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EXHIBIT 2.2
ASSET PURCHASE AGREEMENT
BY AND AMONG
XXXXXX COMMUNICATIONS CORPORATION,
X. XXXXXX, INC.,
CLEAR CHANNEL
METROPLEX, INC.,
CLEAR CHANNEL
METROPLEX LICENSES, INC.
AND
CLEAR CHANNEL
COMMUNICATIONS, INC.
DATED AS OF AUGUST 25, 1997
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TABLE OF CONTENTS
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PAGE
SECTION 1 CERTAIN DEFINITIONS..................................................................................3
1.1 Terms Defined in Appendix 1.............................................................3
1.2 Rule of Construction....................................................................3
SECTION 2 PURCHASE AND SALE OF ASSETS; ASSET VALUE.............................................................3
2.1 Purchase and Sale.......................................................................3
2.2 Excluded Assets.........................................................................3
2.3 Group I Assets. .......................................................................3
2.4 Purchase Price; Allocation..............................................................4
2.5 Prorations and Adjustments..............................................................5
2.6 Payment of Purchase Price and Prorations and
Adjustments.............................................................................8
2.7 Assumption of Liabilities and Obligations...............................................9
SECTION 3 REPRESENTATIONS AND WARRANTIES OF SELLER............................................................10
3.1 Organization and Authority of Seller...................................................10
3.2 Authorization and Binding Obligation...................................................10
3.3 Absence of Conflicting Agreements; Consents............................................10
3.4 Governmental Licenses..................................................................11
3.5 Real Property..........................................................................12
3.6 Tangible Personal Property.............................................................13
3.7 Assumed Contracts......................................................................13
3.8 Intangibles............................................................................14
3.9 Financial Statements...................................................................14
3.10 Taxes and Tax Returns..................................................................14
3.11 Insurance..............................................................................14
3.12 Personnel..............................................................................14
3.13 Claims and Legal Actions...............................................................15
3.14 Compliance with Laws...................................................................15
3.15 Conduct of Business in Ordinary Course.................................................15
3.16 Environmental Matters..................................................................15
3.17 Brokers................................................................................17
3.18 Transactions With Affiliates...........................................................17
3.19 Assets.................................................................................17
3.20 Employee Benefits......................................................................17
3.21 Foreign Person.........................................................................18
3.22 Like-kind Exchange.....................................................................18
3.23 ARS APA................................................................................18
3.24 Disclosure.............................................................................19
3.25 Limitations............................................................................19
SECTION 4 REPRESENTATIONS AND WARRANTIES OF BUYER.............................................................19
4.1 Organization, Standing and Authority...................................................19
4.2 Authorization and Binding Obligation...................................................19
4.3 Absence of Conflicting Agreements and Required
Consents...............................................................................20
4.4 Buyer Qualifications...................................................................20
4.5 Brokers................................................................................20
4.6 Availability of Funds..................................................................20
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4.7 Disclosure.............................................................................21
SECTION 5 OPERATIONS OF THE STATIONS PRIOR TO
EFFECTIVE TIME OR CLOSING...................................................................21
5.1 Generally..............................................................................21
5.2 Dispositions...........................................................................23
5.3 Liens..................................................................................23
5.4 Access to Information..................................................................24
5.5 Financial Information..................................................................24
5.6 Notice of Proceedings..................................................................24
5.7 ARS APA................................................................................25
5.8 Representations and Warranties.........................................................26
SECTION 6 SPECIAL COVENANTS AND AGREEMENTS....................................................................27
6.1 FCC Consent............................................................................27
6.2 HSR Act Filing.........................................................................28
6.3 Confidentiality........................................................................28
6.4 Cooperation............................................................................30
6.5 Control of the Stations................................................................30
6.6 Access to Books and Records............................................................30
6.7 Employee Matters.......................................................................31
6.8 Cure...................................................................................32
6.9 Environmental Reports..................................................................32
6.10 Other Transactions.....................................................................33
6.11 Fees of CEA............................................................................43
6.12 Non-Competition Agreement..............................................................44
6.13 Updated Information....................................................................44
6.14 Miscellaneous..........................................................................44
6.15 Risk of Loss; Interruption of Broadcast
Transmission...........................................................................45
6.16 Computer Systems.......................................................................46
SECTION 7 CONDITIONS TO OBLIGATIONS OF BUYER AND SELLER........................................................46
7.1 Conditions to Obligations of Buyer at Group
II/III and Group V Closings............................................................46
7.2 Conditions to Obligations of Seller at Group
II/III and Group V Closings............................................................48
7.3 Conditions to Obligations of Buyer and Seller
at Group IV Closing....................................................................49
SECTION 8 CLOSING AND CLOSING DELIVERIES......................................................................50
8.1 Closing................................................................................50
8.2 Deliveries by Seller...................................................................52
8.3 Deliveries by Buyer....................................................................54
SECTION 9 TERMINATION.........................................................................................56
9.1 Termination of Agreement...............................................................56
9.2 Procedure and Effect of Termination....................................................57
9.3 Other Agreements.......................................................................62
9.4 Attorneys' Fees........................................................................62
9.5 Specific Performance...................................................................62
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SECTION 10 SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
INDEMNIFICATION; CERTAIN REMEDIES.....................................................62
10.1 Survival..............................................................................62
10.2 Indemnification by Seller.............................................................63
10.3 Indemnification by Buyer and Guarantor................................................66
10.4 Procedure for Indemnification.........................................................69
SECTION 11 MISCELLANEOUS......................................................................................70
11.1 Fees and Expenses.....................................................................70
11.2 Notices...............................................................................71
11.3 Benefit and Binding Effect............................................................72
11.4 Further Assurances....................................................................72
11.5 GOVERNING LAW.........................................................................73
11.6 Entire Agreement......................................................................73
11.7 Waiver of Compliance; Consents........................................................73
11.8 Counterparts..........................................................................73
11.9 Severability..........................................................................73
11.10 Cooperation With Respect to Like-Kind
Exchange..............................................................................74
11.11 Guaranty..............................................................................74
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Appendices
Appendix 1 Definitions
Exhibits
Exhibit 2.3 Group I Purchase Agreement
Exhibit 6.10-A LPI Promissory Note to Seller
Exhibit 6.10-B Subordinated Guaranty
Exhibit 6.10-C Clear Channel Loan Agreement
Exhibit 6.10-D Intercreditor and Subordination
Agreement
Exhibit 6.10-E Security Agreement
Exhibit 6.10-F Guaranty
Exhibit 6.10-G Stock Pledge Agreement
Exhibit 6.10-H Group V TBA
Exhibit 6.10-I Group II/III TBA
Exhibit 6.10-J Forms of TSAs
Exhibit 6.10-K Form of Service Agreement
Exhibit 6.10-L Group IV TBA
Exhibit 6.12 Non-Competition Agreement
Exhibit 8.2(a)(i) Assignment and Assumption Agreement
Exhibit 8.2(j) WHNZ Option Agreement
Exhibit 8.2(k) WYCL Option Agreement
Exhibit 8.2(n) DP Media Assets
Schedules
Schedule 1.1(f) Excluded Contracts
Schedule 1.1(j) Excluded Assets
Schedule 3.1 Qualifications
Schedule 3.3 Absence of Conflicting Agreements; Consents
Schedule 3.4 Governmental Licenses
Schedule 3.5 Real Property
Schedule 3.6 Tangible Personal Property
Schedule 3.7 Contracts
Schedule 3.8 Intangibles
Schedule 3.9 Financial Statements
Schedule 3.10 Tax and Tax Returns
Schedule 3.11 Insurance
Schedule 3.12 Personnel
Schedule 3.13 Claims and Legal Actions
Schedule 3.15 Conduct of Business in Ordinary Course
Schedule 3.16 Environmental
Schedule 3.18 Transactions with Affiliates
Schedule 3.20 Employee Benefits
Schedule 4.4 Buyer Qualifications
Schedule 5.1 Certain Changes
Schedule 5.2 Certain Dispositions
Schedule 6.14(b) WNLS(AM) Tower Remediation
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ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement is dated as of August 25, 1997, by and
among Xxxxxx Communications Corporation, a Delaware corporation ("PCC" or
"Seller"), X. Xxxxxx, Inc., a Delaware corporation ("LPI"), Clear Channel
Metroplex, Inc., a Nevada corporation ("Metroplex"), Clear Channel Metroplex
Licenses, Inc., a Nevada corporation ("CCL"; Metroplex and CCL being referred
to herein, collectively, as "Buyer"), and Clear Channel Communications, Inc., a
Texas corporation ("Guarantor" or "Clear Channel").
R E C I T A L S:
A. Seller owns the following radio stations:
i. WTKS(FM), Cocoa Beach, FL; WPLL(FM), Ft. Lauderdale, FL;
WSHF(FM), Mexico Beach, FL; WJZT(FM), Midway, FL; WSHE(FM), Orlando, FL;
WDIZ(AM), Panama City, FL; WFSY(FM), Panama City, FL; WPAP-FM, Panama City, FL;
WPBH(FM), Xxxxxx, FL; WTLK(FM), Ponte Vedra Beach, FL; WXSR(FM), Quincy, FL;
WNLS(AM), Tallahassee, FL; WTNT(FM), Tallahassee, FL; WSNI(FM), Thomasville,
GA; WTKX-FM, Pensacola, FL (together with WKES, as defined below, each,
individually, a "Group II/III Station" and, collectively, the "Group II/III
Stations") and WYCL(FM), Pensacola, FL ("WYCL"); and
ii. WPLA(FM), Callahan, FL; WJRR(FM), Cocoa Beach, FL;
WFTL(AM), Ft. Lauderdale, FL; WNZS(AM), Jacksonville, FL; WROO(FM),
Jacksonville, FL; WZNZ(AM), Jacksonville, FL; WKRY(FM), Key West, FL; WZTM(AM),
Largo, FL; WAVK(FM), Marathon, FL; WSJT(FM), Lakeland, FL; WINZ(AM), Miami, FL;
WIOD(AM), Miami, FL; WLVE(FM), Miami Beach, FL; WZTA(FM), Miami Beach, FL;
WMGF(FM), Mount Dora, FL; WQTM(AM), Pine Hills, FL; WFKZ(FM), Plantation Key,
FL; WWNZ(AM), Orlando, FL; WHPT(FM), Sarasota, FL; WFSJ-FM, St. Augustine, FL;
WGIC(FM), Cookeville, TN; WGSQ(FM), Cookeville, TN; WHUB(AM), Cookeville, TN;
WPTN(AM), Cookeville, TN (each, individually, a "Group V Station" and,
collectively, the "Group V Stations") and the assets used or useful in
connection with the operation of Channel 7 of the Cookeville, TN cable
television system ("HUB-TV") and WHNZ(AM), Pinellas Park, FL ("WHNZ").
B. Seller is successor by merger to Xxxxxx Broadcasting of Tampa,
Limited Partnership, a Florida limited partnership and wholly-owned subsidiary
of PCC ("PBT"), which is a party to an Asset Purchase Agreement dated as of
September 12, 1996, as amended by a First Amendment to Purchase Agreement dated
as of April 12, 1997 (as amended, the "WKES Purchase Agreement") with The Xxxxx
Bible Institute of Chicago, an Illinois not-for-profit
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corporation ("Xxxxx"), pursuant to which Seller has acquired substantially all
of the assets of Radio Station WILV(FM), St. Petersburg, FL (for purposes of
this Agreement, "WKES").
X. Xxxxxx Communications of West Palm Beach, Inc., a Florida
corporation and a wholly-owned subsidiary of Seller ("PCWPB"), is party to an
Asset Purchase Agreement, dated May 27, 1997 (the "ARS Asset Purchase
Agreement") with American Radio Systems Corporation, a Delaware corporation
("ARS"), pursuant to which PCWPB will acquire substantially all the assets of
Radio Stations WKGR(FM), Ft. Xxxxxx, Florida; XXXX(FM), Riviera Beach, Florida;
and WBZT(AM), West Palm Beach, Florida (each of the foregoing, individually, a
"Group IV Station" and, collectively, the "Group IV Stations") and WEAT(AM),
West Palm Beach, Florida ("WEAT").
D. Seller desires to sell, and Buyer desires to purchase,
substantially all of the assets of the Group II/III Stations, Group IV Stations
and Group V Stations, on the terms and conditions hereinafter set forth.
E. Under certain circumstances, and subject to the terms and
conditions herein set forth, PCC may sell the Group V Stations to LPI, subject
to PCC's agreement to sell such Stations to Buyer and to allow Buyer to time
broker or sell commercial time on such Stations, as the case may be, pending
such sale, each of which obligations would be assumed by LPI as a condition to
any such sale.
F. If so elected by Seller, subject to the terms and conditions of
this Agreement, Seller may enter into an exchange agreement with an
Intermediary providing that the sale and purchase of some or all of the assets
described herein be effected in a transaction that will qualify, to the extent
permissible, as a "like-kind exchange" under Section 1031 of the Code.
A G R E E M E N T S:
In consideration of the above recitals and of the mutual agreements
and covenants contained in this Agreement, the parties to this Agreement,
intending to be bound legally, agree as follows:
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SECTION 1 CERTAIN DEFINITIONS
1.1 Terms Defined in Appendix 1. The terms defined in Appendix 1 hereto,
as used in this Agreement, have the meanings set forth in Appendix 1. Section
references in the definitions in the Appendix shall be deemed to refer to this
Agreement and the Appendix shall be deemed to be part of this Agreement.
1.2 Rule of Construction. Except as specifically otherwise provided in
this Agreement in a particular instance, a reference to a Section, Schedule or
Exhibit is a reference to a Section of this Agreement or a Schedule or Exhibit
hereto, and the terms "hereof," "herein," and other like terms refer to this
Agreement as a whole, including the Schedules and Exhibits to this Agreement,
and not solely to any particular part of this Agreement. The Schedules and
Exhibits shall be deemed to be a part of this Agreement. The descriptive
headings in this Agreement are inserted for convenience of reference only and
are not intended to be part of or to affect the meaning or interpretation of
this Agreement.
SECTION 2 PURCHASE AND SALE OF ASSETS; ASSET VALUE
2.1 Purchase and Sale. (a) Subject to the terms and conditions set forth
in this Agreement, Seller hereby agrees to transfer, convey, assign and deliver
to Buyer, and Buyer agrees to acquire all of Seller's right, title and interest
in the Group II/III Assets, the Group IV Assets and the Group V Assets.
(b) It is understood and agreed that Metroplex shall acquire the
Non-License Assets included in the Group II/III Assets, Group IV Assets and
Group V Assets and CCL shall acquire the License Assets included in the Group
II/III Assets, Group IV Assets and Group V Assets. Notwithstanding the
foregoing, however, it is understood and agreed that each of Metroplex and CCL
shall be jointly and severally liable to perform the obligations of Buyer
provided for in this Agreement and in the documents contemplated hereby.
2.2 Excluded Assets. Notwithstanding anything in this Agreement to the
contrary, the Assets shall not include the Excluded Assets. Notwithstanding
anything to the contrary set forth in this Agreement, no representations,
warranties or covenants or agreements of any nature whatsoever are made by
Seller to Buyer with respect to the Excluded Assets.
2.3 Group I Assets. Simultaneously with the execution and delivery of
this Agreement, Seller and Buyer are entering into an Asset Purchase Agreement
(the "Group I Purchase Agreement"), in
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the form attached hereto as Exhibit 2.3, and dated as of the date hereof,
pursuant to which Seller will sell to Buyer, and Buyer will purchase from
Seller, the Group I Assets, on the terms and subject to the conditions set
forth therein.
2.4 Purchase Price; Allocation.
(a) Group II/III Assets. Subject to the provisions of Section 6.10
hereof, the purchase price for the Group II/III Assets shall be One Hundred
Thirty-Seven Million Two Hundred Six Thousand Dollars ($137,206,000) (the
"Group II/III Estimated Purchase Price"), which sum shall be subject to upward
or downward adjustment, as the case may be, pursuant to Section 2.5(a) below
(the Group II/III Estimated Purchase Price, as so adjusted, the "Group II/III
Purchase Price").
(b) Group IV Assets. Subject to the last sentence of Section 5.7, the
purchase price for the Group IV Assets shall be Thirty-One Million Two Hundred
Fifty Thousand Dollars ($31,250,000), subject to adjustment as provided for in
Section 6.10(c) hereof (the "Group IV Estimated Purchase Price"), which sum
shall be subject to upward or downward adjustment, as the case may be, pursuant
to Section 2.5(a) below (the Group IV Estimated Purchase Price, as so adjusted,
the "Group IV Purchase Price").
(c) Group V Assets. The purchase price for the Group V Assets shall
be Four Hundred Thirty-Four Million Six Hundred Six Thousand Dollars
($434,606,000) (the "Group V Estimated Purchase Price"), which sum shall be
subject to upward or downward adjustment, as the case may be, pursuant to
Section 2.5(a) below (the Group V Estimated Purchase Price, as so adjusted, the
"Group V Purchase Price").
(d) Appraisal and Allocation. Seller shall retain, at Seller's
expense, Bond & Xxxxxx, or another recognized independent appraisal firm
selected by Seller and reasonably acceptable to Buyer, to appraise the Stations
and the Assets. Seller shall provide Buyer with copies of the appraisals for
the Group II/III Assets, Group IV Assets and Group V Assets within 90 days
after Group II/III Closing Date, Group IV Closing Date, and Group V Closing
Date, respectively. Seller and Buyer agree to allocate the Purchase Price among
the Stations and the Assets for all purposes, including financial accounting
and tax purposes, including Section 1060 of the Code and Temporary Treasury
Regulations Section 1.1060-IT, in accordance with such appraisals. Buyer and
Seller agree to file with their respective federal income tax returns initial
asset acquisition statements on Internal Revenue Service Form 8594 required by
Temporary Treasury Regulation Section 1.1060-IT, all in accordance with and
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accurately reflecting such appraisals and allocations. No allocation of the
Purchase Price for any of the Assets shall be made to the Non-Competition
Agreement.
2.5 Prorations and Adjustments.
(a) Prorations and Adjustments. The Group II/III Purchase Price, the
Group IV Purchase Price and the Group V Purchase Price shall be determined by
increasing or decreasing the Estimated Purchase Price as required to effectuate
the proration of revenues and expenses as provided for herein and subject to
the provisions of Section 6.10 hereof with respect to the Group IV Stations.
All revenues and all expenses arising from the operation of any Station,
including tower rental, business and license fees, utility charges, real and
personal property taxes and assessments levied against its Assets, property and
equipment rentals, applicable copyright or other fees, including program
license payments, sales and service charges, taxes (except for taxes arising
from the transfer of the Assets under this Agreement), employee compensation,
including wages, salaries, accrued vacation, sick leave, personal days and
commissions for each employee of Seller who becomes an employee of Buyer, music
license fees and similar prepaid and deferred items, shall be prorated between
Buyer and Seller in accordance with GAAP and to effect the principle that
Seller shall receive all revenues (other than Accounts Receivable) and shall be
responsible for all expenses, costs and liabilities (including, without
limitation, performance bonuses payable to the Assumed Employees allocable to
the period prior to the Effective Time based on the pro rata accrual of such
bonuses over the calendar year on a straight line basis) allocable to the
operations of any Station for the period prior to the applicable Effective
Time, and Buyer shall receive all revenues and shall be responsible for all
expenses, costs and liabilities (including, without limitation, performance
bonuses payable to the Assumed Employees allocable to the period after the
Effective Time based on pro rata accrual of such bonuses over the calendar year
on a straight line basis) allocable to the operations of any Station for the
period after the applicable Effective Time in accordance with GAAP, subject to
the following:
(1) There shall be no adjustment for, and Seller shall
remain solely liable with respect to, any Excluded Contracts and any
other obligation or liability not being assumed by Buyer in
accordance with Section 2.7.
(2) No adjustment or proration shall be made in favor of
Seller for the amount, if any, by which the value of the goods or
services to be received by all the Stations in the aggregate under
their trade or barter agreements as
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of the Effective Time for such Stations exceeds the value of any
advertising time remaining to be run by such Stations as of the
Effective Time. For purposes of this Agreement, including, without
limitation, this Section 2.5 and Section 5.1, the liability for
performance obligations relating to advertising time under any trade
or barter agreements shall be valued according to the applicable
Station's prevailing rates as of the Effective Time, and goods,
services or other items being received shall be valued in accordance
with GAAP as of the Effective Time.
(3) An adjustment or proration shall be made in favor of
Buyer to the extent, if any, that (a) the value of the goods or
services to be received by all the Group II/III Stations, the Group
IV Stations, the Group V Stations and the Businesses (as defined in
the Group I Purchase Agreement) under their trade or barter
agreements as of the applicable Effective Time in the aggregate is
more than $150,000 less than the value of any advertising time
remaining to be run by such Stations and Businesses (as defined in
the Group I Purchase Agreement) thereunder as of the applicable
Effective Time (a "Negative Balance") and (b) Buyer has not
expressly consented to the trade or barter agreements giving rise to
such Negative Balance (and the allocation of such Negative Balance
among the Businesses, Group II/III Stations, Group IV and Group V
Stations shall be made by Seller, in its sole discretion).
(b) Manner of Determining Prorations and Adjustments. The
Group II/III Purchase Price, Group IV Purchase Price and Group V Purchase
Price, taking into account the adjustments and prorations pursuant to Section
2.5(a), will be determined in accordance with the following procedures:
(1) Seller shall prepare and deliver to Buyer not later
than five (5) Business Days before each Closing Date a preliminary
settlement statement which shall set forth Seller's good faith
estimate of the adjustments or prorations under Section 2.5(a)
(each, a "Preliminary Settlement Statement"). The Preliminary
Settlement Statement (A) shall contain all information reasonably
necessary to determine the adjustments or prorations under Section
2.5(a), including appropriate supporting documentation and such
other information as may be reasonably requested by Buyer, to the
extent such adjustments or prorations can be determined or estimated
as of the date of the Preliminary Settlement Statement and (B) shall
be certified by an officer (but without personal liability to such
officer) on behalf of Seller to be true and complete to Seller's
knowledge. The "Preliminary
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Purchase Price" shall be determined by adjusting the Estimated
Purchase Price for the adjustments and prorations contained in the
Preliminary Settlement Statement.
