Quarterly Report — Form 10-Q
Filing Table of Contents
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
EX-10.111 — Asset Purchase Agreement
| EX-10.111 | 1st Page of 40 | TOC | ↑Top | Previous | Next | ↓Bottom | Just 1st |
|---|
EXHIBIT 10.111
================================================================================
ASSET PURCHASE AGREEMENT
DATED AS OF APRIL 22, 1996
BY AND AMONG
PAXSON COMMUNICATIONS OF TALLAHASSEE, INC.
AND
WTNT, INC.
SOUTHERN BROADCASTING COMPANIES, INC.
GREAT SOUTH BROADCASTING, INC.
CHARLES E. GIDDENS, INC.
AND
SOUTHERN BROADCASTING OF PENSACOLA, INC.
================================================================================
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT is dated as of April 29, 1996, by and
among PAXSON COMMUNICATIONS OF TALLAHASSEE, INC., a Florida corporation
("Buyer"), WTNT, INC., a Florida corporation, SOUTHERN BROADCASTING COMPANIES,
INC., a Florida corporation, GREAT SOUTH BROADCASTING, INC., a Florida
corporation,, CHARLES E. GIDDENS, INC., a Florida corporation, and SOUTHERN
BROADCASTING OF PENSACOLA, INC., a Florida corporation [individually, referred
to as "Seller" and collectively as "Sellers"].
RECITALS
A. WTNT, Inc. is the proposed licensee of radio stations WNLS-AM
("Station I") and WTNT-FM ("Station II"), Tallahassee, Florida pursuant to
licenses issued by the FCC and upon approval of a joint assignment application
(File No. BAL-960221GP, BALH-960221GQ) pending before the FCC.
B. Southern Broadcasting Companies, Inc. is the licensee of and
owns and operates radio stations WSNI-FM (Station III), Thomasville, Georgia,
WPAP-FM ("Station IV"), Panama City, Florida and WPBH-FM ("Station V"), Parker,
Florida pursuant to licenses issued by the FCC.
C. Great South Broadcasting, Inc. is the licensee of and owns and
operates radio station WXSR-FM ("Station VI"), Quincy, Florida pursuant to
licenses issued by the FCC.
D. Charles E. Giddens, Inc., is the proposed permittee of radio
station WTPS-FM ("Station VII"), Midway, Florida pursuant to a construction
permit issued by the FCC and upon approval of an assignment application (File
No. BAPH-960315GS) pending before the FCC.
E. Southern Broadcasting of Pensacola, Inc. is the licensee of
and owns and operates radio station WTKX-FM ("Station VIII"), Pensacola,
Florida pursuant to licenses issued by the FCC and is the proposed licensee of
radio station WOWW(FM) )("Station IX"), Pensacola, Florida pursuant to licenses
issued by the FCC and, in the case of WOWW, upon approval of an assignment
application (File No. BALH-960215GG) pending before the FCC.
All of the above Stations I through IX hereinafter
collectively referred to as the Stations".
F. Sellers desire to sell, and Buyer wishes to buy, substantially
all the assets that are used or useful in the business or operations of the
Stations, 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 Sellers, 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 Sellers to payment for the
sale of advertising time run on the Stations 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 designated to indicate that they will be assumed by Buyer upon its
purchase of the Stations, (ii) any Contracts entered into by Sellers between
the date of this Agreement and the Closing Date that Buyer agrees in writing to
assume, and (iii) Contracts entered into by Sellers in compliance with Section
5.3.
"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 Sellers are a party or which are binding upon Sellers and
which relate to or affect the Assets or the business or operations of the
Stations.
"Escrow Agent" means First Union National Bank of Florida.
- 2 -
"FAA" means the Federal Aviation Administration.
"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 and construction permits issued or
to be issued by the FCC to Sellers in connection with the business or
operations of the Stations.
"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 Sellers or under which Sellers are licensed or franchised and which are used
or useful in the business and operations of the Stations, 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 FAA or any other federal, state, or local governmental
authorities to Sellers, in connection with the conduct of the business or
operations of the Stations, together with any additions thereto between the
date of this Agreement and the Closing Date.
"Purchase Price" means the purchase price specified in Section 2.3.
"Real Property" means the real property and interests in real
property, including fee estates, leaseholds and subleaseholds, easements,
rights to access, and rights of way, and all buildings and other improvements
thereon described in Schedule 3.5 hereto used or useful in the business or
operations of the Stations.
"Tangible Personal Property" means all machinery, equipment, tools,
vehicles, furniture, leasehold improvements, office equipment, inventory, spare
parts, and other tangible personal property which is used or useful in the
conduct of the business or operations of the Stations, together with any
additions thereto between the date of this Agreement and the Closing Date.
- 3 -
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, Sellers hereby agree to sell, transfer,
and deliver to Buyer on the Closing Date, and Buyer agrees to purchase, the
tangible and intangible assets used or useful in connection with the conduct of
the business or operations of the Stations described in the Schedules attached
hereto, 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 liens or obligations associated with the Assumed Contracts and
liens for current taxes not yet due and payable), including the following:
(a) The Tangible Personal Property;
(b) The Real Property;
(c) The Licenses;
(d) The Assumed Contracts, including executed copies
thereof;
(e) The Intangibles and all intangible assets of Sellers
relating to the Stations that are not specifically included within the
Intangibles, including the goodwill of the Stations, if any;
(f) All of Sellers' proprietary information, technical
information and data, machinery and equipment warranties, maps, computer discs
and tapes, plans, diagrams, blueprints, and schematics, including filings with
the FCC relating to the business and operation of the Stations;
(g) All choses in action of Sellers relating to the
Stations; and
(h) All books and records relating to the business or
operations of the Stations, and all records required by the FCC to be kept by
the Stations.
2.2 Excluded Assets. The Assets shall exclude the following
assets:
(a) Sellers' cash on hand as of the Closing and all other
cash in any of Sellers' bank or savings accounts; any insurance policies,
letters of credit, or other similar items and cash surrender value in regard
thereto; deposits; and any stocks, bonds, certificates of deposit and similar
investments;
- 4 -
(b) All books and records relating to Sellers' internal
corporate organization;
(c) Any pension, profit-sharing, or employee benefit plans,
and any collective bargaining agreements;
(d) The Accounts Receivable; and
(e) Any Contracts not included among the Assumed Contracts.
(f) All real estate not listed on Schedule 3.5.
2.3 Purchase Price. The Purchase Price for the Assets shall be
Twenty One Million Three Hundred Thousand United States Dollars (US$21,300,000)
to be paid to Sellers by Buyer on the Closing Date adjusted as set forth in
Section 11.2 hereof, by federal wire transfer of immediately available funds
pursuant to wire instructions which shall be delivered by Sellers to Buyer at
least two business days prior to the Closing Date.
2.4 Assumption of Liabilities and Obligations/Trade and Barter.
As of the Closing Date, Buyer shall assume and undertake to pay, discharge, and
perform all obligations and liabilities of Sellers under the Licenses and the
Assumed Contracts insofar as they relate to the time on and after the Closing
Date, and arise out of events related to Buyer's ownership of the Assets or its
operation of the Stations on or after the Closing Date. Buyer shall assume
responsibility for the broadcast of barter announcements and programs for which
there is a negative trade balance not in excess of $5,000.00 for Stations I,
III, IV, V, VI, VII, VIII, and IX and not in excess of $10,000.00 for Station
II. Buyer shall not assume any other obligations or liabilities of Sellers,
including (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 Stations
prior to the Closing, (iv) any obligations or liabilities arising under
capitalized leases or other financing agreements not included in the Assumed
Contracts, (v) any obligations or liabilities of Sellers under any employee
pension, retirement, or other benefit plans or collective bargaining
agreements, (vi) any obligation to any employee of the Stations for
commissions, wages, bonuses, incentive programs, payroll taxes, vacation pay,
sick leave, severance benefits or other benefits with respect to periods prior
to or arising by virtue of the Closing or (vii) any obligations or liabilities
caused by, arising out of, or resulting from any action or omission of Sellers
prior to the Closing.
