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EXHIBIT 99.8
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ASSET PURCHASE AGREEMENT
dated as of January 21, 1997
by and among
OUTDOOR SYSTEMS, INC.
AND
SCADRON ENTERPRISES,
XXXXXX X. XXXXXXX,
XXXXXXX XXXXXXX
AND
XXXXX XXXXXXX
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TABLE OF CONTENTS
1. DEFINITIONS................................................................. 1
2. PURCHASE AND SALE OF THE ASSETS; CLOSING.................................... 1
2.1 Agreement to Purchase and Sell..................................... 1
2.2 Purchased Assets................................................... 2
2.3 Agreement to Assume Certain Liabilities............................ 2
2.4 Excluded Liabilities............................................... 3
2.5 Closing............................................................ 3
2.6 Purchase Price..................................................... 3
2.7 Transactions at the Closing........................................ 5
2.8 Third Party Consents............................................... 5
2.9 New Assets......................................................... 6
2.10 Escrow............................................................. 6
3. REPRESENTATIONS AND WARRANTIES OF SELLER.................................... 7
3.1 Organization and Good Standing..................................... 8
3.2 Authority; No Conflict............................................. 8
3.3 Solvency........................................................... 9
3.4 Books and Records.................................................. 9
3.5 Purchased Assets................................................... 9
3.6 Title, Encumbrances................................................ 11
3.7 No Undisclosed Liabilities......................................... 11
3.8 Taxes.............................................................. 11
3.9 Compliance with Legal Requirements; Governmental Authorizations.... 12
3.10 Legal Proceedings; Orders.......................................... 12
3.11 Other Contracts.................................................... 13
3.12 Insurance.......................................................... 13
3.13 Environmental Matters.............................................. 13
3.14 Intangible Property................................................ 13
3.15 Disclosure......................................................... 13
3.16 Relationships with Related Persons................................. 14
3.17 Brokers or Finders................................................. 14
3.18 Employee Benefit Matters........................................... 14
3.19 Bulk Sales......................................................... 14
4. REPRESENTATIONS AND WARRANTIES OF BUYER..................................... 14
4.1 Organization and Good Standing..................................... 14
4.2 Authority; No Conflict............................................. 14
4.3 Certain Proceedings................................................ 15
4.4 Brokers or Finders................................................. 15
4.5 License............................................................ 15
4.6 Disclosure......................................................... 15
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5. COVENANTS OF SELLER................................................... 15
5.1 Access and Investigation..................................... 15
5.2 Non-Solicitation............................................. 16
5.3 Operation of the Purchased Assets............................ 16
5.4 Negative Covenant............................................ 16
5.5 Required Approvals........................................... 16
5.6 Consents..................................................... 16
5.7 Notification................................................. 16
5.8 No Negotiation............................................... 17
5.9 Tax Clearance................................................ 17
5.10 Best Efforts................................................. 17
6. COVENANTS OF BUYER.................................................... 17
6.1 Approvals of Governmental Bodies............................. 17
6.2 Best Efforts................................................. 17
6.3 Imprints..................................................... 18
6.4 Notification................................................. 18
6.5 Buyer's Covenants Regarding Certain Locations................ 18
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE................... 19
7.1 Accuracy of Representations.................................. 19
7.2 Seller's Performance......................................... 19
7.3 Consents..................................................... 19
7.4 Additional Documents......................................... 19
7.5 No Proceedings............................................... 19
7.6 No Prohibition............................................... 19
7.7 No Material Adverse Change................................... 19
7.8 Release of Liens............................................. 20
8. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE.................. 20
8.1 Accuracy of Representations.................................. 20
8.2 Buyer's Performance.......................................... 20
8.3 Additional Documents......................................... 20
8.4 No Prohibition............................................... 20
8.5 No Proceedings............................................... 20
9. TERMINATION........................................................... 21
9.1 Termination Events........................................... 21
9.2 Effect of Termination........................................ 21
10. INDEMNIFICATION; REMEDIES............................................. 21
10.1 Indemnification and Payment of Damages by Seller............. 21
10.2 Indemnification and Payment of Damages by Buyer.............. 22
10.3 Procedure for Indemnification -- Third Party Claims.......... 23
10.4 Procedure for Indemnification -- Other Claims................ 23
10.5 Survival/Limitations......................................... 24
10.6 Exclusive Remedies........................................... 24
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11. GENERAL PROVISIONS................................................ 24
11.1 Expenses................................................. 24
11.2 Public Announcements..................................... 24
11.3 Availability of Equitable Remedies....................... 25
11.4 Notices.................................................. 25
11.5 Further Assurances....................................... 26
11.6 Waiver................................................... 26
11.7 Entire Agreement and Modification........................ 27
11.8 Assignments, Successors, and No Third-Party Rights....... 27
11.9 Accounts Receivable...................................... 27
11.10 Severability............................................. 27
11.11 Risk of Loss............................................. 27
11.12 Post-Closing Access...................................... 27
11.13 Article and Section Headings; Construction............... 28
11.14 Applicable Law........................................... 28
11.15 Counterparts............................................. 28
11.16 Joint and Several........................................ 28
EXHIBITS
Exhibit A - Definitions
Exhibit B - Advertising Services Agreements
Exhibit C - Leases
Exhibit D - Xxxx of Sale, Assignment and Assumption Agreement
Exhibit E - Assignment of Advertising Services Agreements
Exhibit F - Assignment of Site Leases
Exhibit G - Assignment of Permits
Exhibit H - Opinion of Xxxxxxx, Carton & Xxxxxxx, Counsel to Seller
Exhibit I - Opinion of Powell, Goldstein, Xxxxxx & Xxxxxx, Counsel
to Buyer
Exhibit J - Confidentiality Agreement
DISCLOSURE SCHEDULE
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement ("Agreement") is entered into as of
January 21, 1997, by and among OUTDOOR SYSTEMS, INC., a Delaware corporation
("Buyer"), SCADRON ENTERPRISES, an Illinois general partnership (the "Company"),
XXXXXX X. XXXXXXX, an individual residing in the State of Illinois ("Scadron")
and Managing Partner of the Company, XXXXXXX XXXXXXX, an individual residing in
the State of Illinois and a Partner of the Company ("X. Xxxxxxx") and XXXXX
XXXXXXX ("X. Xxxxxxx"), an individual residing in the State of Illinois and a
Partner of the Company (hereinafter, Scadron, X. Xxxxxxx, X. Xxxxxxx and the
Company are sometimes referred to collectively as the "Seller"). (Buyer and
Seller are sometimes herein referred to individually as a "Party" and
collectively as the "Parties".)
RECITALS
Seller is engaged in the business of owning and operating outdoor signs
and billboards and otherwise providing outdoor advertising services in the
Chicago metropolitan area (the "Business"). Seller desires to sell and assign
certain out-of-home assets to Buyer, and Buyer desires to purchase such assets
and to assume certain liabilities associated with such assets, pursuant to the
terms, conditions, limitations and exclusions contained in this Agreement.
AGREEMENT
The Parties, intending to be legally bound, agree as follows:
1. DEFINITIONS
For purposes of this Agreement, the terms listed on Exhibit A attached
hereto have the meanings specified or referred to in Exhibit A.
2. PURCHASE AND SALE OF THE ASSETS; CLOSING
2.1 AGREEMENT TO PURCHASE AND SELL. On the basis of the
representations, warranties, covenants, and agreements contained in this
Agreement and subject to the terms and conditions of this Agreement, Seller
hereby agrees to grant, sell, assign, transfer, convey and deliver all right,
title and interest in and to the Purchased Assets, free and clear of any liens,
title claims, Encumbrances or Security Interests (except as otherwise
specifically permitted pursuant to the provisions of this Agreement) and to
enter into the Leases, and Buyer hereby agrees to buy and acquire the Purchased
Assets from Seller, to enter into the Leases and to assume the Assumed
Liabilities upon the terms and conditions set forth in this Agreement. The
Purchased Assets with respect to which consent from third parties are required
to transfer Seller's rights shall be transferred by the Company to Buyer at
Closing. All other Purchased Assets shall be transferred by the Scadrons to
Buyer at Closing.
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2.2 PURCHASED ASSETS. The Purchased Assets are:
(a) All of the billboard displays and other out-of-home
advertising structures set forth and described in the Master Disclosure Schedule
("MDS") attached hereto, together with all necessary panels, moldings,
components, assigned rights to walls, sections, fixtures, parts, appurtenances,
and equipment attached to or made a part thereof, including, for illuminated
structures, all electrical components, wiring, and lighting components
associated therewith that are existing, under construction or for which Seller
has any rights (collectively, the "Structures");
(b) All leases, licenses, easements, other rights of ingress
or egress, occupancy agreements, and all other grants of the right to place,
construct, own, operate or maintain the Structures on land, buildings and other
real property owned by third parties, and all extensions, modifications, or
renewals thereof and rights therein (except for any claims for reimbursement of
taxes or other similar items relating to taxes paid by Seller for the period
prior to Closing) (collectively, the "Site Leases"), which Site Leases are set
forth and described in the MDS;
(c) All rights under existing and pending sales and
advertising contracts associated with the Structures and all rights, title and
interest to the advertising copy displayed on the Structures as of the Closing
Date (except for any claims for reimbursement of taxes or other similar items
relating to taxes paid by Seller for the period prior to Closing) (collectively,
the "Advertising Services Agreements"), which Advertising Services Agreements
are set forth and described on Exhibit B attached hereto;
(d) All state and local licenses or permits/tags which Seller
has with respect to the Structures and, to the extent assignable, all other
Governmental Authorizations that are required for the operation of the
Structures that Seller has with respect to the Structures, including, without
limitation, all Governmental Authorizations to erect and maintain the Structures
or to occupy any sites covered by the Site Leases (collectively, the "Permits"),
which Permits are set forth and described in the MDS;
(e) All Books and Records; and
(f) All rights (including any benefits arising therefrom),
causes of action, claims and demands of whatever nature (whether or not
liquidated) relating to the Purchased Assets, including, without limitation,
condemnation rights and proceeds, and all rights against suppliers under
warranties that Seller has covering any of the Purchased Assets (except for any
claims for reimbursement of taxes or other similar items relating to taxes paid
by Seller for the period prior to Closing) .
2.3 AGREEMENT TO ASSUME CERTAIN LIABILITIES. At the Closing, Buyer
shall assume and agree to discharge and perform all liabilities and obligations
that arise or are attributable to events occurring on or after the Closing Date
pursuant to the Site Leases and the Advertising Services Agreements (the
"Assumed Liabilities") but to the extent and only to the extent that:
(a) Such obligations are performable on or after the Closing
Date; and
(b) Such obligations accrue on or after the Closing Date and
are attributable to periods arising on or after the Closing Date.
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2.4 EXCLUDED LIABILITIES. All claims against and liabilities and
obligations of Seller not specifically assumed by Buyer pursuant to Section 2.3,
including, without limitation, the following claims against and liabilities of
Seller (the "Excluded Liabilities"), which are excluded, shall not be assumed or
discharged by Buyer, and shall be discharged in full when due by Seller:
(a) Any liabilities to the extent not attributable to the
Purchased Assets;
(b) Any liability of Seller for Taxes arising prior to or from
the sale of the Purchased Assets under this Agreement;
(c) Any liabilities for or related to indebtedness of Seller
to banks, financial institutions, or other Persons;
(d) Any liabilities of Seller under any leases, contracts,
insurance policies, commitments, sales orders, or purchase orders that are not
assigned to Buyer pursuant to this Agreement or to the extent that such
liabilities arise or are attributable to events occurring prior to the Closing;
(e) Any liabilities of Seller for or with respect to any
employees of Seller, including, without limitation, any liabilities for accrued
and unpaid wages, salaries, bonuses, commissions, sick leave, vacation time, or
compensated time off owing by Seller to its employees or pursuant to any
compensation, collective bargaining, pension, retirement, severance,
termination, or other benefit plan, agreement or arrangement; and
(f) Any other liabilities of Seller that are attributable to
or arise from facts, events, or conditions that occurred or came into existence
prior to the Closing.