(2) Not later than ninety days after each Closing Date,
Buyer shall deliver to Seller a statement setting forth Buyer's
determination of any changes to the adjustments and prorations made
at such Closing. Buyer's statement (A) shall contain all information
reasonably necessary to determine the adjustments and prorations to
the Purchase Price under Section 2.5(a), including appropriate
supporting documentation, and such other information as may be
reasonably requested by Seller, and (B) shall be certified by an
officer (but without personal liability to such officer) on behalf
of Buyer to be true and complete to Buyer's knowledge. Seller (and
its authorized representatives) shall have the right to visit the
Stations during normal business hours to verify and review such
documentation upon providing reasonable notice to Buyer (such access
not to unreasonably interfere with the business or operations of any
Station). If Seller disputes the adjustments and prorations
determined by Buyer, it shall deliver to Buyer within fifteen days
after its receipt of Buyer's statement a statement setting forth its
determination of such adjustments and prorations. If Seller notifies
Buyer of its acceptance of Buyer's statement, or if Seller fails to
deliver its statement within the fifteen-day period specified in the
preceding sentence, Buyer's determination of such adjustments and
prorations shall be conclusive and binding on the parties as of the
last day of such fifteen-day period.
(3) Buyer and Seller shall use good faith efforts to
resolve any dispute involving the determination of the adjustments
and prorations in connection with the Closings. If the parties are
unable to resolve any dispute within fifteen days following the
delivery to Buyer of the statement described in the penultimate
sentence of Section 2.5(b)(2), Buyer and Seller shall jointly
designate an independent certified public accountant, who shall be
knowledgeable and experienced in the operation of radio broadcasting
stations, to resolve such dispute. If the parties are unable to
agree on the designation of an independent certified public
accountant, the selection of the accountant to resolve the dispute
shall be submitted to arbitration in accordance with the commercial
arbitration rules of the American Arbitration Association. The
accountant's resolution of the dispute shall be final and binding on
the parties, and a judgment may be entered thereon in any court of
competent jurisdiction. Any fees of
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the accountant, and, if necessary, for arbitration to select such
accountant, shall be split equally between the parties.
2.6 Payment of Purchase Price and Prorations and
Adjustments.
(a) At each Closing, subject to the provisions of Section 6.10,
Buyer shall pay or cause to be paid to Seller (or to such party or parties
designated by Seller in writing) the Preliminary Purchase Price for the Assets
to be transferred at such Closing, by federal wire transfer of same-day funds
in accordance with wire instructions delivered to Buyer by Seller at least
three (3) Business Days prior to such Closing.
(b) Payments to Reflect Prorations and Adjustments.
(1) If the Purchase Price for any Assets transferred
pursuant to this Agreement as finally determined pursuant to Section
2.5(b)(2) and subject to any applicable provisions of Section 6.10
exceeds the Preliminary Purchase Price for such Assets, Buyer shall
pay to Seller (or to such party or parties designated by Seller in
writing), by federal wire transfer of same-day funds within five
Business Days after the date on which such Purchase Price is
determined pursuant to Section 2.5(b)(2), the difference between
such Purchase Price and such Preliminary Purchase Price.
(2) If the Purchase Price for any Assets transferred
pursuant to this Agreement, as finally determined pursuant to
Section 2.5(b)(2), and subject to any applicable provisions of
Section 6.10, is less than the Preliminary Purchase Price for such
Assets, Seller shall pay to Buyer, by federal wire transfer of
same-day funds within five Business Days after the date on which
such Purchase Price is determined pursuant to Section 2.5(b)(2), the
difference between such Preliminary Purchase Price and such Purchase
Price.
(3) If any dispute arises over the amount to be
refunded or paid pursuant to this Section 2.6(b), such refund or
payment shall nevertheless be made to the extent any amount is not in
dispute.
(c) It is understood and agreed that Buyer shall not be
permitted to offset any amounts in respect of the Group V Assets against any
amounts in respect of any other Assets that are the subject of this Agreement
or the Group I Purchase Agreement. Notwithstanding the foregoing, nothing
contained in this Section 2.6(c) shall in any manner impair any right, remedy
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or recourse Buyer may have against PCC for fraud in connection with this
Agreement.
2.7 Assumption of Liabilities and Obligations.
(a) Without limiting any obligations of Buyer under any applicable
TBA, Buyer shall assume and undertake to pay, discharge and perform:
(i) the Group II/III Assumed Liabilities as of
the Group II/III Closing Date;
(ii) subject to the last sentence of Section 5.7,
the Group IV Assumed Liabilities as of the Group IV Closing Date;
and
(iii) the Group V Assumed Liabilities as of the
Group V Closing Date.
(b) Buyer shall not be required to assume any of the following:
(i) any obligations or liabilities under any Excluded Contract, (ii) any
obligations or liabilities under the Assumed Contracts relating to the period
prior to the applicable Effective Time, except insofar as a proration or
adjustment therefor is made in favor of Buyer under Section 2.5(a), (iii) any
liability or obligation arising out of any litigation, proceeding or claim by
any person or entity relating to the business or operations of any Station or
any of the Assets with respect to any events or circumstances that occur or
exist prior to the applicable Effective Time relating to such Station or
Assets, (iv) any credit agreements, note purchase agreements, indentures, or
other financing arrangements (other than any Assumed Contracts) of Seller and
(v) any other obligation or liability of Seller, LPI or the Assignee that is
not an Assumed Liability (including, without limitation, any increase in the
Assumed Liabilities in violation of Section 2.7(c)). Buyer shall perform all
obligations arising out of the Assets (including the Assumed Contracts and the
Licenses) relating to the period on or after the applicable Effective Time.
Seller shall retain all liabilities of Seller not assumed by Buyer.
(c) Notwithstanding anything in this Agreement to the contrary,
with respect to each Station, the parties acknowledge that after the Effective
Time with respect to such Station, Seller shall not, by any voluntary act or
omission, increase the Assumed Liabilities other than as permitted in
accordance with the terms and provisions of this Agreement or the TBAs, without
the prior written consent of Buyer.
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SECTION 3 REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as follows(i) as of the date
hereof, (ii) (subject to the provisions of Section 7.1(a) hereof) as of the
Group II/III Effective Time and the Group V Effective Time and (iii) (subject
to the provisions of Section 7.1(a) hereof) to the extent specifically
contemplated by Section 6.10(a)(iv)(1) hereof and subject to the limitations
therein, as of the Group II/III Closing Date and the Group V Closing Date:
3.1 Organization and Authority of Seller. Seller is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Delaware and, in respect of the operations of the Stations, is
qualified to conduct business in the States set forth in Schedule 3.1. Except
as set forth in Schedule 3.1, Seller has the requisite corporate power and
authority to own and operate the Assets owned and operated by it, to carry on
the business of the Stations now being conducted by it, and to execute, deliver
and perform this Agreement according to its terms.
3.2 Authorization and Binding Obligation. The execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated hereby by Seller have been duly and validly authorized by all
necessary corporate action on the part of Seller. This Agreement has been duly
executed and delivered by Seller and constitutes its legal, valid and binding
obligation, enforceable against it in accordance with its terms, except as the
enforceability of this Agreement may be affected by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and by judicial discretion
in the enforcement of equitable remedies.
3.3 Absence of Conflicting Agreements; Consents. The execution and
delivery of this Agreement, and the performance of the transactions
contemplated herein, by Seller will not require any consent, approval,
authorization or other action by, or filing with or notification to, any Person
or governmental authority, except as follows: (a) applicable requirements under
the HSR Act; (b) consents to the assignment of the FCC Licenses to Buyer (and,
as applicable, to LPI) by the FCC; (c) filings with respect to real estate,
sales and other transfer taxes; (d) consent of third parties to assignment of
certain of the Assumed Contracts as specified in Schedule 3.3; and (e) other
immaterial consents, approvals, authorizations, actions, filings or
notifications. Subject to obtaining the Consents, the execution, delivery and
performance by Seller of this Agreement (with or without the giving of notice,
the lapse of time, or both): (a) do not conflict with any provision of the
Certificate of
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Incorporation and Bylaws of Seller; (b) do not conflict with, result in a
breach of, or constitute a default in any material respect under, any
applicable law, judgment, order, ordinance, injunction, decree, rule,
regulation or ruling of any court or governmental authority applicable to
Seller; (c) do not result in the breach in any material respect of any contract
or agreement to which Seller is a party or by which Seller may be bound; and
(d) will not create any Lien upon any of the Assets, except for Permitted
Liens.
3.4 Governmental Licenses. (a) Schedule 3.4 identifies all FCC
Licenses used in the operation of the Stations (collectively, "Material
Licenses") and the date on which each expires. Except as described on Schedule
3.4, each Material License is in full force and effect, and Seller is the
authorized legal holder thereof. Except as set forth in Schedule 3.4, the
conduct of the business and operations of each Station is in accordance in all
material respects with the terms and conditions of the Material Licenses for
such Station and the Communications Act and the rules, regulations and policies
of the FCC. Schedule 3.4 also sets forth a true and complete list of all
applications filed with respect to any Station that are pending at the FCC
(other than applications for auxiliary broadcast authorizations), true and
complete copies of which have been delivered by Seller to Buyer. All material
reports and filings required to be filed with the FCC by Seller with respect to
each Station have been timely filed in all material respects. All such reports
and filings are accurate and complete in all material respects. Seller has
received no notice or communication, formal or informal, indicating that the
FCC is considering revoking, suspending, canceling, rescinding or terminating
any Material License. Seller's operation of the Stations complies in all
material respects with the requirements set forth in the "Radio Frequency
Protection Guides" recommended in "American National Standard Safety Levels
with Respect to Human Exposure to Radio Frequency Xxxxxxxxxxxxxxx Xxxxxx 000
XXx xx 000 XXx" (XXXX C95.1-1982), issued by the American National Standards
Institute, and renewal of the FCC Licenses would not constitute a "major
action" within the meaning of Section 1.1301, et seq. of the FCC's rules.
(b) The FCC Licenses listed on Schedule 3.4 constitute all of the
material licenses and authorizations required under the Communications Act or
the current rules, regulations and policies of the FCC for the business and
operation of each Station for which such FCC Licenses are issued as currently
operated, except as set forth in Schedule 3.4. Except as set forth in Schedule
3.13, and except for investigations or other proceedings affecting the
broadcasting industry generally, Seller has no knowledge of any pending or
threatened investigation by or
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before the FCC, or any order to show cause, notice of violation, notice of
apparent liability, notice of forfeiture or material complaint by, before or
with the FCC with respect to any Station. Seller knows of no fact relating to
Seller's ownership or operation of the Stations that would, under existing law
and the existing rules, regulations, policies and procedures of the FCC, cause
the FCC to fail to approve in a timely fashion any of the applications for the
FCC Consents. As of the date hereof, Seller knows of no fact relating to ARS's
ownership or operation of the Group IV Stations that would, under existing law
and the existing rules, regulations, policies and procedures of the FCC, cause
the FCC to fail to approve in a timely fashion any of the applications for the
consent of the FCC to the assignment of the FCC Licenses included in the Group
IV Assets by ARS to PCWPB as contemplated by the ARS Asset Purchase Agreement.
3.5 Real Property. Schedule 3.5 contains an accurate description
as of the date of this Agreement of all Real Property. Except as described in
Schedule 3.5, Seller has good and marketable fee simple title to all fee
estates included in the Real Property and good title to Seller's interests in
all other Real Property, in each case free and clear of all Liens, except for
Permitted Liens. Schedule 3.5 lists all leases and subleases pursuant to which
any of the Real Property included in the Assets is leased by Seller. Seller has
a valid leasehold interest in all such Real Property. Subject to obtaining the
consents to assignment set forth on Schedule 3.3, such leases and subleases are
assignable to Buyer. Seller is in compliance with such leases and subleases in
all material respects and is not in breach or default in any material respect
thereunder, and, to the knowledge of Seller, each other party to any such lease
or sublease is not in default thereunder in any material respect. The Real
Property includes sufficient access to the Stations' facilities to conduct the
operations of the Stations in the manner in which they are currently operated
without the need to obtain other access rights, except where the failure to
have such access would not be material. Seller has delivered to Buyer a true
and complete copy of any and all title insurance policies, surveys, plans and
maps relating to the Real Property in the custody, possession or control of
Seller. None of the Real Property is subject to any lease, sublease, license or
other agreement pursuant to which Seller grants to any other person any right
to the use, occupancy or enjoyment of the Real Property or any part thereof,
except as set forth on Schedule 3.5. There is no pending or, to the knowledge
of Seller, threatened condemnation or similar proceeding affecting any Real
Property. All buildings, towers and other improvements included within the Real
Property are in working order and repair. The use of the Real Property to
operate the Stations is in compliance in all material respects with applicable
zoning and land-use laws. As
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of the date hereof, Seller has received no actual written notice of any
increase in property taxes affecting any item of Real Property to an amount in
excess of 110% of the current taxes on such Real Property or of any other
imposition which is not materially consistent with existing impositions, the
effect of which is, if required, reflected on Seller's financial statements;
provided that the foregoing shall not relate to increases resulting from
improvements to the property made by Seller.
3.6 Tangible Personal Property. Schedule 3.6 lists as of the date
hereof all material items of Tangible Personal Property included in the Assets
owned by Seller. Except as described in Schedule 3.6, Seller owns and has good
title to the Tangible Personal Property listed thereon and none of the Tangible
Personal Property included in the Assets is subject to any Liens, except for
Permitted Liens. Except for the matters described on Schedule 6.14(b) with
respect to the WNLS(AM) transmitting towers, the Tangible Personal Property
listed on Schedule 3.6 owned by Seller necessary for the normal operations of
the Stations as presently conducted is in satisfactory operating condition and
adequate repair (given the age of such property and the use to which such
property is put and ordinary wear and tear excepted).
3.7 Assumed Contracts. Schedules 3.5, 3.7 and 3.12 include a
complete list as of the date of this Agreement of all Assumed Contracts except
(a) contracts with advertisers for production or the sale of advertising time
on any Station for cash that may be canceled by Seller on not more than ninety
days' notice without penalty, (b) trade or barter advertising agreements
entered into in the ordinary course of business, (c) oral employment contracts
terminable at will, (d) miscellaneous service contracts terminable on not more
than thirty (30) days' notice, and (e) other Contracts entered into in the
ordinary course of business, not involving liabilities exceeding Two Thousand
Five Hundred Dollars ($2,500) per contract per year and One Hundred Twenty-Five
Thousand Dollars ($125,000) per year in the aggregate for all Stations and the
Businesses for all such other contracts. Seller has delivered or made available
to Buyer true and complete copies of all written Assumed Contracts and accurate
descriptions of all oral Assumed Contracts listed in Schedules 3.5, 3.7 and
3.12. The Assumed Contracts are in full force and effect in all material
respects. Subject to obtaining the consents to assignment set forth on Schedule
3.3, the Assumed Contracts are assignable to Buyer. Seller is in compliance
with the Assumed Contracts in all material respects and is not in breach or
default in any material respect thereunder, and, to the knowledge of Seller,
each other party to the Assumed Contracts is
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in compliance therewith in all material respects and not in default in any
material respect thereunder.
3.8 Intangibles. Schedule 3.8 is a complete list as of the date
of this Agreement of all material Intangibles (exclusive of Licenses listed in
Schedule 3.4). Seller has provided or made available to Buyer copies of all
documents establishing or evidencing the Intangibles listed in Schedule 3.8.
Other than with respect to matters generally affecting the radio broadcasting
industry and not particular to Seller, as of the date hereof, except as set
forth in Schedule 3.8, Seller has not received any notice or demand alleging
that Seller is infringing upon any trademarks, trade names, service marks,
service names, copyrights or similar intellectual property rights owned by any
other Person.
3.9 Financial Statements. Seller has furnished Buyer with true and
complete copies of the financial statements with respect to the Stations
described in Schedule 3.9 (the "Financial Statements"). Except as set forth in
Schedule 3.9, the Financial Statements have been prepared in accordance with
GAAP, and present fairly in all material respects the financial condition of
Seller with respect to the Stations included in such Financial Statements as at
their respective dates and the results of operations for the periods then
ended.
3.10 Taxes and Tax Returns. Except as set forth in Schedule 3.10
and except where the failure to file, pay or accrue any Taxes does not result
in a Lien on the Assets or in the imposition of transferee or other liability
on Buyer for the payment of Taxes, (a) all Tax Returns have been filed with the
appropriate governmental agencies in all jurisdictions in which such Tax
Returns are required to be filed, and (b) all Taxes shown on such Tax Returns
have been properly accrued or paid to the extent such Taxes have become due.
3.11 Insurance. Schedule 3.11 is a true and complete list of all
insurance policies of Seller with respect to the Stations' Business. All
policies of insurance listed in Schedule 3.11 are in full force and effect.
3.12 Personnel. Schedule 3.12 contains a true and complete list as
of the date of this Agreement of all employees of Seller engaged in the
business and operations of each Station (collectively, the "Employees"), and a
description of the compensation arrangements affecting them. Except as
described in Schedule 3.12, as of the date hereof, Seller has no written or
oral contracts of employment with any employee of the Stations other than oral
employment contracts which are terminable at will. Except as set forth in
Schedule 3.12, Seller is not a
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party to or subject to any collective bargaining agreements with respect to the
Stations, and no labor union or other collective bargaining unit represents or,
to Seller's knowledge, claims to represent any of the employees of the
Stations. Seller has made available to Buyer copies of all employee handbooks
and employee rules and regulations, if any.
3.13 Claims and Legal Actions. Except as disclosed in Schedule 3.13
and for any FCC rulemaking proceedings generally affecting the radio
broadcasting industry and not particular to Seller, as of the date hereof,
there is no material claim, legal action, counterclaim, suit, arbitration, or
other legal, administrative, or tax proceeding, nor any material order, decree,
or judgment, in progress or pending, or to the knowledge of Seller threatened,
against Seller, the Assets, or the business or operations of any Station.
3.14 Compliance with Laws. Seller is in compliance in all material
respects with all federal, state and local laws, rules, regulations and
ordinances applicable or relating to the ownership and operation of the
Stations.
3.15 Conduct of Business in Ordinary Course. Except as set forth in
Schedule 3.15, from January 1, 1997 through the date of this Agreement, Seller
has conducted the business and operations of the Stations in the ordinary
course consistent with past practice in all material respects and has not (a)
made any material increase in compensation payable or to become payable to any
of the employees of the Stations except as disclosed in Schedule 3.12, or any
material change in personnel policies, insurance benefits or other compensation
arrangements affecting the employees of the Stations, (b) made any sale,
assignment, lease or other transfer of any of Seller's properties, other than
obsolete assets no longer usable in the operation of such Station, or other
assets sold or disposed of in the normal course of business with suitable
replacements being obtained therefor, (c) incurred material loss of, or
material injury to, any of the Assets as a result of any fire, explosion,
windstorm, earthquake, labor trouble, riot, accident, act of God or public
authority or armed forces or other casualty or waived any rights of substantial
value related to the Assets, (d) made any material change in any method of
accounting or accounting practice, or (e) transferred to any Affiliate of
Seller any right, property or interest which is necessary or useful in the
operation of the Stations' Business.
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3.16 Environmental Matters.
(a) For purposes of this Agreement, the following
definitions shall be applicable:
(i) "Applicable Environmental Law" shall mean any
and all laws, statutes, regulations, and judicial interpretations thereof of
the United States, of any state in which the Assets, or any portion thereof, or
the business of any Station, are located, and of any other government or
quasi-government authority having jurisdiction, that relate to the prevention,
abatement and elimination of pollution and/or protection of the environment,
including, but not limited to, the federal Comprehensive Environmental
Response, Compensation, and Liability Act, the Resource Conservation and
Recovery Act, the Federal Water Pollution Control Act, the Clean Air Act, the
Safe Drinking Water Act, the Toxic Substances Control Act, the Hazardous
Materials Transportation Act, the Refuse Act and the Emergency Planning and
Community Right to Know Act (each as amended on or before the applicable
Effective Time), together with all state statutes serving any similar or
related purposes, as in effect on or before the applicable Effective Time.
(ii) "Hazardous Substance" means any substance
designated pursuant to Section 307(a) and 311(b)(2)(A) of the federal Clean
Water Act, 33 USCA xx.xx. 1317(a), 1321(b)(2)(A), Section 112 of the federal
Clean Air Act, 42 USCA ss. 3412, Section 3001 of the federal Resource
Conversation and Recovery Act, 42 USCA ss. 6921, Section 7 of the federal Toxic
Substances Control Act, 15 USCA ss. 2606, or Section 101(14) and Section 102 of
the Comprehensive Environmental Response, Compensation, and Liability Act, 42
USCA xx.xx. 9601(14), 9602, as amended by the Superfund Amendments and
Reorganization Act of 1986.
(b) Seller has supplied to Buyer a true and complete copy
of the report for each environmental inspection or audit that Seller has caused
to be conducted with respect to any of the Real Property as listed in Schedule
3.16.
(c) (i) Except as set forth in Schedule 3.16, the
improvements owned or used by Seller on the owned Real Property and on the
leased Real Property do not contain any asbestos that would constitute a
violation of or noncompliance with any Applicable Environmental Law in any
material respect. The equipment owned or used by Seller on the owned Real
Property or any leased Real Property does not contain any polychlorinated
biphenyls that would constitute a violation of or noncompliance with any
Applicable Environmental Law in any material respect.
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(ii) No contamination caused by Seller exists on
or under the owned Real Property or on or under any leased Real Property, or
affecting any natural resources therein that would constitute a violation of or
noncompliance with any Applicable Environmental Law in any material respect.
(iii) No contamination has been caused by Seller
on or under the owned Real Property or leased Real Property, or affecting any
natural resources therein that would constitute a violation of or noncompliance
with any Applicable Environmental Law in any material respect.
(iv) The Assets and the Stations' Business are in
compliance with all Applicable Environmental Laws in all material
respects.
(v) Seller has no material liability relating to
its ownership and operation of any of the Stations as a result of noncompliance
with any Applicable Environmental Law. No charge, complaint, action, suit,
proceeding, hearing, investigation, claim, demand, or notice has been filed or,
to Seller's knowledge, commenced against Seller in connection with its
ownership or operation of any of the Stations alleging any failure to comply in
any material respect with any Applicable Environmental Law.
3.17 Brokers. Except for the fees payable to Communications Equity
Associates ("CEA"), which fees shall be paid by Buyer and Seller as set forth
in Section 6.11, neither Seller nor any Person acting on its behalf has
incurred any liability for any finders' or brokers' fees or commissions in
connection with the transactions contemplated by this Agreement.