SECTION 3 REPRESENTATIONS AND WARRANTIES OF SELLERS
Sellers represent and warrant to Buyer as follows:
- 5 -
3.1 Organization, Standing, and Authority. Each Seller is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Florida and authorized to transact business in each
jurisdiction where the conduct of business or operations of such Seller
requires such Seller to qualify to conduct its business as presently
authorized. Sellers have all requisite power and authority (i) to own, lease,
and use the Assets as now owned, leased, and used, (ii) to conduct the business
and operations of the Stations 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 Sellers hereunder and thereunder. No Seller is a participant,
in any joint venture or partnership with any other person or entity with
respect to any part of the operations of the Stations or any of the Assets.
3.2 Authorization and Binding Obligation. The execution,
delivery, and performance of this Agreement, the Noncompetition Agreement, the
Escrow Agreement and the other agreements to be executed by Sellers and
delivered by Sellers have been duly authorized by all necessary actions on the
part of Sellers and their Shareholders. Schedule 3.2 sets forth the stock
ownership of each Seller. This Agreement has been duly executed and delivered
by Sellers and constitutes the legal, valid, and binding obligation of Sellers,
enforceable against them 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. Except for restrictions on
the changing the format of Station VIII as disclosed on Schedule 3.3, and
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; (h) will not conflict with any
provision of any Sellers' Certificate of Incorporation or By-Laws; (iii) will
not conflict with, result in a breach of, or constitute a material default
under, any law, judgment, order, ordinance, 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 material default under, or accelerate or permit the
acceleration of any performance required by the terms of, any agreement,
instrument, license, or permit to which Sellers are a party or by which Sellers
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. Schedule 3.4 includes a true and
complete list of the material Licenses. Sellers have delivered to Buyer true
and complete copies of the Licenses (including any amendments and other
modifications thereto). The Licenses have been validly issued, and the Seller
set forth above each License on Schedule 3.4 is the authorized legal holder
thereof. The Licenses listed on Schedule 3.4 comprise all of the licenses,
permits,
- 6 -
and other authorizations required from any governmental or regulatory authority
for the lawful conduct of the business and operations of the Stations in the
manner and to the extent they are now conducted, and none of the Licenses is
subject to any restriction or condition that would materially limit the
operation to a greater extent than Stations are now operated. The Licenses are
in full force and effect, and the conduct of the business and operations of the
Stations are in accordance therewith. Sellers have no reason to believe that
any of the Licenses would not be renewed by the FCC or other granting authority
in the ordinary course based upon events occurring prior to Closing.
3.5 Title to and Condition of Real Property.
(a) Schedule 3.5 contains a complete and accurate
description of all the Real Property and each 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 Stations as now conducted. Each Seller has good and
marketable fee simple title, insurable at standard rates, to all fee estates
(including the improvements therein) included in the Real Property, free and
clear of all liens, mortgages, pledges, covenants, easements, restrictions,
encroachments, leases, charges and other claims and encumbrances of any nature
whatsoever, except for liens for real estate taxes not yet due and payable, and
liens which will be discharged at the Closing.
(b) With respect to each leasehold or subleasehold
interest included in the Real Property being conveyed under this Agreement (the
"Leased Property"), so long as the Sellers fulfill their obligations under the
lease therefor, Sellers have enforceable rights to nondisturbance and quiet
enjoyment. Sellers have good title to the Leased Property, free and clear of
all liens, claims, and encumbrances, except as specifically stated in Schedule
3.5. With respect to each such lease, (i) the leases are in full force and
effect, and are valid, binding and enforceable in accordance with their
respective terms, (ii) all accrued and currently payable rents and other
payments required by such leases have been paid, (iii) neither any Seller nor
any other party is in material default in any respect under any such leases,
(iv) no party has asserted any defense, set off or counterclaim thereunder, and
(v) no notice of default or termination has been given or received, no event of
default has occurred, and no condition exists and no event has occurred that,
with the giving of notice, the lapse of time, or the happening of any further
event would become a default or permit early termination under any such lease.
Except as set forth in Schedule 3.3 hereto, no third-party consent or approval
is required for the assignment of any such lease to Buyer, or for the
consummation of the transactions contemplated herein. All improvements located
on the Real Property are in good condition and repair (ordinary wear and tear
excepted), are available for immediate use in the conduct of the business or
operations of the Stations and comply with all applicable building and zoning
codes. All towers, guy anchors, buildings and other
- 7 -
improvements included in the Assets are located entirely on the Real Property.
Sellers have full legal and 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 and the
Station at which the items are used. The Tangible Personal Property listed on
Schedule 3.6 comprises all material items of tangible personal property
necessary to conduct the business and operations of the Stations as now
conducted. Except for liens to be discharged at the Closing unless assumed by
Buyer pursuant to the Assumed Contracts, or except as described in Schedule
3.6, Sellers own and have good title to each item of Tangible Personal
Property, and none of the Tangible Personal Property owned by Sellers is
subject to any security interest, mortgage, pledge, conditional sales
agreement, or other lien or encumbrance, except for liens for current taxes not
yet due and payable. Each item of Tangible Personal Property is available for
immediate use in the business and operations of the Stations. All material
items of transmitting and studio equipment included in the Tangible Personal
Property (i) have been maintained in a manner consistent with generally
accepted standards of good engineering practice, and (ii) will permit the
Stations and any auxiliary broadcast facilities related thereto to operate
substantially in accordance with the terms of the FCC Licenses and the rules
and regulations of the FCC and the FAA.
3.7 Contracts. Schedule 3.7 is a true and complete list of all
material Contracts except (i) contracts with advertisers for the sale of
advertising time on the Stations for cash at prevailing rates and which have
not been prepaid and which may be canceled by the Stations without penalty on
not more than thirty days' notice and (ii) contracts or commitments for the
purchase or sale of goods, supplies, equipment, capital assets, products or
services, that do not involve more than $2,500 for each such contract or
commitment and more than $10,000 in the aggregate for all such contracts or
commitments per Station. With respect to the Contracts listed on Schedule 3.7,
Sellers have delivered to Buyer true and complete copies of all material
written Contracts, true and complete memoranda of all material oral Contracts
(including any amendments and other modifications to such Contracts), and a
schedule summarizing Sellers' obligations under trade and barter agreements
relating to the Stations. All of the Assumed Contracts are in full force and
effect, and are valid, binding, and enforceable in accordance with their terms.
There is not under any Assumed Contract any material default by any party
thereto or any event that, after notice or lapse of time or both, could
constitute a material default. Sellers are not aware of any intention by any
party to any Assumed Contract (i) to terminate such contract or amend the terms
thereof, (ii) to refuse to renew the Assumed Contract upon expiration of its
term, or (iii) to renew the Assumed Contract upon expiration only on terms and
conditions which are more onerous than those now existing. Except for the need
to obtain the Consents listed in Schedule 3.3, Sellers have full legal power
and authority to assign their 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. The
Contracts listed on
- 8 -
Schedule 3.7 hereto constitute all of the material contracts necessary to
conduct the business and operations of the Stations as currently conducted.
3.8 Consents. Except for the FCC Consent provided for in Section
6.1, and the other Consents described in Schedule 3.3, 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 Sellers
to assign or transfer the Assets to Buyer, or (iii) to enable Buyer to conduct
the business and operations of the Stations in essentially the same manner as
such business and operations are now conducted.