2.5 CLOSING. The purchase and sale of the Purchased Assets (the
"Closing") provided for in this Agreement will take place at the offices of
Xxxxxxx, Carton & Xxxxxxx, in Chicago, Illinois, on February 15, 1997 or such
earlier time as all the conditions to Closing set forth herein have been
satisfied. The effective time of the Closing shall be 11:59 p.m., Eastern
Standard Time, on the Closing Date. Subject to the provisions of Section 9,
failure to consummate the purchase and sale provided for in this Agreement on
the date and time and at the place determined pursuant to this Section 2.5 will
not result in the termination of this Agreement and will not relieve any Party
of any obligation under this Agreement.
2.6 PURCHASE PRICE. In consideration for the Purchased Assets, Buyer
shall assume the Assumed Liabilities, and pay an amount (the "Purchase Price")
equal to Twenty-Eight Million Dollars ($28,000,000), of which the Total Escrow
Amount shall be paid to the Escrow Agent and the balance to the Seller (which
balance shall be allocated among and paid to the Company and the Scadrons in
such amounts as they shall jointly designate in writing to Buyer.) The Purchase
Price shall be subject to adjustment as set forth in Sections 2.8 and 2.9 hereof
and as follows:
(a) The following items shall be prorated between Seller and
Buyer as of the Closing Date with respect to the Purchased Assets: power and
utility charges, real (if any) and personal property taxes, rents (including
percentage rents) and security deposits under Site Leases, and payments and
security deposits under Advertising Services Agreements. Prorations will be on a
dollar-for-dollar basis based on the number of days of display before and after
the Closing. Any
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prorations (except percentage rents) not determined at the Closing shall be
prorated on the basis of the most current information available at Closing. On
the Closing Date, Seller shall provide to Buyer a list of items and the
prorations required by this Section 2.6(a) ("Preliminary Adjustment") and the
Purchase Price shall be adjusted accordingly. Seller agrees to furnish Buyer
with any documents or records in Seller's possession that may be needed for
Buyer to confirm the adjustment and prorations in this Section 2.6(a).
(b) Within ninety (90) days after the Closing Date, Buyer will
prepare and provide to Seller an adjusted list of items to be prorated as of the
Closing and reflecting the items to be adjusted and prorated pursuant to Section
2.6(a) and showing the recalculation of adjustments to the Purchase Price
pursuant to the Preliminary Adjustment (the "Closing Date Adjustment"). On the
120th day after the Closing Date, all required refunds or payments under Section
2.6(a) and this 2.6(b), shall be made on the basis of the Closing Date
Adjustment.
(c) Notwithstanding Sections 2.6(a) and 2.6(b), the proration
as of the Closing Date of percentage rents payable under any particular Site
Lease shall be made by Buyer and notice thereof (showing the applicable
calculations) given to Seller, within thirty (30) days following the expiration
of the period over which the percentage rents are calculated under such Site
Lease. The proration notice shall be accompanied by any amounts due Seller as
shown therein, or in the event Seller owes Buyer as shown therein, Seller shall
reimburse Buyer such amount within ten (10) days of receipt of the amount.
(d) If any dispute arises over any amount to be refunded and
paid under this Section 2.6 (whether pursuant to the Preliminary Adjustment, the
Closing Date Adjustment or the percentage rent prorations), such refund or
payment shall nonetheless be promptly made to the extent such amount is not in
dispute. If any such dispute cannot be resolved by the Parties, it shall be
submitted to Buyer's accountants and Seller's accountants for resolution by such
accountants. If such dispute is not resolved by such accountants within thirty
(30) days after the dispute is first submitted to both accountants for
resolution, then Buyer's accountants and Seller's accountants shall jointly
designate a third independent certified public accountant (the "Third
Accountant"), and the resolution of such dispute shall be made by the Third
Accountant. The determination of the Third Accountant shall be final and binding
upon the parties to this Agreement. Buyer and Seller shall each pay one-half of
the fees and expenses of the Third Accountant. Each party shall otherwise bear
its own costs and expenses associated with the resolution of such dispute,
including the fees and expenses of their respective accountants and attorneys.
(e) Buyer and Seller agree to determine the allocation of the
Purchase Price in writing on or before the Closing, and Buyer and Seller shall
use such allocation for reporting the purchase and sale of the Purchased Assets
for Federal, state and local tax purposes and for completing the Form 8594
required to be filed with the IRS.
2.7 TRANSACTIONS AT THE CLOSING. The following transactions shall take
place at the Closing:
(a) Seller shall deliver to Buyer (i) the Bills of Sale, (ii)
the Assignments of Advertising Services Agreements, (iii) the Assignments of
Site Leases, (iv) the Assignments of Permits, (v) the originals of the
Advertising Services Agreements and Site Leases, (vi) the Leases, (vii)
instruments of assignment of all warranties, guarantees and indemnities now in
effect with
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respect to all of the Purchased Assets, (viii) all applicable Tax Clearances,
and (ix) other instruments of transfer, evidence of consent and all other
related documents as may be necessary to evidence or perfect the sale,
assignment, transfer, and conveyance of good title to all of the Purchased
Assets, in each case free and clear of all liens, Security Interests, pledges,
charges, and Encumbrances. Seller shall also deliver to Buyer all Books and
Records; provided, however, that Seller and its officers, employees, counsel,
and agents shall be afforded free and full access to any tax or accounting
records included in the Books and Records and shall be permitted to make
extracts from and copies of such records.
(b) Buyer shall deliver to Seller the Purchase Price, as
adjusted pursuant to Section 2.6, by wire transfer of immediately available
funds to an account designated in writing by Seller.
(c) Buyer shall deliver to Seller the Leases and such
assumption agreements, instructions and other documents as may be necessary to
evidence the assumption by Buyer of the Assumed Liabilities.
(d) The Parties shall also deliver to each other the
agreements, instruments, opinions, certificates, and other documents referred to
in this Agreement.
2.8 THIRD PARTY CONSENTS. To the extent that Seller's rights under any
Advertising Services Agreement, Site Lease or other interest in the Purchased
Assets may not be assigned without the consent of a third party and such consent
has not been obtained, this Agreement shall not constitute an agreement to
assign the same if an attempted assignment would constitute a breach thereof or
be unlawful, and Seller, at its expense, shall use Best Efforts to obtain any
such required consent promptly following the Closing Date. If any such consent
shall not be obtained and the Advertising Services Agreement, the Site Lease or
other interest in the Purchased Assets in question permits Seller to subcontract
its rights and obligations thereunder, then Seller shall subcontract such rights
and obligations to Buyer and Buyer shall accept such subcontract. In the event
that on or before the Closing, any Site Lease cannot be assigned or the rights
therein subcontracted to Buyer hereunder for failure to obtain a consent, or
another mutually acceptable arrangement entered into, the Site Lease and its
related Structures, Permits, Site Leases and Advertising Services Agreements
shall not be included in the Purchased Assets purchased at Closing and the
related liabilities not included in the Assumed Liabilities assumed at Closing,
and the Purchase Price shall be reduced by the Site Lease Purchase Price for
such Site Lease and related assets. At such time as the Required Consent(s) for
the transfer of such Site Lease have been obtained, the Seller shall transfer
the Site Lease and the associated Structures, Permits, Site Leases and
Advertising Services Agreements, and the Buyer shall pay Seller the Site Lease
Purchase Price, subject to any applicable prorations determined in accordance
with Section 2.6, in cash, for the same, and in all other respects the purchase
of such assets shall be in accordance with and subject to the terms of this
Agreement as if such transfer had occurred at the Closing. Seller agrees to use
its Best Efforts to deliver all the Required Consents on or before August 15,
1997. After such date, neither Buyer nor Seller shall have any further
obligations hereunder with respect to any Required Consent and related assets
not delivered to Buyer on or prior to such date. Notwithstanding anything
contained herein to the contrary, Buyer shall have the right to waive the
obtaining of any Consent required for the transfer of any particular Purchased
Asset and, in such case, Seller shall transfer such Purchased Asset to Buyer at
Closing and Buyer shall assume all risks associated with the failure to obtain
such Consent.
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2.9 NEW ASSETS. Notwithstanding anything to the contrary set forth
herein, the parties acknowledge and agree that the New Assets shall not be
purchased by Buyer until and unless, in the case of each New Structure, the
construction of the New Structure has been completed and all appropriate Permits
for such New Structure have been obtained, and the New Structure and the related
Permits, Site Lease and Advertising Services Agreements, if any, otherwise
conform with the representations and warranties set forth herein for such
assets. To the extent that such conditions have not been satisfied with respect
to any New Structure on the Closing Date, the New Structure and its related
Permits, Site Leases and any Advertising Services Agreement shall not be
included in the Purchased Assets purchased at Closing and the related
liabilities not included in the Assumed Liabilities assumed at Closing, and the
Purchase Price shall be reduced by the New Structure Purchase Price for such New
Structure and related New Assets. At such time as the conditions for any such
New Structure have been met, the Seller shall transfer the New Structure and the
associated Permits, Site Leases and any Advertising Services Agreement, and the
Buyer shall pay Seller the New Asset Purchase Price, subject to any applicable
prorations determined in accordance with Section 2.6, in cash, for the same, and
in all other respects the purchase of such New Assets shall be in accordance
with and subject to the terms of this Agreement as if such transfer had occurred
at the Closing. Seller agrees to use its Best Efforts to deliver all the New
Assets on or before February 15, 1998. After such date, neither Buyer nor Seller
shall have any further obligations hereunder with respect to any New Assets not
delivered to Buyer on or prior to such date.
2.10 ESCROW. Notwithstanding anything to the contrary contained herein,
the parties agree that to the extent any of the New Permits have not been issued
to Seller or cannot be transferred to Buyer on or before the Closing Date, with
respect to the New Permit Assets related to such New Permit:
(a) the parties shall enter into an escrow agreement at
Closing containing the terms and conditions set forth in this Section 2.10 and
such other terms and conditions as may be mutually agreeable;
(b) there shall be deducted from the Purchase Price and
deposited by Buyer with the Escrow Agent an amount equal to the Escrow Amount
for each such New Permit which has not been issued or is not transferable;
(c) Seller shall operate the New Permit Assets on behalf of
Buyer, as Buyer's agent. Seller shall pay all expenses of such operations from
revenues derived from such sites (provided, that if such expenses exceed
revenues, Buyer shall reimburse Seller for the excess upon termination of the
escrow) and Seller shall deliver to Buyer on or before the 15th of each month a
statement, certified by Seller, setting forth Seller's determination of the Cash
Flow for each site for the New Permit for the preceding month;
(d) upon issuance of the New Permit, the Escrow Amount for
such New Permit, together with interest, shall be released from escrow to Seller
provided, however, that simultaneously therewith Seller shall deliver to Buyer
an amount equal to the aggregate Cash Flow since the Closing Date for the site
for the New Permit;
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(e) in the event that any of the New Permits have not been
issued or obtained by December 15, 1997, then, unless Buyer elects on or prior
to December 30, 1997 pursuant to the option described in subsection (f) below to
sell the New Permit Assets related to such New Permits back to Seller, the
Escrow Amounts then held in escrow, together with interest earned thereon, shall
be delivered to Seller provided that simultaneously therewith Seller shall
deliver to Buyer an amount equal to the aggregate Cash Flow since the Closing
Date for such New Permit Assets;
(f) Seller hereby agrees to repurchase from Buyer all New
Permit Assets related to any or all New Permits which have not been issued or
obtained by December 15, 1997, upon written request by Buyer given on or prior
to December 30, 1997, at a purchase price equal to the Escrow Amount for such
New Permit Assets, plus interest, less the aggregate Cash Flow since the Closing
Date for such New Permit Assets and the purchase shall be effected on or prior
to December 31, 1997 as follows: Buyer shall execute and deliver appropriate
transfer documents in favor of Seller, the aggregate Cash Flow since the Closing
Date shall be retained by Seller and the Escrow Amount plus interest earned
thereon, shall be delivered from the Escrow to Buyer; and
(g) Notwithstanding anything to the contrary contained in this
Section 2.10, if any New Permit is not issued because the Site Lease for the
site for any such New Permit is cancelled or terminated after the Closing
through no act or omission of Seller's, the option contained in subsection (f)
will not apply to the New Permit Assets related to such New Permit and the
Escrow Amount plus interest earned thereon shall be released from escrow to
Seller within five (5) days after cancellation or Termination of the Site Lease;
provided that simultaneously therewith Seller shall deliver to Buyer an amount
equal to the aggregate Cash Flow since the Closing Date for such New Permit
Assets.