3.18 Transactions With Affiliates. Except as set forth in Schedule
3.18, Seller is not, and since January 1, 1997, has not been a party, directly
or indirectly, to any contract, lease, arrangement or transaction which is
material to the business or operations of any Station, whether for the
purchase, lease or sale of property, for the rendition of services or
otherwise, with any Affiliate of Seller, or any officer, director, employee,
proprietor, partner or shareholder of Seller, and no such Person has any
interest in or right to any of the Assets. The terms and conditions of the
transactions involving Seller and any Affiliate of Seller which are identified
in Schedule 3.18 are described briefly therein.
3.19 Assets. Except for the Excluded Assets, the Assets include all
of the assets or property used in the conduct of the business of the Stations
as currently operated.
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3.20 Employee Benefits. Schedule 3.20 lists all Employee Plans
covering employees of the Stations and, except as set forth in Schedule 3.20,
copies of such Employee Plans together with any trusts related thereto have
previously been made available to Buyer. All Employee Plans are in compliance
with their terms and with the applicable provisions of ERISA and the Code in
all material respects. No Employee Plan is, or within the past six years has
been, subject to Title IV of ERISA or Section 412 of the Code. Seller has at no
time contributed to, or been obligated to contribute to, any multi-employer
plan (as defined in ERISA Section 3(37)). There exists no action, suit or claim
(other than routine claims for benefits) with respect to any Employee Plan
pending, or to the knowledge of Seller threatened, against any Employee Plan
which is reasonably expected to result in any material liability to Seller.
Except as required by ERISA Sections 601 et seq. and Code Section 4980B, Seller
does not sponsor, maintain or contribute to any Employee Plan which provides
medical coverage to retirees or other former employees of Seller. Seller has
not engaged in any transaction described in ERISA Section 4069 within the past
five years. There is no governmental audit or examination of any Employee Plan.
All contributions and premium payments required by law have been made in all
material respects to each Employee Plan. Each Employee Plan that is intended to
be qualified under Section 401(a) of the Code has received a favorable
determination letter that it is so qualified.
3.21 Foreign Person. Seller is not a "foreign person" or a "foreign
corporation" as such terms are defined in Section 1445 of the Code.
3.22 Like-kind Exchange. If Seller elects under Section 11.10 to
effect the transfer of some or all of the Assets to Buyer in a manner
qualifying as part of a like-kind exchange of property by Seller within the
meaning of Section 1031 of the Code, Buyer's tax basis in the Assets shall not
be less than the tax basis Buyer would have had in the Assets had Seller not
made such an election under Section 11.10.
3.23 ARS APA. Seller has delivered to Buyer a true, correct and
complete copy of the ARS Asset Purchase Agreement (including, without
limitation, all Schedules, Exhibits and other attachments thereto) as in effect
on the date hereof. The ARS Asset Purchase Agreement and the other agreements
and documents referred to therein set forth the entire agreement of PCWPB and
ARS with respect to the Group IV Stations. As of the date hereof, the ARS Asset
Purchase Agreement has not been terminated, amended or modified, and no
material rights of PCWPB or obligations of ARS thereunder have been waived.
PCWPB is in compliance with the ARS Asset Purchase Agreement in all material
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respects and is not in material breach or default thereunder, and, to the
knowledge of Seller, as of the date hereof, ARS is in compliance therewith in
all material respects and not in material breach or default thereunder. To
Seller's knowledge, as of the date hereof, no event has occurred or condition
exists that with notice or the passage of time or both would result in a breach
or default thereunder by any party thereto.
3.24 Disclosure. None of the representations or warranties of
Seller in this Agreement contains or will contain any untrue or misleading
statement of material fact or omits or will omit to state any material fact
necessary to make the statements herein or therein, in light of the
circumstances under which they were made, not misleading.
3.25 Limitations. Buyer acknowledges and agrees that
notwithstanding anything to the contrary contained in this Agreement, none of
the representations and warranties of Seller contained herein shall apply in
respect of or be made or deemed to be made in respect of WKES or the Group IV
Assets, or any matter or item relating to or attributable to or otherwise
arising in connection with WKES or the Group IV Assets, except as they relate
solely to any period of time during which Seller or any of its Affiliates owned
the Assets related to WKES or the Group IV Assets, as the case may be, and
performed the Assumed Liabilities related to WKES or the Group IV Assumed
Liabilities, as the case may be.
SECTION 4 REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows (i) as of the date
hereof, (ii) (subject to the provisions of Section 7.2(a) hereof) as of the
Effective Time in respect of the Group II/III Assets and the Group V Assets and
(iii) (subject to the provisions of Section 7.2(a) hereof), to the extent
specifically contemplated by Section 6.10(a)(iv)(2) hereof, as of the Group
II/III Closing Date and the Group V Closing Date:
4.1 Organization, Standing and Authority. Buyer is a corporation
duly organized, validly existing and in good standing under the laws of the
State of Nevada and, at the applicable Effective Time will be duly qualified to
conduct business in each jurisdiction in which such qualification is necessary
for Buyer to own the Assets and operate the Stations. Buyer has the requisite
corporate power and authority to (a) execute, deliver and perform this
Agreement according to its terms, and (b) own the Assets.
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4.2 Authorization and Binding Obligation. The execution, delivery
and performance of this Agreement and the consummation of the transactions
contemplated hereby by Buyer have been duly and validly authorized by all
necessary corporate action on the part of Buyer. This Agreement has been duly
executed and delivered by Buyer and constitutes legal, valid and binding
obligations of Buyer, enforceable against Buyer in accordance with their
respective terms, except as the enforceability of this Agreement may be
affected by bankruptcy, insolvency or similar laws affecting creditors' rights
generally and by judicial discretion in the enforcement of equitable remedies.
4.3 Absence of Conflicting Agreements and Required Consents.
Except for applicable requirements of the HSR Act and subject to the receipt of
the FCC Consent, the execution, delivery and performance by Buyer of this
Agreement (with or without the giving of notice, the lapse of time, or both):
(a) do not require the consent of any third party; (b) do not conflict with the
articles of incorporation or bylaws of Buyer; (c) do not conflict in any
material respect with, result in a material breach of, or constitute a material
default under, any applicable law, judgment, order, ordinance, injunction,
decree, rule, regulation, or ruling of any court or governmental authority
applicable to Buyer or any material contract or agreement to which Buyer is a
party or by which Buyer may be bound.
4.4 Buyer Qualifications. To Buyer's knowledge, except as set
forth on Schedule 4.4 and subject to receipt of the waivers described in
Section 6.1 below, Buyer is legally, financially and otherwise qualified to
enter into and perform its obligations under each TBA and to be the licensee
of, acquire, own and operate each of the Stations under the Communications Act,
and the rules, regulations and policies of the FCC. Subject to receipt of the
waivers described in Section 6.1 below, Buyer knows of no fact that would,
under existing law and the existing rules, regulations, policies and procedures
of the FCC (a) prohibit Buyer from entering into and performing its obligations
under any TBA, (b) disqualify Buyer as an assignee of the FCC Licenses or as
the owner and operator of any Station or (c) cause the FCC to fail to approve
in a timely fashion any of the applications for the FCC Consents. To Buyer's
knowledge, except as described in Section 6.1 below, no waiver of any FCC rule
or policy is necessary to be obtained for the grant of the applications for the
assignment of the FCC Licenses to Buyer, nor will processing pursuant to any
exception to a rule of general applicability be requested or required in
connection with the consummation of the transactions contemplated hereby.
26
4.5 Brokers. Except for the fees payable to CEA, which fees shall
be paid by Buyer and Seller as set forth in Section 6.11, neither Buyer nor any
Person acting on its behalf has incurred any liability for any finders' or
brokers' fees or commissions in connection with the transactions contemplated
by this Agreement.
4.6 Availability of Funds. Buyer will have available sufficient
funds to enable it to consummate the transactions contemplated hereby,
including, without limitation, to make the loans under the Clear Channel Loan
Agreement.
4.7 Disclosure. None of the representations or warranties of Buyer
in this Agreement contains or will contain any untrue or misleading statement
of material fact or omits or will omit to state any material fact necessary to
make the statements herein or therein, in light of the circumstances under
which they were made, not misleading.
SECTION 5 OPERATIONS OF THE STATIONS PRIOR TO EFFECTIVE TIME OR CLOSING
The following covenants of Seller in Sections 5.1 through 5.8 below
shall apply between the date of this Agreement and either the applicable
Effective Time or the applicable Closing, as specified, with respect to the
Stations. Notwithstanding anything to the contrary contained in this Agreement,
Buyer and Seller acknowledge and agree that nothing in this Agreement shall
apply to, or in any way restrict or limit, any of the businesses or operations
of the Seller, other than the businesses and operations of the Stations.
5.1 Generally. Between the date hereof and the relevant Effective
Time, Seller shall operate the Stations in all material respects in the
ordinary course of business (except where such conduct would conflict with the
following covenants or with Seller's other obligations under this Agreement).
Between the date hereof and the relevant Effective Time, Seller shall maintain
and repair Station facilities and equipment, maintain inventory of supplies,
parts and other materials and keep books of account, records and files, in each
case in the ordinary course of business consistent with past practice to the
extent commercially reasonable. Between the date hereof and the relevant
Effective Time, Seller shall continue to operate each Station in accordance
with the terms of its FCC Licenses in all material respects and in compliance
in all material respects with all applicable laws and FCC rules and
regulations.
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Prior to the relevant Closing, except as provided in Schedule 5.1 or
as otherwise permitted by any provision of this Section 5.1, and subject to and
except as provided in any applicable TBA pursuant to which Seller may take
actions thereunder, and without limiting any of Buyer's obligations thereunder,
Seller, with respect to the Stations, will not, without the prior written
consent of Buyer, which consent shall not be unreasonably withheld:
(a) apply to the FCC for any construction permit that would
restrict any Station's present operations, or make any material change in any
Station's buildings, leasehold improvements or fixtures that is not in the
ordinary course of business;
(b) enter into, renew, amend or modify any contract, lease,
license or other agreement; provided that prior to the relevant Effective Time
(1) Seller shall be permitted to enter into or renew, in the ordinary course of
business, any contract, lease, license or other agreement not involving
liabilities exceeding Two Thousand Five Hundred Dollars ($2,500) per contract,
lease, license or agreement per year and One Hundred Twenty-Five Thousand
Dollars ($125,000) per year in the aggregate for all Stations and the
Businesses (as defined in the Group I Purchase Agreement) for all such
contracts, leases, licenses and other agreements, (2) Seller shall be permitted
to enter into trade or barter agreements, in the ordinary course of business,
consistent with past practice, which do not result in a Negative Balance and as
set forth in Section 5.1(f) below, and (3) nothing contained herein shall be
deemed to prevent Seller from entering into any contract, lease, license or
other agreement not falling within the scope of the foregoing clauses of this
Section 5.1(b), provided, that, any such contract, lease, license or other
agreement shall not constitute an Assumed Contract unless expressly agreed to
by Buyer;
(c) make any assignment for the benefit of creditors or take
any action in contemplation of, or which would constitute the basis for, the
institution of insolvency proceedings of any character, including without
limitation, bankruptcy, receivership, reorganization, composition or
arrangement with creditors, voluntary or involuntary;
(d) except as required by law or the Assumed Contracts, (i)
hire any employee except in the ordinary course of business, (ii) enter into,
renew, amend or modify any contract of employment, collective bargaining
agreement or other labor contract or (iii) permit any increases in the
compensation of any of the employees of any Station except for employees
without employment contracts, salary increases each January 1 and July 1
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consistent with past practices not exceeding 5% per year; provided, however,
that (i) Seller may pay bonuses to any of its employees so long as such bonuses
do not create any liability or obligation upon Buyer, and (ii) Seller may amend
any contract of employment to delete the provisions thereof which grant to an
employee an option to purchase common stock of PCC;
(e) discount or otherwise reduce any accounts receivable of any
Station, or collect any such receivables other than in the ordinary course of
business consistent with past practice; and
(f) enter into any trade or barter agreements which would cause
the value of goods or services to be received by all the Stations and the
Businesses (as defined in the Group I Purchase Agreement) as of the related
Effective Time in the aggregate to result in a Negative Balance; provided,
however, that to the extent that Seller determines in good faith that it is
necessary to enter into such a trade or barter agreement, Seller may do so, but
if such agreement has not been consented to by Buyer and causes a Negative
Balance, Buyer shall have no obligation in respect of such agreement to the
extent of the obligations thereunder which cause such Negative Balance.
Whenever, pursuant to subsections (a) through (f) above, Seller shall request
the consent of Buyer, the request shall be sent in writing via facsimile to
Buyer in accordance with Section 11.2. With respect to requests for consent
under Section 5.1, unless Buyer gives or denies its written consent by the end
of the fifth Business Day after the request for consent is transmitted to
Buyer, Buyer's written consent will be presumed to have been given as of that
deadline. With respect to each Station, prior to the Closing applicable
thereto, Seller shall maintain in full force and effect the insurance policies
of Seller listed on Schedule 3.11 with respect to the Station or policies
providing similar coverage, and make and prosecute all claims thereunder in
respect of any loss or damage to any of the Assets in accordance with past
practice, and apply the proceeds thereof to the repair or replacement of any
such Assets. With respect to each Station, prior to the Effective Time
applicable thereto, Seller shall promote the Station in the ordinary course of
business, consistent with past practice.
5.2 Dispositions. Prior to the relevant Closing Date, except as
contemplated by this Agreement or set forth on Schedule 5.2, and subject to and
except as provided in any applicable TBA pursuant to which Seller may take
actions thereunder, and without limiting any of Buyer's obligations thereunder,
Seller shall not sell, assign, lease, or otherwise transfer or dispose of any
of the Assets, except any Assets no longer used in the business or
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operations of any Station or any Assets that are replaced with replacement
property of equivalent value, kind and use. Notwithstanding the foregoing or
anything else contained in this Agreement, the expiration by their terms of
Contracts prior to such Closing shall not be deemed to be a violation of this
Agreement.
5.3 Liens. Prior to the relevant Closing Date, Seller shall not
create, assume or permit to exist any Liens upon the Assets, except for
Permitted Liens and Liens that will be discharged prior to or on the Closing
Date.
5.4 Access to Information. Prior to the relevant Closing Date,
Seller shall give Buyer and its employees and other authorized representatives
during normal business hours and with reasonable prior notice, access to the
Assets and to all other books, records and documents of Seller relating to the
Stations (such access not to unreasonably interfere with the business or
operations of any Station), including, without limitation, for purposes of
conducting any surveys and/or environmental assessments of Real Property
included in the Assets in accordance with Section 6.9, and will furnish or
cause to be furnished to Buyer or its authorized representatives, upon
reasonable notice, all information with respect to the business and operation
of the Stations owned by Seller that Buyer may reasonably request; provided
that the foregoing do not unreasonably disrupt the business of Seller. As soon
as practicable after the date hereof, and in any case prior to August 29, 1997,
Seller shall provide Buyer with a list of all names under which any of the
Stations' Businesses have been conducted by Seller or any Affiliates of Seller.
5.5 Financial Information. For all periods prior to the relevant
Effective Time, Seller shall furnish Buyer within twenty (20) days after the
end of each calendar month after the date hereof an unaudited statement of
income and expense for such month of the Stations owned by Seller and such
other financial information prepared by Seller relating to the operations of
the Stations owned by Seller, as Buyer may reasonably request (the "Monthly
Financial Information"). The Monthly Financial Information shall be prepared in
accordance with GAAP (except for the absence of footnotes and year-end
adjustments otherwise required by GAAP) and shall present fairly in all
material respects the financial condition of Seller with respect to the
Stations included in such Monthly Financial Information as at the date thereof
and for the periods then ended, as appropriate.
5.6 Notice of Proceedings. Prior to the last Closing hereunder,
Seller and Buyer will promptly notify the other in writing upon becoming aware
of any order or decree or any
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complaint praying for an order or decree restraining or enjoining the
consummation of this Agreement, or the transactions contemplated hereunder, or
upon receiving any notice from any court or government authority of its
intention to institute an investigation into, or institute a suit or proceeding
to restrain or enjoin the consummation of this Agreement or the transactions
contemplated hereunder, or to nullify or render ineffective this Agreement, or
such transactions if consummated. Seller and Buyer will each use commercially
reasonable efforts to contest, defend and resolve any such suit, proceeding or
injunction brought against it, and to cause any temporary restraining order or
preliminary injunction against such consummation to be lifted, promptly, so as
to permit the consummation of the transactions contemplated hereby and thereby.
5.7 ARS APA. Except as otherwise set forth in the last sentence of
this Section 5.7, until the Group IV Closing, Seller shall cause PCWPB to
(i)use commercially reasonable efforts to maintain the ARS Asset Purchase
Agreement in full force and effect in accordance with its terms, (ii) use
commercially reasonable efforts to comply with the terms of the ARS Asset
Purchase Agreement applicable to it, (iii) not terminate, amend, modify or
waive any of Seller's rights, or ARS's obligations under, the ARS Asset
Purchase Agreement, without Buyer's prior written consent which shall not be
unreasonably withheld, (iv) at Seller's sole cost, use commercially reasonable
efforts to enforce PCWPB's rights thereunder, (v) use commercially reasonable
efforts to cause all conditions precedent to PCWPB's obligation to close under
the ARS Asset Purchase Agreement to be satisfied, (vi) as soon as practicable
after the time of receipt or delivery by PCWPB, deliver to Buyer copies, of all
notices and other documents received or delivered by PCWPB under the ARS Asset
Purchase Agreement, including, without limitation, all written information
received by PCWPB from ARS or any Affiliate of ARS regarding the cash flow of
the Group IV Stations which is relevant to the applicability of Section 7.1G of
the ARS Asset Purchase Agreement or to the mechanism under Section 2.4 thereof
pursuant to which the purchase price under the ARS Asset Purchase Agreement may
be reduced, (vii) notify Buyer promptly upon learning of any (A) noncompliance
with the ARS Asset Purchase Agreement, (B) material breach or default under the
ARS Asset Purchase Agreement (or any event or condition that with notice or the
passage of time or both would constitute a material breach or default
thereunder), or (C) event or condition that renders any representation or
warranty in the ARS Asset Purchase Agreement untrue or misleading in any
material respect (or would have rendered any such representation or warranty
untrue or misleading in any material respect if such event or condition had
been known to the party making the same at the time made), (viii) use
commercially reasonable efforts to consummate the closing under
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the ARS Asset Purchase Agreement on the earliest date permitted thereunder, and
(ix) use commercially reasonable efforts to otherwise afford Buyer the benefits
received by PCWPB under the ARS Asset Purchase Agreement. Notwithstanding
anything to the contrary contained herein, Seller, in its sole discretion and
without any liability to Buyer, may cause PCWPB to terminate the ARS Asset
Purchase Agreement in accordance with its terms; provided, however, that if the
condition set forth in Section 7.1G of the ARS Asset Purchase Agreement is not
satisfied, but Seller elects not to cause PCWPB to terminate the ARS Asset
Purchase Agreement, Seller shall (x) timely notify Buyer in writing of such
election and (y) provide Buyer with the opportunity, in Buyer's sole
discretion, upon timely written notice to Seller, to cause Seller to cause
PCWPB to terminate the ARS Asset Purchase Agreement in accordance with such
written notice and the provisions of the ARS Asset Purchase Agreement. If the
ARS Asset Purchase Agreement is terminated pursuant to this Section 5.7, the
Group IV Closing shall not take place and all provisions of this Agreement
related to the purchase of the Group IV Assets by Buyer and the Group IV TBA
shall terminate and be of no further force and effect.
5.8 Representations and Warranties. Prior to the relevant
Effective Time with respect to all representations and warranties contained in
this Agreement, and, with respect to the representations and warranties of
Seller set forth in Sections 3.1 and 3.2, the second sentence of Section 3.4
(with respect to Main Station FCC Licenses only and other than as a result of
any action or inaction by Buyer), the second and fourth sentences of Section
3.5, the second sentence of Section 3.6 and Section 3.10 only, prior to the
relevant Closing Date, Seller shall give Buyer detailed written notice promptly
upon becoming aware (i) that any such representation or warranty of Seller
under this Agreement, or under any document, instrument or agreement made or
delivered by Seller in connection herewith, is untrue or misleading in any
material respect and (ii) of any event or condition that would render any such
representation or warranty untrue or misleading in any material respect if such
event or condition were known to Seller when such representation or warranty
was made.
5.9 Marketing. Prior to the related Effective Time, Seller shall
provide Buyer with reasonable access to its senior management at the Stations
to enable Buyer to develop marketing plans to be implemented by Buyer after
such Effective Time; provided, however, that such access shall be upon
reasonable prior notice and shall not unreasonably interfere with Seller's
operations.
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SECTION 6 SPECIAL COVENANTS AND AGREEMENTS
6.1 FCC Consent.
(a) The purchase and sale of the Assets as contemplated by this
Agreement is subject to the prior consent and approval of the FCC.
(b) Buyer and Seller acknowledge that (i) Seller and LPI have
prepared and, on June 23, 1997, filed with the FCC appropriate applications for
the FCC Pro Forma Consent and (ii) Buyer and Seller have prepared and, on June
27, 1997, filed with the FCC appropriate applications for the FCC Consents.
Buyer and PCC shall prosecute the applications to which they are a party with
commercially reasonable diligence and otherwise use their commercially
reasonable efforts to obtain the grants of the applications as expeditiously as
practicable. Each party will promptly provide to the other party a copy of any
pleading, order or other document served on it relating to such applications.
(c) Buyer's portion of the applications for the FCC Consents
included a request for a waiver of the FCC's one-to-a- market rule (47 C.F.R.
73.3555(c)) to permit the common ownership of radio stations WFSJ(FM),
WZNZ(AM), WNZS(AM), WROO(FM), WTLK(FM) and WPLA(FM) and Buyer's existing
television station WAWS(TV) (the "Jacksonville One-To-A-Market Waiver"). Buyer
filed with the FCC on July 25, 1997 a request for waiver of the FCC's
one-to-a-market rule (47 C.F.R. 73.3555(c)) to permit common ownership of radio
station WTKX(FM) and Buyer's existing television station WPMI-TV (the
"Pensacola One-To-A-Market Waiver"). Notwithstanding any provision in this
Agreement to the contrary, Buyer's obligations to consummate the transactions
contemplated by this Agreement shall not be affected by the imposition of any
condition in an FCC Consent requiring compliance with the outcome in the
pending television ownership rulemaking proceeding, Review of Commission's
Regulations Governing Television Broadcast Ownership, Second Further Notice of
Proposed Rulemaking, MM Docket Nos. 91-221 and 87-8, FCC 96- 438 (released
November 7, 1996); should divestiture be required as a result of that
proceeding, Buyer will file an application for FCC consent to sell the
necessary station(s) within any period specified by the FCC from the release of
the final Order in that proceeding. Furthermore, each party agrees to comply
with any other condition imposed on it by any FCC Consent, provided that,
except to the extent provided in the previous sentence of this Section 6.1, no
party shall be required to comply with a condition if compliance with the
condition would materially adversely affect it. Buyer shall promptly provide to
the FCC any information requested by the FCC in connection with its
consideration of the Jacksonville One-To-A-Market Waiver and
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the Pensacola One-To-A-Market Waiver. Buyer and Seller shall oppose any
petitions to deny or other objections filed with respect to any application for
FCC Consent and any requests for reconsideration or review of any FCC Consent.