3.9 Intangibles. Schedule 3.9 is a true and complete list of all
material Intangibles, listed by Station, (exclusive of those listed in Schedule
3.4), all of which are valid and in good standing and uncontested. Sellers
have delivered to Buyer copies of all existing documents that establish or
evidence any of the Intangibles. To Sellers' knowledge, Sellers are not
infringing upon or otherwise acting adversely to any trademarks, trade names,
service marks, service names, copyrights, patents, patent applications,
know-how, methods, or processes owned by any other person or persons, and there
is no claim or action pending, or to the knowledge of Sellers threatened, with
respect thereto. The Intangibles listed on Schedule 3.9 comprise all
intangible property interests necessary to conduct the business and operations
of the Stations as now conducted.
3.10 Financial Condition of Sellers,
(a) Sellers have heretofore delivered to Buyer financial
statements and information attached hereto as Schedule 3.10, together with
monthly financial statements, referred to herein as the "Financial Statements."
The Financial Statements have been or, in the case of those to be provided
after the date hereof, will be prepared by Sellers in accordance with generally
accepted accounting principles, consistently applied and fairly present the
financial condition and results of operation of each Station for the periods
covered thereby (subject, in the case of interim Financial Statements, to
normal year-end adjustments and the absence of footnotes).
(b) Except as otherwise disclosed in Schedule 3.10,
between December 31, 1995 and the date of this Agreement, there has been no
change in the condition (financial or otherwise), results of operations,
business, assets or profits of any Station which, individually or in the
aggregate, is, or would be likely in the future to be, materially adverse to
such Station's condition, results of operations, business, assets or profits.
3.11 Insurance. Schedule 3.11 is a true and complete list of all
insurance policies of Sellers that insure any part of the Assets or the
business of the Stations listed by Station. All policies of insurance listed
in Schedule 3.11 are in full force and effect. The insurance
- 9 -
policies listed in Schedule 3.11 are adequate in amount with respect to, and
for the full value (subject to customary deductibles) of, the Assets, and
insure the Assets and the business of the Stations against all customary and
foreseeable risks.
3.12 Reports. To Sellers' knowledge, all tax returns, ownership
and employment reports, and other material documents that the Stations are
currently required to file with the FCC or with any other governmental agency
have been filed, and all reporting requirements of the FCC and other
governmental authorities having jurisdiction over Sellers and the Stations have
been complied with in all material respects. All of such returns, reports, and
statements are complete and correct in all material respects as filed. Sellers
have paid to the FCC all annual regulatory fees payable with respect to the FCC
Licenses.
3.13 Employee Benefits.
(a) Sellers have no Employee Plans and Compensation
Arrangements with their employees except Sellers pay one-half of their
employees' health insurance premiums, and offer their employees one week's paid
vacation after one year's service, and two weeks paid vacation after two years
service. Sellers pay their employees salaries on New Years Day, Independence
Day, Labor Day, Thanksgiving Day and Christmas Day. Schedule 3.13 contains a
true and complete list of all employees of the Stations, their job description,
date of hire, salary and amount and date of last salary increase.
(b) Sellers do not contribute to and are not required to
contribute to any Multi-employer Plan with respect to the employees of the
Stations, and neither Sellers nor any other trade or business under common
control with Sellers (within the meaning of Sections 414(b), (c), (m) or (o) of
the Code) has incurred or reasonably expects to incur any "withdrawal
liability," as defined under Section 4201 et seq. of ERISA.
(c) Neither Sellers nor any other trade or business under
common control with Sellers (within the meaning of Sections 414(b), (c), (m)
or (o) of the Code) sponsor, maintain or contribute to any Employee Plan or
Compensation Arrangement that provides retiree medical or retiree life
insurance coverage to former employees of Sellers at the Stations.
(d) For purposes of this Agreement, the following terms
shall have the meaning indicated: (i) "Employee Plan" shall mean any pension,
profit-sharing, deferred compensation, vacation, bonus, incentive, medical,
vision, dental, disability, life insurance or any other employee benefit plan
as defined in Section 3(3) of ERISA to which Sellers or any entity related to
Sellers (under the terms of Section 414(b), (c), (m) or (o) of the Code)
contribute or to which Sellers or any entity related to Sellers (under the
terms of Sections 414(b), (c), (m) or (o) of the Code) sponsor, maintain or
otherwise are bound which provides benefits to persons employed or previously
employed at the Stations; (ii) "Code" shall mean the Internal Revenue Code of
1986, as amended, any successor thereto and any regulations
- 10 -
promulgated thereunder; (iii) "Compensation Arrangement" shall mean any plan or
compensation arrangement other than an Employee Plan, whether written or
unwritten, which provides to employees, former employees, officers, directors
and shareholders of Sellers or any entity related to Sellers (under the terms
of Section 414(b), (c), (m) or (o) of the Code) employed or previously employed
at the Stations any compensation or other benefits, whether deferred or not, in
excess of base salary or wages, including, but not limited to, any bonus or
incentive plan, stock rights plan, deferred compensation arrangement, life
insurance, stock purchase plan, severance pay plan and any other employee
fringe benefit plan; (iv) "ERISA" shall mean the Employee Retirement Income
Security Act of 1974, as amended, any successor thereto and any regulations
promulgated thereunder; and (v) "Multi-employer Plan" means a plan, as defined
in ERISA Section 3(37), to which Sellers or any entity related to Sellers
(under the terms of Section 414(b) or (c) of the Code) contribute or are
required to contribute.
3.14 Labor Relations. Sellers are not parties to or subject to any
collective bargaining agreements with respect to the Stations. Sellers have no
written or oral contracts of employment with any employee of the Stations,
other than those listed in Schedule 3.7. Sellers have 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 Sellers have not received any notice alleging
that they have failed to comply in any material respect with any such laws,
rules, or regulations. No material controversies, disputes, or proceedings are
pending or, to the best of Sellers' knowledge, threatened, between Sellers and
any employee (singly or collectively) of the Stations. No labor union or other
collective bargaining unit represents or claims to represent any of the
employees of the Stations. To Sellers' knowledge, there is no union campaign
being conducted to represent employees of the Stations or 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 Stations.
3.15 Taxes. Sellers have 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 they have paid or caused to be paid
all taxes shown on those returns or on any tax assessment received by them to
the extent that such taxes have become due. To Sellers' knowledge, there are
no governmental investigations or other legal, administrative, or tax
proceedings pursuant to which Sellers are 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 Stations, 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 Sellers.
3.16 Claims and Legal Actions. Except as disclosed on Schedule
3.16, there is no claim, legal action, counterclaim, suit, arbitration,
governmental investigation or other legal,
- 11 -
administrative, or tax proceeding, nor any order, decree or judgment, in
progress or pending, or to the knowledge of Sellers threatened, against or
relating to Sellers or otherwise relating to the Assets or the business or
operations of the Stations, nor do Sellers know or have reason to be aware of
any basis for the same. In particular, but without limiting the generality of
the foregoing, to the best of Sellers' knowledge, there are no material
applications, complaints or proceedings pending or, threatened (i) before the
FCC relating to the business or operations of the Stations other than
rulemaking proceedings which affect the radio industry generally, (ii) before
any federal or state agency relating to the business or operations of the
Stations 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 Stations involving zoning
issues under any federal, state, or local zoning law, rule, or regulation.
3.17 Environmental Matters.
(a) Sellers have 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 Sellers or the Stations alleging any failure to comply with
any such law, rule, or regulation.
