Document/Exhibit Description Pages Size
1: 10-Q Paxson Communications, Inc. Form 10-Q 21 142K
13: EX-10.100 Asset Purchase Agreement 40 175K
14: EX-10.101 Asset Purchase Agreement 41 177K
15: EX-10.102 Asset Purchase Agreement 45 190K
16: EX-10.103 Construction Agreement 9 37K
17: EX-10.104 Loan Agreement 29 120K
18: EX-10.105 Asset Purchase Agreement 44 184K
19: EX-10.106 Asset Purchase Agreement 42 176K
20: EX-10.107 Agreement and Plan of Merger 34 110K
21: EX-10.107.01 First Amendment to Agreement and Plan of Merger 3 17K
22: EX-10.108 Asset Purchase Agreement 41 174K
23: EX-10.109 Option Agreement 9 35K
24: EX-10.110 Subordinated Note 13 50K
25: EX-10.111 Asset Purchase Agreement 40 142K
26: EX-10.112 Asset Purchase Agreement 40 169K
27: EX-10.113 Time Brokerage Agreement 28 96K
28: EX-10.114 Purchase Agreement 17 63K
29: EX-10.115 Asset Purchase Agreement 32 138K
30: EX-10.116 Asset Purchase Agreement 32 148K
31: EX-10.117 Asset Purchase Agreement 32 144K
32: EX-10.118 Asset Purchase Agreement 33 147K
33: EX-10.119 Time Brokerage Agreement 16 70K
34: EX-10.120 Loan Agreement 28 109K
35: EX-10.121 Second Amendment to Asset Purchase Agreement 6 22K
36: EX-10.122 Asset Purchase Agreement 41 180K
37: EX-10.123 Asset Purchase Agreement 94 303K
38: EX-10.124 Loan Agreement 52 170K
39: EX-10.125 Time Brokerage Agreement 28 98K
40: EX-10.126 Option Agreement 18 64K
2: EX-10.89 Amended as Restated Promissory Note 6 25K
3: EX-10.90 First Anemdment to Loan Agreement 2 15K
4: EX-10.91 Asset Purchase Agreement 15 73K
5: EX-10.92 Asset Purchase Agreement 41 174K
6: EX-10.93 The Brokerage Agreement 29 97K
7: EX-10.94 Asset Purchase Agreement 38 173K
8: EX-10.95 First Amendment 2 15K
9: EX-10.96 Promissory Note 4 21K
10: EX-10.97 Stock Purchase Agreement 42 199K
11: EX-10.98 Asset Purchase Agreement 42 178K
12: EX-10.99 Asset Purchase Agreement 42 177K
41: EX-27 Financial Data Schedule (For SEC Use Only) 1 12K
EXHIBIT 10.94
================================================================================
ASSET PURCHASE AGREEMENT
BY AND BETWEEN
CHANNEL 55 OF ALBANY, INC.
AND
CORNERSTONE TELEVISION, INC.
FOR
TELEVISION STATION WOCD(TV)
AMSTERDAM, NEW YORK
DECEMBER 11, 1995
================================================================================
TABLE OF CONTENTS
[Enlarge/Download Table]
Page
----
RECITALS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
SECTION 1. DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Accounts Receivable" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Assets" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Assumed Contracts" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Closing" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Closing Date" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Consents" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Contracts" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"FCC" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"FCC Consent" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"FCC Licenses" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Final Order" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Intangibles" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Licenses" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Permitted Liens" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Purchase Price" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Real Property" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Tangible Personal Property" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Time Brokerage Agreement" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2. PURCHASE AND SALE OF ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.1 Agreement to Sell and Buy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.2 Excluded Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.3 Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(a) Prorations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
(b) Manner of Determining Adjustments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.4 Payment of Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.5 Assumption of Liabilities and Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
SECTION 3. REPRESENTATIONS AND WARRANTIES OF SELLER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.1 Organization, Standing and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.2 Authorization and Binding Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
- i -
[Enlarge/Download Table]
Page
----
3.3 Absence of Conflicting Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.4 Governmental Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.5 Title to and Condition of Real Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.6 Title to and Condition of Tangible Personal Property . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.7 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.8 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.9 Intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.10 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.11 Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.12 Personnel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(a) Employees and Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
(b) Labor Relations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
(c) Liabilities . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.13 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.14 Claims and Legal Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.15 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.16 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.17 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.18 No Other Representations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
SECTION 4. REPRESENTATIONS AND WARRANTIES OF BUYER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.1 Organization, Standing and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.2 Authorization and Binding Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.3 Absence of Conflicting Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
4.4 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.5 Buyer Qualifications . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
4.6 Inspection . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
SECTION 5. OPERATIONS OF THE STATION PRIOR TO CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.1 Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.2 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.3 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
5.4 Disposition of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.5 Encumbrances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.6 Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.7 Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.8 No Inconsistent Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.9 Access to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
5.10 Maintenance of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.11 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
- ii -
[Enlarge/Download Table]
Page
----
5.12 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.13 Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.14 Notification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.15 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
5.16 Preservation of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 6. SPECIAL COVENANTS AND AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
6.1 FCC Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
6.2 Control of the Station . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6.3 Risk of Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6.4 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
6.5 Notice Regarding Employees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.6 Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.7 Access to Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.8 Broker . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.9 Noncompetition Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.10 Environmental Audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
6.11 Engineering Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
SECTION 7. CONDITIONS TO OBLIGATIONS OF BUYER AND SELLER
AT CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
7.1 Conditions to Obligations of Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(a) Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
(b) Covenants and Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(c) Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(d) FCC Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(e) Governmental Authorizations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(f) Deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(g) Adverse Change . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
7.2 Conditions to Obligations of Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(a) Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
(b) Covenants and Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(c) Deliveries . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(d) FCC Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
SECTION 8. CLOSING AND CLOSING DELIVERIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
8.1 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(a) Closing Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(b) Closing Place . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
-iii-
[Enlarge/Download Table]
Page
----
8.2 Deliveries by Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(a) Transfer Documents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(b) Estoppel Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(c) Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(d) Certificates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
(e) Licenses, Contracts, Business Records, Etc. . . . . . . . . . . . . . . . . . . . . . . . . 21
(f) Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(g) Noncompetition Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
8.3 Deliveries by Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(a) Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(b) Assumption Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(c) Officer's Certificate . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(d) Opinion of Counsel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
(e) Noncompetition Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 9. TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
9.1 Termination by Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(a) Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(b) Judgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(c) Upset Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
9.2 Termination by Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(a) Conditions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(b) Judgments . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(c) Upset Date . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(d) Casualty Termination Notice . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(e) Environmental Hazards . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
(f) Technical Deficiencies . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
9.3 Escrow Deposit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
9.4 Rights on Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 10. SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
INDEMNIFICATION; CERTAIN REMEDIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
10.1 Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
10.2 Indemnification by Seller . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
10.3 Indemnification by Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
10.4 Procedure for Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
10.5 Specific Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
10.6 Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
- iv -
[Enlarge/Download Table]
Page
----
SECTION 11. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
11.1 Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
11.2 Arbitration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
11.3 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
11.4 Benefit and Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
11.5 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
11.6 GOVERNING LAW . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
11.7 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
11.8 Gender and Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
11.9 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
11.10 Waiver of Compliance; Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
11.11 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
11.12 Seller's Knowledge. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
11.13 Guaranty of Paxson Communications Corporation . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
- v -
[Download Table]
LIST OF SCHEDULES
Schedule 1.1 __ Time Brokerage Agreement
Schedule 2.2 __ Excluded Property
Schedule 2.4 __ Promissory Note and Guaranty And Suretyship
Agreement
Schedule 3.3 __ Consents
Schedule 3.4 __ Licenses and Cable Carriage
Schedule 3.5 __ Real Property
Schedule 3.6 __ Tangible Personal Property
Schedule 3.7 __ Assumed Contracts
Schedule 3.9 __ Intangibles
Schedule 3.10 __ Insurance Policies
Schedule 3.12 __ Employee Matters
Schedule 3.14 __ Litigation Matters
Schedule 6.10 __ Noncompetition Agreement
Schedule 8.2(f) __ Form of Opinions of Seller's Counsel
Schedule 8.3(d) __ Form of Opinion of Buyer's Counsel
Schedule 9.3 __ Escrow Agreement
- vi -
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT is dated as of December 11, 1995, by and
between Channel 55 of Albany, Inc., a Florida corporation ("Buyer"), and
Cornerstone Television, Inc., a non-profit corporation ("Seller").
RECITALS
A. Seller is the licensee of and owns and operates television
station WOCD(TV), Amsterdam, New York (the "Station"), pursuant to licenses
issued by the Federal Communications Commission ("FCC").
B. Seller desires to sell, and Buyer wishes to buy, substantially
all the assets that are owned by Seller or in which Seller has a transferable
interest and which are used or useful in the business or operations of the
Station, for the price and on the terms and conditions set forth in this
Agreement.
AGREEMENTS
In consideration of the above recitals and of the mutual agreements
and covenants contained in this Agreement, Buyer and Seller, intending to be
bound legally, agree as follows:
SECTION 1. DEFINITIONS
The following terms, as used in this Agreement, shall have the
meanings set forth in this Section:
"Accounts Receivable" means the rights of Seller to payment for the
sale of advertising and/or programming time on the Station prior to the Closing
Date.