(d) If any Closing shall not have occurred for any reason within
the original effective period of any FCC Consent applicable to such Closing,
and neither party shall have terminated this Agreement under Section 9, the
parties shall jointly request an extension of the effective period of such FCC
Consent. No extension of the effective period of any FCC Consent
shall limit the exercise by either party of its right to terminate the
Agreement under Section 9.
6.2 HSR Act Filing. Seller and Buyer acknowledge that they have filed,
or caused to be filed, with the U.S. Department of Justice ("DOJ") and Federal
Trade Commission ("FTC") certain filings that are required in connection with
the transactions contemplated hereby under the HSR Act and submitted to the
other party, prior to the filing thereof, their respective HSR Act filings and
discussed with the other any comments the reviewing party may have had. Seller
and Buyer agree to file, or cause to be filed, on or before August 26, 1997,
with the DOJ and FTC all additional filings that are required in connection
with the transactions contemplated hereby under the HSR Act, including
reflecting that the assets used and useable in connection with the Tampa
Billboard Business (as defined in the Group I Purchase Agreement) are to be
excluded from the Group I Assets and, will submit to the other party, prior to
the filing thereof, their respective HSR Act filing and discuss with the other
any comments the reviewing party may have. Buyer and Seller agree to (a)
cooperate with each other in connection with all such HSR Act filings, which
cooperation shall include furnishing the other with any information or
documents that may be reasonably required in connection with such filings; (b)
promptly file, after any request by the FTC or DOJ and after appropriate
negotiation with the FTC or DOJ of the scope of such request, any information
or documents requested by the FTC or DOJ; and (c) furnish each other with any
correspondence from or to, and notify each other of any other communications
with, the FTC or DOJ that relates to the transactions contemplated hereunder,
and to the extent practicable, to permit each other to participate in any
conferences with the FTC or DOJ.
6.3 Confidentiality.
(a) Each party will not use or disclose to third parties (except as
may be necessary for the consummation of the transactions contemplated hereby,
or as required by law, including, without limitation, in connection with legal
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proceedings relating to this Agreement, documents delivered in connection
herewith or pursuant hereto and the transactions contemplated hereby and
thereby, or otherwise pursuant to subpoena or the request of a governmental
authority, and then only with prior notice to the other parties hereto,
including delivery of a copy of the subpoena or request, if applicable) this
Agreement or any information (including, without limitation, financial
information and information regarding program contracts and revenue) received
from the other parties hereto or their agents in the course of investigating,
negotiating and performing the transactions contemplated by this Agreement and
the documents delivered in connection herewith or pursuant hereto; provided,
however, that each party may disclose such information to such party's
officers, directors, employees, lenders, advisors, attorneys and accountants
who need to know such information in connection with the consummation of the
transactions contemplated by this Agreement and the documents delivered in
connection herewith or pursuant hereto and who are informed by such party of
the confidential nature of such information. Nothing shall be deemed to be
confidential information that: (1) is already in such party's possession,
provided that such information is not known by such party to be subject to
another confidentiality agreement with or other obligation of secrecy to the
other party hereto or another party, or (2) becomes generally available to the
public other than as a result of a disclosure by such party or such party's
officers, directors, employees, lenders, advisors, attorneys or accountants, or
(3) becomes available to such party on a non-confidential basis from a source
other than the other party hereto or its advisors, provided that such source is
not known by such party to be bound by a confidentiality agreement with, or
other obligation of secrecy to, the other party hereto or another party, or (4)
is developed independently by either party without resort to the confidential
information of the other party. In the event this Agreement is terminated and
the purchase and sale contemplated hereby abandoned, Buyer will return to
Seller all copies of documents, work papers and other written confidential
material obtained by Buyer in connection with the transactions contemplated
hereby. If this Agreement is terminated, each party will return to the other
party all information (including all documents, work papers and other written
confidential material) obtained by such party from any other party in
connection with the transactions contemplated by this Agreement.
(b) No party shall publish any press release or make any other
public announcement concerning this Agreement or the transactions contemplated
hereby without the prior written consent of each other party, which shall not
be withheld unreasonably; provided, however, that nothing contained in this
Agreement shall prevent any party, after notification to each
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other party, from taking any action required by law or from making any filings
with governmental authorities that, in its judgment, may be required or
advisable in connection with the execution and delivery of this Agreement or
the consummation of the transactions contemplated hereby.
6.4 Cooperation. Buyer and Seller shall cooperate fully with each
other and their respective counsel and accountants in connection with any
actions required to be taken as part of their respective obligations under this
Agreement, and Buyer and Seller shall execute such other documents as may be
necessary or desirable to the implementation and consummation of this
Agreement, including, without limitation, obtaining any Consents and Estoppel
Certificates, and otherwise use their commercially reasonable efforts to
consummate the transactions contemplated hereby and to fulfill their
obligations under this Agreement. Seller and Buyer shall each diligently make,
and cooperate with the other in making, all commercially reasonable efforts to
obtain or cause to be obtained prior to the relevant Closing Date all Consents
and Estoppel Certificates. Buyer agrees to use all commercially reasonable
efforts to assist Seller in obtaining such Consents and Estoppel Certificates,
and to take all commercially reasonable actions necessary or desirable to
obtain such Consents and Estoppel Certificates, including, without limitation,
executing such assumption instruments and other documents as may be reasonably
required in connection with obtaining the Consents and Estoppel Certificates.
6.5 Control of the Stations. Nothing contained in this Agreement shall
give Buyer any right from this date forward or at any time thereafter to
control the operations of any Station, and Seller shall have complete control
of the operations, consistent with, and subject to, the provisions of any
applicable TBA.
6.6 Access to Books and Records. Seller shall provide Buyer access and
the right to copy for a period of two (2) years from the applicable Closing
Date any books and records relating to the Assets sold at such Closing, but not
included in such Assets. Buyer shall provide Seller access and the right to
copy for a period of two (2) years after the applicable Closing Date any books
and records relating to the Assets sold at such Closing, that are included in
such Assets. Neither Buyer nor Seller will destroy any such books and records
during such two (2) year period. After the expiration of such two (2) year
period, Buyer and Seller shall use commercially reasonable efforts to give the
other parties to this Agreement reasonable prior written notice of their
intention to destroy any such books and records prior to destroying any such
books and records.
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6.7 Employee Matters. The following provisions shall be for the
exclusive benefit of the parties to this Agreement and not for the benefit of
any other person or entity:
(a) (i) Effective as of the applicable Effective Time, (but subject
to rescission if the applicable Closing does not occur), with respect to each
Station, except with respect to employees retained by Seller under any
applicable TBA ("Retained Employees"), Buyer (A) shall assume the Assumed
Contracts listed on Schedule 3.12 and (B) may, in its sole discretion, but
shall not be obligated to, offer employment to any of Seller's other employees
with respect to such Station and (ii) (1) effective as of any applicable
Closing Date, Buyer (A) shall assume any Retained Employee's Assumed Contracts
listed on Schedule 3.12 that are not assumed at the Effective Time and (B) may,
in its sole discretion, but shall not be obligated to, offer employment to any
of the other Retained Employees (collectively, those employees to whom Buyer
elects to offer employment and who are employed pursuant to Assumed Contracts,
the "Assumed Employees"). Except as otherwise provided in any Assumed Contract,
Buyer may offer employment to the Assumed Employees on any terms and conditions
that are determined by Buyer in its sole discretion, including with respect to
the provision of retirement and health care benefits. Buyer shall assume the
contracts of employment of the Assumed Employees and notwithstanding anything
in the foregoing to the contrary, to the extent such employment contracts
assumed hereunder provide for terms and conditions in addition to those
referenced in the preceding sentence, Buyer shall assume the terms thereof.
(b) To the extent the Purchase Price is reduced pursuant to Section
2.5 in respect thereof, Buyer shall grant Assumed Employees credit for and
shall assume and be responsible for any liabilities with respect to sick leave
and personal days accrued but unused by any Assumed Employees as of the
applicable Effective Time, and, to the extent of such Purchase Price reduction,
shall grant Assumed Employees credit for and shall assume and be responsible
for any liabilities with respect to any accrued but unused vacation for such
employees as of such Effective Time. No such credit shall exceed the number of
sick, personal and vacation days listed on Schedule 3.12.
(c) Buyer agrees that Seller may inform its employees that Buyer has
agreed that the Assumed Employees will be offered employment as provided in
this Section 6.7; provided, however, that Buyer shall have the right to approve
any written statement to be made by Seller in connection therewith.
(d) Seller shall comply with the provisions of the Worker Adjustment
and Retraining and Notification Act (the "WARN
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Act") and similar laws and regulations, if applicable, and shall be solely
responsible for any and all liabilities, penalties, fines, or other sanctions
that may be assessed or otherwise due under such applicable laws and
regulations on account of the dismissal or termination of any of the employees
of any of the Stations by Seller prior to the applicable Effective Time or
Closing Date, as the case may be. Buyer shall employ at least that proportion
of the employees of each Station as shall be necessary to prevent a "mass
layoff" or a "plant closing" as such terms are defined in the WARN Act and
Buyer shall comply with all applicable laws and regulations applicable in
connection with Buyer's exercise of discretion in offering employment to
employees of Seller, including, without limitation, those relating to
employment discrimination.
(e) With respect to any Assumed Employees, within a reasonable
period of time after the related Effective Time or within a reasonable period
of time after the related Closing Date, as the case may be, Seller shall
transfer from the Xxxxxx Communications 401(k) Profit Sharing Plan (the "Seller
401(k) Plan") to the 401(k) Plan maintained by the Guarantor or its Affiliates
for the benefit of the employees of the Buyer ("Buyer's 401(k) Plan") an
amount, in cash, equal to the aggregate account balances held in the Seller
401(k) Plan as of the date of transfer with respect to all Assumed Employees
hired by the Buyer as of such Effective Time or such Closing Date, as the case
may be; provided, however, that Buyer shall have no obligation under this
Section 6.7(e) if Buyer reasonably believes such transfer shall cause Buyer's
401(k) Plan to not be qualified under the Code. Prior to the date of any such
transfer, and as preconditions thereto: (i) Buyer shall use commercially
reasonable efforts to deliver to Seller a copy of the most recently issued
Internal Revenue Service ("IRS") determination letter (or other proof
reasonably satisfactory to counsel for Seller) that Buyer's 401(k) Plan is
qualified under the Code, and (ii) Seller shall use commercially reasonable
efforts to deliver to Buyer a copy of the most recently issued IRS
determination letter (or other proof reasonably satisfactory to counsel for the
Buyer) that the Seller 401(k) Plan is qualified under the Code. Seller and
Buyer agree to cooperate with respect to any government filing, including, but
not limited to, the filing of IRS Forms 5310-A, if necessary, to effect the
transfer of assets contemplated by this Section 6.7(e).
6.8 Cure. For all purposes under this Agreement, the existence or
occurrence of any events or circumstances that constitutes or causes a breach
of a representation or warranty of Seller or Buyer (including, without
limitation, in the case of Seller, under the information disclosed in the
Schedules hereto) on the date such representation or warranty is made shall be
38
deemed not to constitute a breach of such representation or warranty if such
event or circumstance is cured in all material respects on or before 30 days
after the receipt by such party of written notice thereof from the other party.
6.9 Environmental Reports.
(a) Seller has delivered to Buyer, at Seller's cost, copies of
the Phase I environmental reports that have been prepared by Dames and Xxxxx
with respect to certain parcels of owned Real Property and all other
environmental reports with respect to the Real Property that are in the
possession, custody or control of Seller (collectively, the "Existing Phase I
Reports").
(b) Buyer, at its election and cost, may obtain any updates of
the Existing Phase I Reports (the "Updated Reports"). Seller will cooperate
with Buyer in obtaining, at Seller's expense, a Phase II environmental report
for any parcel of Real Property owned by Seller with respect to the Stations to
the extent expressly recommended in any Existing Phase I Reports or any Updated
Report (a "Phase II Report"); provided, however, that no such Phase II Report
shall be ordered or obtained before the expiration of five (5) Business Days
after the date hereof. Notwithstanding the foregoing, Seller acknowledges that
Buyer has ordered, at Seller's expense, an analysis, to be performed by Dames &
Xxxxx, of suspected asbestos containing materials (ACM) and suspected PCB
containing transformer dielectric fluid; provided, however, that in the event
such analysis confirms the presence of the suspected ACM and PCB containing
fluids, (i) Seller shall have no liability for the remediation of any ACM
unless and to the extent Dames & Xxxxx recommends the immediate remediation of
any friable ACM and (ii) Seller shall have no liability for the remediation of
any PCB containing equipment which is not owned by Seller or which does not
require immediate remediation as recommended by Dames & Xxxxx. Seller and Buyer
shall use commercially reasonable efforts to obtain the Phase II Reports as
soon as practicable thereafter. The Existing Phase I Reports, any Updated
Reports and any Phase II Reports are hereinafter referred to as the
"Assessments."
(c) Copies of each Assessment shall be delivered to Seller by
Buyer promptly after receipt by Buyer. Seller and Buyer agree that the results
of any Assessment carried out pursuant to this Section shall not be disclosed
to any third party, unless such disclosure is required by law; provided,
however, that each party may disclose such information to such party's
officers, directors, employees, lenders, advisors, attorneys and accountants
who need to know such information in connection with the consummation of the
transactions contemplated
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by this Agreement and who are informed by such party of the confidential nature
of such information.
(d) From and after the applicable Effective Time, in accordance
with and subject to the provisions of Section 10 hereof, Seller shall, at its
sole cost, either undertake, or reimburse Buyer for, any remediation or other
action required to eliminate noncompliance with Applicable Environmental Laws
with respect to any Real Property owned by Seller, in each case as specifically
set forth in any Phase II Report (irrespective of whether such Phase II Report
is received before or after the relevant Effective Time).
6.10 Other Transactions.
(a) Sale of Group V Assets to LPI. Notwithstanding any provision
of this Agreement to the contrary, Buyer and Seller hereby agree as follows:
(i) if the Group II/III Closing and Group V Closing have not
occurred, then and in such event, on the later of (x) October 1, 1997 and (y)
the date reasonably agreeable to Seller and Buyer not less than five (5)
Business Days nor more than ten (10) Business Days following the later of (1)
the grant by the FCC of the FCC Pro Forma Consent and (2) the date on which the
waiting period under the HSR Act in respect of the transactions to be
consummated under this Agreement shall have expired or terminated and there
shall not be pending any action or request for information instituted by the
FTC or the DOJ under the HSR Act relating to such transactions (the foregoing,
the "LPI Sale Date"), subject to the terms and conditions set forth in this
Section 6.10(a), the following provisions shall apply:
(1) PCC shall sell and transfer, on the LPI
Sale Date, the Group V Assets and Group V Assumed Liabilities to
LPI, and, concurrently therewith, PCC shall, pursuant to
documentation reasonably acceptable to PCC and Buyer (which
documentation shall be submitted by Seller to Buyer for review by
Buyer a reasonable period of time prior to the LPI Sale Date),
assign all of its rights, liabilities and obligations under this
Agreement in respect of the Group V Sale to LPI, and LPI shall
purchase the Group V Assets and assume the liabilities and
obligations of PCC under the Group V Assumed Liabilities and the
Group V Sale under this Agreement (the "LPI Sale"); provided that
such sale and assignment shall not release PCC from any of its
liabilities and obligations hereunder to Buyer. For purposes hereof,
except as otherwise provided in this Agreement or as the context
otherwise requires, in the event of such assignment,
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XXX xxxxx xx treated as the "Seller" hereunder in respect of the
Group V Assets and/or the Group V Sale.
(2) The LPI Sale shall be consummated between
PCC and LPI on the terms and conditions set forth in this Section
6.10(a), pursuant to assignments and other conveyancing documents
that are sufficient to convey and vest good title to the Group V
Assets to LPI, free and clear of all Liens, other than Permitted
Liens, in form and substance reasonably acceptable to PCC, LPI and
Buyer.
(3) LPI shall purchase the Group V Assets from
PCC for a purchase price of Four Hundred Twenty-Eight Million Two
Hundred Eighty Thousand Eight Hundred Seventy- Three Dollars
($428,280,873), which shall be paid by LPI on the LPI Sale Date by
federal wire transfer of same-day funds to such account or accounts
as PCC designates in writing to LPI on or before the LPI Sale Date,
including the account of any Intermediary referred to in Section
6.10(a)(i)(8) hereof, in an amount equal to Three Hundred Sixty-Nine
Million Four Hundred Fifteen Thousand One Hundred Dollars
($369,415,100) and by execution and delivery by LPI to PCC (or to
any such Intermediary) of a promissory note substantially in the
form of Exhibit 6.10-A hereto (the "LPI Note"), in a principal
amount of Fifty-Eight Million Eight Hundred Sixty-Five Thousand
Seven Hundred Seventy-Three Dollars ($58,865,773).
(4) In connection with the execution and
delivery of the LPI Note, LPI shall cause to be executed and
delivered to PCC a subordinated Guaranty from Xx. Xxxxxx X. Xxxxxx,
substantially in the form of Exhibit 6-10B hereto (the "Subordinated
Guaranty") and PCC shall execute and deliver, and LPI shall
acknowledge, the Intercreditor Agreement.
(5) Proration and adjustments relating to the
Group V Assets shall be made in accordance with the provisions of
Section 2.5 as follows:
(A) On the Group V Closing Date, Buyer shall
pay LPI the Preliminary Purchase Price for the Group V
Assets based upon the prorations and adjustments
reflected in the Preliminary Settlement Statement for the
Group V Assets, as required by Sections 2.5(b)(1) and
2.6(a). If the Preliminary Purchase Price for the Group V
Assets exceeds $434,606,000, then LPI shall pay the
amount of such excess to PCC (or to any party designated
by PCC in writing to Buyer). If $434,606,000 exceeds the
Preliminary Purchase Price for
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the Group V Assets, then PCC shall pay (or cause to be
paid) the amount of such excess to LPI.
(B) The Purchase Price for the Group V Assets
shall be finally determined pursuant to Section
2.5(b)(2). If the Purchase Price as so determined for the
Group V Assets exceeds the Preliminary Purchase Price as
so determined for the Group V Assets, Buyer shall pay the
amount of such excess to LPI in accordance with Section
2.6(b)(1), and LPI shall thereafter pay the amount of
such excess to PCC (or to any party designated by PCC in
writing to LPI). If the Preliminary Purchase Price for
the Group V Assets exceeds the Purchase Price as so
determined for the Group V Assets, PCC shall pay (or
cause to be paid) the amount of such excess to LPI, and
LPI shall thereafter pay the amount of such excess to
Buyer in accordance with Section 2.6(b)(2).
(6) On the LPI Sale Date (A) Buyer and LPI
shall enter into the Clear Channel Loan Agreement, substantially in
the form of Exhibit 6.10-C hereto (the "Clear Channel Loan
Agreement") and pursuant to the terms thereof, LPI shall make two
promissory notes in favor of Buyer in the forms of Exhibit A-1 and
Exhibit A-2 to the Clear Channel Loan Agreement; (B) Buyer and PCC
shall execute and deliver, and LPI shall acknowledge, the
Intercreditor and Subordination Agreement, substantially in the form
of Exhibits 6.10-D hereto (the "Intercreditor Agreement"); LPI shall
execute and deliver to Buyer the Security Agreement, substantially
in the form of Exhibit 6.10-E hereto, and Mortgages on the owned
Real Property included in the Group V Assets, in forms enforceable
under Florida law and otherwise reasonably satisfactory to the
parties, and cause to be executed and delivered to Buyer a Guaranty
from Xx. Xxxxxx X. Xxxxxx, substantially in the form of Exhibit
6.10-F hereto, and Stock Pledge Agreement, substantially in the form
of Exhibit 6.10-G hereto, together with UCC-1's and such other
documents in connection therewith as Buyer may reasonably request
(collectively with the Intercreditor Agreement, the "Security
Documents"); (C) Buyer and LPI shall execute and deliver the Group V
Time Brokerage Agreement, substantially in the form of Exhibit
6.10-H hereto, (the "Group V TBA"); (D) Buyer and PCC shall execute
and deliver the Group II/III Time Brokerage Agreement,
substantially, in the form of Exhibit 6.10-I hereto, (the "Group
II/III TBA"); (E) Buyer and LPI shall execute and deliver a TSA with
respect to WFSJ(FM) and Buyer and PCC shall execute and deliver a
TSA with respect to WHNZ(AM), each substantially in the form of
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Exhibit 6.10-J; (F) Buyer and PCC shall execute and deliver a TSA
with respect to WTLK(FM), substantially in the form of Exhibit
6.10-J; and (G) if requested by PCC or LPI, Buyer, PCC and LPI shall
execute and deliver separate Service Agreements for logging,
traffic, payroll, accounting and similar services, with respect to
each of WHNZ, WFSJ, WTLK, WYCL and WEAT, substantially in the form
of Exhibit 6.10-K hereto (collectively, the "Services Agreements").
The "Group II/III TBA Date" and the "Group V TBA Date" shall mean
the dates on which the Group II/III TBA and Group V TBA,
respectively, are executed and delivered.
(7) Funding of the Clear Channel Loan shall be
subject to satisfaction of the conditions set forth in the Clear
Channel Loan Agreement. Subject to satisfaction of the conditions
set forth in Section 6.10(a)(ii) below on the LPI Sale Date, Buyer
shall advance to LPI, by federal wire transfer of same-day funds, an
amount equal to the Group V Loan Amount pursuant to the Clear
Channel Loan Agreement.