(b) Sellers have no liability relating to their ownership and
operation of the Stations (and there is no basis related to the past or present
operations, properties, or facilities of the Stations by Sellers for any
present or future charge, complaint, action, suit, proceeding, hearing,
investigation, claim, or demand against Sellers giving rise to any such
liability) under the Comprehensive Environmental Response, Compensation and
Liability Act, the Resource Conservation and Recovery Act, the Federal Water
Pollution Control Act, the Clean Air Act, the Safe Drinking Water Act, the
Toxic Substances Control Act, the Refuse Act, the Emergency Planning and
Community Right-to-Know Act, or the Occupational Safety and Health Act (each as
amended), or any other law, rule, or regulation of any federal, state, or local
government (or agency thereof) concerning release or threatened release of
hazardous substances, public or employee health and safety, or pollution or
protection of the environment.
(c) Sellers have no liability relating to their ownership
and operation of the Stations (and there is no basis for any present or future
charge, complaint, action, suit, proceeding, hearing, investigation, claim, or
demand, under the common law or pursuant to any statute, against Sellers giving
rise to any such liability) arising out of such Sellers's handling, disposal or
arranging for disposal of any substance.
- 12 -
(d) Sellers have no liability relating to its ownership
and operation of the Stations (and there is no basis for any present or future
charge, complaint, action, suit, proceeding, hearing, investigation, claim, or
demand, under the common law or pursuant to a statute, against Sellers giving
rise to any such liability) for any illness or personal injury to any employee.
(e) Except as set forth on Schedule 3.17, to Sellers'
best knowledge, all properties and equipment used in the business of the
Stations are and have been free of friable asbestos, and all transformers used
in the operations of the Stations are free of PCB's.
(f) No pollutant, contaminant, industrial, hazardous, or
toxic material or waste is located on the Real Property.
3.18 Compliance with Laws. Sellers have 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 Stations. Neither the ownership or use of the properties of
the Stations nor the conduct of the business or operations of the Stations
conflicts with the rights of any other person or entity.
3.19 Conduct of Business in Ordinary Course. Since December 31,
1995, Sellers have conducted the business and operations of the Stations only
in the ordinary course and have not:
(a) Suffered any material adverse change in the
properties of the Stations, including any damage, destruction, or loss
affecting any assets used or useful in the conduct of the business of the
Stations;
(b) Made any material increase in compensation payable or
to become payable to any of the employees of the Stations, or any bonus payment
made or promised to any employee of the Stations, or any material change in
personnel policies, employee benefits, or other compensation arrangements
affecting the employees of the Stations;
(c) Made any sale, assignment, lease, or other transfer
of any of the Stations' properties that are subject to sale to Buyer other than
in the normal and usual course of business with suitable replacements being
obtained therefor;
(d) Canceled any material debts owed to or claims held by
any Seller with respect to the Stations, except in the normal and usual course
of business;
(e) Suffered any material write-down of the value of any
Assets or any material write-off as uncollectible of any accounts receivable of
the Stations:
- 13 -
(f) Transferred or granted any material right under, or
entered into any settlement regarding the breach or infringement of, any
license, patent, copyright, trademark, trade name, franchise, or similar right,
or modified any existing right relating to the Stations;
(g) Incurred any obligation or liability (fixed or
contingent) except normal trade or business obligations and liabilities
incurred in the ordinary course of business; or
(h) Mortgaged, pledged or subjected to any lien any of
the material Assets other than in the ordinary course of business.
3.20 Transactions with Affiliates. Sellers have not been involved
in any business arrangement or relationship relating to the Stations with any
affiliate of any Sellers, and no affiliate of Sellers owns any property or
right, tangible or intangible, which is used in the business of the Stations
where such arrangement, relationship or ownership could have a material adverse
effect on Buyer's rights under this Agreement. As used in this paragraph,
"affiliate" has the meaning set forth in Rule 12b-2 promulgated under the
Securities and Exchange Act of 1934.
3.21 Broker. Neither Sellers nor any person or entity acting on
their behalf have incurred any liability for any finders' or brokers' fees or
commissions in connection with the transactions contemplated by this Agreement,
except for a commission payable to Media Venture Partners. It is disclosed
that one of Sellers' principals, Charles E. Giddens, is a media broker and a
principal of Media Venture Partners, and Sellers and Buyer waive for all
purposes any objection to Mr. Giddens' participation in this transaction as
Sellers' principal and broker.
3.22 Full Disclosure. No representation or warranty made by
Sellers in this Agreement or in any certificate, document, or other instrument
furnished or to be furnished by Sellers pursuant hereto contains or will
contain any untrue statement of a material fact, or omits or will omit to state
any material fact required to make any statement made herein or therein not
misleading.
SECTION 4 REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Sellers 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. 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.
- 14 -
4.2 Authorization and Binding Obligation. The execution,
delivery, and performance of this Agreement, the Noncompetition Agreement, the
Escrow Agreement, and the other agreements to be executed by Buyer and
delivered by Buyer have been duly authorized by all necessary corporate 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. Buyer has the partnership authority
to own the Assets and to operate the Stations after the consummation of the
transactions contemplated hereby.
4.3 Absence of Conflicting Agreements. Subject to obtaining the
Consents and except as set forth in Schedule 4.3, 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 under any agreement, license or law
applicable to Buyer; (ii) will not conflict with any provision of Buyer's
Certificate of Incorporation or By-laws of Buyer; (iii) will not conflict with,
result in a breach of, or constitute a material default under, any law,
judgment, order, injunction, decree, rule, regulation, or ruling of any court
or governmental instrumentality applicable to Buyer; and (iv) will not conflict
with, constitute grounds for termination of, result in a breach of, constitute
a material default under, or accelerate or permit the acceleration of any
performance required by the terms of, any mortgage, deed of trust, agreement,
instrument, license, or permit to which Buyer is a party or by which Buyer may
be bound, that may impair Buyer's ability to acquire or operate the Assets.
4.4 Consents. Other than the consents and approvals of the FCC
referred to in Section 6.1, certain filings required to be made with the FCC
after the Closing Date, consents of third parties to Assumed Contracts, filings
required to perfect security interests and liens and other consents, approvals,
authorizations and filings contemplated by this Agreement or otherwise obtained
or completed at or prior to the Closing, Buyer is not required to obtain any
consent, approval or authorization from, or file any declaration or statement
with, any governmental instrumentality or other agency or any third party in
connection with the execution of this Agreement or any of the other agreements
contemplated hereunder, or the consummation of the transactions contemplated
hereunder.
4.5 Broker. Neither Buyer 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.
4.6 Qualification. Buyer is legally qualified to become the
licensee of the Stations and is financially qualified to purchase the Stations
and consummate the transactions contemplated herein.
- 15 -
4.7 Litigation. To Buyer's knowledge, there is no litigation,
action, suit, investigation or proceeding pending or threatened before any
court or the FCC or any other governmental agency or any board of arbitration
which could reasonably be expected to (a) impair Buyer's ability to perform its
obligations under this Agreement, or (b) materially and adversely affect the
ability of Buyer to own and operate the Stations after the Closing.
4.8 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 contain
any untrue statement of a material fact, or omits or will omit to state any
material fact required to make any statement made herein or therein not
misleading.
SECTION 5 OPERATIONS OF THE STATIONS PRIOR TO CLOSING
5.1 Generally. Sellers agree that, between the date of this
Agreement and the Closing Date, Sellers shall operate the Stations diligently
in the ordinary course of business in material accordance with their past
practices (except where such conduct would conflict with the following
covenants or with Sellers' other obligations under this Agreement), and in
accordance with the other covenants in this Section 5.
5.2 Compensation. Sellers shall not 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 Stations,
except in accordance with past practices.