"Assets" means the assets to be sold, transferred, or otherwise
conveyed to Buyer under this Agreement, as specified in Section 2.1.
"Assumed Contracts" means (i) all Contracts listed in Schedule 3.7
that are specifically designated as Contracts to be assumed by Buyer upon its
purchase of the Station, (ii) all Contracts entered into by Seller in the
ordinary course of business which comply with the provisions of Section 5.3
hereof; and (iii) any other Contracts entered into by Seller between the date
of this Agreement and the Closing Date that Buyer agrees in writing to assume.
"Closing" means the consummation of the purchase and sale of the
Assets pursuant to this Agreement in accordance with the provisions of Section
8.
"Closing Date" means the date on which the Closing occurs, as
determined pursuant to Section 8.
"Consents" means the consents, permits, or approvals of government
authorities and other third parties necessary to transfer the Assets to Buyer
or otherwise to consummate the transactions contemplated by this Agreement.
"Contracts" means all contracts, leases, non-governmental licenses,
and other agreements (including leases for personal or real property and
employment agreements), written or oral (including any amendments and other
modifications thereto) to which Seller is a party or which are binding upon
Seller and which relate to or affect the Assets or the business or operations
of the Station, and (i) which are in effect on the date of this Agreement or
(ii) which are entered into by Seller between the date of this Agreement and
the Closing Date.
"FCC" means the Federal Communications Commission.
"FCC Consent" means action by the FCC granting its consent to the
assignment of the FCC Licenses to Buyer as contemplated by this Agreement.
"FCC Licenses" means all Licenses issued by the FCC to Seller in
connection with the business or operations of the Station.
"Final Order" means an action by the FCC that has not been reversed,
stayed, enjoined, set aside, annulled, or suspended, and with respect to which
no requests are pending for administrative or judicial review, reconsideration,
appeal, or stay, and the time for filing any such requests and the time for the
FCC to set aside the action on its own motion have expired.
"Intangibles" means all copyrights, trademarks, trade names, service
marks, service names, licenses, patents, permits, jingles, proprietary
information, technical information and data, machinery and equipment
warranties, and other similar intangible property rights and interests (and any
goodwill associated with any of the foregoing) applied for, issued to, or owned
by Seller or under which Seller is licensed or franchised and which are used in
the business and operations of the Station, together with any additions thereto
between the date of this Agreement and the Closing Date.
"Licenses" means all licenses, permits, and other authorizations
issued by the FCC, the Federal Aviation Administration, or any other federal,
state, or local government authorities to Seller in connection with the conduct
of the business or operations of the Station, together with any additions
thereto between the date of this Agreement and the Closing Date.
- 2 -
"Permitted Liens" means liens for taxes not yet due and payable.
"Purchase Price" means the purchase price specified in Section 2.3.
"Real Property" means Seller's interests in real property, leaseholds
and subleaseholds, purchase options, easements, licenses, rights to access, and
rights of way, and all buildings and other improvements thereon, which are used
in the business or operations of the Station, together with any additions
thereto between the date of this Agreement and the Closing Date.
"Tangible Personal Property" means all machinery, equipment, tools,
furniture, leasehold improvements, office equipment, plant, inventory, spare
parts, and other tangible personal property which is owned by the Seller or in
which Seller has an interest and which is used in the conduct of the business
or operations of the Station, together with any additions thereto between the
date of this Agreement and the Closing Date, but excluding any Tangible
Personal Property consumed in the ordinary course of business between the date
hereof and the Closing Date.
"Time Brokerage Agreement" means the Time Brokerage Agreement between
Channel 55 of Albany, Inc. and Cornerstone Television, Inc. to be executed at
the Closing and as set forth in Schedule 1 hereof.
SECTION 2. PURCHASE AND SALE OF ASSETS
2.1 Agreement to Sell and Buy. Subject to the terms and
conditions set forth in this Agreement, Seller hereby agrees to sell, transfer,
assign and deliver to Buyer on the Closing Date, and Buyer agrees to purchase
and accept all of the Assets and property interests owned by Seller or in which
Seller has a property interest which are used in connection with the conduct of
the business or operations of the Station, (but excluding all vehicles)
together with any additions thereto between the date of this Agreement and the
Closing Date, but excluding the assets described in Section 2.2, free and clear
of any claims, liabilities, security interests, mortgages, liens, pledges,
conditions, charges, or encumbrances of any nature whatsoever (except for
Permitted Liens), including the following:
(a) The Tangible Personal Property;
(b) The Real Property;
(c) The Licenses;
(d) The Assumed Contracts including executed copies
thereof;
- 3 -
(e) The Intangibles, including the goodwill of the
Station, if any; and
(f) All records required by the FCC to be kept by the
Station and copies of all other books and records, if any, which belong to
Seller and are within its possession and control relating to the business or
operations of the Station (exclusive of corporate, financial and accounting
records).
2.2 Excluded Assets. The Assets shall exclude the following
assets.
(a) Seller's cash on hand as of the Closing and all other
cash in any of Seller's bank or savings accounts; any insurance policies (and
all rights under such policies), letters of credit, or other similar items and
cash surrender value in regard thereto; and any stocks, bonds, certificates of
deposit and similar securities or other investments;
(b) All corporate and accounting records of Seller and
copies of all other books and records relating to the business and operations
of the Station;
(c) Seller's claims, choses in action, causes of action
and judgments;
(d) All property listed on Schedule 2.2 hereto; and
(e) The Accounts Receivable.
2.3 Purchase Price. The Purchase Price for the Assets shall be
TWO MILLION FOUR HUNDRED FIFTY THOUSAND DOLLARS ($2,490,000), adjusted as
provided below, plus FIFTY THOUSAND DOLLARS ($50,000) in payment of the
Noncompetition Agreement.:
(a) Prorations. The Purchase Price shall be increased or
decreased as required to effectuate the proration of expenses as of 11:59 p.m.
local time, on the day prior to the Closing Date. All expenses arising from
the operation of the Station, including business and license fees, utility
charges, real and personal property taxes and assessments levied against the
Assets, property and equipment rentals, applicable copyright or other fees,
sales and service charges, taxes (except for taxes arising from the transfer of
the Asset under this Agreement which shall be governed by Section 11.1 hereof)
and similar prepaid and deferred items, shall be prorated between Buyer and
Seller in accordance with the principle that Seller shall be responsible for
all expenses, costs, and liabilities allocable to the period prior to the
Closing Date, and Buyer shall be responsible for all expenses, costs, and
obligations allocable to the period on and after the Closing Date.
Notwithstanding the preceding sentence, there shall be no adjustment for, and
Seller shall remain solely liable with respect to, any Contracts not included
in the Assumed Contracts including specifically
- 4 -
all cash program licensing agreements and any other obligation or liability not
being assumed by Buyer in accordance with Section 2.5.
(b) Manner of Determining Adjustments. Any adjustments
will, insofar as feasible, be determined and paid on the Closing Date, with
final settlement and payment by the appropriate party occurring no later than
ninety (90) days after the Closing Date or such other date as the parties shall
mutually agree upon.
2.4 Payment of Purchase Price. The Purchase Price shall be paid
by Buyer to Seller as follows: At the Closing, Buyer shall pay to Seller (i)
the sum of EIGHT HUNDRED THOUSAND DOLLARS ($800,000), adjusted as provided
above, by wire transfer of immediately available funds pursuant to wire
instructions which shall be delivered by Seller to Buyer, at least two days
prior to the Closing Date; and (ii) a Promissory Note and Guaranty in the form
of Schedule 2.4, in the principal amount of One Million Six Hundred Fifty
Thousand Dollars ($1,650,000).
2.5 Assumption of Liabilities and Obligations. As of the Closing
Date, Buyer shall assume and undertake to pay, discharge, and perform all
obligations and liabilities of the Seller under the Licenses and the Assumed
Contracts insofar as they relate to the Buyer's ownership of the Assets or its
operation of the Station on or after the Closing Date and those relating to the
period prior to the Closing which Buyer agrees to assume pursuant to the
prorations and adjustments. Buyer shall not assume any other obligations or
liabilities of Seller, including without limitation (i) any obligations or
liabilities under any Contract not included in the Assumed Contracts, (ii) any
obligations or liabilities under the Assumed Contracts relating to the period
prior to the Closing Date, (iii) any claims or pending litigation or
proceedings relating to the operation of the Station prior to the Closing, (iv)
any obligations or liabilities arising under agreements entered into other than
in the ordinary course of business, or (v) any obligation to any employee of
the Station for severance benefits, vacation time, or sick leave accrued prior
to the Closing Date, except that Buyer shall reimburse Seller for the amounts
paid by Seller as of the Closing Date in respect of such obligations, provided
that the amount of such reimbursement shall not exceed, in the aggregate, Five
Thousand Dollars ($5,000), and all such obligations and liabilities shall
remain and be the obligations and liabilities solely of Seller.