(8) PCC may assign some or all of its rights
(but not its obligations) under the LPI Sale as set forth in this
Section 6.10(a) (including its right to receive the LPI Note) to an
Intermediary; provided that (i) such assignment shall not deprive
LPI or Buyer of rights or benefits, or relieve PCC of any
obligations or liabilities, under this Agreement, (ii) neither LPI
nor Buyer shall be obligated to expend funds or incur obligations or
liabilities in connection therewith and (iii) PCC shall indemnify
and hold harmless LPI and Buyer from and against any and all loss,
liability, cost and expense arising or resulting from any such
assignment to an Intermediary; provided that such indemnification of
LPI shall be subordinated to prior satisfaction in full of any
applicable indemnification of Buyer in respect of the Like-Kind
Exchange (as hereinafter defined) as provided in this Agreement. PCC
intends to effect a like-kind exchange pursuant to Section 1031 of
the Code. However, nothing in this Agreement shall be construed as a
representation or warranty of any party to any other party as to the
tax characterization of the transactions contemplated by this
Agreement.
(9) Notwithstanding the foregoing, if on the
date otherwise scheduled for the LPI Sale pursuant to paragraph
6.10(a)(i) above, the conditions precedent set forth herein, with
respect to the LPI Sale, the Clear Channel Loan and the other
transactions to be consummated concurrently therewith, have not been
satisfied, the party for whose benefit such conditions have been
imposed may
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elect to postpone the LPI Sale, the Clear Channel Loan, and the
other transactions to be consummated concurrently therewith, and the
LPI Sale, the Clear Channel Loan, and such transactions shall
thereafter take place on a date specified by not less than five (5)
Business Days' prior written notice from such party, which date
shall be not less than five (5) Business Days nor more than ten (10)
Business Days after the satisfaction or waiver of such conditions
precedent, but in no event later than the Termination Date. The
parties shall seek extension of the applicable FCC Consents that may
be required for any such postponement.
(10) Notwithstanding anything to the contrary
set forth herein, in the event LPI elects not to draw down the Clear
Channel Loan, such election shall not affect the parties'
obligations to enter into the Group II/III TBA or the Group V TBA.
(ii) The obligations of Buyer to consummate the
transactions contemplated under paragraphs (6) and (7) of Section 6.10(a)(i) on
the LPI Sale Date are subject, at Buyer's option, to the fulfillment at or
prior to such date, of each of the following conditions:
(1) PCC shall have satisfied the conditions
precedent set forth in Sections 7.1(a) and (b), and the condition
precedent set forth in Sections 7.1(d) and (e) shall apply, and for
purposes of Sections 7.1(a) and (b), the phrase "LPI Sale Date"
shall be substituted for the phrase "Closing Date for such
Closings";
(2) each of PCC and LPI shall have taken, or
stand ready, willing and able to take, the actions contemplated
under this Section 6.10(a);
(3) the conditions precedent set forth in the
Clear Channel Loan Agreement to the obligations of Buyer to make the
Group V Loan shall have been satisfied; and
(4) to the extent the conditions precedent to
the obligations of PCC to the consummation of the Group I Purchase
Agreement have been satisfied (or would be satisfied at consummation
by delivery of documents and the purchase price by Buyer), PCC shall
stand ready, willing and able to consummate the closing under the
Group I Purchase Agreement concurrently with the LPI Sale and the
making of the Group V Loan; provided it is understood and agreed
that if such
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conditions precedent are not satisfied, Closing of the Group I Sale
shall not be a condition to consummation of the LPI Sale and the
making of the Group V Loan.
(iii) The obligations of PCC and LPI to consummate
the transactions contemplated under this Section 6.10(a) on the LPI Sale Date
are subject, at PCC's and LPI's option, to the fulfillment at or prior to such
date, of each of the following conditions:
(1) the conditions precedent set forth in
Sections 7.2(a), (b), (d) and (e) shall apply and, for purposes of
Sections 7.2(a) and (b), the phrase "LPI Sale Date" shall be
substituted for the phrase "Closing Date for such Closings";
(2) Buyer shall have taken, or stand ready,
willing and able to take, the actions contemplated under this
Section 6.10(a); and
(3) to the extent the conditions precedent to
the obligations of Buyer to the consummation of the Group I Purchase
Agreement have been satisfied (or would be satisfied at consummation
by delivery of documents by the Sellers thereunder), Buyer shall
stand ready, willing and able to consummate the Closing under the
Group I Purchase Agreement concurrently with the LPI Sale and the
making of the Group V Loan; provided it is understood and agreed
that if such conditions precedent are not satisfied, Closing of the
Group I Sale shall not be a condition to consummation of the LPI
Sale and the making of the Group V Loan.
(iv) It is understood and agreed by Buyer, PCC and
LPI that from and after the LPI Sale Date (assuming the LPI Sale occurs),
notwithstanding anything in this Agreement to the contrary, the only conditions
precedent applicable to the obligations of the parties at the Group II/III
Closing and the Group V Closing are as follows:
(1) for Buyer, (A) Sections 7.1(a), (b),
(c), (e), (f) (provided, however, that the officer's certificate
required by Section 8.2(b) shall apply only with respect to the
representations and warranties identified in clause (B) below), (g),
(h), (i) and (j); provided, however that (B) Section 7.1(a) shall
apply only with respect to the representations and warranties set
forth in Sections 3.1 and 3.2, the second sentence of Section 3.4
(with respect to Main Station FCC Licenses only and other than as a
result of any action or inaction by Buyer), the second and fourth
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sentences of Section 3.5, the second sentence of Section 3.6,
Section 3.10 and Section 7.1(b) shall apply only with respect to
those covenants and agreements expressly to be performed or complied
with after the applicable Effective Time and prior to the applicable
Closing;
(2) for PCC and LPI, Sections 7.2(a), (b), (c), (e),
(f), (g), (h) and (i);
(3) for Buyer, that, concurrently with the Group
II/III Closing and the Group V Closing, the LPI Note shall have been
discharged in full; provided that Buyer's right to reliance upon
this condition precedent is conditioned upon its compliance with its
obligation to fund the Clear Channel Loan and the Preliminary
Purchase Price for the Group II/III Assets and the Group V Assets on
the Group II/III Closing Date and Group V Closing Date; and
(4) for PCC and LPI, that, concurrently with the
Group II/III Closing and the Group V Closing, the Group V Loan (and
related promissory note) have been discharged in full and the
related security interests of Buyer pursuant to the Security
Documents shall have been released; provided, that PCC's and LPI's
right to reliance upon this condition precedent is conditioned upon
PCC's compliance with its obligation to consummate the LPI Sale.
(v) Notwithstanding anything in this Agreement or in any
of the documents or instruments delivered pursuant hereto or in connection
herewith or in any applicable law to the contrary, Buyer agrees that under no
circumstances shall PCC have any liability or obligation of any nature
whatsoever with respect to repayment of the Group V Loan or any other
obligations of LPI pursuant to the Clear Channel Loan, the related security
interests of Buyer pursuant to the Security Documents or any other documents
delivered in connection therewith or pursuant thereto and Buyer hereby waives
and releases all such claims. Notwithstanding the foregoing, nothing contained
in this Section 6.10(a)(v) shall in any manner impair any right, remedy or
recourse Buyer may have against PCC for fraud in connection with this
Agreement.
(b) Group IV. On the date (the "Group IV Date") which is the
latest of (w) October 1, 1997, (x) the LPI Sale Date (assuming the LPI Sale
occurs), (y) the date agreeable to Buyer and Seller not less than five (5)
Business Days nor more than ten (10) Business Days following the date on which
the waiting period under the HSR Act in respect of the transaction to be
consummated under this Section 6.10(b) shall have expired or terminated and
there shall not be pending any action or request for information
46
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instituted by the FTC or the DOJ relating to such transaction and (z) provided
Seller has given Buyer not less than (5) Business Days' prior written notice
thereof, and, provided, further, that the provisions of Section 5.7 above have
been complied with in all material respects and the ARS Asset Purchase
Agreement has not been terminated, the date of Seller's acquisition of the
Group IV Assets, if the Group IV Closing has not yet occurred, then and in such
event: (1) Buyer and Seller shall execute and deliver the Group IV Time
Brokerage Agreement, substantially in the form of Exhibit 6.10-L hereto (the
"Group IV TBA"); (2) Buyer and Seller (or, if the Assignee is the owner of
WEAT, the Assignee) shall execute and deliver a TSA with respect to WEAT
substantially in the form of Exhibit 6.10-J hereto (the "WEAT TSA"); and (3)
Buyer shall loan to Seller the sum of Thirty-Three Million Dollars
($33,000,000), as adjusted pursuant to the provisions of the ARS Asset Purchase
Agreement, including, without limitation, pursuant to Section 2.4 thereof (the
"Group IV Advance"), evidenced by three (3) promissory notes (the "Group IV-A
Note," the "Group IV-B Note" and the "Group IV-C Note," respectively), by
federal wire transfer of same-day funds. The Group IV-A Note shall be in the
principal amount of Twenty-Eight Million One Hundred Twenty-Five Thousand
Dollars ($28,125,000), the Group IV-B Note shall be in the principal amount of
Three Million One Hundred Twenty-Five Thousand Dollars ($3,125,000) and the
Group IV-C Note shall be in the principal amount of One Million Seven Hundred
Fifty Thousand Dollars ($1,750,000), in each case, as adjusted in the aggregate
to reflect adjustment to the purchase price under the ARS Asset Purchase
Agreement. The Group IV Advance, the Group IV Loan Agreement, the Group IV-A
Note, the Group IV-B Note and the Group IV-C Note are hereinafter collectively
referred to as the "Group IV Loan." The terms and conditions of the Group IV
Loan shall be substantially similar to the terms and conditions of the Clear
Channel Loan and the promissory notes and Security Documents delivered pursuant
thereto; provided, however, that (a) the Group IV Loan shall be secured by the
Group IV Assets prior to the Group IV Closing Date and the WEAT Assets prior to
the transfer of WEAT by Seller; it being understood and agreed that (i) nothing
herein shall impair Seller's right to transfer WEAT to a third party and Buyer
shall immediately release all liens in the WEAT Assets in favor of Buyer in
connection with any such transfer and (ii) Buyer shall immediately release all
liens in the Group IV Assets in favor of Buyer in connection with the
acquisition by Buyer of the Group IV Assets notwithstanding that the Group IV-C
Note may still be outstanding hereunder; (b) the Group IV Loan shall bear
interest at a rate of ten percent (10%) per annum accruing from the date such
loan is made; provided that payments of interest in respect of the principal
amount of the Group IV Loan evidenced by the Group IV-C Note shall accrue and
be payable monthly in arrears in cash and not as an offset against any other
payments; (c) no
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payments in respect of interest shall be due with respect to that portion of
the principal of the Group IV Loan evidenced by the Group IV-A Note and the
Group IV-B Note if Buyer has not yet paid the programming fee due under the
Group IV TBA; (d) the Group IV- C Note shall be due and payable on the earlier
of twelve (12) months after the Group IV Effective Time and the date on which
Seller sells WEAT; (e) any Event of Default as defined in the Clear Channel
Loan Agreement shall be a default under the Group IV Loan Agreement; and (f)
the Group IV Loan and the Group IV-A Note, the Group IV-B Note and the Group
IV-C Note shall receive the benefit of a loan agreement (the "Group IV Loan
Agreement"), a security agreement and related financing statements, a stock
pledge agreement, a guaranty agreement of Xx. Xxxxxx X. Xxxxxx, and an
intercreditor subordination agreement, each substantially similar to the forms
of agreements referred to in Section 6.10(a)(i)(6) and attached hereto,
together with such other documents in connection therewith in substantially
similar forms as those contemplated by the Clear Channel Loan Agreement to the
extent requested by Buyer; provided, however, that references in the Clear
Channel Loan Agreement to the Group V TBA and TSA Agreements shall mean the
Group IV TBA and the TSA for WEAT, respectively. On the Group IV Date, the
following provisions shall also apply:
(1) PCC may elect, in its sole discretion, to transfer,
on the Group IV Date, the Group IV Assets and the Group IV Assumed
Liabilities, together with the tangible and intangible assets used
or useful in connection with the conduct of the business or
operations of WEAT (the "WEAT Assets") and certain related
liabilities, to an entity controlled by Xx. Xxxxxx X. Xxxxxx (the
"Assignee"), and concurrently therewith, PCC shall, pursuant to
documentation reasonably acceptable to Buyer (which documentation
shall be submitted by Seller to Buyer for review by Buyer a
reasonable period of time prior to the Group IV Date), assign all of
its rights, liabilities and obligations under this Agreement in
respect of the Group IV Sale to the Assignee, and the Assignee shall
accept such transfer and assignment of the Group IV Assets and
assume the liabilities and obligations of PCC under the Group IV
Assumed Liabilities and the Group IV Sale under this Agreement (the
"Group IV Transfer"); provided that such assignment shall not
release PCC from any of its liabilities and obligations hereunder to
Buyer. For purposes hereof, except as otherwise provided in this
Agreement or as the context otherwise requires, in the event of such
assignment, the Assignee shall be treated as the "Seller" hereunder
in respect of the Group IV Assets and/or the Group IV Transfer.
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(2) The Group IV Transfer shall be consummated between
PCC and the Assignee on the terms and conditions set forth in this
Section 6.10(b)for a purchase price of Thirty-Three Million Dollars
($33,000,000), and, to the extent applicable, as adjusted pursuant
to the ARS Asset Purchase Agreement, including, without limitation,
pursuant to Section 2.4 thereof, pursuant to assignments and other
conveyancing documents that are sufficient to convey and vest good
title to the Group IV Assets and the WEAT Assets to the Assignee,
free and clear of all Liens, other than Permitted Liens, in form and
substance reasonably acceptable to PCC, the Assignee and Buyer.
Prorations and adjustments relating to the Group IV Assets and WEAT
Assets shall be made in accordance with the provisions of Section
2.5 in substantially the same manner as prorations and adjustments
made in connection with the LPI Sale.
(3) The funding of the Group IV Loan shall be subject to
satisfaction of the conditions set forth in the Group IV-A Note and
the Group IV-B Note (which shall be substantially similar to those
set forth in Section 6.10(a)(ii)) and Buyer shall advance to the
Assignee, by federal wire transfer of same-day funds, the amount of
the Group IV Loan upon satisfaction of conditions substantially
similar to those set forth in Section 6.10(a)(ii), but with respect
to the Group IV Sale and/or the Group IV Assets and WEAT Assets.
(4) Notwithstanding anything in this Agreement or in any
of the documents or instruments delivered pursuant hereto or in
connection herewith or in any applicable law to the contrary, Buyer
agrees that, if the Group IV Transfer is consummated, under no
circumstances shall PCC have any liability or obligation of any
nature whatsoever with respect to repayment of the Group IV Loan or
the indebtedness evidenced by Group IV-A Note and the Group IV-B
Note or any other obligations of the Assignee pursuant thereto, the
related security documents or any other documents delivered in
connection therewith or pursuant thereto and Buyer hereby waives and
releases all such claims. Notwithstanding the foregoing, nothing
contained in this Section 6.10(b)(4) shall in any manner impair any
right, remedy or recourse Buyer may have against PCC for fraud in
connection with this Agreement.
In the event of termination of this Agreement with respect to the Group IV Sale
and the Group IV Assets, the Group IV Loan shall be repaid as provided for in
the Group IV-Loan Agreement and the Group IV-A Note, the Group IV-B Note and
the Group IV-C Note
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(subject to reduction as provided for in Section 9.2, the Group IV Loan
Agreement and the Group IV-B Note).
(c) Adjustments and Other Matters Relating to Group IV and
WKES. Notwithstanding any other provision of this Agreement to the contrary,
Buyer and Seller agree as follows:
(i) The Group IV Purchase Price shall be determined by
increasing or decreasing the Group IV Estimated Purchase Price under Section
2.5(a) hereof, to take account of any adjustments or prorations (upward or
downward) to the purchase price under the ARS Asset Purchase Agreement
(including any preliminary adjustments or prorations thereunder and any final
adjustments or prorations thereunder, including, without limitation or
duplication, pursuant to the first sentence of Section 2.4 of the ARS Asset
Purchase Agreement); provided, however, that no purchase price increase shall
be taken into account to the extent Buyer does not receive the benefit giving
rise thereto.
(ii) For purposes of the WKES Purchase Agreement and the
ARS Asset Purchase Agreement, after the Group II/III Closing with respect to
WKES and the Group IV Closing with respect to the Group IV Stations, Seller
shall provide Buyer with all of the rights and benefits received by Seller and
its Affiliates under the WKES Purchase Agreement and the ARS Asset Purchase
Agreement, as the case may be, and Buyer shall perform on behalf of PCC all
obligations of, and actions to be performed by, Seller and its Affiliates
arising after such Closings under such agreements and any agreements, documents
and instruments executed in connection therewith, including, without
limitation, the liabilities and obligations of Seller's Affiliates under
Sections 2.3(b), 2.5, 6.4, 6.7, 6.11, 10.3, 10.6 and 11.1 of the WKES Purchase
Agreement and Sections 2.4B, 2.5, 5.2, 6.3, 6.5, 6.6, 6.9, 6.10, 6.16 and 10.3
of the ARS Asset Purchase Agreement; provided, however, that (w) Buyer shall
not assume Seller's obligations under Section 6.13 of the WKES Purchase
Agreement, (x) Buyer's obligations pursuant to Section 10.3 of the WKES
Purchase Agreement and Section 10.3 of the ARS Asset Purchase Agreement shall
not extend to any such obligations arising (A)with respect to WKES or the Group
IV Stations, as the case may be, during the period of Seller's or its
Affiliates' ownership of WKES or the ARS Stations, if any, or (B) any
indemnification obligations of Seller or its Affiliates, as applicable,
relating to any breach by Seller or its Affiliates of any of their
representations or warranties, as applicable, or the failure to perform any
covenant to be performed by Seller or its Affiliates, as applicable, under the
WKES Purchase Agreement or the ARS Asset Purchase Agreement, respectively, to
be performed by them prior to the Group II/III Effective Time with respect to
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WKES and the Group IV Effective Time with respect to the Group IV Stations; (y)
Buyer shall not be responsible for payment of any applicable FCC fees or fees
payable in respect of HSR Act filings under the WKES Purchase Agreement or the
ARS Asset Purchase Agreement; and (z) except as otherwise provided herein,
Buyer shall have no, and Seller shall retain all, obligations with respect to
WEAT. Buyer shall execute such documentation evidencing Buyer's obligations
hereunder as Seller may reasonably request.
(iii) The conveyance of the Group IV Assets to Buyer by
Seller shall be effected by delivery of conveyancing documents substantially
similar to those used for the conveyance of the Group II/III Assets and Group V
Assets, modified to be consistent with the provisions of Section 6.10(c)(iv)
below.
(iv) Except in respect of any liabilities arising out of
the operations of WKES or the Group IV Stations, as the case may be, after the
consummation of the acquisition of WKES or the Group IV Stations by Seller or
its Affiliates, as the case may be, but prior to the earlier of (1) the entry
by Buyer and Seller into the Group II/III TBA with respect to WKES or the Group
IV TBA with respect to the Group IV Stations, as the case may be, or (2) the
consummation of the purchase of the Group II/III Stations or the Group IV
Stations, as the case may be, by Buyer, and not assumed by Buyer hereunder
(which liabilities shall be subject to indemnification pursuant to the
provisions of Section 10 hereof and all limitations set forth therein), Seller
shall have no liability or obligation of any nature whatsoever to Buyer in
respect of WKES or the Group IV Stations, except to the extent that Seller or
its Affiliates receive indemnification in respect of any such liability or
obligation from Xxxxx with respect to WKES or ARS with respect to the Group IV
Stations, as the case may be, and, in connection therewith, Seller shall
reasonably cooperate with Buyer (at Buyer's expense, except to the extent
Seller receives reimbursement of any such expenses by Xxxxx or ARS, as the case
may be, under such agreements) in enforcing any rights that Seller may have
under the WKES Purchase Agreement or the ARS Asset Purchase Agreement, against
Xxxxx and ARS, respectively.
6.11 Fees of CEA. No party shall have any liability to any other
party in respect of the fees of CEA to be paid by Buyer and Seller in
accordance with the terms of their respective agreements with CEA.
6.12 Non-Competition Agreement. At the Group II/III Closing and the
Group V Closing, Seller shall cause Xx. Xxxxxx X. Xxxxxx to execute and deliver
the Non-Competition Agreement, substantially in the form of Exhibit 6.12. No
portion of the
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Purchase Price (as defined in the Group I Purchase Agreement), Group II/III
Purchase Price, Group IV Purchase Price or Group V Purchase Price shall be
allocated to the Non-Competition Agreement.
6.13 Updated Information. On the date which is three (3) Business
Days prior to the relevant Effective Time, Seller shall deliver to Buyer a
supplement to the Schedules to this Agreement (the "Schedule Supplement"),
certifying that Seller has delivered to Buyer all notices required by Section
5.8 and setting forth any matter which, if existing or occurring on the date
hereof, would have been required to be set forth or described on the Schedules
hereto or that is necessary to complete or correct any information contained
therein. This Section 6.13 does not, and shall not be construed to, permit any
actions or inactions by Seller not otherwise permitted under this Agreement.
For purposes of the conditions to any Closing, if the matters disclosed in the
Schedule Supplement fall within the exceptions set forth in clauses (1), (2) or
(3) to Section 7.1(a) or the exception to Section 7.1(b), then such exceptions
shall apply, but no such disclosure by Seller to Buyer shall otherwise affect
any of Buyer's rights or obligations hereunder, whether before or after any
Closing. Without limiting the foregoing, regardless of any such disclosure, all
representations and warranties of Seller in this Agreement shall survive the
Closing to which they relate to the extent provided in Section 10.1 of this
Agreement, and Buyer shall be entitled to indemnification, in accordance with
Section 10.2.
6.14 Miscellaneous.
(a) Buyer hereby grants to Seller the unlimited, exclusive right
to use the four court-side seats at the present Miami Arena for so long as
Buyer or its Affiliates have such right in consideration of the payment of an
amount equal to the stated cost of the tickets therefor as printed on the face
thereof by Seller to Buyer to the extent Seller conveys to Buyer as a part of
the Assets all rights necessary to enable Buyer to perform Buyer's obligations
under this Section 6.14.
(b) Notwithstanding any provision herein to the contrary, Buyer
hereby acknowledges and agrees that, at any time after the date hereof, Seller
may, in its sole discretion, cancel the broadcast of the Xxx & Xxx Show on any
Station and terminate all affiliation and other agreements relating to the
production or broadcast of such show.
(c) Seller shall use commercially reasonable efforts to complete,
as soon as reasonably practicable, the replacement and repair work for the
WNLS(AM) transmitting towers as described
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in Schedule 6.14(b) and any FCC filings which may be necessary as a result
thereof and, if such work or filings have not been completed by the Group
II/III Effective Time, Seller shall, at the Group II/III Effective Time, pay
Twenty-Two Thousand Dollars ($22,000) to Buyer in immediately available funds.