In the event that on or before the Closing, a Permit is cancelled or terminated,
it shall be deemed a New Permit hereunder, and, in each case, the Structures,
Permits, Site Leases and Advertising Services Agreements associated therewith
shall be deemed New Permit Assets for all purposes hereunder, including without
limitation the provisions of this Section 2.10.
3. REPRESENTATIONS AND WARRANTIES OF SELLER
The Company and each of the Scadrons jointly and severally represent
and warrant to Buyer as follows:
3.1 ORGANIZATION AND GOOD STANDING. Part 3.1 of the Disclosure Schedule
contains a complete and accurate list of (i) the counties where the Structures,
Site Leases and the Real Property are located, (ii) the Company's name and
jurisdiction of organization, (iii) names that Seller has used or conducted the
Business under during the past five (5) years, and (iv) the addresses at which
Seller has conducted the Business during such five (5)-year period. The Company
is a general partnership duly organized, validly existing and in good standing
under the laws of Illinois, with full power and authority to conduct the
Business as it is now being conducted, to own or use the Purchased Assets and
the Real Property, and to perform all its obligations. The Company has delivered
to Buyer copies of its Organizational Documents, as currently in effect. Scadron
is the sole Managing Partner of and owns approximately 85% of the partnership
interests in the Company. Each Scadron is a general partner of the Company, and
the Scadrons collectively own 100% of the partnership interests in the Company.
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3.2 AUTHORITY; NO CONFLICT.
(a) This Agreement constitutes the legal, valid, and binding
obligation of each of the Company and the Scadrons, enforceable against each of
them, respectively, in accordance with its terms. Upon the execution and
delivery by the Company and the Scadrons, as applicable, of any documents to be
executed at Closing pursuant to this Agreement (collectively, the "Closing
Documents"), such Closing Documents will constitute the legal, valid, and
binding obligations of each of the Company and the Scadrons, as applicable,
enforceable against each of them in accordance with their respective terms. Each
of the Company and the Scadrons has the absolute and unrestricted right, power,
authority, and capacity to execute and deliver this Agreement and the Closing
Documents to which each is a party and to perform its or his obligations
thereunder. The execution, delivery and performance of this Agreement has been
specifically authorized by the Partners of the Company.
(b) Except as set forth on the MDS or in Part 3.2 of the
Disclosure Schedule, neither the execution and delivery by the Company and the
Scadrons of this Agreement nor the consummation or performance by the Company
and the Scadrons of any of the Contemplated Transactions will:
(i) conflict with, violate or result in a breach of
(A) any provision of the Organizational Documents of the Company, or
any resolution adopted by the Partners of the Company; (B) any Legal
Requirement or any Order to which the Company or the Scadrons or any of
the Purchased Assets or Real Property may be subject; (C) any
Governmental Authorization that is held by the Company or the Scadrons
or that otherwise relates to the Purchased Assets or Real Property or
the business associated therewith; or (D) any material Contract to
which the Company or the Scadrons is a party or by which the Company or
the Scadrons may be bound; or
(ii) (A) cause Buyer to become liable for the payment
of, any taxes in Illinois arising from the transfer of the Purchased
Assets; (B) contravene, conflict with, or result in a violation or
breach of any provision of, or give any Person the right to declare a
default or exercise any remedy under, or to accelerate the maturity or
performance of, or to cancel, terminate, or modify, any interest or
rights of Seller in or to the Purchased Assets or the Real Property; or
(C) result in the imposition or creation of any Encumbrance upon or
with respect to any of the Purchased Assets or the Real Property.
Except as set forth on the MDS or in Part 3.2 of the Disclosure Schedule and in
Section 5.9, neither the Company nor any of the Scadrons is or will be required
to give any notice to or obtain any Consent from any Person in connection with
the execution and delivery of this Agreement or the consummation or performance
of any of the Contemplated Transactions. None of the representations in this
Section 3.2(b) shall be deemed to apply to Consents to the transfer of any
Advertising Services Agreements pursuant to this Agreement .
(c) None of the Scadrons nor the Company is a person (or
included in a person), that has total assets of $10 million or more or annual
net sales of $10 million or more, within the meaning of, and as determined in
accordance with, the HSR Act.
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3.3 SOLVENCY. By consummating the transactions contemplated hereby,
including, without limitation, the distribution of any Purchased Assets by the
Company to the Scadrons prior to the Closing, Seller does not intend to hinder,
delay or defraud any of Seller's present or future creditors. Before giving
effect to the transactions contemplated hereby, Seller has been paying its debts
in the ordinary course of business and, after giving effect to the transactions
contemplated hereby, Seller will have paid or discharged all of its debts (or
made adequate provision for the payment thereof) in the Ordinary Course of
Business. Without limiting the foregoing, Seller will pay on or prior to
maturity all of the debts described in Section 2.4 that become due and properly
payable except as such are Assumed Liabilities.
3.4 BOOKS AND RECORDS. The Books and Records of the Company maintained
in connection with the Purchased Assets are complete and correct in all material
respects and have been maintained in accordance with sound business practices.
3.5 PURCHASED ASSETS.
(a) Except as set forth on the MDS or in Part 3.5(a) of the
Disclosure Schedule, each Structure (i) has (or, in the case of Structures
covered by the Leases, on the Closing Date will have) a valid written Site
Lease, (ii) to the Knowledge of the Company and Scadron, is in adequate
condition and repair for the uses to which it is being put, (iii) to the
Knowledge of the Company and Scadron, has available reasonable and appropriate
means of ingress and egress to allow such Structures to be maintained and
operated without violating the rights of third parties, and (iv) is not
currently the subject of any dispute with any lessor, any owner or lessee of
adjacent or nearby property, or any other Person. Except as set forth on the MDS
or in Part 3.5(a) of the Disclosure Schedule, to the Knowledge of the Company
and Scadron, (x) such Structures are located entirely on the property covered by
a Site Lease or the Real Property, and no such Structure encroaches on any
adjoining property, public or private and (y) no other Contract exists that
relates to the Structures other than the Site Leases and the Advertising
Services Agreements.
(b) Seller has delivered or will deliver prior to Closing to
Buyer true and complete copies of the Advertising Services Agreements (including
any and all amendments and addenda thereto), and Seller has delivered or will
deliver the original Site Leases to Buyer at or prior to the Closing. Except as
set forth on Part 3.5(b) of the Disclosure Schedule, all sales made to
advertisers in connection with the Structures have been made pursuant to
Advertising Services Agreements.
(c) Except as set forth on the MDS or on Part 3.5(c) of the
Disclosure Schedule, the Permits constitute all necessary licenses, permits,
registrations, approvals, agreements and consents for the installation,
maintenance and operation of the Structures. Except as set forth in the MDS or
on Part 3.5(c) of the Disclosure Schedule, (i) each Permit is in full force and
effect, and all fees payable in connection therewith have been paid, (ii) each
Structure to which a Permit pertains complies with the terms and conditions of
such Permit (including, without limitation, terms as to size and location),
(iii) no violation of a Permit by Seller has occurred thereunder which has not
been cured, and no event, occurrence or condition exists which (with or without
notice or lapse of time or the happening of any further event or condition)
would become a violation by Seller thereunder or would have an adverse effect on
the use of any Structure, as currently used in the operation of the Purchased
Assets, (iv) Seller has not received notice of any violation which has not been
cured or notice of any termination or cancellation of any Permit, and (v) to the
Knowledge of the Company and Scadron, there is no legislation (other than
legislation that affects the outdoor advertising industry
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generally), in effect or proposed, pertaining to the ownership or operation of
billboard displays or other out-of-home structures in the area in which the
Business operates that would require the removal of any Structure; provided,
however, that this Section 3.5(c) shall not apply to any item or items unless
such item or items (individually or in the aggregate) could have a Material
Adverse Effect or it is likely that, with the lapse of time or the happening of
any further probable event or condition, such item or items (individually or in
the aggregate) could have a Material Adverse Effect; and provided, further, that
this Section 3.5(c) will not give rise to a claim for indemnification for a
breach of this Section 3.5(c) unless Buyer suffers damages with respect to the
operation of Structures to which forty percent (40%) or more of the Purchase
Price (as adjusted on the Closing Date) is attributable, determined by applying
the Price Formula to such Structures.
(d) The MDS and Part 3.5(d) of the Disclosure Schedule
contains a complete and accurate list of all Site Leases to which the Company
and the Scadrons is a party and which relate to the Purchased Assets, setting
forth, with respect to each Site Lease, (i) term, (ii) options, if any, to
renew, (iii) rentals or other payments to be made thereunder for 1997, (iv)
security deposits, if any, paid thereunder, and (v) the location of Structures.
Seller has previously delivered or will deliver to Buyer true and complete
copies of all such Site Leases (including any and all amendments and addenda
thereto). Except as set forth in the MDS or on Parts 3.5(a) and 3.5(d) of the
Disclosure Schedule, the Site Leases are in full force and effect, are binding
upon the parties thereto and to the Knowledge of the Company and Scadron, no
default by Seller has occurred thereunder. Except as set forth on the MDS or in
3.5(d) of the Disclosure Schedule, (x) to the Knowledge of the Company and
Scadron, no default by any other party has occurred under the Site Leases, (y)
to the Knowledge of the Company and Scadron, no event, occurrence or condition
exists which (with or without notice or lapse of time or the happening of any
further event or condition) would become a default by Seller thereunder or would
entitle any other party to terminate a Site Lease, to make a claim or set-off
against Seller or otherwise to amend such Site Lease or prevent such Site Lease
from being renewed in accordance with its terms, and (z) neither the Company nor
Scadron has received any written notice of default, termination or non-renewal
under any Site Lease.
3.6 TITLE, ENCUMBRANCES.
(a) Good and marketable record title to the Real Property that
will be subject to the Leases (the "Real Property") is held by land trusts of
which the Company or Scadron is the sole beneficiary, such title being a fee
interest in the Real Property. Seller has not granted to any Person any option,
contract or other agreement with respect to a purchase, sale, acquisition, lease
or other occupancy relating to the Real Property or any portion thereof or any
interest therein. Seller has not received any notice of pending or threatened
claims, actions, proceedings, planned public improvements, annexations, special
assessments, rezonings or other adverse claims affecting the Real Property.
(b) Except as set forth on the MDS or in Part 3.6(b) of the
Disclosure Schedule, Seller owns or has good title to all of the Purchased
Assets, and there are no existing agreements, options, commitments or rights
with, of or to any Person to acquire any of the Purchased Assets or the Real
Property or any interest therein. Except as set forth on the MDS or on Part
3.6(b) of the Disclosure Schedule, all of the Purchased Assets and the Real
Property are free and clear of all Encumbrances and Security Interests and are
not subject, to the Knowledge of the Company and Scadron, to any rights of way,
building use restrictions, exceptions, variances, reservations, or limitations
of any nature, other than liens for current taxes not yet due.