SECTION 3. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as follows:
3.1 Organization, Standing and Authority. Seller is a non-profit
corporation duly organized, validly existing and subsisting under the laws of
the Commonwealth of Pennsylvania. Seller has all requisite corporate power and
authority (i) to own, lease, and use the Assets as now owned, leased, and used,
(ii) to conduct the business operations of the
- 5 -
Station as now conducted, and (iii) to execute and deliver this Agreement and
the documents contemplated hereby, and to perform and comply with all of the
terms, covenants, and conditions to be performed and complied with by Seller
hereunder and thereunder. Seller is not a participant of any joint venture or
partnership with any person or entity with respect to any part of the operations
of the Station or any of the Assets.
3.2 Authorization and Binding Obligation. The execution,
delivery, and performance of this Agreement by Seller have been duly authorized
by all necessary actions on the part of Seller. This Agreement has been duly
executed and delivered by Seller and constitutes the legal, valid, and binding
obligation of Seller, 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. Subject to obtaining the
Consents listed on Schedule 3.3, the execution, delivery and performance of
this Agreement and the documents contemplated hereby (with or without the
giving of notice, the lapse of time, or both): (i) do not require the consent
of any third party; (ii) will not conflict with the Articles of Incorporation
or Bylaws of Seller, (iii) will not conflict with, result in a breach of, or
constitute a default under, any law, judgment, order, ordinance, injunction,
decree, rule, regulation, or ruling of any court or governmental
instrumentality in a proceeding involving Seller; (iv) will not conflict with,
constitute grounds for termination of, result in a breach of, constitute a
default under, or accelerate or permit the acceleration of any performance
required by the terms of, any agreement, instrument, license, or permit to
which Seller is a party or by which Seller may be bound; and (v) will not
create any claim, liability, mortgage, lien, pledge, condition, charge, or
encumbrance of any nature whatsoever upon any of the Assets.
3.4 Governmental Licenses. To Seller's knowledge, (i) Schedule
3.4 includes a true and complete list of the material Licenses; (ii) Seller has
delivered to Buyer true and complete copies of the Licenses listed on such
Schedule (including any amendment and other modifications thereto), (iii) the
Licenses have been validly issued, and Seller is the authorized legal holder
thereof, (iv) the Licenses listed on Schedule 3.4 comprise all of the material
licenses, permits, and other authorizations required from any governmental or
regulatory authority for the lawful conduct of the business and operations of
the Station in the manner and to the full extent they are now conducted, (v)
none of the Licenses is subject to any restriction or condition that would
limit the full operation of the Station as now operated, and (vi) the Licenses
are in full force and effect, in all material respects, and the conduct of the
business and operations of the Station is in material accordance therewith.
Schedule 3.4 lists the cable systems to whom Seller made a valid election of
must carry and further lists those cable systems that have disputed or are
currently disputing Seller's must carry election.
- 6 -
3.5 Title to and Condition of Real Property. Schedule 3.5
contains a complete and accurate description of all the Real Property and
Seller's interests therein (including street address, legal description, owner,
and use and the location of all improvements thereon). The Real Property
listed on Schedule 3.5 comprises all real property interests necessary to
conduct the business and operations of the Station as now conducted. With
respect to each leasehold or subleasehold interest included in the Real
Property being conveyed under this Agreement, so long as Seller fulfills its
obligations under the lease therefor, Seller has enforceable rights to
nondisturbance and quiet enjoyment, and no third party holds any interest in
the leased premises with the right to foreclose upon Seller's leasehold or
subleasehold interest. All Real Property (including all improvements thereon)
(i) is available for immediate use consistent with the conduct of the business
and present operations of the Station, and (ii) complies in all material
respects with all applicable building or zoning codes and the regulations of
any governmental authority having jurisdiction. Seller has practical access to
the Real Property.
3.6 Title to and Condition of Tangible Personal Property. Schedule 3.6
lists all material items of Tangible Personal Property. The Tangible Personal
Property listed on Schedule 3.6 comprises all material items of inventory and
spare parts that are not currently used in the operation of the Station and the
tangible personal property used to conduct the business and operations of the
Station as now conducted exclusive of motor vehicles. Except as described in
Schedule 3.6, Seller owns and has good title to each item of Tangible Personal
Property, and none of the Tangible Personal Property owned by Seller is subject
to any security interest, mortgage, pledge, conditional sales agreement, or
other lien or encumbrance, except Permitted Liens. Each material item of
Tangible Personal Property (other than items of inventory and spare parts that
are not currently used in the operation of the Station) is available for
immediate use in the business and operations of the Station except as indicated
on Schedule 3.6. To Seller's knowledge, all items of transmitting and studio
equipment included in the Tangible Personal Property currently permit the
Station to operate in all material respects in accordance with the terms of the
FCC Licenses and the rules and regulations of the FCC, and with all other
applicable federal, state, and local statutes, ordinances, rules, and
regulations.
3.7 Contracts. Schedule 3.7 is a true and complete list of all
Assumed Contracts except contracts with advertisers for the sale of advertising
time on the Station for cash at prevailing rates and which have not been prepaid
and which may be canceled by the Station without penalty on not more than ninety
days' notice. Seller has delivered to Buyer true and complete copies of all
Assumed Contracts, (including any amendments and other modifications to such
Assumed Contracts), and a schedule summarizing Seller's obligations under trade
and barter agreements relating to the Station. To Seller's knowledge, all of
the Assumed Contracts are in full force and effect, and are valid, binding, and
enforceable in accordance with their terms and there is not under any Assumed
Contract any default by any party thereto or any event that, after notice or
lapse of time or both, could constitute a
- 7 -
default. Except for the need to obtain the Consents listed in Schedule
3.3, Seller has full legal power and authority to assign its rights under the
Assumed Contracts to Buyer in accordance with this Agreement, and such
assignment will not affect the validity, enforceability, or continuation of
any of the Assumed Contracts.
3.8 Consents. Except for the FCC Consent provided in Section 6.1
and the other Consents described in Schedule 3.3, to Seller's knowledge, no
consent, approval, permit, or authorization of, or declaration to or filing
with any governmental or regulatory authority, or any other third party is
required (i) to consummate this Agreement and the transactions contemplated
hereby, (ii) to permit Seller to assign or transfer the Assets to Buyer, or
(iii) to enable Buyer to conduct the business and operations of the Station in
essentially the same manner as such business and operations are now conducted.
3.9 Intangibles. To Seller's knowledge, Schedule 3.9 is a true
and complete list of all material Intangibles (exclusive of those listed in
Schedule 3.4), all of which, are valid and in good standing and uncontested.
Seller has delivered to Buyer copies of all documents establishing or
evidencing all intangibles. Seller is not, to the best of its knowledge,
infringing upon or otherwise acting adversely to any trademarks, trade names,
service marks, service names, copyright, patents, patent applications,
know-how, methods, or processes owned by any other person or persons, and,
there is no claim or action pending, or threatened, with respect thereto. To
the best of Seller's knowledge, the Intangibles listed on Schedule 3.9 comprise
all intangible property interests used to conduct the business and operations
of the Station as now conducted.
3.10 Insurance. Schedule 3.10 is a true and complete list of all
insurance policies of Seller that insure any part of the Assets or the business
of the Station. All policies of insurance listed in Schedule 3.10 are in full
force and effect.
3.11 Reports. To Seller's knowledge, all returns, reports, and
statements that the Station is currently required to file with the FCC or place
in its Public File or file with any other governmental agency have been filed,
and all reporting requirements of the FCC and other governmental authorities
having jurisdiction over Seller and the Station have been complied with in all
material respects and all of such returns, reports, and statements are
substantially complete and correct as filed.
3.12 Personnel.
(a) Employees and Compensation. Schedule 3.12 contains a
true and complete list of all employees of the Station, their job description,
date of hire, salary and amount and date of last salary increase. There are no
commitments, written or oral, to provide material salary increases or bonuses
to any station employee. Schedule 3.12 also contains a true and complete list
as of the date of this Agreement of all material employee
- 8 -
benefit plans or arrangements applicable to the employees of the Station and all
material fixed or contingent liabilities or obligations of Seller with respect
to any person now or formerly employed by Seller at the Station, including
pension or thrift plans, individual or supplemental pension or accrued
compensation arrangements, contributions to hospitalization or other health or
life insurance programs, incentive plans, bonus arrangements, and vacation, sick
leave, disability and termination arrangements or policies, including workers'
compensation policies, and a description of all fixed or contingent liabilities
or obligations of Seller with respect to any person now or formerly employed at
the Station or any person now or formerly retained as an independent contractor
at the Station. Seller has furnished Buyer with true and complete copies of all
employee handbooks, written employee rules and regulations, and summary plan
descriptions of the written plans and arrangements listed in Schedule 3.12. At
Buyer's request, Seller will furnish Buyer with true and complete copies of all
applicable plan documents, trust documents, and insurance contracts with respect
to the plans and arrangements listed on Schedule 3.12. All employee benefits and
welfare plans or arrangements listed in Schedule 3.12 were established and have
been executed, managed and administered in all material respects in accordance
with the Internal Revenue Code of 1986, as amended, the Employee Retirement
Income Security Act of 1974, as amended ("ERISA"), and all other laws. Seller
is not aware of the existence of any governmental audit or examination of any of
such plans or arrangements or of any facts which would lead it to believe that
any such audit or examination is pending or threatened. No action, suit, or
claim with respect to any of such plans or arrangements (other than routine
claims for benefits) is pending or, to the knowledge of Seller, threatened, and
Seller possesses no knowledge of any facts which could give rise to any
such action, suit or claim.