Upon (i) the completion of such work and filings or (ii) the payment of such
amount to Buyer, as the case may be, Seller shall have no further obligation or
liability to Buyer hereunder with respect to the repair or replacement of the
WNLS(AM) transmitting towers; provided, however, that if any FCC filings are
required as a result of such work and have not been made by Seller, Seller
shall reimburse Buyer for expenses related thereto (including, without
limitation, antenna proof of performance, FCC filing fees and legal and
engineering costs) up to and including the sum of Ten Thousand Dollars
($10,000).
(d) Seller shall use commercially reasonable efforts to defend
against the World Class Rock Claims; provided, however, that Seller shall not
be obligated to appeal any judgment or award in connection therewith.
6.15 Risk of Loss; Interruption of Broadcast Transmission.
(a) The risk of any loss, damage, impairment, confiscation or
condemnation of any Assets prior to the Effective Time therefor (collectively,
a "Loss") shall be borne by Seller. In the event of any Loss prior to the
Effective Time that interferes with the normal operation of any of the Stations
to which such Assets relate, Seller shall promptly notify Buyer of same in
writing, specifying with particularity the Loss incurred, the cause thereof, if
known or reasonably ascertainable, and the insurance coverage, if any,
applicable thereto.
(b) (i) Except as provided in Section 6.15(c), if the Assets
subject to such Loss have not been restored or replaced by the applicable
Effective Time, Buyer shall proceed to consummate the transactions to be
consummated at such Effective Time pursuant to this Agreement. Buyer and Seller
shall negotiate in good faith to agree on the amount of the costs necessary to
complete the restoration and replacement of such damaged Assets. To the extent
Buyer and Seller are unable to agree on the amount of such costs, Buyer and
Seller shall jointly designate an independent appraiser who shall be
knowledgeable and experienced in the operation of radio broadcasting stations
to resolve such dispute. If the parties are unable to agree on the designation
of an independent appraiser, the selection of the appraiser to resolve the
dispute shall be submitted to arbitration in accordance with the commercial
arbitration rules of the American Arbitration Association.
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(ii) To the extent the parties agree upon the amount of
such costs prior to the applicable Closing Date or the appraiser is able to
determine the amount of such costs prior to the applicable Closing Date, such
amount shall be deducted from the applicable Preliminary Purchase Price. To the
extent such amount is not determined prior to such Closing Date, such amount
shall be a Settled Claim and shall be paid by Seller to Buyer pursuant to
Section 10.2(a)(ix). The appraiser's resolution of any such dispute shall be
final and binding on the parties. Any fees of the appraiser and, if necessary,
for arbitration to select such appraiser, shall be split equally between the
parties.
(c) In the event of a Loss prior to the Effective Time which
results in a Material Broadcast Interruption, Seller shall give written notice
thereof (a "Broadcast Interruption Notice") to Buyer within five (5) Business
Days of such Loss resulting in a Material Broadcast Interruption. After receipt
of a Broadcast Interruption Notice, Buyer may terminate this Agreement by
giving written notice thereof to Seller within ten (10) Business Days of
receipt by Buyer of such Broadcast Interruption Notice. If Buyer chooses not to
terminate this Agreement or fails to give written notice within such ten (10)
Business Day period, Buyer shall have no further right to terminate this
Agreement in respect of such Material Broadcast Interruption and the remaining
provisions of this Agreement shall govern.
(d) The risk of loss, damage, impairment, confiscation or
condemnation of any of the Assets arising after the related Effective Time
shall be borne by Buyer and no such loss, damage, impairment, confiscation or
condemnation of such Assets shall (i) give Buyer any claim against Seller with
respect thereto, including, without limitation, any claim for indemnification
pursuant to Section 10.2, or (ii) otherwise affect Buyer's obligation to
consummate the related Closing or pay the related Purchase Price.
(e) If before the Effective Time for any Assets, the regular
broadcast transmission of any Station related thereto in the normal and usual
manner is interrupted for a period of 12 continuous hours or more, Seller shall
give prompt written notice thereof to Buyer.
6.16 Computer Systems. From each Effective Time through the Closing
Date for each Group Sale, Buyer shall not dismantle and shall keep in operation
the computer systems (which term includes the existing e-mail, traffic
accounting and wide area network system) currently operating at the Stations
included in such Group Sale. If the Group II/III Closing Date and the Group V
Closing Date is prior to January 1, 1998, for a period of four
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(4) months therefrom, upon request of Buyer, Seller shall provide Buyer,
without cost, with access to, and the right to use, the wide area network
system currently used by the Stations. Buyer and Seller agree to take all
reasonable steps required to maintain the integrity and security of their
respective computer and electronic data systems.
SECTION 7 CONDITIONS TO OBLIGATIONS OF BUYER AND SELLER
7.1 Conditions to Obligations of Buyer at Group II/III and Group V
Closings. Subject to the provisions of Section 6.10 hereof limiting such
conditions following the LPI Sale Date (assuming the LPI Sale occurs), the
obligations of Buyer at the Group II/III and the Group V Closings hereunder are
subject, at Buyer's option, to the fulfillment prior to or at such Closings of
each of the following conditions:
(a) Representations and Warranties. The representations and
warranties of Seller contained in this Agreement shall be true and correct at
and as of the Closing Date for such Closings as though made at and as of that
time, except (1) to the extent any such representation or warranty is expressly
stated only as of a specified earlier date or dates, in which case such
representation or warranty shall be true and correct in all material respects
as of such earlier specified date or dates (subject to clause 3 below), (2) for
changes which are permitted or contemplated pursuant to this Agreement or (3)
where the consequence of the matter set forth in such representation or
warranty having failed to be true and correct as of the date when made, on the
Closing Date or on such earlier specified date would not have a Material
Adverse Effect.
(b) Covenants. Seller shall have performed and complied with
all covenants and agreements required by this Agreement to be performed or
complied with by it prior to or on such Closing Date for such Closings, except
to the extent that the consequence of the failure of Seller to have so
performed or complied would not have a Material Adverse Effect.
(c) FCC Consent. The FCC Consent with respect to the FCC
Licenses to be transferred at such Closings shall have been granted or, if FCC
Consent for the assignment of an FCC License for any satellite earth station or
private operational fixed microwave station shall not have been granted,
special temporary authority shall have been granted to permit Buyer to operate
such Stations pending the grant of such FCC Consent.
(d) HSR Act. The waiting period under the HSR Act in respect
of the transactions to be consummated at such Closings
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shall have expired or terminated and there shall not be pending any action or
request for information instituted by the FTC or the DOJ under the HSR Act
relating to such transactions.
(e) Legal Proceedings. No injunction, restraining order or
decree of any nature of any court or governmental authority of competent
jurisdiction shall be in effect which restrains or prohibits Buyer from
consummating the transactions at such Closings contemplated by this Agreement.
(f) Deliveries. Seller shall have made, or stand willing to
make, all the deliveries to Buyer described in Section 8.2 applicable to such
Closings.
(g) Simultaneous Closing. The Group II/III Closing and the
Group V Closing shall occur simultaneously.
(h) Discharge of Loans. The condition set forth in Section
6.10(a)(iv)(3) shall have been satisfied.
(i) Group I Closing. If the Group I Closing has not
previously occurred, to the extent the conditions precedent to the obligations
of PCC to the consummation of the Group I Purchase Agreement have been
satisfied (or would be satisfied at consummation by delivery of documents and
the purchase price by Buyer), PCC shall stand ready, willing and able to
consummate the Closing under the Group I Purchase Agreement concurrently with
the Group II/III Closing and the Group V Closing; provided it is understood and
agreed that if such conditions precedent are not satisfied, Closing of the
Group I Sale shall not be a condition to consummation of the Group II/III
Closing and the Group V Closing.
(j) Required Consents. All Required Consents shall have been
obtained and delivered to Buyer.
7.2 Conditions to Obligations of Seller at Group II/III and Group
V Closings. Subject to the provisions of Section 6.10 hereof limiting such
conditions following the LPI Sale Date (assuming the LPI Sale occurs), the
obligations of Seller at the Group II/III and Group V Closings hereunder are
subject, at Seller's option, to the fulfillment prior to or at such Closings of
each of the following conditions:
(a) Representations and Warranties. All representations and
warranties of Buyer contained in this Agreement shall be true and correct in
all material respects at and as of the Closing Date for such Closings as though
made at and as of that time, except to the extent any such representation or
warranty is expressly stated only as of a specified earlier
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date or dates, in which case such representation and warranty shall be true and
accurate in all material respects as of such earlier specified date or dates.
(b) Covenants. Buyer shall have performed and complied in all
material respects with all covenants and agreements required by this Agreement
to be performed or complied with by it prior to or on such Closing Date.
(c) FCC Consent. The FCC Consent with respect to the FCC Licenses to
be transferred at such Closings shall have been granted or, if FCC Consent for
the assignment of an FCC License for any satellite earth station or private
operational fixed microwave station shall not have been granted, special
temporary authority shall have been granted to permit Buyer to operate such
Stations pending the grant of such FCC Consent.
(d) HSR Act. The waiting period under the HSR Act in respect of the
transactions to be consummated at such Closings shall have expired or
terminated and there shall not be pending any action or request for information
instituted by the FTC or the DOJ under the HSR Act relating to such
transactions.
(e) Legal Proceedings. No injunction, restraining order or decree of
any nature of any court or governmental authority of competent jurisdiction
shall be in effect which restrains or prohibits Seller from consummating the
transactions at such Closings contemplated by this Agreement.
(f) Deliveries. Buyer shall have made or stand willing to make all
the deliveries described in Section 8.3 applicable to such Closings.
(g) Simultaneous Closings. The Group II/III Closing and the Group V
Closing shall occur simultaneously.
(h) Discharge of Loans. The condition set forth in Section
6.10(a)(iv)(4) shall have been satisfied.
(i) Group I Closing. If the Group I Closing has not previously
occurred, to the extent the conditions precedent to the obligations of Buyer to
the consummation of the Group I Purchase Agreement have been satisfied (or
would be satisfied at consummation by delivery of documents by the Sellers
thereunder), Buyer shall stand ready, willing and able to consummate the
Closing under the Group I Purchase Agreement concurrently with the Group II/III
Closing and the Group V Closing; provided it is understood and agreed that if
such conditions precedent are not satisfied, Closing of the Group I Sale shall
not be a condition
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to consummation of the Group II/II Closing and the Group V Closing.
7.3 Conditions to Obligations of Buyer and Seller at Group IV
Closing. Notwithstanding anything in this Agreement to the contrary, the
obligations of Buyer and Seller at the Group IV Closing hereunder are subject
to the fulfillment prior to or at such Closing of each of the following
conditions only:
(a) The Group II/III Closing and the Group V Closing shall have
occurred prior to, or shall occur simultaneously with, the Group IV Closing;
(b) For the benefit of Seller, cancellation and termination of
all indebtedness of Seller pursuant to the Group IV-A Note;
(c) For the benefit of Buyer, Seller shall have made, or stand
willing to make, all the deliveries described in Section 8.2 applicable to such
Closing;
(d) For the benefit of Seller, Buyer shall have made or taken, or
stand willing to make or take, all the actions and deliveries described in
Section 8.3 applicable to such Closing;
(e) For the benefit of Buyer, no injunction, restraining order
or decree of any nature of any court or governmental authority of competent
jurisdiction shall be in effect which restrains or prohibits Buyer from
consummating the transactions contemplated at the Group IV Closing;
(f) For the benefit of Seller, no injunction, restraining
order or decree of any nature of any court or governmental authority of
competent jurisdiction shall be in effect which restrains or prohibits Seller
from consummating the transactions contemplated at the Group IV Closing;
(g) For the benefit of Buyer, the conditions set forth in Section
7.1(c) and 7.1(d) as applicable to the Group IV Assets shall have been
satisfied;
(h) For the benefit of Seller, the conditions set forth in
Section 7.2(c) and 7.2(d) applicable to the Group IV Assets shall have been
satisfied; and
(i) For the benefit of Buyer, Seller shall have complied in all
material respects with its obligations under Section 5.7 hereof, and the
representations set forth in Section 3.23 shall be true and correct in all
material respects as though made at and as of that time, except to the extent
any such representation is expressly stated only as of a specified earlier date
or dates, in which case such representation shall be true
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and correct in all material respects as of such earlier specified date or
dates.
(j) For the benefit of Seller, to the extent not previously made,
Buyer shall have made that portion of the Group IV Loan evidenced by the Group
IV-C Note to Seller or the Assignee, as the case may be.
(k) For the benefit of Buyer, to the extent that the Group IV
Loan is made by Buyer and not previously delivered the Group IV-C Note (and the
related security agreements and guaranty), duly executed by Seller or the
Assignee, as the case may be.
SECTION 8 CLOSING AND CLOSING DELIVERIES
8.1 Closing.
(a) Closing Date.
(i) Subject to (1) the provisions of Section 6.10
hereof and (2) the satisfaction or, to the extent permissible by law, waiver
(by the party for whose benefit the Closing condition is imposed) on the date
scheduled for the applicable Closing of the applicable conditions precedent set
forth in Section 7.1, 7.2 or 7.3, as appropriate, the parties hereto agree as
follows:
(A) The Closing of the Group II/III Sale and
Group V Sale shall take place at 10:00 a.m., Washington, D.C. time, on the
later of (x) October 1, 1997 and (y) the date reasonably agreeable to Seller
and Buyer not less than five (5) Business Days nor more than ten (10) Business
Days following the grant of the Group II/III FCC Consent and the Group V FCC
Consent; provided, however, that if the Group II/III FCC Consent and the Group
V FCC Consent are granted prior to October 1, 1997, notwithstanding clause (y)
above, the Closing of the Group II/III Sale and the Group V Sale shall take
place no later than October 1, 1997.
(B) The Closing of the Group IV Sale shall
take place at 10:00 a.m., Washington, D.C. time, on the latest of (x) the
Closing of the Group II/III Sale and the Group V Sale; (y) the date reasonably
agreeable to Seller and Buyer not less than five (5) Business Days nor more
than ten (10) Business Days following the grant of the Group IV FCC Consent and
(z) the date specified by Seller to Buyer, upon five (5) Business Days' prior
written notice to Buyer, that is concurrent with the date of consummation of
the ARS Asset Purchase Agreement and the acquisition of the Group IV Stations
by Seller. Notwithstanding clause (y) of the previous sentence, Buyer shall use
commercially reasonable efforts to consummate the Group IV Closing on the same
date that Seller or any of its Affiliates, as the case may be,
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acquires the Group IV Stations from ARS pursuant to the ARS Asset Purchase
Agreement.
(ii) Notwithstanding the foregoing, if on the
date otherwise scheduled for any Closing pursuant to the preceding paragraphs,
the conditions precedent set forth in Sections 7.1(d), 7.1(e), 7.1(i), 7.1(j),
7.2(d), 7.2(e), 7.2(i), 7.3(e), 7.3(f), 7.3(g) or 7.3(h) if applicable, with
respect to such Closing, have not been satisfied, the party for whose benefit
such conditions have been imposed may elect to postpone such Closing, and such
Closing shall thereafter take place on a date specified by not less than five
(5) Business Days' prior written notice from such party, which date shall be
not less than five (5) Business Days nor more than ten (10) Business Days after
the satisfaction or waiver of such conditions precedent. The parties shall seek
extensions of the applicable FCC Consents that may be required for any such
postponement of such Closing.
(iii) In no event shall any Closing hereunder
occur later than the Termination Date, except as provided in
Section 9.1.
(b) Closing Place. Each Closing shall be held at the
offices of Dow, Xxxxxx & Xxxxxxxxx, PLLC, 0000 Xxx Xxxxxxxxx Xxxxxx, X.X.,
Xxxxx 000, Xxxxxxxxxx, X.X. 00000, or any other place that is agreed upon by
Buyer and Seller.
8.2 Deliveries by Seller. With respect to the Closing for each Group
Sale, prior to or on the related Closing Date, Seller shall take the following
actions and deliver to Buyer the following documents, in form and substance
reasonably satisfactory to Buyer and its counsel:
(a) Conveyancing Documents. Subject to the provisions of
Section 6.10, duly executed assignments and other conveyancing documents that
are sufficient to convey and vest good and, in the case of owned Real Property,
marketable, title to the Assets which are part of such Group Sale to the Buyer,
free and clear of all Liens, except for Permitted Liens. Such documents shall
include, but shall not be limited to, the following:
(i) Assignment and Assumption Agreements for
the Assumed Contracts substantially in the form of Exhibit 8.2(a)(i) annexed
hereto and assignment agreements in recordable form for each Real Property
lease (provided, however, that Seller shall have no liability to Buyer with
respect to the recording or recordability of any such assignment agreements and
the recording or recordability of any such assignment agreements shall not be a
condition to the satisfaction of this Section 8.2(a)(i));
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(ii) deeds (the "Deeds") in recordable form
conveying fee simple title to all Real Property owned by Seller and used in the
business of the Stations which is part of such Group Sale, subject to Permitted
Liens and consistent with and subject to the representations and warranties and
the indemnity limitations set forth in this Agreement;
(iii) bills of sale; and
(iv) Assignment and Acceptances of FCC Licenses.
(b) Officer's Certificate. At the Group II/III and Group V
Closing, a certificate, dated as of such Closing Date, executed on behalf of
Seller by the President of Seller (but without personal liability to such
officer), certifying to the fulfillment of the conditions set forth in Sections
7.1(a) and 7.1(b) with respect to such Group Sale.
(c) Secretary's Certificate. At the Group II/III and Group V
Closing, a certificate, dated as of the relevant Closing Date, executed by the
Secretary of Seller (but without personal liability to such officer),
certifying that the resolutions, as attached to such certificate, were duly
adopted by the Board of Directors and shareholders (if required) of Seller,
authorizing and approving the execution of this Agreement and the consummation
of the transactions contemplated hereby and that such resolutions remain in
full force and effect and that attached thereto are true, correct and complete
copies of the Certificate of Incorporation and bylaws of Seller.
(d) Consents and Estoppel Certificates. Any instruments
evidencing any Consents and any Estoppel Certificates received with respect to
such Group Sale, including any Required Consents.
(e) Releases. Subject to the provisions of Section 6.10,
any mortgage discharges or releases of liens that are necessary in order for
the Assets which are part of such Group Sale to be free and clear of all Liens,
other than the Permitted Liens or a pay-off letter from any of Seller's lenders
providing for such discharges and releases upon payment by Seller of the
obligations owed to such lenders with the proceeds of the Preliminary Purchase
Price on such relevant Closing Date.
(f) Good Standing Certificates. At the Group II/III and
Group V Closings, a certificate as to the formation and good standing of Seller
issued by the Secretary of State of the State of Delaware, dated not more than
ten (10) days before such Closing Date.
(g) Incumbency Certificate. A certificate signed by an
officer of Seller (but without personal liability to such
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officer) certifying the signature and incumbency of the person executing this
Agreement on behalf of Seller.
(h) Title Commitments. ALTA Title commitments issued by
Lawyers Title Insurance Corporation obtained by Seller at Buyer's expense,
insuring fee simple title in each fee estate included in the Real Property
being conveyed as part of such Group Sale, subject to standard survey
exceptions and Permitted Liens, in an amount reasonably determined by Buyer
that permits such commitments to be obtained; provided that if the Group II/III
Closing and Group V Closing take place hereunder without the Group V Loan being
made, Seller shall pay for the costs of the foregoing title commitments.
(i) Lien Search Results. The results of a search for tax,
lien and judgment filings with respect to each of the names reasonably
requested by Buyer no later than 20 days before such Closing, obtained by
Seller, at Buyer's expense, against the Secretary of State's records of the
State of Florida and Tennessee (as applicable, with respect to such names) and
in the records of each county in Florida and Tennessee (as applicable, with
respect to such names) in which any of the Assets being conveyed as part of
such Group Sale are located, reflecting the absence of Liens other than
Permitted Liens on such Assets and Liens removed concurrently with, or prior
to, such Closing; provided that if the Group II/III Closing and Group V Closing
takes place hereunder without the Group V Loan being made, Seller shall pay for
the costs of the foregoing lien searches.
(j) WHNZ Option Agreement. The Option Agreement related to
the purchase of WHNZ, substantially in the form of Exhibit 8.2(j) annexed
hereto (the "WHNZ Option Agreement").
(k) WYCL Option Agreement. The Option Agreement related to
the purchase of WYCL, substantially in the form of Exhibit 8.2(k) annexed
hereto (the "WYCL Option Agreement"), duly executed by Seller.
(l) Services Agreements. The Services Agreements, duly
executed by Seller.
(m) TSAs. To the extent not previously delivered at the
Effective Time, the TSAs with respect to WHNZ, WYCL and WEAT, duly executed by
Seller, LPI or the Assignee, as the case may be.
(n) DP Media Lease Agreement. A lease agreement between DP
Media, Inc. ("DP Media") and Buyer pursuant to which DP Media shall lease from
Buyer (i) that portion of the Seller's studio building located at 0000 00xx
Xxxxxx, Xxxxxx Xxxx, Xxxxxxx which DP Media currently uses and (ii) the assets
set forth in Exhibit 8.2(n) (the "DP Media Assets"), in each case
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for a period of six (6) months from the Group II/III Closing Date and without
charge (the "DP Media Agreement") to the extent that the foregoing does not
unreasonably interfere with Buyer's operations at such premises, duly executed
by DP Media.
(o) Other. Such other documents expressly called for to
be delivered by Seller under the terms of this Agreement or as may reasonably
be requested by Buyer.
8.3 Deliveries by Buyer. With respect to the Closing for each
Group Sale, prior to or on the related Closing Date, Buyer shall take the
following actions and deliver to Seller the following documents, in form and
substance reasonably satisfactory to Seller and its counsel:
(a) Closing Payment. Make the payment described in
Section 2.6(a) to be made with respect to such Group Sale.
(b) Officer's Certificate. At the Group II/III and
Group V Closings, a certificate, dated as of such Closing Date,
executed on behalf of Buyer by the President of Buyer (but without personal
liability to such officer), certifying to the fulfillment of the conditions set
forth in Sections 7.2(a) and 7.2(b) with respect to such Group Sale.
(c) Secretary's Certificate. At the Group II/III and
Group V Closings, a certificate, dated as of such Closing Date, executed by
Secretary of Buyer (but without personal liability to such officer), certifying
that the resolutions, as attached to such certificate, were duly adopted by the
Board of Directors and shareholders (if required) of the Buyer, authorizing and
approving the execution of this Agreement and the consummation of the
transactions contemplated hereby and that such resolutions remain in full force
and effect and that attached thereto are true, correct and complete copies of
the Certificate of Incorporation and bylaws of Buyer.