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(c) Except as set forth on the MDS or in Part 3.6(c) of the
Disclosure Schedule, to the Knowledge of the Company and Scadron, none of the
Structures, Site Leases or the Real Property lie in an area that is or will, be
subject to zoning, use, or building code restrictions that will prohibit the
continued effective ownership, leasing or other use of such assets as currently
owned and used and, to the Knowledge of the Company and Scadron, no
circumstances exist which prevent or will prevent the continued effective
ownership, leasing or other use of such assets as currently owned and used.
3.7 NO UNDISCLOSED LIABILITIES. Except as set forth on the MDS or on
Part 3.7 of the Disclosure Schedule, Seller has no liabilities or obligations of
any nature relating to the Purchased Assets or the Real Property.
3.8 TAXES. With respect to the Purchased Assets and the Real Property:
(a) Seller has filed or caused to be filed all Tax Returns
that are or were required to be filed by Seller, pursuant to applicable Legal
Requirements. Seller has paid, or made provision for the payment of, all Taxes
that have or may have become due pursuant to those Tax Returns or otherwise, or
pursuant to any assessment received by Seller, except such Taxes, if any, as are
listed in Part 3.8(a) of the Disclosure Schedule and are being contested in good
faith.
(b) Except as listed in Part 3.8(b) of the Disclosure
Schedule, no unpaid Taxes create an Encumbrance on the Purchased Assets or the
Real Property.
3.9 COMPLIANCE WITH LEGAL REQUIREMENTS; GOVERNMENTAL AUTHORIZATIONS.
Except as set forth on the MDS or in Part 3.9 of the Disclosure Schedule:
(a) Seller has complied with all Legal Requirements applicable
to ownership or use of any of the Purchased Assets and the Real Property, except
for noncompliances or failures to file that, individually or in the aggregate,
would not be reasonably expected to have a Material Adverse Effect;
(b) The present uses and operation of the Purchased Assets and
the Real Property do not violate or fail to comply with any such Legal
Requirements except for noncompliances that, individually or in the aggregate,
would not be reasonably expected to have a Material Adverse Effect;
(c) To the knowledge of the Company and Scadron, no basis
exists for any claim for compensation or damage or other legal or equitable
relief from any violation of the foregoing, the effect of which violations,
individually or in the aggregate, would be reasonably expected to have a
Material Adverse Effect; and
(d) Seller has not received any written notice within the
preceding one (1) year of any violation or failure to comply with any Legal
Requirement relating to the Purchased Assets or the Real Property or the use or
operation thereof which violation or failure has not been cured.
As used in Sections 3.9(a), (b) and (c), the term "Legal Requirement"
does not include any Occupational Safety and Health Law or Environmental Law.
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3.10 LEGAL PROCEEDINGS; ORDERS.
(a) Except as set forth on the MDS or in Part 3.10(a) of the
Disclosure Schedule, there is no pending Proceeding, (i) that has been commenced
by or against Seller that relates to or may affect the Purchased Assets, the
Real Property or the Leases; or (ii) that challenges, or that may have the
effect of preventing, making illegal, or otherwise delaying, any of the
Contemplated Transactions. To the Knowledge of the Company and Scadron, (x) no
such Proceeding has been Threatened in writing, and (y) no event has occurred or
circumstance exist that may give rise to or serve as a basis for the
commencement of any such Proceeding. Seller will deliver to Buyer copies of all
pleadings, and non-privileged correspondence, and other documents relating to
each Proceeding listed in Part 3.10(a) of the Disclosure Schedule immediately
upon execution hereof. The Proceedings listed in Part 3.10(a) of the Disclosure
Schedule will not have a Material Adverse Effect.
(b) Except as set forth in Part 3.10(b) of the Disclosure
Schedule, (i) there is no Order to which any of the Company or the Scadrons is
subject that relates to any of the Purchased Assets or the Real Property; and
(ii) to the Knowledge of the Company and Scadron, no officer, director, agent,
or employee of Seller is subject to any Order that prohibits such officer,
director, agent, or employee from engaging in or continuing the operation of or
any conduct, activity, or practice relating to the Purchased Assets, the Real
Property or the Leases.
3.11 OTHER CONTRACTS Seller is not a party to or bound by any Other
Contract, except as disclosed in the MDS or on Part 3.11 of the Disclosure
Schedule.
3.12 INSURANCE. Seller has maintained, and will maintain through the
Closing, policies of fire and other casualty, liability, title and other forms
of insurance covering the Purchased Assets, the Real Property and the operation
thereof, of the types and with the amounts of coverage as are consistent with
industry standards for outdoor advertising businesses comparable to the
Business. All such policies are in full force and effect, all premiums with
respect thereto covering all periods up to and including the Closing Date have
been paid, and no notice of cancellation or termination has been received by
Seller with respect to any such policy. Except as set forth on Part 3.12 of the
Disclosure Schedule, no claims are pending or, to the Knowledge of the Company
and Scadron, Threatened under any such insurance policy with respect to the
Purchased Assets or Real Property.
3.13 ENVIRONMENTAL MATTERS. Except as set forth in Part 3.13 of the
Disclosure Schedule, with respect to the Purchased Assets, the Real Property and
the operation thereof:
(a) Seller is, and at all times has been, in material
compliance with, and has not been and is not in material violation of or liable
under, any Environmental Law, resulting from any action or omission of Scadron
or the Company.
(b) To the Knowledge of the Company and Scadron, there are no
pending or Threatened claims in writing or Encumbrances resulting from any
Environmental, Health, and Safety Liabilities or arising under or pursuant to
any Environmental Law, with respect to or affecting any of the properties
included in the Purchased Assets or to be subject to the Leases.
(c) Neither the Company nor Scadron has Knowledge of, nor has
Seller received, any citation, directive, inquiry, notice, Order, summons,
warning, or other communication that relates to any alleged actual or potential
liability with respect to Hazardous Materials.
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(d) Seller has delivered to Buyer true and complete copies, if
any, and results of any reports, studies, analyses, tests, or monitoring
possessed or initiated by Seller or any Related Person, if any, pertaining to
Hazardous Materials or Hazardous Activities in, on, or under the properties
included in the Purchased Assets or to be subject to the Leases or Site Leases.
3.14 INTANGIBLE PROPERTY. Seller uses no Intangible Property in
connection with the operation of the Purchased Assets except for the Permits and
licenses for commonly available software programs under which Seller is the
licensee.
3.15 DISCLOSURE. No representation or warranty of Seller in this
Agreement and no statement in the Disclosure Schedule omits to state a material
fact necessary to make the statements herein or therein, in light of the
circumstances in which they were made, not misleading.
3.16 RELATIONSHIPS WITH RELATED PERSONS. Except as set forth on Part
3.16 of the Disclosure Schedule, Seller is not a party to any contract with a
Related Person of Seller relating to the Purchased Assets or the Real Property
or their operation. Neither Seller nor any Related Person of Seller is the owner
(of record or as a beneficial owner) of an equity interest or any other
financial or profit interest in, a Person that has business dealings or a
material financial interest in any transaction with Seller involving the
Purchased Assets, the Real Property or the Business associated therewith. Except
as set forth on Part 3.16 of the Disclosure Schedule, neither Seller nor any
Related Person of Seller has any claim or right against, the Purchased Assets or
Real Property.
3.17 BROKERS OR FINDERS. Seller and its Representatives have not
incurred any obligation or liability, contingent or otherwise, for brokerage or
finders' fees or agents' commissions or other similar payment in connection with
this Agreement.
3.18 EMPLOYEE BENEFIT MATTERS. Except as disclosed on Part 3.18 of the
Disclosure Schedule:
(a) Seller does not maintain and has never maintained an
"employee benefit pension plan", within the meaning of ERISA Section 3(2), that
is or was subject to Title IV of ERISA.
(b) Seller does not have and has not ever had any past,
present or future obligation or liability to contribute any "multiemployer
plan", as defined in ERISA Section 3(37).
For purposes of this Section 3.18, the term Seller shall be deemed to include
any other corporation, trade, business or other entity, other than Seller, which
would together with the Seller, now or in the past constitute a single employer
within the meaning of Section 414 of the IRC.
3.19 BULK SALES. The Contemplated Transactions are not subject to any
"bulk sales law" or similar bulk transfer laws or regulations.
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4. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
4.1 ORGANIZATION AND GOOD STANDING. Buyer is a corporation duly
organized, validly existing, and in good standing under the laws of the State of
Delaware.
4.2 AUTHORITY; NO CONFLICT.
(a) This Agreement constitutes the legal, valid, and binding
obligation of Buyer, enforceable against Buyer in accordance with its terms.
Upon the execution and delivery by Buyer of the Closing Documents to which Buyer
is a party, such Closing Documents will constitute the legal, valid, and binding
obligations of Buyer, enforceable against Buyer in accordance with their
respective terms. Buyer has the absolute and unrestricted right, power, and
authority to execute and deliver this Agreement and the Closing Documents and to
perform its obligations under this Agreement and the Closing Documents to which
Buyer is a party.
(b) Neither the execution and delivery of this Agreement by
Buyer nor the consummation or performance of any of the Contemplated
Transactions by Buyer will give any Person the right to prevent, delay, or
otherwise interfere with any of the Contemplated Transactions pursuant to (i)
any provision of Buyer's Organizational Documents; (ii) any resolution adopted
by the board of directors or the stockholders of Buyer; (iii) any Legal
Requirement or Order to which Buyer may be subject; or (iv) any material
Contract to which Buyer is a party or by which Buyer may be bound. Buyer is not
and will not be required to give any notice to or obtain any Consent from any
Person in connection with the execution and delivery of this Agreement or the
consummation or performance of any of the Contemplated Transactions.
4.3 CERTAIN PROCEEDINGS. There is no pending Proceeding that has been
commenced against Buyer and that challenges, or may have the effect of
preventing, making illegal, or otherwise delaying, any of the Contemplated
Transactions. To Buyer's Knowledge, no such Proceeding has been Threatened in
writing and no event has occurred or circumstance exists that may give rise to
or serve as a basis for the commencement of any Proceeding.
4.4 BROKERS OR FINDERS. Buyer and its Representatives have not incurred
any obligation or liability, contingent or otherwise, for brokerage or finders'
fees or agents' commissions or other similar payment in connection with this
Agreement.
4.5 LICENSE. There is no legal impediment to Buyer's acceptance of the
transfer of the Purchased Assets. Buyer is licensed and bonded in the State of
Illinois in accordance with applicable Legal Requirements to operate in the
outdoor advertising business.
4.6 DISCLOSURE. No representation or warranty of Buyer in this
Agreement omits to state a material fact necessary to make the statements
herein, in light of the circumstances in which they were made, not misleading.
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5. COVENANTS OF SELLER
5.1 ACCESS AND INVESTIGATION. Between the date of this Agreement and
the Closing Date, Seller will, and will cause its Representatives to, (a) afford
Buyer and its Representatives reasonable access to Seller's personnel (provided,
that Buyer shall obtain Scadron's consent prior to initiating any contact with
Seller's personnel and shall not, under any circumstances, disclose any
Confidential Information to Seller's personnel), properties, Books and Records,
and other documents and data relating to the Purchased Assets or Real Property,
(b) furnish Buyer and its Representatives with copies of all Books and Records,
and other existing documents and data as Buyer may reasonably request relating
to the Purchased Assets or Real Property, and (c) furnish Buyer and its
Representatives with such additional financial, operating, and other data and
information relating to the Purchased Assets or Real Property as Buyer may
reasonably request.
5.2 NON-SOLICITATION. Each of the Company and the Scadrons hereby
agrees not to, directly or indirectly, solicit or enter into agreements of any
kind, either oral or written, regarding purchase or leasing of advertising signs
or wall or billboard space at any of the sign locations which are the subject of
the Site Leases, or to otherwise interfere with Buyer's use of such locations,
for a period of two years following the termination date of the existing lease
or any renewals or extensions thereof for each such location.