(b) Labor Relations. Seller is not a party to or subject
to any collective bargaining agreements with respect to the Station. Seller
has no written or oral contracts of employment with any employee of the
Station. Seller has complied in all material respects with all laws, rules,
and regulations relating to the employment of labor, including those related to
wages, hours, collective bargaining, occupational safety, discrimination, and
the payment of social security and other payroll related taxes, and it has not
received any notice alleging that it has failed to comply in any material
respect with any such laws, rules, or regulations. No material controversies,
disputes, or proceedings are pending or, to Seller's knowledge, threatened,
between it and any employee (singly or collectively) of the Station. No labor
union or other collective bargaining unit represents or claims to represent any
of the employees of the Station. To Seller's knowledge, there is no union
campaign being conducted to solicit cards from employees to authorize a union
to request a National Labor Relations Board certification election with respect
to any employees at the Station.
(c) Liabilities. Except as disclosed in the Schedules
hereto, Seller has no liability of any kind to or in respect of
any employee benefit plan covering the employees of the Station, including
withdrawal liability under Section 4201 of ERISA. Seller has not incurred any
accumulated funding deficiency within the meaning of ERISA or Section 4971
- 9 -
of the Internal Revenue Code. Seller has not failed to make any required
contributions to any employee benefit plan covering the employees of the
Station. The Pension Benefit Guaranty Corporation has not asserted that Seller
has incurred any liability in connection with any such plan. No lien has been
attached and no person has threatened to attach a lien on any property of
Seller as a result of a failure to comply with ERISA.
3.13 Taxes. To the best of the Seller's knowledge, (i) Seller has
filed or caused to be filed all federal income tax returns and all other
federal, state, county, local, or city tax returns which are required to be
filed, and it has paid or caused to be paid all taxes shown on those returns or
on any tax assessment received by it to the extent that such taxes have become
due, and (ii) there are no governmental investigations or other legal,
administrative, or tax proceedings pursuant to which Seller is or could be made
liable for any taxes, penalties, interest, or other charges, the liability for
which could extend to Buyer as transferee of the business of the Station, and
no event has occurred that could impose on Buyer any transferee liability for
any taxes, penalties, or interest due or to become due from Seller. Seller is
not required to file New York sales tax returns.
3.14 Claims and Legal Actions. Except for any FCC rulemaking
proceedings generally affecting the broadcasting industry, and except as set
forth on Schedule 3.14, to the best of Seller's knowledge, there is no claim,
legal action, counterclaim, nor any order, decree or judgment, in progress or
pending, or to the knowledge of Seller threatened, against or relating to
Seller with respect to its ownership or operation of the Station or otherwise
relating to the Assets, nor does Seller know or have reason to be aware of any
basis for the same. In particular, but without limiting the generality of the
foregoing, and except as forth on Schedule 3.14, to the best of Seller's
knowledge, there are no applications, complaints or proceedings pending or, to
the best of its knowledge, threatened (i) before the FCC relating to the
business or operations of the Station other than rule making proceedings which
affect the television industry generally, (ii) before any federal or state
agency relating to the business or operations of the Station involving charges
of illegal discrimination under any federal or state employment laws or
regulations, or (iii) before any federal, state, or local agency relating to
the business or operations of the Station involving zoning issues under any
federal, state, or local zoning law, rule, or regulation.
3.15 Environmental Matters.
(a) Seller has complied in all material respects with all
laws, rules, and regulations of all federal, state, and local governments (and
all agencies thereof) concerning the environment, public health and safety, and
employee health and safety, and no charge, complaint, action, suit, proceeding,
hearing, investigation, claim, demand, or notice has been filed or commenced
against Seller in connection with its ownership or operation of the Station
alleging any failure to comply with any such law, rule, or regulation.
- 10 -
(b) To Seller's knowledge, Seller has no liability
relating to its ownership and operation of the Station under any environmental
law, rule, or regulation of any federal, state, or local government (or agency
thereof) concerning release or threatened release of hazardous substances,
public health and safety, or pollution or protection of the environment.
(c) To Seller's knowledge, Seller has no liability
relating to its ownership and operation of the Station for damage to any site,
location, or body of water (surface of subsurface) or for illness or personal
injury.
(d) To Seller's knowledge, Seller has no liability
relating to its ownership and operation of the Station under any environmental
law, rule, or regulation of any federal, state, or local government (or agency
thereof) concerning employee health and safety.
(e) In connection with its ownership or operation of the
Station, Seller has obtained and been in material compliance with all of the
terms and conditions of all permits, licenses, and other authorizations which
are required under, and has complied in all material respects with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules, and timetables which are contained in, all federal,
state, and local laws, rules, and regulations (including all codes, plans,
judgments, orders, decrees, stipulations, injunctions, and charges thereunder)
relating to public health and safety, worker health and safety, and pollution
or protection of the environment, including laws relating to emissions,
discharges, releases, or threatened releases of pollutants, contaminants, or
chemical, industrial, hazardous, or toxic materials or wastes into ambient air,
surface water, ground water, or lands or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling of pollutants, contaminants, or chemical, industrial, hazardous, or
toxic materials or wastes.
(f) To Seller's knowledge, all properties and equipment
used in the business of the Station are free of friable asbestos and friable
asbestos-related products, PCB's, dioxins, and Extremely Hazardous Substances
(as defined in Section 302 of the Emergency Planning and Community
Right-to-Know Act).
(g) No pollutant, contaminant, or chemical, industrial,
hazardous, or toxic material or waste has ever been manufactured, buried,
stored, spilled, leaked, discharged, emitted, or released by Seller in
connection with its ownership and operation of the Station or, to Seller's
knowledge, by any other party on any Real Property.
3.16 Compliance with Laws. To Seller's knowledge, Seller has
complied in all material respects with the Licenses and all federal, state, and
local laws, rules, regulations, and ordinances applicable or relating to the
ownership and operation of the Station. To Seller's knowledge, neither the
ownership or use of the properties of the Station nor the
- 11 -
conduct of the business or operations of the Station conflicts in any material
respect with the rights of any other person or entity.
3.17 Full Disclosure. No representation or warranty made by Seller
in this Agreement or in any certificate, document, or other instrument
furnished or to be furnished by Seller pursuant hereto contains or will
knowingly contain any untrue statement of a material fact.
3.18 No Other Representations. Notwithstanding anything to the
contrary stated herein, it is the explicit intent of each party hereto that the
Seller is making no representations or warranties whatsoever, express or
implied, other than those representations and warranties expressly set forth in
this Agreement.
SECTION 4. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
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 Florida and at Closing will be duly qualified to conduct business as a
foreign corporation in the State of New York. Buyer has all requisite power and
authority to execute and deliver this Agreement and the documents contemplated
hereby, and to perform and comply with all of the terms, covenants, and
conditions to be performed and complied with by Buyer hereunder and thereunder.
4.2 Authorization and Binding Obligation. The execution,
delivery, and performance of this Agreement by Buyer have been duly authorized
by all necessary actions on the part of Buyer. This Agreement has been duly
executed and delivered by Buyer and constitutes the legal, valid, and binding
obligation of Buyer, enforceable against Buyer 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.
4.3 Absence of Conflicting Agreements. Subject to obtaining the
Consents, the execution, delivery, and performance by Buyer of this Agreement
and the documents contemplated hereby (with or without the giving of notice,
the lapse of time, or both): (i) do not require the consent of any third party;
(ii) will not conflict with the Certificate of Incorporation or Bylaws of
Buyer; (iii) will not conflict with, result in a breach of, or constitute a
default under, any law, judgment, order, injunction, decree, rule, regulation,
or ruling of any court or governmental instrumentality; (iv) will not conflict
with, constitute grounds for termination of, result in a breach of, constitute
a default under, or accelerate or permit the acceleration of any performance
required by the terms of, any agreement,
- 12 -
instrument, license, or permit to which Buyer is a party or by which Buyer may
be bound, such that Buyer could not acquire the Assets or operate the Station.
4.4 Full Disclosure. No representation or warranty made by Buyer
in this Agreement or in any certificate, document, or other instrument
furnished or to be furnished by Buyer pursuant hereto contains or will
knowingly contain any untrue statement of a material fact.
4.5 Buyer Qualifications. Buyer is legally, financially and
otherwise qualified to be the licensee of, acquire, own and operate the Station
under the Communications Act of 1934, as amended, and the rules, regulations
and policies of the FCC. Buyer knows of no fact that would, under existing law
and the existing rules, regulations, policies and procedures of the FCC
disqualify Buyer as a assignee of the FCC Licenses or as the owner and operator
of the Station.