(d) Assignment and Assumption Agreements and Assignment
and Acceptance Agreements. The Assignment and Assumption Agreements referenced
in Section 8.2(a)(i) and the Assignment and Acceptances of FCC Licenses
referenced in Section 8.2(a)(iv).
(e) Good Standing Certificate. At the Group II/III and
Group V Closings, a certificate as to the existence and good standing of Buyer
issued by the Secretary of State of the State of organization of Buyer, dated
not more than ten (10) days before such Closing Date, and certificates issued
by the appropriate governmental authority as to the qualification of Buyer to
do business in each jurisdiction in which such qualification is necessary for
Buyer to own the Assets and operate the Stations which are part of such Group
Sale.
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(f) Incumbency Certificate. A certificate signed by an
officer of Buyer and Guarantor (but without liability to such officer)
certifying the signatures and incumbency of the persons executing this
Agreement on behalf of Buyer and the Guarantor.
(g) WHNZ Option Agreement. The WHNZ Option Agreement,
duly executed by Buyer.
(h) WYCL Option Agreement. The WYCL Option Agreement,
duly executed by Buyer.
(i) Services Agreements. The Services Agreements, duly
executed by Buyer.
(j) TSAs. To the extent not previously delivered at the
Effective Time, the TSAs with respect to WHNZ, WYCL and WEAT, duly executed
by Buyer.
(k) DP Media Agreement. The DP Media Agreement, duly
executed by Buyer.
(l) Other. Such other documents expressly called for to be
delivered by Buyer under the terms of this Agreement or as may be reasonably
requested by Seller.
SECTION 9 TERMINATION
9.1 Termination of Agreement. This Agreement may be terminated only
as follows:
(a) at any time by written consent of each of Buyer, Guarantor,
PCC and LPI;
(b) by PCC, if PCC is not in default or breach in any material
respect of its obligations under this Agreement to consummate the transactions
contemplated under Section 6.10(a) and the other transactions to be consummated
on the LPI Sale Date under Section 6.10, if Buyer defaults under or breaches
its obligations under Section 6.10(a) or the other provisions of Section 6.10
that are applicable on the LPI Sale Date;
(c) by Buyer, if Buyer is not in default or breach in any
material respect of its obligations under this Agreement to consummate the
transactions contemplated under Section 6.10(a) and the other transactions to
be consummated on the LPI Sale Date under Section 6.10, if either PCC or LPI
defaults under or breaches its respective obligations under Section 6.10(a) or
under the other provisions of Section 6.10 that are applicable on the LPI Sale
Date;
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(d) by Seller, with respect only to the Group Sale to be
consummated at any applicable Closing, if Seller is not in default or breach in
any material respect of its obligations under this Agreement with respect to
such Group Sale, if the applicable conditions precedent to Seller's obligations
in Sections 7.2 or 7.3 (as modified by the provisions of Section 6.10) with
respect to the Closing of such Group Sale have not been satisfied (or waived by
Seller) by the date scheduled for such Closing pursuant to Section 8.1 (as such
date may be postponed pursuant to Section 8.1(a)(ii)); provided that
notwithstanding the foregoing, if termination pursuant to this Section 9.1(d)
is in respect of the Group II/III Sale or the Group V Sale, such termination
shall then be effective with respect to this entire Agreement and all Group
Sales hereunder;
(e) by Buyer, with respect only to the Group Sale to be
consummated at any applicable Closing, if Buyer is not in default or breach in
any material respect of its obligations under this Agreement with respect to
such Group Sale, if the applicable conditions precedent to Buyer's obligations
in Sections 7.1 or 7.3 (as modified by the provisions of Section 6.10) with
respect to the Closing of such Group Sale have not been satisfied (or waived by
Buyer) by the date scheduled for such Closing pursuant to Section 8.1 (as such
date may be postponed pursuant to Section 8.1(a)(ii)); provided that
notwithstanding the foregoing, if termination pursuant to this Section 9.1(e)
is in respect of the Group II/III Sale or the Group V Sale, such termination
shall then be effective with respect to this entire Agreement and all Group
Sales hereunder;
(f) by either Buyer or Seller with respect only to such
transactions which are to be consummated at any Closing which have not occurred
on or before the Termination Date, except where the Closing related to such
transactions has been postponed pursuant to the provisions of Section
8.1(a)(ii), in which case the applicable date shall be upon the expiration of
the period referred to in Section 8.1(a)(ii), if the terminating party is not
in default or breach in any material respect of its obligations under this
Agreement in respect of such Closings hereunder that have not taken place on or
before the Termination Date; and
(g) by Buyer, pursuant to Section 6.15(c).
Notwithstanding anything in this Section 9.1 to the contrary, if
on the Termination Date, a Closing has not occurred solely because any required
notice period for such Closing has not lapsed, the Termination Date shall be
extended until the lapse of such period.
Without limiting the generality of the foregoing, or any
applicable law, neither Buyer, on the one hand, nor Seller,
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on the other hand, may rely on the failure of any condition precedent set forth
in Section 7 to be satisfied as a ground for termination of this Agreement by
such party if such failure was caused by such party's failure to act in good
faith, or a breach of or failure to perform its representations, warranties,
covenants or other obligations in accordance with the terms hereof.
9.2 Procedure and Effect of Termination.
(a) In the event of termination of this Agreement in whole
(or in part with respect only to any particular Group Sale as expressly
provided herein) by either or both of Buyer and/or PCC or LPI pursuant to
Section 9.1, prompt written notice thereof shall forthwith be given to the
other party and this Agreement shall terminate (in whole or in part, as the
case may be) and, to the extent this Agreement is terminated, the transactions
contemplated hereby shall be abandoned without further action by any of the
parties hereto, but subject to and without limiting any of the rights of the
parties specified herein in the event a party is in default or breach in any
material respect of its obligations under this Agreement. If this Agreement is
terminated as provided herein, to the extent this Agreement is terminated:
(i) None of the parties hereto shall have any liability or
further obligation to any other party or any of their respective
directors, officers, shareholders, employees, agents, or Affiliates
pursuant to this Agreement or otherwise, except as stated in
Sections 6.3, 6.11 (if applicable), 9.2, 9.3, 9.4 and 11.1 hereof;
(ii) Except for Guarantor, which shall have liability as
Guarantor hereunder to the extent set forth herein, if applicable,
and Xx. Xxxxxx X. Xxxxxx, who shall have liability as guarantor
pursuant to the Guaranty described in Section 6.10(a)(i)(6) to the
extent set forth therein, if applicable, notwithstanding anything
herein or in applicable law to the contrary, none of the respective
directors, officers, shareholders, employees, agents or Affiliates
of any of the parties hereto shall have any liability or obligation
to any other party or any of their respective directors, officers,
shareholders, employees, agents or Affiliates pursuant to this
Agreement or otherwise;
(iii) All filings, applications and other submissions
relating to the transactions contemplated hereby as to which
termination has occurred shall, to the extent practicable, be
withdrawn from the agency or other Person to which made.
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(b) With respect to terminations pursuant to Section 9.1
hereof:
(i) If this Agreement is terminated pursuant to Sections
9.1(a) or 9.1(g), then and in that event, none of the parties hereto
shall have any recourse against or liability to the other parties
hereto, except as stated in Sections 6.3, 6.11, 9.2, 9.3, 9.4 and
11.1 hereof or in any written agreement entered into by the parties
in connection with such termination.
(ii) If this Agreement is terminated by PCC pursuant to
Sections 9.1(b), PCC shall have the right to pursue all legal and
equitable remedies available against Buyer and Guarantor for breach
of contract; provided, however, that to the extent Buyer has
defaulted or breached in the manner referenced in Section 9.1(b), in
determining Seller's damages hereunder, Buyer shall be deemed to
have breached its obligations to make the Group V Loan and to
consummate the Group I Sale, the Group II/III Sale, the Group IV
Sale and the Group V Sale.
(iii) If this Agreement is terminated by Buyer pursuant
to Section 9.1(c), Buyer shall have the right to pursue all legal
and equitable remedies available to it for breach of contract.
(iv) If this Agreement is terminated by Seller pursuant
to Section 9.1(d) or (f), and Buyer is in breach or default of its
obligations under this Agreement, then the following provisions
shall apply:
(1) If termination is with respect to all Group
Sales, and the LPI Sale has not occurred, Seller shall have
the right to pursue all legal and equitable remedies
available to it against Buyer or Guarantor for breach of
contract.
(2) If the LPI Sale has been consummated and
termination is with respect to all Group Sales, then and in
that event (A) the Group V Loan shall be reduced in a
principal amount of $56,967,153, which reduction shall also
be provided for in the Clear Channel Loan Agreement; and (B)
the principal amount of the Group IV Loan shall be reduced by
$3,125,000 and the Group IV-B Note shall be canceled in
connection therewith. The foregoing remedies shall constitute
liquidated damages and the exclusive remedies of Seller and
LPI for Buyer's breach; provided, however, that if the LPI
Sale has been consummated, nothing contained herein shall
limit or otherwise restrict the rights and liabilities of PCC
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and LPI with respect to each other in connection with a
termination of this Agreement with respect to any of the
Group Sales. Notwithstanding the foregoing, to the extent
the following agreements have been entered into and to
the extent expressly provided therein (but subject to the
acceleration, termination and other provisions thereof),
the provisions of the TBAs applicable in the event of
termination, the Intercreditor Agreement, the Clear
Channel Loan Agreement (and the promissory note and
Security Documents delivered pursuant thereto), the LPI
Note (and the Subordinated Guaranty delivered therewith),
the Group IV Loan Agreement, the Group IV-A Note, the
Group IV-B Note and the Group IV-C Note (and the security
documents delivered pursuant thereto) shall remain in
full force and effect and shall be unimpaired by any
termination of this Agreement or payments made by Buyer
or Guarantor pursuant to this Section.
(3) If the Group II/III Closing and Group V
Closing have occurred, and Buyer is in breach of its
obligations to consummate the Group IV Sale, then the
principal amount of the Group IV Loan shall be reduced by
$3,125,000 and the Group IV-B Note shall be canceled in
connection therewith. The foregoing remedies shall
constitute liquidated damages and the exclusive remedies
of PCC in respect of Buyer's breach of its obligations
with respect to the Group IV Sale, but, to the extent
they do not relate to such sale, without impairing any of
PCC's other rights under this Agreement and the documents
related hereto or delivered in connection therewith.
(v) If this Agreement is terminated by Seller pursuant to
Section 9.1(d) or (f), and Buyer is not in breach of its obligations
under this Agreement, then the following provisions shall apply:
(1) If the LPI Sale has occurred, and to the extent
expressly provided therein (but subject to the acceleration,
termination and other provisions thereof) the provisions of
the TBAs applicable in the event of termination, the
Intercreditor Agreement, the Clear Channel Loan Agreement
(and the promissory note and the Security Documents delivered
pursuant thereto), and the LPI Note (and the Subordinated
Guaranty delivered therewith) shall remain in full force and
effect and shall be unimpaired by any termination of this
Agreement.
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(2) If termination is effective with respect to the
Group IV Assets, and to the extent expressly provided in the
Group IV Loan (but subject to the acceleration, termination
and other provisions thereof), the Group IV Loan shall be
repaid in accordance with the terms of the Group IV Loan.
(vi) If this Agreement is terminated by Buyer pursuant to
Section 9.1(e) or (f), then the following provisions shall apply:
(1) If termination is with respect to all Group
Sales and if Seller is in breach of its obligations under
this Agreement to consummate such Group Sales, Buyer shall
have the right to pursue all legal and equitable remedies
available to it.
(2) If termination is with respect only to the Group
IV Sale and if Seller is in breach of its obligations under
this Agreement to consummate such Group Sale, Buyer shall
have the right to pursue all legal and equitable remedies
available to it in respect of the Group IV Sale.
(3) If and to the extent the following agreements
have been entered into and to the extent expressly provided
therein (but subject to the acceleration, termination and
other provisions thereof), the provisions of the TBAs
applicable in the event of termination, the Intercreditor
Agreement, the Clear Channel Loan Agreement (and the
promissory note and the Security Documents delivered pursuant
thereto), and the Group IV-A Note and the Group IV-B Note
(and the security documents delivered pursuant thereto) shall
remain in full force and effect and shall be unimpaired by
any termination of this Agreement.
(c) If the Group I Sale has been consummated pursuant to the
Group I Purchase Agreement with respect to any of the Repurchase Assets, and
(i) this Agreement is terminated with respect to (A) all Group Sales or (B) the
Group II/III Sale and the Group V Sale or (ii) the Group II/III Closing and the
Group V Closing have not occurred on or before the Termination Date, the
parties shall have the following rights and obligations:
(1) If this Agreement has been terminated other than
as a result of Seller's breach or default of its obligations
hereunder, PCC shall have the right to cause Buyer to sell
back to PCC, and upon request by PCC, Buyer shall sell back
to PCC, the Group I Repurchase Assets in accordance
with and subject to
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the terms and conditions set forth in Section 6.10 of
the Group I Purchase Agreement.
(2) If this Agreement has been terminated other than
as a result of Buyer's breach or default of its obligations
hereunder, Buyer shall have the right to cause PCC to
repurchase from Buyer, and upon the request of Buyer, PCC
shall repurchase from Buyer, the Group I Repurchase Assets in
accordance with and subject to the terms and conditions set
forth in Section 6.10 of the Group I Purchase Agreement.
9.3 Other Agreements. Notwithstanding anything in this Agreement
to the contrary, if the transactions contemplated by this Agreement are not
consummated in whole or in part, as a result of termination of this Agreement
pursuant to Section 9.1 hereof, then, to the extent expressly provided therein
(but subject to the acceleration, termination and other provisions thereof),
the provisions of the TBAs applicable in the event of termination, the
Intercreditor Agreement, the Clear Channel Loan Agreement (and the promissory
notes and Security Documents delivered pursuant thereto), the Group IV Loan
Agreement, the Group IV-A Note, the Group IV-B Note and the Group IV-C Note
(and the security documents delivered pursuant thereto) shall remain in effect.
9.4 Attorneys' Fees. In the event of a default by either party
that results in a lawsuit or other proceeding for any remedy available under
this Agreement, the prevailing party shall be entitled to reimbursement from
the other party of its reasonable legal fees and expenses incurred in
connection with such proceedings (whether incurred in arbitration, at trial, or
on appeal).
9.5 Specific Performance. In the event of a breach or threatened
breach by Buyer, Guarantor or Seller of any representation, warranty, covenant
or agreement under this Agreement, in addition to any other remedy available to
it, Seller or Buyer, as the case may be, shall be entitled to an injunction
restraining any such breach or threatened breach by the other parties to this
Agreement and, subject to obtaining any requisite approval of the FCC, to
enforcement of this Agreement by a decree of specific performance requiring
such other parties to fulfill their respective obligations under this
Agreement, in each case without the necessity of showing economic loss or other
actual damages and without any bond or other security being required.
SECTION 10 SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
INDEMNIFICATION; CERTAIN REMEDIES
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10.1 Survival. (a) The representations and warranties of Buyer,
Guarantor and Seller with respect to each Group Sale contained herein shall
survive the Closing related thereto for a period expiring eighteen (18) months
after the related Effective Time and shall terminate on such date, except to
the extent that any claims for indemnification in respect of a breach of any
such representation or warranty is made on or before the applicable dates set
forth in the preceding clause, in which case such representation or warranty
(but not any others) shall survive until the resolution of such claim.
(b) Notwithstanding the foregoing, (1) any claims for
indemnification related to a breach of the representations and warranties
contained in Section 3.16 shall survive, and must be brought before the
expiration of, the period expiring thirty-six (36) months after the applicable
Effective Time in respect of the Group Sale pursuant to which such claim is
brought and (2) any claims for indemnification pursuant to Section 10.2(a)(iv)
or related to a breach of the representations and warranties contained in
Sections 3.10 and 3.22 shall survive, and must be brought before the expiration
of, the applicable statute of limitations.
(c) Buyer's obligation to pay, perform or discharge the Assumed
Liabilities shall survive until such Assumed Liabilities have been paid,
performed or discharged in full.
(d) Seller's obligations to pay, perform or discharge all
liabilities of Seller that are not Assumed Liabilities ("Retained
Liabilities"), and to indemnify Buyer in respect thereof, shall survive until
such liabilities have been paid, performed or discharged in full.
(e) Any claim for indemnification in respect of a covenant or
agreement of Buyer or Seller hereunder to be performed before the Closing
related thereto shall be made before the expiration of the eighteen month
anniversary of the related Effective Time. The covenants and agreements of the
parties contained herein and to be performed to any extent after any Closing
Date shall survive the related Closing until fully paid, discharged and
performed, and any claims for indemnification in respect of a breach of such
covenants to be performed after such Closing Date shall survive until such
covenants and agreements are so paid, discharged and performed.
10.2 Indemnification by Seller. (a) With respect to any Group Sale,
after the Closing therefor, Seller hereby agrees to indemnify, defend and hold
Buyer harmless against and with respect to, and shall reimburse Buyer for:
(i) Any and all losses, liabilities or damages resulting from
any breach of any representation or warranty made
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pursuant to this Agreement as of the date hereof or as of the applicable
Effective Time or, to the extent specifically contemplated by Section
6.10(a)(iv)(1) hereof and subject to the limitations therein, as of the
applicable Closing Date, or any failure by Seller to perform any covenant of
Seller set forth in this Agreement or in any certificate, document or
instrument prepared by Seller and delivered to Buyer hereunder;
(ii) Any failure by Seller to pay, perform or
discharge any and all Retained Liabilities;
(iii) Any litigation, proceeding or claim by any
third party arising from the business or operations of the Assets by Seller
prior to the Effective Time for the Group Sale in which such Assets were
included, except to the extent arising from Assumed Liabilities;
(iv) If Seller elects under Section 11.10 (the
"1031 Election") to effect the transfer of some or all of the Assets to Buyer
in a manner qualifying as part of a like-kind exchange of property by Seller
within the meaning of Section 1031 of the Code (a "Like-kind Exchange"), (A)
the excess, if any, of (1) all reasonable out-of-pocket costs and expenses of
Buyer in consummating the transfer of any of the Assets to Buyer in a Like-kind
Exchange, including, without limitation, reasonable legal fees and expenses for
the review of any additional documentation to be executed and delivered by
Buyer as a result of the Like-kind Exchange, over (2) the costs and expenses of
Buyer in consummating the transfer of such Assets to Buyer if the 1031 Election
had not been made and (B) the excess, if any, of (1) if the 1031 Election
causes Buyer to obtain a tax basis in such assets less than the tax basis Buyer
would have had in such Assets had Seller not made a 1031 Election, the Taxes
payable by Buyer, over (2) the Taxes that would have been payable by Buyer had
Seller not made the 1031 Election;
(v) With respect to any leased Real Property for
which a Lease Consent or Estoppel Certificate are not obtained by the date
which is twelve (12) months after the Closing Date related to such leased Real
Property only, any and all reasonable out-of-pocket costs and expenses,
including reasonable legal fees and expenses, arising from the termination of
any lease for such Real Property and the transfer of any Assets from the
related leased Real Property to a new site as a result thereof;
(vi) Any and all reasonable out-of-pocket costs
and expenses, including reasonable legal fees and expenses, of undertaking
remediation or such other action to eliminate any noncompliance with applicable
law with respect to any Real Property owned by Seller, in each case as
specifically set forth in any Phase II Report;
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(vii) Any and all losses, liabilities or damages
resulting from any claim by Marketing Magic, Inc. in respect of
trade or barter agreements for any period prior to January 1,
1997;
(viii) Any and all loss, liabilities or damages
resulting from those provisions of any employment contract between any Station
and an Assumed Employee which address the terms and conditions of any grant by
PCC to such Assumed Employee of an option to purchase common stock;
(ix) The amount finally determined pursuant to
Section 6.15(b)(ii);
(x) Any and all losses, liabilities or damages
which Buyer pays to Citicasters Co. or its Affiliates as a
result of a judgment in the World Class Rock Claims attributable
to Seller's actions or inactions prior to the relevant Effective
Time; and
(xi) Any and all reasonable out-of-pocket costs
and expenses, including reasonable legal fees and expenses, incident to any
action, suit, proceeding, claim, demand, assessment or judgment incident to the
foregoing or reasonably incurred in investigating or attempting to avoid the
same or to oppose the imposition thereof, or in enforcing this indemnity.
(b) Seller's obligation to indemnify Buyer pursuant to
Section 10.2(a) shall be subject to all of the following limitations:
(i) (1) No indemnification shall be required to
be made by Seller as the Indemnifying Party under Section 10.2(a) until the
aggregate amount of all Settled Claims of Buyer as Claimant pursuant to this
Agreement (and any agreements executed in connection herewith or delivered
pursuant hereto) and the Group I Purchase Agreement (and any agreements
executed in connection therewith or delivered pursuant thereto) exceeds Five
Hundred Thousand Dollars ($500,000) in the aggregate (the "Hurdle Amount");
provided, however, that such limitation shall not apply to claims made by Buyer
with respect to indemnification pursuant to Sections 10.2(a)(iv),(v), (vi),
(vii), (viii) and (ix) and prorations and adjustments to the Estimated Purchase
Price pursuant to Section 2.5. Once the aggregate amount of all such Settled
Claims exceeds the Hurdle Amount Seller shall provide indemnification to Buyer
in respect of all Settled Claims, whether occurring before or after such time.
(2) Notwithstanding anything in this Agreement
or applicable law to the contrary, in no event shall Seller's
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obligation for indemnification under this Agreement and the Group I Purchase
Agreement (and agreements executed in connection herewith or therewith or
delivered pursuant hereto or thereto) in the aggregate for all such agreements,
exceed $56,967,153, and Buyer waives, releases and shall have no recourse
against Seller for amounts in excess of $56,967,153; provided, however, that
such limitation shall not apply to claims made by Buyer pursuant to Section
10.2(a)(iv) or (ix).
(ii) Buyer shall be entitled to indemnification
only for those damages arising with respect to any claim as to which Buyer has
given Seller written notice within the appropriate time period set forth in
Section 10.1 hereof for such claim.
(iii) All of Buyer's damages sought to be
recovered under Section 10.2(a) hereof shall be net of (i) any insurance
proceeds received by Buyer as Claimant, with respect to events giving rise to
such damages, and (ii) tax benefits finally received by or accruing to Buyer in
connection with such events.