5.3 Contracts. Except for any necessary "bridge" financing
necessary to the acquisition of Stations I, II, VII, and IX (which will be
repaid at the Closing), and except for contracts terminable on not more than 60
days' notice, Sellers will not incur any obligation (including obligations
relating to the borrowing of money or the guaranteeing of indebtedness) that
will be binding on Buyer after Closing, enter into any contract or commitment
relating to the Stations or the Assets, or amend or terminate any Contract (or
waive any material right thereunder), except for (i) cash time sales agreements
made in the ordinary course of business and (ii) other contracts and
commitments entered into in the ordinary course of business (other than trade
or barter agreements as described in Section 2.4) which will not obligate Buyer
to an amount of more than $2,500 in respect to each contract or commitment and
$10,000 in respect to all such contracts and commitments per Station and which
will not obligate Buyer to perform any material non-monetary obligations.
Prior to the Closing Date, Sellers 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. Except for transactions in the
ordinary course of business, Sellers shall not sell, assign, lease, or
otherwise transfer or dispose of any of the
- 16 -
Assets subject to sale to Buyer, except assets that are no longer used or
useful in the business or operations of the Stations and assets that are
disposed of in connection with the acquisition of replacement property of
equivalent kind and value.
5.5 Encumbrances. Sellers 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) matters
disclosed on Schedule 3.5 and Schedule 3.6, which shall be removed prior to the
Closing Date (unless assumed by Buyer), (ii) liens for current taxes not yet
due and payable, (iii) mechanics' liens and other similar liens, which shall be
removed prior to the Closing Date, or (iv) liens necessary for the acquisition
of Stations I, II, VII and IX which will be removed by the Closing Date.
5.6 Licenses. Sellers shall not cause or permit, by any act or
failure to act, any of the Licenses to expire or to be revoked, suspended, or
modified, or take any action that could cause the FCC or any other governmental
authority to institute proceedings for the suspension, revocation, or adverse
modification of any of the Licenses. Sellers shall not fail to prosecute with
due diligence any applications to any governmental authority in connection with
the operation of the Stations including the prosecution of the pending
assignment applications for radio stations WNLS(AM) and WTNT-FM, Tallahassee,
Florida (FCC File Nos. BAL-960221GP and BALH-950221GQ), radio station WTPS-FM,
Midway, Florida (FCC File No. BAPH-960215GS) and radio station WOWW(FM),
Pensacola, Florida (FCC File No. BALH-960215GG). Sellers are participating in
MM Docket No. 95-82 to upgrade Station VI to operate on Channel 268C1. Sellers
have agreed to reimburse the licensees of other radio stations to accommodate
the upgrade. With regard to Station VI, Seller will give the Buyer at the
Closing a credit in the amount of $37,500, which shall be deducted from the
Purchase Price and Buyer will assume sole responsibility for the reimbursement
of third parties in connection with the upgrade of Station VI. Sellers make no
warranty to Buyer that the FCC will ultimately adopt Sellers' proposal to
upgrade Station VI, and Buyer accepts Station VI as a Class C2 station and will
not refuse to close the purchase of Station VI in the event the upgrade is not
granted, or such grant is unlikely.
5.7 Access to Information. Sellers shall give Buyer and its
counsel, accountants, engineers, and other authorized representatives, upon
reasonable advance notice, reasonable access to the Assets and to all other
properties, equipment, books, records, Contracts, and documents relating to the
Stations for the purpose of audit and inspection and will furnish or cause to
be furnished to Buyer or its authorized representatives all information with
respect to the affairs and business of the Stations that Buyer may reasonably
request (including any financial reports and operations reports produced with
respect to the affairs and business of the Stations). Without limiting the
generality of the foregoing, Sellers shall give Buyer and its counsel,
accountants and other authorized representatives reasonable access to Sellers'
financial records and Sellers' employees, counsel, accountants and other
representatives for the purpose of preparing and auditing, at Buyer's sole
expense, such financial statements as
- 17 -
Buyer determines, in its judgment, are required or advisable to comply with
federal or state securities laws and the rules and regulations of securities
markets as a result of the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
5.8 Maintenance of Assets. Sellers shall maintain all of the
Assets in good condition (ordinary wear and tear excepted), and use, operate,
and maintain all of the Assets in a reasonable manner. Sellers shall maintain
inventories of spare parts and expendable supplies at levels consistent with
past practices. If any material loss, damage, impairment, confiscation, or
condemnation of or to any of the Assets occurs, Sellers shall repair, replace,
or restore the Assets. to their prior condition as represented in this
Agreement as soon thereafter as possible, and Sellers shall use the proceeds of
any claim under any insurance policy solely to repair, replace, or restore any
of the Assets that are lost, damaged, impaired, or destroyed. Sellers disclose
that the Station IX transmitter switching apparatus and production console are
inoperable, and Buyer acknowledges that Sellers have no obligation to repair
these items.
5.9 Insurance. Sellers shall maintain the existing insurance
policies on the Stations and the Assets.
5.10 Consents. Sellers shall use their best efforts to obtain the
Consents and the estoppel certificates described in Section 8.2(b), without any
change in the terms or conditions of any Contract or License that could be
less advantageous to the Stations than those pertaining under the Contract or
License as in effect on the date of this Agreement. Sellers shall promptly
advise Buyer of any difficulties experienced in obtaining any of the Consents
and of any conditions proposed, considered, or requested for any of the
Consents.
5.11 Books and Records. Sellers shall maintain their books and
records relating to the Stations in accordance with past practices.
5.12 Notification. Sellers shall promptly notify Buyer in writing
of any unusual or material adverse developments with respect to the business or
operations of the Stations, and of any material adverse change in any of the
information contained in Sellers' representations and warranties contained in
Section 3 of this Agreement, provided that such notification shall not relieve
Sellers of any obligations hereunder.
5.13 Financial Information. Sellers shall furnish to Buyer as soon
as practicable after the information becomes available to Seller, between the
date of this Agreement and the Closing Date an unaudited statement of income
and expense of the Stations for the month just ended and such other financial
information (including information on payables and receivables) as Buyer may
reasonably request, all of which financial information shall comply with the
standards contained in the representations and warranties set forth in Section
3.10.
- 18 -
5.14 Compliance with Laws. Sellers shall comply in all material
respects with all laws, rules, and regulations applicable or relating to the
ownership and operation of the Stations.
5.15 Financing Leases. Except for obligations to be assumed by
Buyer listed on Schedule 3.7, Sellers shall satisfy at or prior to Closing all
outstanding obligations under capital and financing leases with respect to any
of the Assets and obtain good title to the Assets leased by Sellers pursuant to
those leases so that those Assets shall be transferred to Buyer at Closing free
of any interest of the lessors.
5.16 Programming. Sellers shall not make any material changes in
the broadcast hours or in the percentages of types of programming broadcast by
the Stations, or make any other material change in the Stations' programming
policies, except such changes as in the good faith judgment of Sellers are
required by the public interest.
5.17 Preservation of Business. Sellers shall use their best
efforts to preserve the business and organization of the Stations and use their
best efforts to keep available to the Stations their present employees and to
preserve the audiences of the Stations and the Stations' present relationships
with suppliers, advertisers, and others having business relations with them, to
the end that the business, operations, and prospects of the Stations shall be
materially unimpaired at the Closing Date. The ordinary and customary
operating, marketing, promotional, sales, and advertising practices of the
Stations shall be maintained.
5.18 Collection of Accounts Receivable. Sellers shall collect the
accounts receivable of the Stations only in the ordinary course consistent with
their past practices.
5.19 Personnel Recommendations. Sellers shall promptly notify
Buyer as personnel vacancies occur at the Stations and consider for employment
(but Sellers shall be under no obligation to employ) all personnel recommended
by Buyer for such vacant position.
5.20 Rights. Sellers shall not knowingly waive any material rights
relating to the Stations or any of the Assets that could have a material
adverse effect on Buyer.