4.6 Inspection. Except for the environmental audit described in
Section 6.10 and the engineering study described in Section 6.11, Buyer has had
the opportunity to conduct such due diligence and to inspect such Assets as
Buyer deems appropriate, and, subject to Sections 6.10 and 6.11, Buyer is
purchasing the Assets "as is, where is" based on such due diligence and
inspection and the representations, warranties and covenants of Seller
expressly set forth herein. Buyer is experienced in the acquisition and
operation of television stations and is relying on such expertise in evaluating
the desirability of acquiring the Assets and is not relying on any information
provided by Seller; provided, however, that Buyer is relying on the
representations, warranties and covenants expressly set forth herein and the
Schedules attached hereto.
SECTION 5. OPERATIONS OF THE STATION PRIOR TO CLOSING
5.1 Generally. Seller agrees that, between the date of this
Agreement and the Closing Date, Seller shall operate the Station in the
ordinary course of business in accordance with its past practices (except where
such conduct would conflict with the following covenants or with Seller's other
obligations under this Agreement), and in accordance with the other covenants
in this Section 5.
5.2 Compensation. Seller shall not materially increase the
compensation, bonuses, or other benefits payable or to be payable to any person
employed in connection with the conduct of the business or operations of the
Station, except in accordance with past practices.
5.3 Contracts. Seller will not enter into any contract or
commitment which is not terminable on 90-days notice relating to the Station or
the Assets, or amend or terminate any Contract (or waive any material right
thereunder), or incur any obligation (including obligations relating to the
borrowing of money or the guaranteeing of indebtedness) that will
- 13 -
be binding on Buyer after Closing, except for cash time sales agreements made in
the ordinary course of business and other contracts or commitments involving
less than $5,000. Prior to the Closing Date, Seller shall deliver to Buyer a
list of all Contracts entered into between the date of this Agreement and the
Closing Date, together with copies of such Contracts.
5.4 Disposition of Assets. Seller shall not sell, assign, lease,
or otherwise transfer or dispose of any of the material Assets, except where no
longer used or useful in the business or operations of the Station or in
connection with the acquisition of replacement property of equivalent kind and
value.
5.5 Encumbrances. Seller shall not create, assume or permit to
exist any claim, liability, mortgage, lien, pledge, condition, charge, or
encumbrance of any nature whatsoever upon the Assets, except for (i) liens
which shall be removed prior to the Closing Date, (ii) liens for current taxes
not yet due and payable, and (iii) mechanics' liens and other similar liens,
which shall be removed prior to the Closing Date either by payment or posting
an appropriate indemnity bond.
5.6 Licenses. Seller shall not cause or permit, by any act or
failure to act, any of the Licenses issued by the FCC to expire or to be
revoked, suspended, or modified, or take any action that could reasonably be
expected to cause the FCC or any other governmental authority to institute
proceedings for the suspension, revocation, or adverse modification of any of
the Licenses. Seller shall not fail to prosecute with due diligence any
applications to any governmental authority in connection with the operation of
the Station.
5.7 Rights. Seller shall not knowingly waive any material right
relating to the Station or any of the Assets.
5.8 No Inconsistent Action. Seller shall not take any action that
is inconsistent with its material obligations under this Agreement or that
could hinder or delay the consummation of the transactions contemplated by this
Agreement.
5.9 Access to Information. Seller shall give Buyer and its
counsel, accountants, engineers, and other authorized representatives
reasonable access during normal business hours to the Assets and to all other
properties, equipment, books, records, Contracts, and documents relating to the
Station for the purpose of audit and inspection, including inspections relating
to a Phase I Environmental Study and an engineering review of the Station all
to be accomplished in coordination with Seller and without disruption to the
Station and will furnish or cause to be furnished to Buyer or its authorized
representatives all material information with respect to the affairs and
business of the Station that Buyer may reasonably request (including any
operations reports produced with respect to the affairs and business of the
Station).
- 14 -
5.10 Maintenance of Assets. Seller shall maintain all of the
Assets in their current existing condition (ordinary wear and tear and casualty
loss excepted), and use, operate, and maintain all of the Assets in a
reasonable manner. Seller shall maintain inventories of spare parts and
expendable supplies at levels consistent with past practices.
5.11 Insurance. Seller shall maintain substantially the same
insurance coverage provided by the existing insurance policies on the Station
and the Assets.
5.12 Consents. Seller shall obtain the Consents described in
Section 8.2(c), without any material change in the terms or conditions of any
Contract or License as in effect on the date of this Agreement. Seller shall
advise Buyer of any communications it receives concerning the Consents and of
any conditions proposed, considered, or requested for any of the Consents.
5.13 Books and Records. Seller shall maintain its books and
records relating to the Station in accordance with past practices.
5.14 Notification. Seller shall promptly notify Buyer in writing
of any material developments of which Seller has actual knowledge with respect
to the business or operations of the Station, and of any material change in any
of the information contained in Seller's representations and warranties
contained in Section 3 of this Agreement.
5.15 Compliance with Laws. Seller shall comply in all material
respects with all laws, rules, and regulations applicable or relating to the
ownership and operation of the Station.
5.16 Preservation of Business. Seller shall operate the Station in
the ordinary course of business consistent with its past practices.
SECTION 6. SPECIAL COVENANTS AND AGREEMENTS
6.1 FCC Consent.
(a) The assignment of the FCC Licenses in connection with
the purchase and sale of the Assets pursuant to this Agreement shall be subject
to the prior consent and approval of the FCC.
(b) Seller and Buyer shall promptly prepare an
appropriate application for the FCC Consent and shall file the application with
the FCC within five (5) business days of the execution of this Agreement. The
parties shall prosecute the application with all reasonable diligence and
otherwise use their reasonable commercial efforts to obtain a grant of the
application as expeditiously as practicable. Each party agrees to comply with
any
- 15 -
condition imposed on it by the FCC Consent, except that no party shall be
required to comply with a condition if (1) the condition was imposed on it as
the result of a circumstance the existence of which does not constitute a
breach by the party of any of its representations, warranties, or covenants
under this Agreement, and (2) compliance with the condition would have a
material adverse effect upon it. Buyer and Seller shall oppose any requests
for reconsideration or judicial review of the FCC Consent. If the Closing
shall not have occurred for any reason within the original effective period
of the FCC Consent, and neither party shall have terminated this Agreement
under Section 9, the parties shall jointly request an extension of the
effective period of the FCC Consent. No extension of the FCC Consent shall
limit the exercise by either party of its rights under Section 9.
6.2 Control of the Station. Prior to Closing, Buyer shall not,
directly or indirectly, control, supervise, direct, or attempt to control,
supervise, or direct, the operations of the Station; such operations, including
complete control and supervision of all of the Station programs, employees, and
policies, shall be the sole responsibility of the Seller until the Closing.
6.3 Risk of Loss. The risk of any loss, damage, impairment,
confiscation, or condemnation of any of the Assets from any cause whatsoever
shall be borne by Seller at all times prior to the Closing. If any damage or
destruction of the Assets or any other event occurs which prevents in any
material respect signal transmission by the Station in the normal and usual
manner and Seller is unable to restore or replace the Assets so that such
conditions are cured and normal and usual transmission is resumed in all
material respects before the Closing Date, Seller shall send Buyer written
notice of such event (a "Casualty Notice"), which notice shall contain an
estimate, in Seller's reasonable judgment, of the costs to repair or replace
the damaged or destroyed Assets, as well as the amount of any credit or refund
Seller will offer Buyer due to the inadequacy of Seller's insurance proceeds to
restore or place the Assets in all material respects. Within five (5) days
after its receipt of a Casualty Notice, Buyer may, by written notice to seller
(a "Casualty Termination Notice"), elect to terminate the Agreement and receive
a refund of the Escrow Deposit and interest earned thereon, and neither party
shall thereafter have any liability to the other hereunder. In the event that
Buyer does not give Seller a timely and unconditional Casualty Termination
Notice, then Buyer shall, proceed to close this Agreement and complete the
restoration and replacement of such damaged Assets and Seller shall deliver to
Buyer all insurance proceeds received in connection with such damage or
destruction of the Assets; provided, however, that Buyer will receive a credit
or refund at Closing for any funds it provides to the extent such credit or
refund is equal to or less than the amount of credit or refund established by
Seller in the Casualty Notice.
6.4 Confidentiality. Except as necessary for the consummation of
the transaction contemplated by this Agreement, including Buyer's obtaining of
financing related hereto, and except as and to the extent required by law,
including, without limitation, disclosure
- 16 -
requirements of federal or state securities laws and rules and regulations of
securities markets, each party will keep confidential any information obtained
from the other party in connection with the transactions contemplated by this
Agreement. Except as provided in this Paragraph each party will refrain from
disclosing any such information to any third party. If this Agreement is
terminated, each party will return to the other party all copies of all
documents and other all information obtained by the such party from the other
party in connection with the transactions contemplated by this Agreement.