5.3 OPERATION OF THE PURCHASED ASSETS. Between the date of this
Agreement and the Closing Date, Seller will:
(a) operate the Purchased Assets and the Real Property only in
the Ordinary Course of Business;
(b) use its Best Efforts to maintain the Purchased Assets and
the Real Property, and maintain the relations and good will with advertisers,
landlords and others associated with the operation of the Purchased Assets and
the Real Property; and
(c) confer with Buyer concerning any new Advertising Services
Agreement which involves a term of more than three (3) months.
5.4 NEGATIVE COVENANT. Except as otherwise expressly permitted by this
Agreement, between the date of this Agreement and the Closing Date, Seller will
not, without the prior consent of Buyer, take any affirmative action, or fail to
take any reasonable action within their or its control, as a result of which any
Material Adverse Effect is reasonably likely to occur.
5.5 REQUIRED APPROVALS. As promptly as practicable after the date of
this Agreement, Seller will make all filings, if any, required by Legal
Requirements to be made by them in order to consummate the Contemplated
Transactions. Between the date of this Agreement and the Closing Date, Seller
will (i) cooperate with Buyer with respect to all filings that Buyer elects to
make or is required by Legal Requirements to make in connection with the
Contemplated Transactions, and (ii) cooperate with Buyer in obtaining all
consents referenced in Section 3.2.
5.6 CONSENTS. Seller shall use its Best Efforts to obtain such of the
Consents identified in Section 3.2 for the transfer of Site Leases as Buyer
deems necessary and are legally required; provided, however, that Seller shall
not make any agreement or reach any understanding that would
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impose additional obligations or burdens on Buyer without the approval in
writing by Buyer as a condition for obtaining such Consents.
5.7 NOTIFICATION. Between the date of this Agreement and the Closing
Date, Seller will promptly notify Buyer in writing if Seller becomes aware of
any fact or condition that causes or constitutes a breach of any of Seller's
representations and warranties as of the date of this Agreement, or if Seller
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this Agreement) cause
or constitute a breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or discovery
of such fact or condition. During the same period, Seller will promptly notify
Buyer of the occurrence of any breach of any covenant of Seller in this Section
5 or of the occurrence of any event that may make the satisfaction of the
conditions in Section 7 impossible or unlikely.
5.8 NO NEGOTIATION. Until such time, if any, as this Agreement is
terminated pursuant to Section 9, neither Seller nor any Related Person will,
nor will they permit their respective Representatives to, directly or indirectly
solicit, initiate, or encourage any inquiries or proposals from, discuss or
negotiate with, provide any non-public information to, or consider the merits of
any unsolicited inquiries or proposals from, any Person (other than Buyer or its
Representatives) relating to or affecting any transaction involving the sale of
the Purchased Assets or affecting the Real Property or the Leases.
5.9 TAX CLEARANCE. Seller shall obtain all certificates of clearances
for Taxes ("Tax Clearances"), if any, required by the State of Illinois or, if
such Tax Clearances are required but not available at the Closing, certificates
from the State of Illinois certifying as to the payment by or on behalf of
Seller of all Taxes due on or prior to a date not more than thirty (30) days
prior to the Closing Date (it being agreed and understood that, notwithstanding
the foregoing, if any Tax Clearances are not obtained prior to the Closing,
Seller shall obtain such Tax Clearances after the Closing and shall be
responsible for, and shall discharge in full, all liabilities and obligations
therefor).
5.10 BEST EFFORTS. Between the date of this Agreement and the Closing
Date, Seller will use Best Efforts to cause the conditions in Sections 7 and 8
to be satisfied. After the Closing Date Seller will use Best Efforts (i) until
February 15, 1998 to cause the conditions to the consummation of the transfer of
New Assets set forth in Section 2.9 to be satisfied, (ii) until December 15,
1997 to obtain the New Permits, and (iii) until August 15, 1997, to obtain any
Required Consents. Seller will use Best Efforts in acting as Buyer's agent for,
and will reasonably cooperate with Buyer in, the management and operation of the
New Permit Assets until the Escrow Amounts with respect thereto are released
from escrow.
6. COVENANTS OF BUYER
6.1 APPROVALS OF GOVERNMENTAL BODIES. As promptly as practicable after
the date of this Agreement, Buyer will make all filings, if any, required by
Legal Requirements to be made by it to consummate the Contemplated Transactions.
Between the date of this Agreement and the Closing Date, Buyer will cooperate
with Seller (i) with respect to all filings that Seller is required by Legal
Requirements to make in connection with the Contemplated Transactions, and (ii)
in obtaining all consents identified in Part 3.2 of the Disclosure Schedule,
provided that this Agreement will not
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require Buyer to dispose of or make any change in any portion of its business or
to incur any other burden to obtain a Governmental Authorization.
6.2 BEST EFFORTS. Except as set forth in the proviso to Section 6.1,
between the date of this Agreement and the Closing Date, Buyer will use its Best
Efforts to cause the conditions in Sections 7 and 8 to be satisfied. Buyer will
reasonably cooperate with Seller in the management and operation of the New
Permit Assets until the Escrow Amounts with respect thereto are released from
escrow.
6.3 IMPRINTS. No later than 150 days after the Closing, Buyer shall
remove from all Structures included in the Purchased Assets (except for New
Permit Assets) all imprints used by Seller containing Seller's trade name;
provided, however, until the earlier of (i) such removal or (ii) the expiration
of such 150-day period, Buyer may display Seller's trade name on such
Structures. With respect to the New Permit Assets, no later than 90 days after
the release of the Escrow Amount with respect to each New Permit Asset from
Seller to Buyer, Buyer shall remove from all Structures included in such New
Permit Asset all imprints used by Seller containing Seller's trade name.
6.4 NOTIFICATION. Between the date of this Agreement and the Closing
Date, Buyer will promptly notify Seller in writing if Buyer becomes aware of any
fact or condition that causes or constitutes a breach of any of Buyer's
representations and warranties as of the date of this Agreement, or if Buyer
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this Agreement) cause
or constitute a breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or discovery
of such fact or condition. During the same period, Buyer will promptly notify
Seller of the occurrence of any breach of any covenant of Buyer in this Section
6 or of the occurrence of any event that may make the satisfaction of the
conditions in Section 8 impossible or unlikely.
6.5 BUYER'S COVENANTS REGARDING CERTAIN LOCATIONS.
(a) With respect to item Nos. 18 and 27 in the MDS, Buyer
acknowledges that Seller is lessee under a lease for a new sign with the owners
of the property immediately south of this location. Buyer agrees not to increase
the height of item Nos. 18 and 27 on the MDS, provided however, that Buyer shall
be entitled to add extensions to these two panels not exceeding an additional
five feet, six inches. Seller hereby grants Buyer the right of first refusal
with respect to the sale or other transfer of such lease and/or sign.
(b) With respect to item Nos. 24 and 53 in the MDS, Buyer
acknowledges that Seller is currently negotiating with an adjacent property
owner for a new sign across the street from this location. Buyer agrees not to
interfere with Seller's negotiations with the adjacent property owner for a
period of twenty-four (24) months from the date hereof.
(c) With respect to item No. 110 on the MDS, Buyer
acknowledges that Seller is currently negotiating with the owner of a vacant lot
adjacent to the west wall of the building (which owner is also the lessor under
the Site Lease for this location) to build a new sign on the adjacent lot. Buyer
agrees to waive any right it has or may acquire as lessee under the Site Lease
for this location to prohibit the lessor thereunder from entering into a lease
agreement with Seller for the new sign and
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not to interfere with Buyer's negotiation with the lessor for a period of
twenty-four (24) months from the date hereof.
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to purchase the Purchased Assets and to take the
other actions required to be taken by Buyer at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by Buyer, in whole or in part):
7.1 ACCURACY OF REPRESENTATIONS. Seller's representations and
warranties in this Agreement must have been accurate in all material respects as
of the date of this Agreement, and must be accurate in all material respects as
of the Closing Date as if made on the Closing Date, and Buyer shall have
received a certificate of an executive officer of Seller, dated as of the
Closing Date, as to such accuracy.
7.2 SELLER'S PERFORMANCE. The covenants and obligations that Seller and
any Related Person of Seller are required to perform or to comply with pursuant
to this Agreement at or prior to the Closing must have been performed and
complied with in all material respects, and Buyer shall have received a
certificate of an executive officer of the Company, dated as of the Closing
Date, as to such compliance.
7.3 CONSENTS. [INTENTIONALLY OMITTED.]
7.4 ADDITIONAL DOCUMENTS. Each of the following documents must have
been delivered to Buyer:
(a) an opinion of Xxxxxxx, Carton & Xxxxxxx dated the Closing
Date, to the effect set forth on Exhibit I, subject to customary assumptions and
qualifications;
(b) the deliveries required from Seller in Section 2.7; and
(c) such other documents as Buyer may reasonably request for
the purpose of (i) evidencing the satisfaction of any condition referred to in
this Section 7, or (ii) otherwise facilitating the consummation or performance
of any of the Contemplated Transactions.
7.5 NO PROCEEDINGS. Since the date of this Agreement, there must not
have been commenced and pending or Threatened in writing against Buyer, or
against any Person affiliated with Buyer, any Proceeding (i) involving any
challenge to, or seeking damages or other relief in connection with, any of the
Contemplated Transactions, (ii) that prevents, makes illegal, or otherwise
delays any of the Contemplated Transactions or seeks to do any of the foregoing,
or (iii) that involves any material claim against Seller that could create an
Encumbrance on the Purchased Assets or impose a liability on the transferee of
the Purchased Assets.
7.6 NO PROHIBITION. There must not be in effect any Legal Requirement
or any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions.
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7.7 NO MATERIAL ADVERSE CHANGE. There shall not have been a Material
Adverse Change since the date hereof.
7.8 RELEASE OF LIENS. Buyer shall have obtained the release of all
liens on the Purchased Assets held by Manufacturers Bank and any other lien not
permitted by this Agreement.
8. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE
Seller's obligation to sell the Purchased Assets and Seller's
obligations to take the other actions required to be taken by Seller at the
Closing is subject to the satisfaction, at or prior to the Closing, of each of
the following conditions (any of which may be waived by Seller, in whole or in
part):
8.1 ACCURACY OF REPRESENTATIONS. Buyer's representations and warranties
in this Agreement must have been accurate in all material respects as of the
date of this Agreement and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date, and Seller shall have received a
certificate of an executive officer of Buyer, dated as of the Closing Date, as
to such accuracy.
8.2 BUYER'S PERFORMANCE. The covenants and obligations that Buyer is
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been performed and complied with in all material respects,
and Seller shall have received a certificate of an executive officer of Buyer,
dated as of the Closing Date, as to such compliance.
8.3 ADDITIONAL DOCUMENTS. Buyer must have caused the following
documents to be delivered to Seller:
(a) an opinion of Powell, Goldstein, Xxxxxx & Xxxxxx, dated
the Closing Date, to the effect set forth on Exhibit J, subject to customary
assumptions and qualifications; and
(b) the deliveries required from Buyer in Section 2.7; and
(c) such other documents as Seller may reasonably request for
the purpose of (i) evidencing the satisfaction of any condition referred to in
this Section 8, or (ii) otherwise facilitating the consummation of any of the
Contemplated Transactions.
8.4 NO PROHIBITION. There must not be in effect any Legal Requirement
or any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions.
8.5 NO PROCEEDINGS. Since the date of this Agreement, there must not
have been commenced and pending or Threatened in writing against Seller, or
against any Person affiliated with Seller, any Proceeding (i) involving any
challenge to, or seeking damages or other relief in connection with, any of the
Contemplated Transactions, or (ii) that prevents, makes illegal, or otherwise
delays any of the Contemplated Transactions or seeks to do any of the foregoing.