5.21 Inconsistent Action. Sellers shall not knowingly take any
action that is inconsistent with their obligations under this Agreement or that
could hinder or delay the consummation of the transactions contemplated by this
Agreement.
- 19 -
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) Sellers and Buyer shall promptly prepare appropriate
applications for the FCC Consent and shall file such applications with the FCC
on or before the tenth business day after the execution of this Agreement. The
parties shall prosecute the applications with all reasonable diligence and
otherwise use their reasonable commercial efforts to obtain a grant of the
applications as expeditiously as practicable. Each party agrees to comply with
any 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 such 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 Sellers 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 Stations. Prior to Closing, Buyer shall not,
directly or indirectly, control, supervise, direct, or attempt to control,
supervise, or direct, the operations of the Stations; such operations,
including complete control and supervision of all of the Stations' programs,
employees, and policies, shall be the sole responsibility of Sellers until the
Closing.
6.3 Accounts Receivable.
(c) Collection. As of the Closing, Sellers shall
designate Buyer as their agent solely for the purposes of collecting the
Accounts Receivable. Sellers shall deliver to Buyer as soon as practicable
after the Closing a complete and detailed statement showing the name, amount
and age of each Account Receivable. Buyer shall make reasonable efforts in
accordance with Buyer's customary business practices to collect the Accounts
Receivable during the "Collection Period," which shall be the period beginning
on the Closing, and ending three months later. Buyer shall not be obligated to
use any efforts to collect any of the Accounts Receivable that are more
extensive than the efforts that Buyer uses to collect its own accounts
receivable. Buyer shall not refer any Accounts Receivable to a collection
- 20 -
agency or attorney for collection, and Buyer shall not make any such referral
or compromise, nor settle or adjust the amount of any of the Accounts
Receivable, except with the approval of Sellers. During the Collection Period,
neither Sellers nor their agents shall make any direct solicitation with
respect to any of the Accounts Receivable. Buyer shall incur no liability to
Sellers for any uncollected account unless Buyer shall have engaged in wilful
misconduct or gross negligence in the collection of such account.
(d) Payments to Sellers. On or before the fifteenth day
after the end of each full calendar month during the Collection Period, Buyer
shall furnish to Sellers (i) a list of the amounts collected before the end of
such month with respect to the Accounts Receivable, and (ii) the amount
collected during such month with respect to the Accounts Receivable. On or
before the fifteenth day after the end of the Collection Period, Buyer shall
furnish Sellers with a list of all of the Accounts Receivable which remain
uncollected at the end of the Collection Period.
(e) Further Obligations. After the expiration of the
Collection Period, Buyer shall have no further obligation hereunder other than
to make the payment under Section 6.4(b) and to remit to Sellers any payments
with respect to any of the Accounts Receivable that Buyer subsequently
receives, and Sellers may act to collect any of the Accounts Receivable that
continue to remain uncollected.
6.4 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 Sellers at all times prior to the Closing.
6.5 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 requirements of federal or state
securities laws and rules and regulations of securities markets, each party
will keep confidential any information of a confidential nature obtained from
the other party in connection with the transactions contemplated by this
Agreement. If this Agreement is terminated, each party will return to the
other party all information obtained by such party from the other party in
connection with the transactions contemplated by this Agreement.
6.6 Cooperation. Buyer and Sellers 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 Sellers shall execute such other documents as may be
necessary and desirable to the implementation and consummation of this
Agreement, and otherwise use their commercially reasonable 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
- 21 -
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, and Sellers
shall have no obligation to expend funds (other than the incidental cost of
preparing and submitting requests, responding to reasonable inquiries and
ordinary and customary filing fees and processing charges) to obtain any of the
Consents.
6.7 Bulk Sales Law. If applicable, the bulk sales law of the
State of Florida shall be complied with by Sellers. Any loss, liability,
obligation, or cost suffered by Sellers or Buyer as the result of the failure
of Sellers or Buyer to comply with the provisions of any bulk sales law
applicable to the transfer of the Assets as contemplated by this Agreement
shall be borne by Sellers.
6.8 Title Insurance and Surveys.
(f) Title Insurance. With respect to each parcel of Real
Property, Sellers will at Seller's sole cost obtain (1) as soon as practicable
after the date of this Agreement, a title commitment disclosing the condition
of title to all Real Property and all easements, rights of way, and
restrictions of record with respect thereto, as of a date not earlier than the
date of this Agreement, accompanied by copies of all instruments evidencing the
scope and extent of all such easements, rights of way, and restrictions of
record, and (2) at or prior to Closing, an ALTA Leasehold Policy of Title
Insurance on a form customarily used in the State of Florida, issued by a title
insurer satisfactory to Buyer, in an amount equal to the fair market value of
Sellers' leasehold interest (as reasonably determined by Buyer), insuring title
to such leasehold interest to be in the name of Buyer as of the Closing,
subject only to liens or encumbrances expressly permitted by this Agreement.
(g) General Requirements as to Title Insurance Policies.
Each title insurance policy obtained pursuant to this Agreement shall, except
to the extent that title insurers in the State of Florida are not lawfully
permitted to issue such policies or unless otherwise agreed by Buyer, (1)
insure title to the Real Property described in the policy and all recorded
easements benefitting such Real Property, (2) contain an "extended coverage
endorsement" or similar modification insuring over or otherwise eliminating the
general exceptions customarily contained in title policies, (3) contain an
endorsement insuring that the Real Property described in the policy is the same
real estate shown in the survey delivered with respect to such property and (4)
contain a "contiguity" endorsement with respect to any Real Property consisting
of more than one record parcel. At Buyer's expense, Sellers shall cause prior
to Closing all lease agreements included in the Real Property or memorandums of
lease relating thereto to be recorded in the appropriate public recording
office in the county where such Real Property is located.
(h) Surveys. With respect to each parcel of Real
Property, Sellers will cooperate with Buyer so that Buyer may obtain at Buyer's
sold expense as soon as practicable
- 22 -
after the date of this Agreement a current survey of the parcel, prepared by a
licensed surveyor and conforming to current ALTA Minimum Detail Requirements
for Land Title Surveys, disclosing the location of all improvements, easements,
party walls, sidewalks, roadways, utility lines, and other matters customarily
shown on such surveys, and showing access affirmatively to public streets and
roads.
(i) Associated Fees and Costs. Buyer shall be
responsible for and promptly pay all costs associated with obtaining the title
commitments and the surveys, and for the costs associated with obtaining the
title insurance policy with the special endorsements described above. If this
Agreement is terminated for any reason, Buyer shall not have any recourse
against Sellers for the expenses so incurred.
6.9 Access to Books and Records. Sellers shall provide Buyer
access and the right to copy for a period of three years from the Closing Date
any books and records relating to the Assets but not included in the Assets.
Buyer shall provide Sellers access and the right to copy for a period of three
years from the Closing Date any books and records relating to the Assets that
are included in the Assets.
6.10 Environmental Audit. Buyer may, at its option and sole
expense, retain an environmental consultant to be selected by Buyer to perform
a Phase I environmental survey of the properties of the Stations which survey
shall be commenced within ten days following the execution of this Agreement
and promptly completed thereafter. If the survey discloses any material
environmental hazard, or as a direct result thereof material possibility of
future liability for environmental damages or clean-up costs, Buyer shall so
notify Sellers as soon as practicable and shall promptly provide Sellers with a
copy of the Phase I environmental survey and all ancillary reports.
6.11 Engineering Study. Buyer may, at its option and sole expense,
retain an engineering firm to conduct a proof of performance study of the
Stations and to prepare a report on the Stations' compliance with applicable
FCC rules and regulations, which study shall be commenced within ten days
following the execution of this Agreement and promptly completed thereafter.