6.5 Notice Regarding Employees. Buyer shall notify Seller no
later than seven days prior to the Closing of those employees of the Station
that Buyer intends to offer to employ following the Closing; provided, however,
that neither this Section 6.5 nor Buyer's delivery of the notice contemplated
hereby shall be deemed to create any obligation on the part of Buyer to offer
to employ or employ any employee of the Station.
6.6 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 and desirable to the implementation and consummation of this
Agreement, and otherwise use their reasonable commercial efforts to consummate
the transaction contemplated hereby and to fulfill their obligations under this
Agreement. Notwithstanding the foregoing, Buyer shall have no obligation (i)
to expend funds to obtain any of the Consents or (ii) to agree to any adverse
change in any License or Assumed Contract to obtain a Consent required with
respect thereto.
6.7 Access to Books and Records. Seller shall provide Buyer
access and the right to copy for a period of four (4) years from the Closing
Date any books and records relating to the Assets but not included in the
Assets. Buyer shall provide Seller access and the right to copy for a period
of four (4) years from the Closing Date any books and records relating to the
Assets that are included in the Assets.
6.8 Broker. Each of Buyer and Seller represents and warrants that
neither it nor any person or entity 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.
6.9 Noncompetition Agreement. At Closing, Buyer, Seller shall
enter into a Noncompetition Agreement in the form of Schedule 6.10 and Buyer
shall pay Seller at the Closing Fifty Thousand Dollars ($50,000) for the
covenants of Seller.
6.10 Environmental Audit.
(a) Buyer may, at its option and expense, retain an
environmental consultant to be selected by Buyer to perform a Phase I
environmental survey of the
- 17 -
properties of the Station. If the survey discloses any material environmental
hazard or the possibility of future material liability for environmental damages
or clean-up costs (each, an "Environmental Hazard"), Buyer shall so notify
Seller in writing as soon as practicable.
(b) If Buyer notifies Seller pursuant to Section 6.10(a)
of any Environmental Hazard within forty- five days after the date of this
Agreement, then Seller may, by written notice given to Buyer within seven days
after Seller's receipt of such notice from Buyer, agree to remedy such
Environmental Hazard prior to the Closing Date. If Seller does not agree prior
to the end of such seven-day period to remedy such Environmental Hazard prior
to the Closing Date, then Buyer may as its sole and exclusive remedy terminate
this Agreement pursuant to Section 9.2(e).
6.11 Engineering Study.
(a) Buyer may, at its option and expense, retain an
engineering firm or other broadcast engineer to conduct proof of performance
studies of the Station and to prepare a report on the Station's compliance with
customary engineering practices and all applicable FCC rules, regulations,
prescribed practices, and technical standards. If the study discloses any
material defects in the equipment or the operating condition of the equipment
of the Station (each, a "Material Defect"), Buyer shall so notify Seller in
writing as soon as practicable.
(b) If Buyer notifies Seller pursuant to Section 6.11(a)
of any Material Defect within forty-five days after the date of this Agreement,
then Seller may, by written notice given to Buyer within seven days after
Seller's receipt of such notice from Buyer, agree to remedy such Material
Defect prior to the Closing Date. If Seller does not agree prior to the end of
such seven-day period to remedy such Material Defect prior to the Closing Date,
then Buyer may as its sole and exclusive remedy terminate this Agreement
pursuant to Section 9.2(f).
SECTION 7. CONDITIONS TO OBLIGATIONS OF BUYER AND SELLER
AT CLOSING
7.1 Conditions to Obligations of Buyer. All obligations of Buyer
at the Closing are subject at Buyer's option to the fulfillment or waiver by
Buyer prior to or at the Closing Date of each of the following conditions:
(a) Representations and Warranties. All representations
and warranties of Seller contained in this Agreement shall be true and complete
in all material respects at and as of the Closing Date as though made at and as
of that time.
- 18 -
(b) Covenants and Conditions. Seller shall have
performed and complied in all respects with all material covenants, agreements,
and conditions required by this Agreement to be performed or complied with by
it prior to or on the Closing Date.
(c) Consents. All Consents shall have been obtained and
delivered to Buyer without any adverse change in the terms or conditions of any
agreement or any governmental license, permit, or other authorization.
(d) FCC Consent. The FCC Consent shall have been granted
without the imposition on Buyer of any material conditions that need not be
complied with by Buyer under Section 6.1 hereof, Seller shall have complied
with any material conditions imposed on it by the FCC Consent, and the FCC
Consent shall have become a Final Order.
(e) Governmental Authorizations. Seller shall be the
holder of all material Licenses and there shall not have been any modification
of any material License that could have an adverse effect on the Station or the
conduct of its business and operations. No proceeding shall be pending the
effect of which could be to revoke, cancel, fail to renew, suspend, or modify
adversely any material License. All FCC Licenses are material Licenses.
(f) Deliveries. Seller shall have made or stand willing
to make all the deliveries to Buyer set forth in Section 8.2.
(g) Adverse Change. Between the date of this Agreement
and the Closing, there shall have been no material adverse change in the assets
or properties of the Station, including any damage, destruction, or loss
affecting any assets used or useful in the conduct or business of the Station.
(h) Correction of Defects. If Seller shall have notified
Buyer in accordance with Sections 6.10 or 6.11 that Seller intends to remedy an
Environmental Hazard or a Material Defect and Seller shall have failed to
remedy such Environmental Hazard or Material Defect as agreed by Seller and
Buyer.
7.2 Conditions to Obligations of Seller. All obligations of
Seller at the Closing are subject at Seller's option to the fulfillment prior
to or at the Closing Date of each of the following conditions:
(a) Representations and Warranties. All representations
and warranties of Buyer contained in this Agreement shall be true and complete
in all material respects at and as of the Closing Date as though made at and as
of that time.
- 19 -
(b) Covenants and Conditions. Buyer shall have performed
and complied in all material respects with all material covenants, agreements,
and conditions required by this Agreement to be performed or complied with by
it prior to or on the Closing Date.
(c) Deliveries. Buyer shall have made or stand willing
to make all the deliveries set forth in Section 8.3.
(d) FCC Consent. The FCC Consent shall have been granted
without the imposition on Seller of any material conditions that need not be
complied with by Seller under Section 6.1 hereof and Buyer shall have complied
with any conditions imposed on it by the FCC Consent.
SECTION 8. CLOSING AND CLOSING DELIVERIES
8.1 Closing.
(a) Closing Date. The Closing shall take place at 10:00
a.m. on a date to be set by Buyer on at least five days' written notice to
Seller, that is (1) not earlier than the first business day after the FCC
Consent is granted, and (2) not later than the tenth business day after the
date upon which the FCC Consent becomes a Final Order.
(b) Closing Place. The Closing shall be held at the
offices of Dow, Lohnes & Albertson, 1255 23rd Street, N.W, Suite 500,
Washington, D.C. 20037, or such other place that is agreed upon by Buyer and
Seller.
8.2 Deliveries by Seller. Prior to or on the Closing Date, Seller
shall deliver to Buyer the following, in form and substance reasonably
satisfactory to Buyer and its counsel:
(a) Transfer Documents. Subject to the provisions of
this Agreement, duly executed bills of sale, assignments, and other transfer
documents which shall be sufficient to vest good and marketable title to the
Assets in the name of Buyer, free and clear of all mortgages, liens,
restrictions, encumbrances, claims, and obligations except for Permitted Liens.
(b) Estoppel Certificate. Estoppel Certificate of the
Lessor of the leasehold interests listed in Schedule 3.5.
(c) Consents. An executed copy of any instrument
evidencing receipt of any Consent;
(d) Certificates. A certificate, dated as of the Closing
Date, executed by Seller certifying (1) that the material representations and
warranties of Seller contained in
- 20 -
this Agreement are true and complete in all material respects as of the Closing
Date as though made on and as of that date; and (2) that Seller has in all
material respects performed and complied with all of its material obligations,
covenants, and agreements set forth in this Agreement to be performed and
complied with on or prior to the Closing Date. Such additional certificates and
confirmations to Buyer's lenders as Buyer may reasonably request in connection
with obtaining financing for the performance of its payment obligations
hereunder.
(e) Licenses, Contracts, Business Records, Etc. Copies
of all Licenses and Assumed Contracts;
(f) Opinion of Counsel. An opinion or opinions of
Seller's counsel dated as of the Closing Date, which include the matters set
forth in Schedule 8.2(f) hereto and which are otherwise reasonably acceptable
in form and substance to Buyer and Buyer's counsel..
(g) Noncompetition Agreement. The Noncompetition
Agreement in the form of Schedule 6.10 duly executed by Seller.