(iv) Following the Closing with respect to any
Group Sale, the sole and exclusive remedy for Buyer for any claim arising out
of a breach of any representation, warranty, covenant or other agreement herein
or otherwise arising out of or in connection with the transactions contemplated
by this Agreement (and agreements executed in connection herewith or delivered
pursuant hereto) related to such Group Sale or the operations of the Stations
included in such Group Sale, other than in respect of claims arising in
connection with the WHNZ Option Agreement, the WYCL Option Agreement, the
Services Agreements and the TSAs, whether such claim is framed in tort,
contract or otherwise, shall be a claim for indemnification pursuant to this
Section 10.
(v) Anything in this Agreement or any applicable
law to the contrary notwithstanding, it is understood and agreed by Buyer that,
other than with respect to Seller (but not including any shareholder, director,
officer, employee, agent or Affiliate of Seller) as expressly provided for in
Section 10.2(a) and this Section 10.2(b), no shareholder, director, officer,
employee, agent or Affiliate of Seller shall have (i) any personal liability to
Buyer as a result of the breach of any representation, warranty, covenant or
agreement of Seller contained herein or otherwise arising out of or in
connection with the transactions contemplated hereby or the operations of the
Stations or (ii) any personal obligation to indemnify Buyer for any of Buyer's
claims pursuant to Section 10.2(a) and Buyer waives and releases and shall have
no recourse against any of such parties described in this Section 10.2(b)(v) as
a result of the breach of any representation, warranty, covenant or
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agreement of Seller contained herein or otherwise arising out of or in
connection with the transactions contemplated hereby or the operations of the
Stations; provided, however, that the foregoing shall not affect the liability
and obligations of any of the parties to the Clear Channel Loan Agreement and
the Guaranty delivered to Buyer pursuant to Section 6.10(a)(i)(6) thereunder.
(vi) Any obligations of Seller in respect of WKES
and the Group IV Stations shall be subject to the limitations set forth in
Section 6.10 hereof.
(vii) Except as specifically provided in Section
10.2(a)(x) and notwithstanding any other provision of this Agreement to the
contrary, Seller shall have no obligation to indemnify or hold harmless Buyer
for or against any loss, liabilities, damages, costs or expenses resulting from
or relating to the World Class Rock Claims.
10.3 Indemnification by Buyer and Guarantor.
(a) With respect to any Group Sale, after the Closing therefor,
Buyer and Guarantor hereby jointly and severally agree to indemnify, defend and
hold Seller harmless against and with respect to, and shall reimburse Seller
for:
(i) Any and all losses, liabilities or damages resulting
from any material breach of any representation or warranty made pursuant to
this Agreement, or any material failure by Buyer or Guarantor to perform any
covenant of Buyer or Guarantor set forth in this Agreement or in any
certificate, document or instrument delivered to Seller under this Agreement;
(ii) Any failure by Buyer or Guarantor to pay, perform or
discharge any and all Assumed Liabilities or any other liabilities of Buyer or
Guarantor pursuant to this Agreement;
(iii) Any litigation, proceeding or claim arising from the
business or operations of the Assets or the Stations on or after the Effective
Time related thereto, other than as a result of any action or inaction by
Seller in violation of its obligations under this Agreement and the TBAs; and
(iv) Any and all reasonable out-of-pocket costs and
expenses, including reasonable legal fees and expenses, incident to any action,
suit, proceeding, claim, demand, assessment or judgment incident to the
foregoing or reasonably incurred in investigating or attempting to avoid the
same or to oppose the imposition thereof, or in enforcing this indemnity.
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(b) Buyer's and Guarantor's obligation to indemnify
Seller pursuant to Section 10.3(a) shall be subject to all of
the following limitations:
(i) (1) No indemnification shall be required to
be made by Buyer and Guarantor as the Indemnifying Party under Section
10.3(a)(i) relating solely to material breaches of representations and
warranties until the aggregate amount of all Settled Claims of Seller as
Claimant pursuant to this Agreement (and any agreements executed in connection
herewith or delivered pursuant hereto) and the Group I Purchase Agreement (and
any agreements executed in connection therewith or delivered pursuant thereto)
exceeds the Hurdle Amount in the aggregate; provided, however, that once the
aggregate amount of all such Settled Claims exceeds the Hurdle Amount, Buyer
shall provide indemnification to Seller in respect of all such Settled Claims,
whether occurring before or after such time.
(2) Notwithstanding anything in this Agreement
or applicable law to the contrary, in no event shall Buyer's or Guarantor's
obligation for indemnification relating solely to representations and
warranties under Section 10.3(a)(i) of this Agreement and Section 10.3(a)(i) of
the Group I Purchase Agreement (and agreements executed in connection herewith
or therewith or delivered pursuant hereto or thereto) in the aggregate for all
such agreements, exceed $56,967,153, and Seller waives, releases and shall have
no recourse against Buyer for amounts in excess of $56,967,153 relating solely
to such matters; provided, however, that such limitation shall not apply to
claims made by Seller pursuant to any subsection of Section 10.3 of this
Agreement or Section 10.3 of the Group I Purchase Agreement other than the
provisions thereof relating solely to material breaches of representations and
warranties under Section 10.3(a)(i) of this Agreement and Section 10.3(a)(i) of
the Group I Purchase Agreement.
(ii) Seller shall be entitled to indemnification
only for those damages arising with respect to any claim as to which Seller has
given Buyer written notice within the appropriate time period set forth in
Section 10.1 hereof for such claim.
(iii) All of Seller's damages sought to be
recovered under Section 10.3(a) hereof shall be net of (A) any insurance
proceeds received by Seller as Claimant, with respect to events giving rise to
such damages, and (B) any tax benefits finally received or accruing to Seller
in connection with such events.
(iv) Following the Closing with respect to any
Group Sale, the sole and exclusive remedy for Seller for any claim arising out
of a breach of any representation, warranty,
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covenant or other agreement herein or otherwise arising out of or in connection
with the transactions contemplated by this Agreement (and agreements executed
in connection herewith or delivered pursuant hereto) related to such Group Sale
or the operations of the Stations included in such Group Sale, other than in
respect of claims arising in connection with the WHNZ Option Agreement, the
WYCL Option Agreement, the Services Agreements and the TSAs, whether such claim
is framed in tort, contract or otherwise, shall be a claim for indemnification
pursuant to this Section 10.
(v) Anything in this Agreement or any applicable
law to the contrary notwithstanding, it is understood and agreed by Seller
that, other than with respect to Buyer and Guarantor (but not including any
shareholder, director, officer, employee, agent or other Affiliate of either of
them), as expressly provided for in Section 10.3(a) and this Section 10.3(b),
no shareholder, director, officer, employee, agent or Affiliate of Buyer or
Guarantor shall have (A) any personal liability to Seller as a result of the
breach of any representation, warranty, covenant or agreement of Buyer
contained herein or otherwise arising out of or in connection with the
transactions contemplated hereby or the operations of the Stations or (B)
personal obligation to indemnify Seller for any of Seller's claims pursuant to
Section 10.3(a), and Seller waives and releases and shall have no recourse
against any one of such parties described in this Section 10.3(b)(v) as the
result of the breach of any representation, warranty, covenant or agreement of
Buyer contained herein or otherwise arising out of or in connection with the
transactions contemplated hereby or the operations of the Stations.
10.4 Procedure for Indemnification. The procedure for
indemnification shall be as follows:
(a) The party claiming indemnification (the "Claimant") shall
promptly give notice to the party from which indemnification is claimed (the
"Indemnifying Party") of any claim, whether between the parties or brought by a
third party, specifying in reasonable detail the factual basis for the claim,
the amount thereof, estimated in good faith, and the method of computation of
such claim, all with reasonable particularity and containing a reference to the
provisions of this Agreement in respect of which such indemnification claim
shall have occurred. If the claim relates to an action, suit, or proceeding
filed by a third party against Claimant, such notice shall be given by Claimant
within ten Business Days after written notice of such action, suit, or
proceeding was given to Claimant.
(b) With respect to claims solely between the parties,
following receipt of notice from the Claimant of a claim, the Indemnifying
Party shall have thirty days to make
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such investigation of the claim as the Indemnifying Party deems necessary or
desirable. For the purposes of such investigation, the Claimant agrees to make
available to the Indemnifying Party and its authorized representatives the
information relied upon by the Claimant to substantiate the claim. If the
Claimant and the Indemnifying Party agree at or prior to the expiration of the
thirty-day period (or any mutually agreed upon extension thereof) to the
validity and amount of such claim, the Indemnifying Party shall immediately pay
to the Claimant the full amount of the claim, subject to the terms hereof
(including Sections 10.2(b) and 10.3(b)). If the Claimant and the Indemnifying
Party do not agree within the thirty-day period (or any mutually agreed upon
extension thereof), the Claimant may seek appropriate remedy at law or equity,
as applicable, subject to the limitations of Sections 10.2(b) and 10.3(b).
(c) With respect to any claim by a third party as to which the
Claimant is entitled to indemnification under this Agreement, the Indemnifying
Party shall have the right at its own expense, to participate in or assume
control of the defense of such claim, and the Claimant shall cooperate fully
with the Indemnifying Party, subject to reimbursement for actual out-of-pocket
expenses incurred by the Claimant as the result of a request by the
Indemnifying Party. If the Indemnifying Party elects to assume control of the
defense of any third-party claim, the Claimant shall have the right to
participate in the defense of such claim at its own expense. If the
Indemnifying Party does not elect to assume control or otherwise participate in
the defense of any third-party claim, then the Claimant may defend through
counsel of its own choosing and (so long as it gives the Indemnifying Party at
least fifteen (15) days' prior written notice of the terms of the proposed
settlement thereof and permits the Indemnifying Party to then undertake the
defense thereof) settle such claim, action or suit, and to recover from the
Indemnifying Party the amount of such settlement or of any judgment and the
costs and expenses of such defense. The Indemnifying Party shall not compromise
or settle any third party claim, action or suit without the prior written
consent of the Claimant, which consent will not be unreasonably withheld or
delayed.
(d) If a claim, whether between the parties or by a third party,
requires immediate action, the parties will make every effort to reach a
decision with respect thereto as expeditiously as practicable.
(e) Any claim for indemnity pursuant to this Section 10 with respect
to which (i) the Claimant and the Indemnifying Party agree as to its validity
and amount, (2) a final judgment, order or award of a court of competent
jurisdiction deciding such claim has been rendered, as evidence by a certified
copy of such judgment, provided that such judgment is not appealable or
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the time for taking an appeal has expired or (3) the Indemnifying Party has not
given written notice to the Claimant disputing such claim in whole or in part
within thirty days of receiving notice thereof, is referred to as a "Settled
Claim."
SECTION 11 MISCELLANEOUS
11.1 Fees and Expenses. Except as otherwise specifically provided in
this Agreement, each party shall pay its own expenses incurred in connection
with the authorization, preparation, execution, and performance of this
Agreement and the documents and transactions contemplated hereby, including all
fees and expenses of counsel, accountants, agents and representatives;
provided, however, that all transfer taxes, recordation taxes, sales taxes and
document stamps in connection with the transactions contemplated by this
Agreement and all other filing fees (including all FCC and HSR Act filing
fees), and other charges levied by any governmental entity in connection with
the transactions contemplated by this Agreement shall be paid one-half by Buyer
and one-half by Seller. Notwithstanding the foregoing, Seller shall pay (a) all
Florida state sales tax, if any, arising from the conveyance of the Assets to
Buyer pursuant to this Agreement and (b) all federal, state or local income
taxes payable by Seller, and Buyer shall pay all federal, state or local income
taxes payable by Buyer. Buyer hereby waives compliance with the provisions of
any applicable bulk transfer laws.
11.2 Notices. All notices, demands and requests required or permitted
to be given under the provisions of this Agreement shall be (i) in writing,
(ii) sent by facsimile (with receipt personally confirmed by telephone),
delivered by personal delivery, or sent by commercial delivery service or
certified mail, return receipt requested, (iii) deemed to have been given on
the date telecopied with receipt confirmed, the date of personal delivery, or
the date set forth in the records of the delivery service or on the return
receipt, and (iv) addressed as follows:
To Metroplex, CCL Clear Channel Metroplex, Inc.
or Guarantor: 000 Xxxxxxx Xxxxx
Xxx Xxxxxxx, Xxxxx 00000
Attention: Xxxx X. Xxxx, President and
Xxxxxxx X. Xxxxx, Senior
Vice President for Legal
Affairs
Telecopy (000) 000-0000
Telephone: (000) 000-0000
with a copy Wiley, Rein & Fielding
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(which shall 0000 X Xxxxxx, X.X.
not constitute Xxxxxxxxxx, XX 00000
notice) to: Attention: Xxxxxxx X. Xxxxxxx, Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
To PCC: Xxxxxx Communications Corporation
000 Xxxxxxxxxx Xxxx Xxxx
Xxxx Xxxx Xxxxx, Xxxxxxx 00000
Attention: Xx. Xxxxxx X. Xxxxxx and
Xx. Xxxxxxx X. Xxxxxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
with a copy Dow, Xxxxxx & Xxxxxxxxx, PLLC
(which shall 0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
not constitute Suite 800
notice) to: Xxxxxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxx, Xx., Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
To LPI: X. Xxxxxx, Inc.
000 Xxxxxxxxxx Xxxxxx Xxxxx, Xxxxx 000
Xxxx Xxxx Xxxxx, XX 00000
Attention: Xx. Xxxxx X. Xxxxxx
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
with a copy Dow, Xxxxxx & Xxxxxxxxx, PLLC
(which shall 0000 Xxx Xxxxxxxxx Xxxxxx, X.X.
not constitute Suite 800
notice) to: Xxxxxxxxxx, XX 00000-0000
Attention: Xxxx X. Xxxxx, Xx., Esq.
Telecopy: (000) 000-0000
Telephone: (000) 000-0000
or to any other or additional persons and addresses as the parties may from
time to time designate in a writing delivered in accordance with this Section
11.2.
11.3 Benefit and Binding Effect. Except as otherwise provided in
Sections 6.10 and 11.10 and the following sentence of this Section 11.3, no
party hereto may assign this Agreement without the prior written consent of the
other parties hereto. Buyer may assign its rights and obligations under this
Agreement to Clear Channel Radio, Inc. ("CCRI") and Clear Channel Radio
License, Inc. ("CCRL") so long as (i) CCRI and CCRL are wholly-owned
subsidiaries of the Guarantor and (ii) such assignment
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does not hinder, impair or delay in any respect the grant by the FCC of any FCC
Consent or any Closing hereunder; provided that such assignment shall not
release Buyer from any of its obligations hereunder. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
11.4 Further Assurances. Subject to the terms and conditions of this
Agreement, from time to time prior to, at and after the Closing Date, each
party hereto will use commercially reasonable efforts to take, or cause to be
taken, all such actions and to do or cause to be done, all things, necessary,
proper or advisable under applicable laws and regulations to consummate and
make effective the purchase and sale contemplated by this Agreement and the
consummation of the other transactions contemplated hereby, including executing
and delivering such documents as the other party being advised by counsel shall
reasonably request in connection with the consummation of this Agreement and
the consummation of the other transactions contemplated hereby, including,
without limitation, the execution and delivery of any and all confirmatory and
other instruments, in addition to those to be delivered on the Closing Date.
11.5 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED, CONSTRUED AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF FLORIDA (WITHOUT REGARD TO THE CHOICE
OF LAW PROVISIONS THEREOF).
11.6 Entire Agreement. This Agreement, the Appendices, Exhibits and
Schedules hereto and thereto, and all documents, certificates and other
documents to be delivered by the parties pursuant hereto, collectively,
represent the entire understanding and agreement between Buyer and Seller with
respect to the subject matter of this Agreement. This Agreement supersedes the
Letter of Intent dated June 16, 1997, as amended, and all prior negotiations
between the parties and cannot be amended, supplemented, or changed except by
an agreement in writing that makes specific reference to this Agreement and
that is signed by the party against which enforcement of any such amendment,
supplement, or modification is sought. Buyer acknowledges and agrees that
Seller shall not be liable for or bound in any manner by, and Buyer has not
relied upon, any express or implied, oral or written information, warranty,
guaranty, promise, statement, inducement, presentation or opinion (whether of,
by or on behalf of Seller, any broker or finder, or any officer, employee,
agent or representative of any of the foregoing, or any other person)
pertaining to the transactions contemplated hereby, the Seller, the Stations,
the Assets, or any part of any of the foregoing (including, without limitation,
any projections, budgets or other financial forecasts or the physical condition
of the Stations or any of the Assets, or the uses which can be made of the same
or the
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value thereof), except as is expressly set forth in this Agreement.
11.7 Waiver of Compliance; Consents. Except as otherwise provided in
this Agreement, any failure of any of the parties to comply with any
obligation, representation, warranty, covenant, agreement, or condition herein
may be waived by the party entitled to the benefits thereof only by a written
instrument signed by the party granting such waiver, but such waiver or failure
to insist upon strict compliance with such obligation, representation,
warranty, covenant, agreement, or condition shall not operate as a waiver of,
or estoppel with respect to, any subsequent or other failure. Whenever this
Agreement requires or permits consent by or on behalf of any party hereto, such
consent shall be given in writing in a manner consistent with the requirements
for a waiver of compliance as set forth in this Section 11.7.
11.8 Counterparts. This Agreement may be signed in counterparts with
the same effect as if the signature on each counterpart were upon the same
instrument.
11.9 Severability. If any provision of this Agreement or the
application thereof to any person or circumstance shall be invalid or
unenforceable to any extent, the remainder of this Agreement and the
application of such provision to other persons or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by law
so long as the economic or legal substance of the transactions contemplated
hereby is not affected in any manner materially adverse to any party. Upon such
determination that any term or other provision is invalid or unenforceable, the
parties hereto shall negotiate in good faith to modify this Agreement so as to
effect the original intent of the parties as closely as possible in an
acceptable manner to the end that the transactions contemplated hereby are
fulfilled to the greatest extent possible.
11.10 Cooperation With Respect to Like-Kind Exchange. Seller may
assign some or all of its rights (but not its obligations) under this Agreement
to an escrow agent or other Person reasonably satisfactory to Buyer serving as
a Intermediary under United States Treasury Regulations promulgated under
Section 1031 of the Code; provided that (i) such assignment shall not deprive
Buyer of rights or benefits, or relieve Seller of any obligations or
liabilities, under this Agreement, (ii) Buyer shall not be obligated to expend
funds or incur obligations or liabilities in connection therewith and (iii)
Seller shall indemnify and hold harmless Buyer from and against any and all
loss, liability, cost and expense arising or resulting from any such
transaction. Seller intends for such exchange to constitute a like-kind
exchange pursuant to Section 1031 of the Code. However, nothing in this
Agreement shall be
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construed as a representation or warranty of any party to any other party as to
the tax characterization of the transaction.
11.11 Guaranty. (a) Guarantor irrevocably guarantees (the
"Guarantee"), as principal and not as surety, to Seller and its successors and
permitted assigns full and prompt performance by Buyer (which for all purposes
hereof shall include any assignee(s) of Buyer permitted under Section 11.3) of
all of its obligations under or pursuant to this Agreement and all documents
and instruments executed in connection herewith or delivered pursuant hereto in
accordance with the terms hereof and thereof (the "Guaranteed Obligations").
Such guarantee shall apply and survive until all obligations of Buyer under
this Agreement and all documents and instruments executed in connection
herewith or delivered pursuant hereto are performed and satisfied in accordance
with the terms thereof. Guarantor hereby waives any provision of any statute or
judicial decision otherwise applicable hereto which restricts or in any way
limits the rights of any obligee against a guarantor or surety following a
default or failure of performance by an obligor with respect to whose
obligations the guarantee is provided. To the fullest extent permitted by
applicable law, Guarantor hereby waives presentment to, demand of payment from
and protest of any Guaranteed Obligation, and also waives notice of acceptance
of its guarantee and notice of protest for nonpayment. To the fullest extent
permitted by applicable law, the obligations of Guarantor hereunder shall not
be affected by (a) the failure of the applicable obligee to assert any claim or
demand or to enforce any right or remedy against Guarantor pursuant to the
provisions of this Agreement or otherwise and (b) any rescission, waiver,
amendment or modification of, or any release from any of the terms or
provisions of this Section 11.11, unless consented to in writing by Buyer and
Seller.
(b) Guarantor hereby represents and warrants to Seller as follows:
(i) Guarantor is a corporation duly organized, validly existing and in good
standing under the laws of the State of Texas and has the requisite corporate
power and authority to execute, deliver and perform this Agreement according to
its terms; (ii) the execution, delivery and performance of this Agreement and
the consummation of the transactions contemplated hereby by Guarantor have been
duly authorized by all necessary corporate action on the part of Guarantor;
(iii) this Agreement has been duly executed and delivered by Guarantor and
constitutes the legal, valid and binding obligation of Guarantor enforceable
against Guarantor in accordance with its terms, except as the enforceability of
this Agreement may be affected by bankruptcy, insolvency or similar laws
affecting creditors' rights generally and by judicial discretion in the
enforcement of equitable remedies; and (iv) the execution, delivery and
performance of this Agreement: (1) do not require the consent of any third
party, (2) do not
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conflict with the Articles of Incorporation or bylaws of Guarantor, and (3) do
not conflict in any material respect with, result in a material breach of, or
constitute a material default under any applicable law, judgment, order,
ordinance, injunction, decree, rule, regulation or ruling of any court or
governmental authority applicable to Guarantor or any material contract or
agreement to which Guarantor is a party or by which Guarantor may be bound.
84
IN WITNESS WHEREOF, this Agreement has been executed by the duly
authorized officers of Buyer, Seller and Guarantor as of the date first written
above.
CLEAR CHANNEL METROPLEX, INC.
By:/s/ Xxxx X. Xxxx
---------------------------------------
Name: Xxxx X. Xxxx
Title: President/COO
CLEAR CHANNEL METROPLEX LICENSES, INC.
By:/s/ Xxxx X. Xxxx
--------------------------------------
Name: Xxxx X. Xxxx
Title:President/COO
XXXXXX COMMUNICATIONS CORPORATION
By:/s/ Xxxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxxx X. Xxxxxx
Title: Chairman
X. XXXXXX, INC.
By:/s/ Xxxxx X. Xxxxxx
-------------------------------------
Name: Xxxxx X. Xxxxxx
Title: President
CLEAR CHANNEL COMMUNICATIONS, INC.
By:/s/ Xxxx X. Xxxx
-------------------------------------
Name: Xxxx X. Xxxx
Title: President/COO