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9. TERMINATION
9.1 TERMINATION EVENTS. This Agreement may, by notice given prior to or
at the Closing, be terminated:
(a) by Buyer, on the one hand, or Seller, on the other hand,
if a material breach of any provision of this Agreement has been committed by
the other Party or Parties and such breach has not been cured or waived;
(b) (i) by Buyer if any of the conditions in Section 7 has not
been satisfied as of the Closing Date or if satisfaction of such a condition is
or becomes impossible (other than through the failure of Buyer to comply with
its obligations under this Agreement) and Buyer has not waived such condition on
or before the Closing Date; or (ii) by Seller, if any of the conditions in
Section 8 has not been satisfied of the Closing Date or if satisfaction of such
a condition is or becomes impossible (other than through the failure of Seller
to comply with their respective obligations under this Agreement) and Seller
have not waived such condition on or before the Closing Date;
(c) by mutual consent of Buyer and Seller; or
(d) by Buyer, on the one hand, or Seller, on the other hand,
if the Closing has not occurred (other than through the failure of any Party
seeking to terminate this Agreement to comply fully with its obligations under
this Agreement) on or before February 28, 1997, or such later date as the
Parties may agree upon.
9.2 EFFECT OF TERMINATION. Each Party's right of termination under
Section 9.1 is in addition to any other rights it may have under this Agreement
or otherwise, and the exercise of a right of termination will not be an election
of remedies. If this Agreement is terminated pursuant to Section 9.1, all
further obligations of the Parties under this Agreement will terminate, except
that the obligations in Sections 11.1 and 11.2 will survive; provided, however,
that if this Agreement is terminated by a Party because of the breach of the
Agreement by the other Party or because one or more of the conditions to the
terminating Party's obligations under this Agreement is not satisfied as a
result of the other Party's failure to comply with its obligations under this
Agreement, the terminating Party's right to pursue all legal and equitable
remedies, separately or simultaneously, (including specific performance) will
survive such termination unimpaired.
10. INDEMNIFICATION; REMEDIES
10.1 INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER. The Company and
each of the Scadrons, jointly and severally, will indemnify and hold harmless
Buyer and its respective Representatives, stockholders, controlling Persons, and
affiliates (collectively, the "Seller Indemnified Persons") for, and will pay to
the Seller Indemnified Persons the amount of, any loss, liability, claim,
damage, expense (including costs of investigation and defense and reasonable
attorneys' fees), whether or not involving a third-party claim (collectively,
"Damages"), arising, directly or indirectly, from or in connection with:
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(a) any breach of any representation or warranty made by
Seller in this Agreement, the MDS or the Disclosure Schedule, or any other
certificate or document delivered by Seller pursuant to this Agreement;
(b) any breach by Seller of any covenant or obligation of
Seller in this Agreement or any certificate or document delivered by Seller
pursuant to this Agreement;
(c) the failure of Seller to satisfy and discharge any
obligations or liabilities arising out of or related to the ownership, operation
and use of the Purchased Assets or the Real Property prior to the Closing,
except only the Assumed Liabilities;
(d) any claims or demands arising out of, or in any manner
connected with, the consummation of the Contemplated Transactions which are made
or asserted by any officer, partner, noteholder, debtor, employee, independent
contractor, agent, attorney or representative of Seller, or any of their
respective heirs, executors, successors or assigns, but excluding any such
claims or demands arising from any breach by Buyer of any of its
representations, warranties or agreements contained herein;
(e) any claims or demands of third parties which are based, in
whole or in part, on any actions or conduct of Seller on or before the Closing,
excepting only claims or demands specifically included in the Assumed
Liabilities;
(f) all matters which relate, directly or indirectly, to the
Excluded Liabilities; or
(g) any Damages arising, directly or indirectly, under or
pursuant to any Environmental Law which results from an act or omission of
Seller at any time on or prior to the Closing Date and relates to the Purchased
Assets or the Real Property subject to the Leases.
10.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER. Buyer will
indemnify and hold harmless Seller and Seller's respective Representatives,
partners, controlling Persons, affiliates and heirs (collectively, the "Buyer
Indemnified Persons") for, and will pay to the Buyer Indemnified Persons the
amount of any Damages arising, directly or indirectly, from or in connection
with:
(a) any breach of any representation or warranty made by Buyer
in this Agreement or in any certificate or document delivered by Buyer pursuant
to this Agreement;
(b) any breach by Buyer of any covenant or obligation of Buyer
in this Agreement including, without limitation, any failure to pay Assumed
Liabilities after the Closing;
(c) any claims or demands arising out of, or in any manner
connected with, the consummation of the Contemplated Transactions which are made
or asserted by any officer, director, partner, noteholder, debtor, employee,
independent contractor, agent, attorney or representative of Buyer, or any of
their respective heirs, executors, successors or assigns, but excluding any such
claims or demands arising from any breach by Seller of any of its
representations, warranties or agreements contained herein; or
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(d) any claims or demands of third parties which are based, in
whole or in part, on any actions, conduct or omissions of Buyer after the
Closing with respect to the operation of the Purchased Assets.
10.3 PROCEDURE FOR INDEMNIFICATION -- THIRD PARTY CLAIMS.
(a) Promptly after receipt by an Indemnified Person under
Section 10.1 or 10.2, of notice of any claim against it, such Indemnified
Person will, if a claim is to be made against an Indemnifying Party under such
Section , give notice to the Indemnifying Party of the commencement of such
claim, but the failure to notify the Indemnifying Party will not relieve the
Indemnifying Party of any liability that it may have to any Indemnified Person,
except to the extent that the Indemnifying Party demonstrates that the defense
of such action is prejudiced by the Indemnified Person's failure to give such
notice.
(b) If any claim referred to in Section 10.3(a) is brought
against an Indemnified Person and it gives written notice to the Indemnifying
Party of such claim, the Indemnifying Party may, at its option, assume the
defense of such claim with counsel reasonably satisfactory to the Indemnified
Person and, after written notice from the Indemnifying Party to the Indemnified
Person of its election to assume the defense of such claim, the Indemnifying
Party will not, as long as it diligently conducts such defense, be liable to the
Indemnified Person under this Article 10 for any fees of other counsel or any
other expenses with respect to the defense of such claim, subsequently incurred
by the Indemnified Person in connection with the defense of such claim, other
than reasonable costs of investigation. If the Indemnifying Party assumes the
defense of a claim, (i) no compromise or settlement of such claims may be
effected by the Indemnifying Party without the Indemnified Person's consent
unless (A) there is no finding or admission of any violation of Legal
Requirements or any violation of the rights of any Person, and (B) the sole
relief provided is monetary damages that are paid in full by the Indemnifying
Party; and (ii) the Indemnified Person will have no liability with respect to
any compromise or settlement of such claims effected without its consent.
Subject to Section 10.3(c), if notice is given to an Indemnifying Party of any
claim and the Indemnifying Party does not, within twenty days after the
Indemnified Person's notice is given, give notice to the Indemnified Person of
its election to assume the defense of such claim, the Indemnifying Party will be
bound by any determination made in such claim or any compromise or settlement
effected by the Indemnified Person.
(c) Notwithstanding the foregoing, if an Indemnified Person
determines in good faith that there is a reasonable probability that a claim may
adversely affect it or its affiliates other than as a result of monetary damages
for which it would be entitled to indemnification under this Agreement, the
Indemnified Person may, by written notice to the Indemnifying Party, assume the
exclusive right to defend, compromise, or settle such claim, but the
Indemnifying Party will not be bound by any determination of a claim so defended
or any compromise or settlement effected without its consent (which may not be
unreasonably withheld).
10.4 PROCEDURE FOR INDEMNIFICATION -- OTHER CLAIMS. A claim for
indemnification for any matter not involving a third-party claim shall be
asserted by written notice to the Indemnifying Party from whom indemnification
is sought.
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10.5 SURVIVAL/LIMITATIONS.
(a) The parties hereto agree that (i) the covenants and
agreements contained in the Agreement and any document delivered pursuant hereto
and the representations and warranties contained in Sections 3.1, 3.2(a), 3.3,
3.6(b), 4.1 and 4.2(a) shall survive without limitation; (ii) the
representations and warranties contained in Sections 3.8, 3.13, 3.17, 3.18, 3.19
and 4.4 shall survive until 90 days after the expiration of all applicable
statutes of limitation with respect to the subject matter thereof, and (iii) all
other representations and warranties in Article 3 and Article 4 (other than the
sections specifically mentioned in clauses (i) and (ii)) shall survive until the
first anniversary following the Closing Date.
(b) The Seller's obligation to indemnify the Seller
Indemnified Persons for Damages pursuant to Section 10.1 hereof is subject to
the following limitations: (i) no indemnification shall be made by the Seller
for Damages arising solely from Section 10.1(a) unless the aggregate amount of
such Damages exceeds $100,000 and then to the full extent of such Damages; and
(ii) in no event shall the Seller's obligation to indemnify the Seller
Indemnified Persons exceed the Purchase Price.
10.6 EXCLUSIVE REMEDIES. Subject to Section 11.3, the remedies provided
in this Article 10 will be exclusive and limit any other remedies that may be
available to the Parties hereto or the other Indemnified Persons.
11. GENERAL PROVISIONS
11.1 EXPENSES. Except as otherwise expressly provided in this
Agreement, each Party to this Agreement will bear its respective expenses
incurred in connection with the preparation, execution, and performance of this
Agreement and the Contemplated Transactions, including all fees and expenses of
agents, representatives, brokers or finders, counsel, and accountants. In the
event of termination of this Agreement, the obligation of each Party to pay its
own expenses will be subject to any rights of such Party arising from a breach
of this Agreement by another Party.
11.2 PUBLIC ANNOUNCEMENTS; CONFIDENTIALITY. Any public announcement or
similar publicity with respect to this Agreement or the Contemplated
Transactions will be issued, if at all, at such time and in such manner as Buyer
and Seller agree in writing, provided that the parties shall reasonably
cooperate in such announcements, and provided further that nothing contained
herein shall prevent any party from at any time furnishing information required
by a Governmental Body. Unless consented to by Buyer and Seller in advance or
required by Legal Requirements, prior to the Closing, each Party shall, and
shall cause their respective Representatives to, keep this Agreement strictly
confidential and may not make any disclosure of this Agreement to any Person.
Seller and Buyer will consult with each other concerning the means by which
Seller's employees, customers, suppliers, landlords and other Governmental
Bodies having dealings with Seller will be informed of the Contemplated
Transactions. From the date hereof until the Closing, Buyer agrees not to
disclose Confidential Information of Seller to Seller's employees or other
Representatives. The terms of the Confidentiality Agreement are hereby
incorporated by reference; provided, however, that (i) notwithstanding Article 2
thereof, Buyer shall be permitted to use or disclose Confidential Information if
(a) the use of such information is necessary in making any filing required by
Legal Requirements and only to the extent necessary, or (b) the furnishing or
use of such information is
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required by or necessary in connection with legal proceedings, and (ii) Buyer's
obligations under Article 5 of the Confidentiality Agreement with respect to the
Purchased Assets (other than New Assets) shall terminate upon the Closing;
provided, however, that to the extent any New Permit Assets are repurchased by
Seller pursuant to Section 2(f), such obligations under Article 5 shall be
reinstated upon such repurchase but only with respect to such repurchased New
Permit Assets. Buyer's obligations under Article 5 of the Confidentiality
Agreement shall terminate with respect to any New Assets when and to the extent
the same are sold to Buyer in accordance with Section 2.9 hereof.
11.3 AVAILABILITY OF EQUITABLE REMEDIES. The Parties acknowledge and
agree that (i) a breach of the provisions of this Agreement could not adequately
be compensated by money damages, and (ii) any Party shall be entitled, either
before or after the Closing, in addition to any other right or remedy available
to it, to an injunction restraining such breach and to specific performance of
this Agreement, and no bond or other security shall be required in connection
therewith.