If the survey discloses any material violation of the FCC rules and regulations
relative to the operations or equipment of the Stations, Buyer shall so notify
Sellers as soon as practicable and shall promptly provide Sellers with a copy
of all such studies and reports.
6.12 Noncompetition Agreement. At Closing, Buyer, Sellers and
Seller's Shareholders shall enter into a Noncompetition Agreement in the form
of Schedule 6.12 and Buyer shall pay the amounts due thereunder.
SECTION 7 CONDITIONS TO OBLIGATIONS OF BUYER AND SELLERS AT
CLOSING
- 23 -
7.1 Conditions to Obligations of Buyer. All obligations of Buyer
at the Closing are subject at Buyer'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 Sellers 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.
(b) Covenants and Conditions. Sellers shall have
performed and complied in all material respects with all covenants, agreements,
and conditions required by this Agreement to be performed or complied with by
them prior to or on the Closing Date.
(c) Consents. All material Consents shall have been
obtained and delivered to Buyer without any material adverse change in the
terms or conditions of any License or Assumed Contract.
(d) FCC Consents. Each Seller shall have received FCC
consent to the assignment of the licenses or construction permits of Stations
I, II, VII, and IX, without the imposition on Sellers of any material adverse
conditions, and each consent shall have become a Final Order, unless "finality"
is waived by mutual agreement of the parties. The FCC Consent referred to in
Section 6.1 hereof shall have been granted without the imposition on Buyer of
any material adverse conditions that need not be complied with by Buyer under
Section 6.1 hereof, Sellers shall have complied with any conditions imposed on
them by the FCC Consent, and the FCC Consent shall have become a Final Order.
In the event the third parties selling Stations I, II, VII and IX to Sellers
insist on a Final Order prior to closing the acquisitions of the subject
stations, Buyer agrees with Seller to extend the Closing Date so that the
conditions in the contracts to acquire Stations I, II, VII and IX can be
complied with.
(e) Governmental Authorizations. Sellers shall be the
holders of all Licenses and there shall not have been any modification of any
License that could have a material adverse effect on any Station or the conduct
of its business and operations. No proceeding shall be pending with respect to
the Licenses to be assigned to Buyer the effect of which could be reasonably
expected to revoke, cancel, fail to renew, suspend, or modify adversely any
License. Buyer shall at Closing accept the license of Station VI subject to
any modifications that may result from the proceeding in MM Docket No. 95-82.
(f) Deliveries. Sellers 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 Date, there shall have been no material adverse change in the
assets or properties of the Stations, including any damage, destruction, or
loss affecting any assets used or useful in the
- 24 -
conduct of the business of the Stations that has not been repaired, restored or
remedied, excepting normal wear and tear to the Assets.
7.2 Conditions to Obligations of Sellers. All obligations of
Sellers at the Closing are subject at Sellers' 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.
(b) Covenants and Conditions. Buyer shall have performed
and complied in all material respects with all 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 Consents. Each Seller shall have received FCC
consent to the assignment of the licenses or construction permits of Stations
I, II, VII, and IX, without the imposition on Sellers of any material adverse
conditions, and each consent shall have become a Final Order, unless "finality"
is waived by mutual agreement of the parties. The FCC Consent referred to in
Section 6.1 hereof shall have been granted without the imposition on Seller of
any material adverse conditions that need not be complied with by Seller under
Section 6.1 hereof, Buyer shall have complied with any conditions imposed on it
by the FCC Consent, and the FCC Consent shall have become a Final Order. The
FCC Consent envisions multiple FCC actions, and the Closing Date shall be
determined from the date on which the last FCC consent is granted and becomes a
Final Order. In the event the third parties selling Stations I, II, VII and IX
to Sellers insist on a Final Order prior to closing the acquisitions of the
subject stations, Buyer will agree with Seller to extend the Closing Date so
that the conditions in the contracts to acquire Stations I, II, VII and IX can
be complied with.
SECTION 8 CLOSING AND CLOSING DELIVERIES
8.1 Closing.
(a) Closing Date. Subject to Sections 7.1(d) and 7.2(d)
hereof, 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 Sellers, that is (1) not earlier
than the first business day after the FCC Consent is granted, and (2) not later
than ten business days following the date upon which the last of the
- 25 -
multiple FCC actions comprising the FCC Consent has become a Final Order. If
Buyer fails to specify the date for Closing pursuant to the preceding sentence
prior to the fifth business day after the date upon which the FCC Consent
becomes a Final Order, the Closing shall take place on 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, 1200 New Hampshire Avenue, N.W., Suite 800,
Washington, D.C. 20036, or any other place that is agreed upon by Buyer and
Sellers.
8.2 Deliveries by Sellers. Prior to or on the Closing Date,
Sellers shall deliver to Buyer the following, in form and substance reasonably
satisfactory to Buyer and its counsel:
(a) Transfer Documents. Duly executed warranty bills of
sale, deeds, motor vehicle titles, 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 any claims, liabilities, security
interests, mortgages, liens, pledges, conditions, charges or encumbrances of
any nature whatsoever, except for liens for current taxes not yet due and
payable, and obligations assumed by Buyer under Section 2.4;
(b) Estoppel Certificates. Estoppel certificates of the
lessors of all leasehold and subleasehold interests included in the Real
Property including consents to the collateral assignment of such interests by
Buyer to its lenders as collateral security for Buyer's obligations to such
lenders;
(c) Consents. A manually executed copy of any instrument
evidencing receipt of any Consent;
(d) Certificate. A certificate, dated as of the Closing
Date, executed by duly authorized officers of Sellers on behalf of each Seller,
certifying (1) that the representations and warranties of each Seller 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 each Seller
has in all material respects performed and complied with all of their
obligations, covenants, and agreements set forth in this Agreement to be
performed and complied with on or prior to the Closing Date;
(e) Licenses, Contracts, Business Records, Etc. Copies
of all Licenses, Assumed Contracts, blueprints, schematics, working drawings,
plans, projections, engineering records, and all files and records used by
Sellers in connection with the operations of the Stations;
- 26 -
(f) Opinion of Counsel. Opinion of Sellers's counsel
dated as of the Closing Date, in substantially the form attached hereto as
Schedule 8.2(h), and if requested by Buyer, Buyer's lenders shall be permitted
to rely on such opinion;
(g) Lender's Certificate. If requested by Buyer, and at
Buyer's expense, Sellers shall deliver to Buyer's lenders such closing
certificates as Buyer's lenders may reasonably request;
(h) Noncompetition Agreement. The executed
Noncompetition Agreement in the form of Schedule 6.12; and
(i) Other Instruments. Such other instruments and
certificates or other documentation as Sellers are required by the terms hereof
to deliver or as Buyer may reasonably request.
8.3 Deliveries by Buyer. Prior to or on the Closing Date, Buyer
shall deliver to Sellers the following, in form and substance reasonably
satisfactory to Sellers and their counsel:
(a) Purchase Price. The Purchase Price as provided in
Section 2.3;
(b) Assumption Agreements. Appropriate assumption
agreements pursuant to which Buyer shall assume and undertake to perform all
obligations and liabilities of Sellers under the Licenses and Assumed Contracts
insofar as they relate to the time on or after the Closing Date and arise out
of events related to Buyer's ownership of the Assets or its operation of the
Stations on or after the Closing Date;
(c) Certificate. A certificate, dated as of the Closing
Date executed by an officer of the general partner of Buyer on behalf of Buyer,
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 of Buyer's counsel
dated as of the Closing Date substantially in the form of Schedule 8.3(d)
hereof;
(e) Other Instruments. Such other instruments and
certificates or other documentation as Buyer is required by the terms hereof to
deliver or as Sellers may reasonably request; and
- 27 -
(f) Noncompetition Agreement. The executed
Noncompetition Agreement in the form of Schedule 6.12 and the portion of the
Purchase Price allocated thereto.
