Newsource Sales, CNN Headline News Sep-98 Aug-00 YES
Inc.
NL - No specific assignment language in Agreement. NLF - Have not received
signed long-form contract.
-
GUY GANNETT COMMUNICATIONS
PURCHASE AGREEMENT - BROADCASTING
MATERIAL CONTRACTS
SECTION 3.10.3 - Program Licenses
WGME
Written
Contract Term Consent
----------------------------- Req'd to
Distributor Package Start End Assign ?
----------- -------------------------------------------- ------------ ----------------- ----------
Paramount Xxxxxxx Sep-97 Dec-00 Yes
Xxxxxxx - 97/98 extention - estimate Sep-01
Entertainment Tonight Sep-96 Sep-99 Yes
Entertainment TonightAddendum dated 02/16/96
Hard Copy Sep-96 Sep-99 Yes
Hard Copy - Amendment Letter dated 3/18/96
Xxxxx Xxxxxx Sep-96 Sep-98 Yes
Xxxxx Xxxxxx addendum dated 02/16/96
Star Trek: Deep Space Nine Jan-93 Sep-99 Yes
Star Trek: Deep Space Nine - Syndex Amendment Letter
Xxxxx Xxxxxx Jul-98 Sep-99 Yes
King World Oprah Sep-95 Sep-00 Yes
Inside Edition Sep-96 Sep-98 Yes
Inside Edition Addendum dated 10/24/97
Warner Bros. Friends Sep-98 Dec-01 Yes
Friends - 97/98 extention - estimate Sep-02
Columbia / Tristar The Nanny Sep-98 Dec-01 Yes
The Nanny - 97/98 extention - estimate Sep-02
MCA / Universal Xxxxx Xxxxxx Sep-98 Sep-00 Yes