11.4 NOTICES. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand (with written confirmation of receipt), (b)
sent by telecopier (with written confirmation of receipt), provided that a copy
is mailed by registered mail, return receipt requested, or (c) when received by
the addressee, if sent by a nationally recognized overnight delivery service
(receipt requested), in each case to the appropriate addresses and telecopier
numbers set forth below (or to such other addresses and telecopier numbers as a
Party may designate by notice to the other Parties):
If to Seller, to:
Xx. Xxxxxx X. Xxxxxxx
0000 Xxxx Xxxxxxx
Xxxxxxxx Xxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
and
Xx. Xxxxxx X. Xxxxxxx
Scadron Outdoor Advertising
0000 X. Xxxxx Xxxxxx
Xxxxxxx, Xxxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to:
Xxxxxxx, Carton & Xxxxxxx
Quaker Tower
000 X. Xxxxx Xxxxxx
Xxxxx 0000
Xxxxxxx, Xxxxxxxx 00000-0000
Attention: Xxxxxx X. Xxxxxx, Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
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If to Buyer, to:
Outdoor Systems, Inc.
0000 Xxxxx Xxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
and
Xxxxxxx X. Xxxxxx
0000 X. Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to:
Powell, Goldstein, Xxxxxx & Xxxxxx
000 Xxxxxxxxx Xxxxxx, XX, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Attention: Xxxxxxx X. Xxxxxxx, Xx., Esq.
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
11.5 FURTHER ASSURANCES. The Parties agree (i) to furnish upon request
to each other such further information, (ii) to execute and deliver to each
other such other documents, and (iii) to do such other acts and things, all as
the other Party may reasonably request for the purpose of carrying out the
intent of this Agreement and the documents referred to in this Agreement.
11.6 WAIVER. Neither the failure nor any delay by any Party in
exercising any right, power, or privilege under this Agreement or the documents
referred to in this Agreement will operate as a waiver of such right, power, or
privilege, and no single or partial exercise of any such right, power, or
privilege will preclude any other or further exercise of such right, power, or
privilege or the exercise of any other right, power, or privilege.
11.7 ENTIRE AGREEMENT AND MODIFICATION. This Agreement and the
Confidentiality Agreement (as incorporated and amended herein) supersede all
prior agreements between the Parties with respect to its subject matter and
constitute (along with the documents referred to in this Agreement) a complete
and exclusive statement of the terms of the agreement between the Parties with
respect to its subject matter. This Agreement may not be amended except by a
written agreement executed by the Party to be charged with the amendment.
11.8 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS. No Party may
assign any of its rights under this Agreement without the prior consent of the
other Parties except that Buyer may assign any of its rights under this
Agreement to any affiliate of Buyer. Notwithstanding the foregoing, Seller
reserves the right to assign the contractual rights to the proceeds from the
sale of certain of the Purchased Assets as part of a Section 1031 tax-deferred
exchange. Buyer agrees to cooperate with Seller (at Seller's cost) in connection
with such exchange transaction, to execute all
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documents reasonably required for the exchange transaction, and to pay all or
such portion of the Purchase Price to a person other than Seller as Seller
directs in such documents, provided that Buyer shall not be required to make any
payment or incur any cost not otherwise required to be made or incurred by Buyer
hereunder and that Buyer shall not otherwise be prejudiced thereby, and any such
payment made by Buyer to a designee of Seller hereunder shall satisfy Buyer's
obligations hereunder as if made to Seller directly. This Agreement will apply
to, be binding in all respects upon, and inure to the benefit of the successors
and permitted assigns of the Parties. Nothing expressed or referred to in this
Agreement will be construed to give any Person other than the Parties to this
Agreement any legal or equitable right, remedy, or claim under or with respect
to this Agreement or any provision of this Agreement. This Agreement and all of
its provisions and conditions are for the sole and exclusive benefit of the
Parties to this Agreement and their successors and assigns.
11.9 ACCOUNTS RECEIVABLE. Buyer agrees to forward to Seller any
payments that Buyer may receive with respect to any accounts receivable of
Seller (except for any payment with respect to an Advertising Services Agreement
that has been prorated in favor of Buyer pursuant to Section 2.6 hereof).
11.10 SEVERABILITY. If any provision of this Agreement is held invalid
or unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
11.11 RISK OF LOSS. Material risk of loss or damage to the Purchased
Assets or Real Property from any cause whatsoever prior to the Closing shall be
borne by Seller, and after the Closing shall be borne by Buyer.
11.12 POST-CLOSING ACCESS. Buyer agrees that all Books and Records
delivered to Buyer by Seller pursuant to this Agreement shall be open for
inspection by Seller at any time during regular business hours upon reasonable
notice for a period of seven (7) years (or for such longer period as may be
required by applicable Legal Requirements) following the Closing and that,
during such period, Seller, at its expense, may make such copies thereof as it
may reasonably desire. Without limiting the generality of the foregoing, Buyer
shall not destroy or give up possession of any original or final copy of any
such Books and Records delivered to Buyer hereunder (whether stored on
electronic media or otherwise) without first offering Seller the opportunity, at
Seller's expense, to obtain such original or final copy or a copy thereof.
Seller agrees that all books and records relating to the Purchased Assets and
retained by Seller shall be open for inspection by Buyer at any time during
regular business hours for a period of seven (7) years (or for such longer
period as may be required by applicable Legal Requirements) following the
Closing and that, during such period, Buyer, at its expense, may make such
copies thereof as it may reasonably desire. Without limiting the generality of
the foregoing, Seller shall not destroy or give up possession of any original or
final copy of any such books and records relating to the Purchased Assets and
retained by Seller hereunder (whether stored on electronic media or otherwise)
without first offering Buyer the opportunity, at Buyer's expense, to obtain such
original or final copy or a copy thereof. Nothing contained in this Section
11.12 shall obligate any Party hereto to make available any books and records if
to do so would violate the terms of any Contract or Legal Requirement to which
it is a party or to which it or its assets are subject.
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11.13 ARTICLE AND SECTION HEADINGS; CONSTRUCTION. The headings of
Sections in this Agreement are provided for convenience only and will not affect
its construction or interpretation. All references to "Article" or "Articles" or
"Section " or "Sections " refer to the corresponding Article or Articles or
Section or Sections of this Agreement. All words used in this Agreement will be
construed to be of such gender or number as the circumstances require. Unless
otherwise expressly provided, the word "including" does not limit the preceding
words or terms.
11.14 APPLICABLE LAW. This Agreement shall be governed and controlled
as to validity, enforcement, interpretations, construction, effect and in all
other respects by the internal laws of the State of Illinois applicable to
contracts made in that State. The parties hereto agree to submit exclusively to
any federal or state court located in the State of Illinois any dispute or
controversy arising out of or relating to this Agreement.
11.15 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
11.16 JOINT AND SEVERAL. The obligations of the Company and each of the
Scadrons hereunder shall be joint and several.
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IN WITNESS WHEREOF, the Parties have executed, sealed and delivered
this Agreement as of the date first written above.
BUYER:
OUTDOOR SYSTEMS, INC.
By: _________________________________
Title: ______________________________
THE COMPANY:
SCADRON ENTERPRISES
By: _________________________________
Title: ______________________________
_____________________________________
THE SCADRONS:
_____________________________________
XXXXXX X. XXXXXXX
_____________________________________
XXXXX XXXXXXX
_____________________________________
XXXXXXX XXXXXXX
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EXHIBIT A
DEFINITIONS
"ADVERTISING SERVICES AGREEMENTS" -- as defined in Section 2.2(c) and
listed on Exhibit B.
"ASSIGNMENTS OF ADVERTISING SERVICES AGREEMENTS" -- the Assignments and
Assumptions of Advertising Services Agreements from each of the Company and the
Scadrons in the form of Exhibit D attached hereto.
"ASSIGNMENTS OF SITE LEASES" -- the Assignments and Assumptions of Site
Leases from each of the Company and the Scadrons in the form of Exhibit F
attached hereto.
"ASSIGNMENTS OF PERMITS" -- the Assignments and Assumptions of Permits
from each of the Company and the Scadrons in the form of Exhibit G attached
hereto.
"ASSUMED LIABILITIES" -- as defined in Section 2.3.
"BEST EFFORTS" -- the efforts that a prudent Person desirous of
achieving a result would use in similar circumstances to ensure that such result
is achieved as expeditiously as possible.
"BILLS OF SALE" -- the Xxxx of Sale, Assignment and Assumption
Agreements from each of the Company and the Scadrons in the form of Exhibit D
attached hereto.
"BOOKS AND RECORDS" -- All of the Company's books and records relating
to the Purchased Assets, including, without limitation, all Site Lease files,
Advertising Services Agreements, Permit files, warranties, site surveys and
construction data and files, and a listing of all advertising revenue for 1995
and 1996 relating to the Purchased Assets. Books and Records shall not include
client or customer lists or any financial statements of Seller.
"BUYER" -- as defined in the first paragraph of this Agreement.
"CASH FLOW" -- with respect to operation of the New Permit Assets,
revenues less rent and other direct cash expenses, being production costs,
maintenance and commissions.
"CLOSING" -- as defined in Section 2.5.
"CLOSING DATE" -- the date and time as of which the Closing actually
takes place.
"CLOSING DOCUMENTS" -- as defined in Section 3.2(a).
"CONFIDENTIAL INFORMATION" -- as defined in the Confidentiality
Agreement.
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"CONFIDENTIALITY AGREEMENT" -- Confidentiality and NonDisclosure
Agreement dated July 27, 1996, by and between Company, Buyer, Xxxxxx Xxxxxx and
Xxxxxx Xxxxx, as amended by letter agreement with Xxxxxx Xxxxxx dated August 23,
1996 and by letter agreement with Xxxx Xxxxxxx dated December 18, 1996, which
are attached hereto as Exhibit J.
"CONSENT" -- any approval, consent, ratification, waiver, or other
authorization (including any Governmental Authorization).
"CONTEMPLATED TRANSACTIONS" -- all of the transactions contemplated by
this Agreement, including: (a) the purchase of the Purchased Assets (including
the New Permit Assets) and of the New Assets by Buyer from Seller and assignment
to and assumption by Buyer of the Assumed Liabilities, (b) the execution and
delivery by Seller and Buyer of the Leases, and (c) the performance by Buyer,
the Company and Scadron of their respective covenants and obligations under this
Agreement.
"CONTRACT" -- any agreement, contract, obligation, promise, or
undertaking (whether written or oral and whether express or implied) that is
legally binding.
"DAMAGES" -- as defined in Section 10.1.
"DISCLOSURE SCHEDULE" -- the disclosure schedule, other than the Master
Disclosure Schedule, delivered by Seller to Buyer concurrently with the
execution and delivery of this Agreement.
"DUE DILIGENCE PERIOD" -- as defined in Section 5.2.
"ENCUMBRANCE" -- any charge, claim, condition, equitable interest,
lien, option, pledge, security interest, right of first refusal, or restriction
of any kind, including any restriction on use, transfer, receipt of income, or
exercise of any other attribute of ownership.
"ENVIRONMENT" -- soil, land surface or subsurface strata, surface
waters, groundwaters, drinking water supply, stream sediments, ambient air
(including indoor air), plant and animal life, and any other environmental
medium or natural resource.
"ENVIRONMENTAL, HEALTH, AND SAFETY LIABILITIES" -- any cost, damages,
expense, liability, obligation, or other responsibility arising from or under
Environmental Law or Occupational Safety and Health Law, including fines,
penalties, financial responsibility for cleanup costs, corrective action,
removal, remedial actions and response actions, and any other compliance,
corrective, investigative, or remedial measures required under Environmental Law
or Occupational Safety and Health Law. The terms "removal," "remedial," and
"response action," include the types of activities covered by the United States
Comprehensive Environmental Response, Compensation, and Liability Act, 42 U.S.C.
Section 9601 et seq., as amended ("CERCLA").