8.3 Deliveries by Buyer. Prior to or on the Closing Date, Buyer
shall deliver to Seller the following, in form and substance reasonably
satisfactory to Seller and its counsel;
(a) Purchase Price. The Purchase Price as provided in
Section 2.4(a) and the Promissory Note, the Guaranty and Suretyship Agreement
and the Time Brokerage Agreement in the form of the Schedules attached hereto;
(b) Assumption Agreements. Appropriate assumption
agreements pursuant to which Buyer shall assume and undertake to perform
Seller's obligations under the Licenses and Assumed Contracts arising on or
after the Closing Date;
(c) Officer's Certificate. A certificate, dated as of
the Closing Date, executed on behalf of Buyer by its President, certifying (1)
that the representations and warranties of Buyer contained in this Agreement
are true and complete in all material respects as of the Closing Date as though
made on and as of that date, and (2) that Buyer has in all material respects
performed and complied with all of its obligations, covenants, and agreements
set forth in this Agreement to be performed and complied with on or prior to
the Closing Date;
(d) Opinion of Counsel. An opinion or opinions of
Buyer's counsel dated as of the Closing Date, which include the matters set
forth in Schedule 8.3(d) hereto and which are otherwise reasonably acceptable
in form and substance to Seller and Seller's counsel.
- 21 -
(e) Noncompetition Agreement. The Noncompetition
Agreement in the form of Schedule 6.10, duly executed by Buyer and the
noncompetition payment allocated thereto.
SECTION 9. TERMINATION
9.1 Termination by Seller. This Agreement may be terminated by
Seller and the purchase and sale of the Assets abandoned, if Seller is not then
in material default, upon written notice to Buyer, upon the occurrence of any
of the following:
(a) Conditions. If, on the date that would otherwise be
the Closing Date, any of the conditions precedent to the obligations of Seller
set forth in this Agreement have not been satisfied or waived in writing by
Seller.
(b) Judgments. If there shall be in effect on the date
that would otherwise be the Closing Date any judgment not caused by Seller,
decree, or order that would prevent or make unlawful the Closing.
(c) Upset Date. If the Closing shall not have occurred
by August 1, 1996.
9.2 Termination by Buyer. This Agreement may be terminated by
Buyer and the purchase and sale of the Station abandoned, if Buyer is not then
in material default, upon written notice to Seller, upon the occurrence of any
of the following:
(a) Conditions. If on the date that would otherwise be
the Closing Date any of the conditions precedent to the obligations of Buyer
set forth in this Agreement have not been satisfied or waived in writing by
Buyer.
(b) Judgments. If there shall be in effect on the date
that would otherwise be the Closing Date any judgment, not caused by Buyer,
decree, or order that would prevent or make unlawful the Closing.
(c) Upset Date. If the Closing shall not have occurred
by August 1, 1996.
(d) Casualty Termination Notice. Buyer shall have given
a timely and unconditional Casualty Termination Notice to Seller pursuant to
Section 6.3 hereof.
(e) Environmental Hazards. If Buyer shall have notified
Seller pursuant to Section 6.10(a) of any Environmental Hazard within
forty-five days after the date of this Agreement and Seller shall not have
agreed within the period specified in Section 6.10(b) to remedy such
Environmental Hazard; provided, however, that Buyer may only terminate this
Agreement pursuant to this Section 9.2(e) by delivering written notice to
Seller within seven
- 22 -
days after the end of the period specified in Section 6.10(b) during which
Seller had the right to elect to remedy such Environmental Hazard.
(f) Material Defect. If Buyer shall have notified Seller
pursuant to Section 6.11(a) of any Material Defect within forty-five days after
the date of this Agreement and Seller shall not have agreed within the period
specified in Section 6.11(b) to remedy such Material Defect, provided, however,
that Buyer may only terminate this Agreement pursuant to this Section 9.2(f) by
delivering written notice to Seller within seven days after the end of the
period specified in Section 6.11(b) during which Seller had the right to elect
to remedy such Material Defect.
9.3 Escrow Deposit. Simultaneously with the execution and
delivery of this Agreement, Buyer has deposited with First Union National Bank
of Florida, as escrow agent (the "Escrow Agent"), the sum of One Hundred
Thousand Dollars ($100,000) in accordance with an Escrow Agreement among Buyer,
Seller and the Escrow Agent in the form of Schedule 9.3. All funds deposited
with the Escrow Agent shall be held and disbursed in accordance with the terms
of the Escrow Agreement and the following provisions:
(a) At the Closing, all amounts held by the Escrow Agent
pursuant to the Escrow Agreement, including any interest or other proceeds from
the investment of funds held by the Escrow Agent, shall be disbursed to or at
the direction of Buyer.
(b) If this Agreement is terminated pursuant to Section
9.1 or Section 9.2 and Buyer is not in material breach of any provision of this
Agreement, all amounts held by the Escrow Agent pursuant to the Escrow
Agreement, including any interest or other proceeds from the investment of
funds held by the Escrow Agent, shall be disbursed to or at the direction of
Buyer.
(c) If this Agreement is terminated by Seller due to
Buyer's breach of this Agreement, then the amounts held by the Escrow Agent
pursuant to the Escrow Agreement, including any interest or other proceeds from
the investment of funds held by the Escrow Agent shall be disbursed by the
Escrow Agent to or at the direction of Seller.
9.4 Rights on Termination. If this Agreement is terminated
pursuant to Section 9.1 or Section 9.2 and neither party is in material breach
of any provision of this Agreement, the parties hereto shall not have any
further liability to each other with respect to the purchase and sale of the
Assets. If this Agreement is terminated by Seller due to Buyer's material
breach of any provision of this Agreement, then the payment to Seller pursuant
to Section 9.3(c) shall be liquidated damages and shall constitute full payment
and the exclusive remedy for any damages suffered by Seller by reason of
Buyer's material beach of this Agreement. Seller and Buyer agree in advance
that actual damages would be difficult to ascertain and that the amount of One
Hundred Thousand ($100,000) is a fair and equitable
- 23 -
amount to reimburse Seller for damages sustained due to Buyer's material breach
of this Agreement. If prior to Closing, Seller is in material breach of its
obligations under this Agreement, Buyer's sole remedy shall be an action for
specific performance of this Agreement and Buyer expressly waives any right to
pursue a claim for monetary damages.
SECTION 10. SURVIVAL OF REPRESENTATIONS AND WARRANTIES;
INDEMNIFICATION; CERTAIN REMEDIES
10.1 Representations and Warranties. All representations and
warranties contained in this Agreement shall be deemed continuing
representations and warranties and shall survive the closing for a period of
twelve (12) months provided, however, that as to any representation or warranty
made by either the Buyer or Seller which the other party knows, or has reason
to believe, is not true as of the Closing Date, such representation or warranty
shall not survive the Closing. Until the Closing, Buyer and Seller will
immediately advise each other, in writing, of any fact or occurrence or any
pending or threatened occurrence of which any of them obtains knowledge and
which (a) (if existing and known at the date of the execution of this
Agreement) would have been required to be set forth or disclosed in or pursuant
to this Agreement or a Schedule hereto, (b) (if existing and known at any time
prior to or at the Closing) would make the performance by any party of a
covenant contained in this Agreement impossible or make that performance
materially more difficult than in the absence of that fact or occurrence, or
(c) (if existing and known at the time of the Closing) would cause a condition
to any party's obligations under this Agreement not to be fully satisfied.
10.2 Indemnification by Seller. Seller hereby agrees to indemnify
and hold Buyer harmless against and with respect to, and shall reimburse Buyer
for:
(a) Subject to the proviso contained in the first
sentence of Section 10.1, any and all losses, liabilities, or damages resulting
from any untrue representation, breach of warranty, or material omission or
nonfulfillment of any covenant by Seller contained in this Agreement or in any
certificate, document, or instrument delivered to Buyer under this Agreement.
(b) Any and all obligations of Seller not assumed by
Buyer pursuant to this Agreement, including any liabilities arising at any time
under any Contract not included in the Assumed Contracts.
(c) Any and all losses, liabilities, or damages
contingent or otherwise resulting from Seller's operation or ownership of the
Station prior to the Closing Date, including any liabilities arising under the
Licenses or the Assumed Contracts which relate to events occurring prior to the
Closing Date.
- 24 -
(d) Any and all actions, suits, proceedings, claims,
demands, assessments, judgments, costs, and expenses, including reasonable
legal fees and expenses, incident to any of the foregoing or incurred in
investigating or attempting to avoid the same or to oppose the imposition
thereof, or in enforcing this indemnity.
10.3 Indemnification by Buyer. Buyer hereby agrees to indemnify
and hold Seller harmless against and with respect to, and shall reimburse
Seller for:
(a) Subject to the proviso contained in the first
sentence of Section 10.1, any and all losses, liabilities, or damages resulting
from any untrue representation, breach of warranty, or material omission or
nonfulfillment of any covenant by Buyer contained in this Agreement or in any
certificate, Schedule, document, or instrument delivered to Seller under this
Agreement.
(b) Any and all obligations of Seller assumed by Buyer
pursuant to this Agreement.
(c) Any and all losses, liabilities, or damages
contingent or otherwise, resulting from Buyer's operation or ownership of the
Station on and after the Closing, including any liabilities arising under the
Licenses or the Assumed Contracts which relate to events occurring on or after
the Closing Date.
(d) Any and all actions, suits, proceedings, claims,
demands, assessments, judgments, costs and expenses, including reasonable legal
fees and expenses, incident to any of the foregoing or incurred in
investigating or attempting to avoid the same or to oppose the imposition
thereof, or in enforcing this indemnity.
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. 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 as soon
as practicable 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 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/or its authorized representatives the information relied upon by the
Claimant to
- 25 -
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. 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 or under the arbitration
provisions of this Agreement, as applicable.
(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
reasonable 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 int he defense of any third party claim, it shall be bound by the
results obtained by the Claimant with respect to such claim.
(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 possible. Except as
otherwise expressly provided herein, the right to indemnification provided in
this Section 10 shall be the exclusive post-closing remedy available to the
parties with respect to the transaction contemplated hereby.
(e) The indemnifications rights provided in Sections 10.2
and 10.3 shall extend to the shareholders, directors, officers, employees, and
representatives of any Claimant although for the purpose of the procedures set
forth in this Section 10.4, any indemnification claims by such parties shall be
made by and through the Claimant.
(f) In no event shall either Buyer or Seller be liable to
the other for any damages or claims until the cumulative amount of such damages
or claims against the Indemnifying Party equals or exceeds Fifty Thousand
Dollars ($50,000) and in no event shall Seller be liable for any damages or
claims in excess of the Purchase Price.
10.5 Specific Performance. The parties recognize that if Seller
breaches this Agreement and refuses to perform under the provisions of this
Agreement, monetary damages alone would not be adequate to compensate Buyer for
its injury. Buyer shall therefore be entitled, as its sole and exclusive
remedy, to obtain specific performance of the terms of this Agreement. If any
action is brought by Buyer to enforce this Agreement, Seller shall waive the
defense that there is an adequate remedy at law.
- 26 -
10.6 Attorneys' Fees. In the event of a default by either party
which 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.
SECTION 11. MISCELLANEOUS
11.1 Fees and Expenses. Any federal, state, or local sales or
transfer tax arising in connection with the conveyance of the Assets by Seller
to Buyer pursuant to this Agreement shall be paid one-half by Buyer and
one-half by Seller. Buyer and Seller shall each pay one-half of the fee
payable to the FCC in connection with the filing of the application for FCC
Consent. Except as otherwise provided in this Agreement, each party shall pay
its own expenses incurred in connection with the authorization, preparation,
execution, and performance of this Agreement, including all fees and expenses
of counsel, accountants, agents, and representatives, and each party shall be
responsible for all fees or commissions payable to any finder, broker, advisor,
or similar person retained by or on behalf of such party.
11.2 Arbitration. Except as otherwise provided to the contrary
below, any dispute arising out of or related to this Agreement that Seller and
Buyer are unable to resolve by themselves shall be settled by arbitration in
the District of Columbia by a panel of three arbitrators. Seller and Buyer
shall each designate one disinterested arbitrator, and the two arbitrators so
designated shall select the third arbitrator. Before undertaking to resolve
the dispute, each arbitrator shall be duly sworn faithfully and fairly to hear
and examine the matters in controversy and to make a just award according to
the best of his or her understanding. The arbitration hearing shall be
conducted in accordance with the commercial arbitration rules of the American
Arbitration Association. The written decision of a majority of the arbitrators
shall be final and binding on Seller and Buyer. The costs and expenses of the
arbitration proceeding shall be assessed between Seller and Buyer in a manner
to be decided by a majority of the arbitrators, and the assessment shall be set
forth in the decision and award of the arbitrators. Judgment on the award, if
it is not paid within thirty days, may be entered in any court having
jurisdiction over the matter. No action at law or suit in equity based upon
any claim arising out of or related to this Agreement shall be instituted in
any court by Seller or Buyer against the other except (i) an action to compel
arbitration pursuant to this Section, (ii) an action to enforce the award of
the arbitration panel rendered in accordance with this Section, or (iii) a suit
for specific performance pursuant to Section 10.5.
11.3 Notices. All notices, demands, and requests required or
permitted to be given under the provisions of this Agreement shall be (a) in
writing, (b) delivered by personal delivery, or sent by commercial delivery
service or registered or certified mail, return receipt requested, (c) deemed
to have been given on the date of personal delivery or the date set
- 27 -
forth in the records of the delivery service or on the return receipt, and (d)
addressed as follows:
If to Seller: Oleen Eagle
President
Cornerstone Television, Inc.
Route #48
Signal Hill Drive
Wall, Pennsylvania 16148-1499
With a copy to: Joseph L. Luciana, III, Esquire
Kirkpatrick & Lockhart LLP
1500 Oliver Building
Pittsburgh, Pennsylvania 15222
If to Buyer: James L. West
President
The Christian Network
14444 66th Street North
Clearwater, Florida 34624
With a copy to: John R. Feore, Jr., Esquire
Dow, Lohnes & Albertson
1255 23rd Street, N.W., Suite 500
Washington, D.C. 20037
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
11.3.
11.4 Benefit and Binding Effect. Neither party hereto may assign
this Agreement without the prior written consent of the other party hereto.
Upon any permitted assignment by Buyer or Seller in accordance with this
Section 11.4, all references to "Buyer" herein shall be deemed to be references
to Buyer's assignee and all references to "Seller" herein shall be deemed to be
references to Seller's assignee. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors and
permitted assigns.
11.5 Further Assurances. The parties shall take any actions and
execute any other documents that may be necessary or desirable to the
implementation and consummation of this Agreement, including, in the case of
Seller, any additional bills of sale, deeds, or other transfer documents that,
including, in the case of Seller, any additional bills of sale, deeds, or other
transfer documents that, in the reasonable opinion of Buyer, may be necessary
to
- 28 -
ensure, complete, and evidence the full and effective transfer of the
Assets to Buyer pursuant to this Agreement.
11.6 GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED, CONSTRUED,
AND ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA (WITHOUT
REGARD TO THE CHOICE OF LAW PROVISIONS THEREOF).
11.7 Headings. The headings in this Agreement are included for
ease of reference only and shall not control or affect the meaning or
construction of the provisions of this Agreement.
11.8 Gender and Number. Words used in this Agreement, regardless
of the gender and number specifically used, shall be deemed and construed to
include any other gender, masculine, feminine, or neuter, and any other number,
singular or plural, as the context requires.
11.9 Entire Agreement. This Agreement, the schedules, hereto, 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 hereof. This
Agreement supersedes 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 which is signed by the party against
which enforcement of any such amendment, supplement, or modification is sought.
11.10 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 11.10.
11.11 Counterparts. This Agreement may be signed in counterparts
with the same effect as if the signature on each counterpart were upon the same
instrument.
11.12 Seller's Knowledge. Whenever a representation, warranty or
covenant contained herein is qualified by the phrase "to Seller's Knowledge" or
other similar phrase, such representation, warranty or covenant is made based
on the actual knowledge of
- 29 -
the officers of Seller following reasonable inquiry to the officer or employee
of Seller who has responsibility for the area of the Station's operations to
which such representation, warranty or covenant relates.
11.13 Guaranty of Paxson Communications Corporation.
(a) In consideration of the execution and delivery of
this Agreement by Seller, Paxson Communications Corporation ("PCC") hereby
guarantees the full, complete and timely performance by Buyer of its payment
obligation under the Promissory Note.
(b) PCC hereby represents and warrants to Seller as
follows:
(1) The Guaranty, as set forth in Schedule 2.4,
will, when it is executed, constitute its legal, valid, and binding agreement,
enforceable 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.
(2) The execution, delivery and performance by
PCC of the Guaranty (A) do not require the consent of any third party; (B) will
not conflict with any provision of the Certificate of Incorporation or Bylaws
of PCC; (C) will not conflict with, result in a breach of, or constitute a
default under, any law, judgment, order, ordinance, injunction, decree, rule,
regulation, or ruling of any court or governmental instrumentality; and (D)
will not conflict with, constitute grounds for termination of, result in a
breach of, constitute default under, or accelerate or permit the acceleration
of any performance required by the terms of, any agreement, instrument,
license, or permit to which PCC is a party or by which PCC may be bound.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
- 30 -
IN WITNESS WHEREOF, the parties hereto have duly executed this Asset
Purchase Agreement as of the day and year first above written.
BUYER: CHANNEL 55 OF ALBANY, INC.
By: James L. West
-------------------------------------
Name: James L. West
-----------------------------------
Title: Chairman
----------------------------------
SELLER: CORNERSTONE TELEVISION, INC.
By: Oleen Eagle
-------------------------------------
Name: Oleen Eagle
-----------------------------------
Title: President
----------------------------------
As to Section 11.13 Only:
PAXSON COMMUNICATIONS CORPORATION
By: William Watson
-------------------------------
Name: William Watson
-------------------------------
Title: Assistant Secretary
-------------------------------
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘10-Q’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| Filed on: | | 8/13/96 | | | | | | | None on these Dates |
| | 8/1/96 | | 29 |
| For Period End: | | 6/30/96 |
| | 12/11/95 | | 1 | | 8 |
| List all Filings |
↑Top
Filing Submission 0000950144-96-005239 – Alternative Formats (Word / Rich Text, HTML, Plain Text, et al.)
Copyright © 2024 Fran Finnegan & Company LLC – All Rights Reserved.
About — Privacy — Redactions — Help —
Thu., Apr. 25, 6:07:46.1pm ET 