"ENVIRONMENTAL LAW" -- any Legal Requirement that requires or relates
to Releases of pollutants or hazardous substances or materials, violations of
discharge limits, or other similar prohibitions; preventing or reducing to
acceptable levels the Release of pollutants or hazardous
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substances or materials into the Environment; reducing the quantities,
preventing the Release, or minimizing the hazardous characteristics of wastes
that are generated; reducing to acceptable levels the risks inherent in the
transportation of hazardous substances, pollutants, oil, or other potentially
harmful substances; cleaning up pollutants that have been Released, preventing
the threat of Release, or paying the costs of such clean up or prevention; or
making responsible parties pay private parties, or groups of them, for damages
done to their health or the Environment, or permitting self-appointed
representatives of the public interest to recover for injuries done to public
assets.
"ERISA" -- the Employee Retirement Income Security Act of 1974 or any
successor law, and regulations and rules issued pursuant to that Act or any
successor law.
"ESCROW AGENT" -- LaSalle National Bank.
"ESCROW AGREEMENT" -- the Escrow Agreement to be entered into between
Seller and Buyer described in Section 2.10(a).
"ESCROW AMOUNT" -- shall be determined by applying the Price Formula
with respect to the Structure which is the subject of the applicable New
Permit(s).
"EXCLUDED LIABILITIES" -- as defined in Section 2.4.
"GOVERNMENTAL AUTHORIZATION" -- any approval, consent, license, permit,
waiver, or other authorization issued, granted, given, or otherwise made
available by or under the authority of any Governmental Body or pursuant to any
Legal Requirement.
"GOVERNMENTAL BODY" -- any federal, state, local, municipal, foreign,
or other government; or governmental or quasi-governmental authority of any
nature (including any governmental agency, branch, department, official, or
entity and any court or other tribunal).
"HAZARDOUS ACTIVITIES" -- the distribution, generation, handling,
importing, management, manufacturing, processing, production, refinement,
Release, storage, transfer, transportation, treatment, or use (including any
withdrawal or other use of groundwater) of Hazardous Materials in, on, under,
about, or from the properties subject to the Site Leases or the Real Property or
any part thereof into the Environment, and any other act, business, operation,
or thing that increases the danger, or risk of danger, or poses an unreasonable
risk of harm to Persons or property on or off the properties subject to the Site
Leases or the Real Property.
"HAZARDOUS MATERIALS" -- any waste or other substance that is listed,
defined, designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any
Environmental Law, and specifically including petroleum and all derivatives
thereof or synthetic substitutes therefor and asbestos or asbestos-containing
materials.
"HSR ACT" -- the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976,
as amended, and any regulations and rules promulgated thereunder.
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"INDEMNIFIED PERSON" -- any of the Seller Indemnified Persons or the
Buyer Indemnified Persons, as the context requires.
"INDEMNIFYING PARTY" -- the Company and Scadron or the Buyer, as the
context requires.
"INTANGIBLE PROPERTY" -- All right, title and interest in and to the
goodwill and other intangible property (except for Seller's corporate or trade
names and trade logos) used in connection with the Purchased Assets, all
licenses, permits and authorizations pertaining to the Purchased Assets or the
right to own and operate the Purchased Assets and all right, title and interest
in and to (i) any intellectual property used in connection with the Purchased
Assets, and (ii) all records and data relating specifically to the Purchased
Assets.
"IRC" -- the Internal Revenue Code of 1986, as amended from time to
time, or any successor law, and regulations issued by the IRS pursuant to the
Internal Revenue Code or any successor law.
"IRS" -- the United States Internal Revenue Service and, to the extent
relevant, the United States Department of the Treasury.
"KNOWLEDGE" -- an individual will be deemed to have "Knowledge" of a
particular fact or other matter if such individual is actually aware of such
fact or other matter.
A Person (other than an individual) will be deemed to have "Knowledge" of a
particular fact or other matter if any individual who is serving as a director,
officer, partner, executor, or trustee of such Person (or in any similar
capacity) has Knowledge of such fact or other matter.
"LEASES" -- the three (3) Leases pertaining to the Real Property, to be
entered into between Seller and Buyer in the form of Exhibit C, provided,
however, that the Lease with respect to the Structures numbered 50 and 55 on the
MDS shall provide that no advertising on such Structures shall compete with
Menards.
"LEGAL REQUIREMENT" -- any federal, state, local, municipal, foreign,
international, multinational, or other administrative Order, constitution, law,
ordinance, principle of common law, regulation, statute, or treaty.
"MASTER DISCLOSURE SCHEDULE" or "MDS" -- the Master Disclosure Schedule
and the Notes thereto delivered to Buyer concurrently with the execution and
delivery of this Agreement, as the same may be amended as provided herein.
"MATERIAL OR "MATERIAL" -- What is considered material for purposes of
this Agreement shall be determined in light of the facts and circumstances of
the matter in question. No particular monetary amount cited in this Agreement
shall be deemed to determine materiality.
"MATERIAL ADVERSE CHANGE" -- a change that would cause a Material
Adverse Effect.
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"MATERIAL ADVERSE EFFECT" -- an adverse effect on the Purchased Assets,
or the Real Property operations, or conditions (financial or otherwise) relating
thereto, taken as a whole.
"NEW ASSETS" -- the New Structures and the Permits, Site Leases and
Advertising Services Agreements related thereto.
"NEW PERMIT ASSETS" -- the Structures, Site Leases, Advertising
Services Agreements and other Permits related to the sites for the New Permits.
"NEW PERMITS" -- the permits to be obtained by Seller on the MDS for
those Structures identified as Nos. 3, 8, 13, 28, 63 and 96 in the MDS.
"NEW STRUCTURE PURCHASE PRICE" -- the price determined in accordance
with the Price Formula for such New Structure.
"NEW STRUCTURES" -- those Structures identified as Nos. 2, 9, 41, 42,
84, 110, 111, and 112 in the MDS.
"OCCUPATIONAL SAFETY AND HEALTH LAW" -- any Legal Requirement designed
to provide safe and healthful working conditions and to reduce occupational
safety and health hazards, and any program, whether governmental or private
(including those promulgated or sponsored by industry associations and insurance
companies), designed to provide safe and healthful working conditions.
"ORDER" -- any award, decision, injunction, judgment, order, ruling,
subpoena, or verdict entered, issued, made, or rendered by any court,
administrative agency, or other Governmental Body or by any arbitrator.
"ORDINARY COURSE OF BUSINESS" -- an action taken by a Person will be
deemed to have been taken in the "Ordinary Course of Business" if such action is
consistent with the past custom and practices of such Person and is taken in the
ordinary course of the normal day-to-day operations of such Person (including
with respect to quantity and frequency).
"ORGANIZATIONAL DOCUMENTS" -- (a) the articles or certificate of
incorporation and the bylaws of a corporation; (b) the partnership agreement and
any statement of partnership of a general partnership; (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership; (d) any charter or similar document adopted or filed in connection
with the creation, formation, or organization of a Person; and (e) any amendment
to any of the foregoing.
"OTHER CONTRACT" -- any Contract (other than a Site Lease or
Advertising Services Agreement) relating to or affecting the Purchased Assets,
the Real Property, or the Leases or the operation thereof (i) under which Seller
has or may acquire any rights, (ii) under which Seller has or may become subject
to any obligation or liability, or (iii) by which Seller or any of the Purchased
Assets or the Real Property is or may become bound.
"PARTY" -- as defined in the first paragraph of this Agreement.
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"PERMITS" -- as defined in Section 2.2(d) and described in the MDS.
"PERSON" -- any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, labor union, or other entity
or Governmental Body.
"PRICE FORMULA" -- 10.81 times the Gross Revenue for a Structure or New
Structure as designated on the MDS, provided, however, that with respect to the
New Structures identified as Nos. 110, 111, and 112 in the MDS, the multiple
shall be 9.955 rather than 10.81.
"PROCEEDING" -- any action, arbitration, audit, hearing, investigation,
litigation, or suit (whether civil, criminal, administrative, investigative, or
informal) commenced, brought, conducted, or heard by or before, or otherwise
involving, any Governmental Body or arbitrator.
"PURCHASE PRICE" -- as defined in Section 2.6.
"PURCHASED ASSETS" -- as defined in Section 2.2.
"REAL PROPERTY" -- as defined in Section 3.6(a).
"RELATED PERSON" -- with respect to a particular individual:
(a) each other member of such individual's Family;
(b) any Person that is directly or indirectly controlled by such
individual or one or more members of such individual's Family;
(c) any Person in which such individual or members of such individual's
Family hold (individually or in the aggregate) a Material Interest; and
(d) any Person with respect to which such individual or one or more
members of such individual's Family serves as a director, officer, partner,
executor, or trustee (or in a similar capacity).
With respect to a specified Person other than an individual:
(a) any Person that directly or indirectly controls, is directly or
indirectly controlled by, or is directly or indirectly under common control with
such specified Person;
(b) any Person that holds a Material Interest in such specified Person;
(c) each Person that serves as a director, officer, partner, executor,
or trustee of such specified Person (or in a similar capacity);
(d) any Person in which such specified Person holds a Material
Interest;
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(e) any Person with respect to which such specified Person serves as a
general partner or a trustee (or in a similar capacity); and
(f) any Related Person of any individual described in clause (b) or
(c).
For purposes of this definition, (a) the "Family" of an individual includes (i)
the individual, (ii) the individual's spouse, (iii) any other natural person who
is related to the individual or the individual's spouse within the second
degree, and (iv) any other natural person who resides with such individual, and
(b) "Material Interest" means direct or indirect beneficial ownership (as
defined in Rule 13d-3 under the Securities Exchange Act of 1934) of voting
securities or other voting interests representing at least 5% of the outstanding
voting power of a Person or equity securities or other equity interests
representing at least 5% of the outstanding equity securities or equity
interests in a Person.
"RELEASE" -- any spilling, leaking, emitting, discharging, depositing,
escaping, leaching, dumping, or other releasing into the Environment, whether
intentional or unintentional.
"REPRESENTATIVE" -- with respect to a particular Person, any director,
officer, employee, agent, consultant, advisor, or other representative of such
Person, including legal counsel, accountants, and financial advisors.
"REQUIRED CONSENTS" -- those consents to the transfer of Site Leases
which have not been obtained on or before Closing, the obtaining of which has
not otherwise been waived by Buyer.
"SCADRONS" -- Scadron, X. Xxxxxxx and X. Xxxxxxx.
"SECURITY INTEREST" -- any mortgage, pledge, lien, encumbrance, charge
or other security interest or option or right of any third party with respect
thereto.
"SELLER" -- as defined in the first paragraph of this Agreement.
"SITE LEASE PURCHASE PRICE" -- the price determined in accordance with
the Price Formula for the Structure(s) related to the Site Lease requiring a
Required Consent.
"SITE LEASES" -- as defined in Section 2.2(b) and listed in the MDS.
"STRUCTURES" -- as defined in Section 2.2(a) and listed in the MDS.
"TAX" -- shall mean all tax (including income tax, capital gains tax,
value added tax, sales tax, property tax, transfer tax or intangibles tax), levy
assessment, tariff, duty, deficiency or other fee and any related charge or
amount (including fine, penalty and interest) imposed, assessed or collected by
or under the authority of any Governmental Body.
"TAX CLEARANCES" -- as defined in Section 5.9.
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"TAX RETURN" -- any return (including any information return), report,
statement, schedule, notice, form, or other document or information filed with
or submitted to, or required to be filed with or submitted to, any Governmental
Body in connection with the determination, assessment, collection, or payment of
any Tax or in connection with the administration, implementation, or enforcement
of or compliance with any Legal Requirement relating to any Tax.
"THREATENED" -- a claim, Proceeding or dispute will be deemed to have
been "THREATENED" if any demand or statement has been made or any notice has
been given that would lead a prudent Person to conclude that such a claim,
Proceeding or dispute is likely to be asserted, commenced, taken, or otherwise
pursued in the future.
"TOTAL ESCROW AMOUNT" -- the aggregate of the Escrow Amounts for each
New Permit which is not delivered at Closing.
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