SECTION 9 TERMINATION
9.1 Termination by Sellers. This Agreement may be terminated by
Sellers and the purchase and sale of the Stations abandoned, if Sellers are 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 Sellers
set forth in this Agreement have not been satisfied or waived in writing by
Sellers.
(b) Judgments. If there shall be in effect on the date
that would otherwise be the Closing Date any judgment, decree, or order that
would prevent or make unlawful the Closing.
(c) Upset Date. If the Closing shall not have occurred
by January 31, 1997.
(d) Breach. Without limiting Sellers' rights under the
other provisions of this Section 9.1, if Buyer has failed to cure any material
breach of any of its representations, warranties, or covenants under this
Agreement within fifteen days after Buyer received written notice of such
breach from Sellers.
(e) Hearing. If the FCC designates for an evidentiary
hearing any of the applications referred to in Section 5.6 including the
applications by which Sellers will acquire Stations I, II, VII and IX.
9.2 Termination by Buyer. This Agreement may be terminated by
Buyer and the purchase and sale of the Stations abandoned, if Buyer is not then
in material default, upon written notice to Sellers, 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, decree, or order that
would prevent or make unlawful the Closing.
(c) Upset Date. If the Closing shall not have occurred
by January 31, 1997.
- 28 -
(d) Interruption of Service. If any event shall have
occurred that prevented signal transmission of any of the Stations for a
continuous period of five (5) days, or in the normal and usual manner for a
continuous period of fifteen (15) days.
(e) Breach. Without limiting Buyer's rights under the
other provisions of this Section 9.2, if Sellers have failed to cure any
material breach of any of their representations, warranties, or covenants under
this Agreement within fifteen days after Sellers received written notice of
such breach from Buyer.
(f) Environmental Hazards. Buyer shall have notified in
writing Sellers of material environmental hazards or the material possibility
of environmental damages or cleanup costs, as indicated in the environmental
study described in Section 6.10, within 20 days following the execution of
this Agreement, and the cause thereof shall not have been remedied prior to the
Closing Date, Sellers having no obligation to perform such remediation. If
Buyer does not timely notify Sellers of said environmental hazards, damages, or
clean-up costs, Buyer shall be deemed to have waived any claim against Sellers
on account of any such hazards, damages, or clean-up costs no matter when they
may arise.
(g) Technical Deficiencies. Buyer shall have notified
Sellers of material deficiencies in the operations or equipment of the
Stations, as indicated in the engineering study described in Section 6.11,
within 20 days following the execution of this Agreement, and the cause thereof
shall not have been remedied prior to the Closing Date, Sellers having no
obligation to perform such remediation. If Buyer does not timely notify
Sellers of said material deficiencies, Buyer shall be deemed to have waived any
claim against Sellers on account of any such deficiencies no matter when they
may arise.
(h) Assignment Application. The refusal by the FCC to
approve on delegated authority any of the assignment applications referenced in
Section 5.6 hereof.
9.3 Escrow Deposit. Simultaneously with the execution and
delivery of this Agreement, Buyer has deposited with the Escrow Agent
$1,000,000 (the "Escrow Deposit") in accordance with an Escrow Agreement among
Buyer, Sellers, and the Escrow Agent (the "Escrow Agreement") in the form
attached hereto as 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 Buyer
so long as Buyer has paid Seller the Purchase Price as provided in Section
2.3(a).
- 29 -
(b) If this Agreement is terminated pursuant to Section
9.1 or Section 9.2 and Buyer has complied in all material respects with the
terms 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 Sellers due to
Buyer's material breach of this Agreement, and Sellers are not in material
breach of this Agreement, then the Escrow Deposit together with all interest
earned thereon shall be disbursed by the Escrow Agent to or at the direction of
Sellers.
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 Sellers due to Buyer's material
breach of this Agreement and Sellers are not in material breach of this
Agreement, then the payment to Sellers pursuant to Section 9.3(c) shall be
liquidated damages and shall constitute full payment and the exclusive remedy
for any damages suffered by Sellers by reason of Buyer's material breach of
this Agreement. Sellers and Buyer agree in advance that actual damages would
be difficult to ascertain and that the amount of the Escrow Deposit is a fair
and equitable amount to reimburse Sellers for damages sustained due to Buyer's
material breach of this Agreement. Notwithstanding Buyer's rights under
Section 10.5 hereof, if this Agreement is terminated by Buyer due to Sellers'
material breach of this Agreement, and if Buyer has complied with all material
terms of this Agreement, Buyer shall be entitled only to damages as awarded
pursuant to the procedures set forth in Section 11.3 of this Agreement
(Arbitration).
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
eighteen months. Any investigations by or on behalf of any party hereto shall
not constitute a waiver as to enforcement of any representation, warranty, or
covenant contained in this Agreement. No notice or information delivered by
Sellers shall affect Buyer's right to rely on any representation or warranty
made by Sellers or relieve Sellers of any obligations under this Agreement as
the result of a breach of any of their representations and warranties.
10.2 Indemnification by Sellers. Notwithstanding the Closing, and
regardless of any investigation made at any time by or on behalf of Buyer or
any information Buyer may have,
- 30 -
Sellers hereby agree to indemnify and hold Buyer harmless against and with
respect to, and shall reimburse Buyer for:
(a) Any and all losses, liabilities, or damages resulting
from any untrue representation, breach of warranty, or nonfulfillment of any
covenant by Sellers contained in this Agreement or in any certificate,
document, or instrument delivered to Buyer under this Agreement.
(b) Any and all obligations of Sellers 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 loss, liability, obligation, or cost resulting
from the failure of the parties to comply with the provisions of any bulk sales
law applicable to the transfer of the Assets.
(d) Any and all losses, liabilities, or damages resulting
from the operation or ownership of the Stations prior to the Closing, including
any liabilities arising under the Licenses or the Assumed Contracts which
relate to events occurring prior the Closing Date.
(e) 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. Notwithstanding the Closing, and
regardless of any investigation made at any time by or on behalf of Sellers or
any information Sellers may have, Buyer hereby agrees to indemnify and hold
Sellers harmless against and with respect to, and shall reimburse Sellers for:
(a) Any and all losses, liabilities, or damages resulting
from any untrue representation, breach of warranty, or nonfulfillment of any
covenant by Buyer contained in this Agreement or in any certificate, document,
or instrument delivered to Sellers under this Agreement.
(b) Any and all obligations of Sellers assumed by Buyer
pursuant to this Agreement.
(c) Any and all losses, liabilities, or damages resulting
from the operation or ownership of the Stations 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.
- 31 -
(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 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
or its authorized representatives the information relied upon by the Claimant
to substantiate the claim. If the Claimant and the Indemnifying Party agree at
or prior to the expiration of the thirty-day period (or any mutually agreed
upon extension thereof) to the validity and amount of such claim, the
Indemnifying Party shall immediately pay to the Claimant the full amount of the
claim. 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
actual out-of-pocket expenses incurred by the Claimant as the result of a
request by the Indemnifying Party. If the Indemnifying Party elects to assume
control of the defense of any third-party claim, the Claimant shall have the
right to participate in the defense of such claim at its own expense. If the
Indemnifying Party does not elect to assume control or otherwise participate in
the defense of any third party claim, 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.
- 32 -
(e) The indemnifications rights provided in Sections 10.2
and 10.3 shall extend to the shareholders, directors, officers, employees,
representatives and successors and assigns 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.
10.5 Specific Performance. The parties recognize that if Sellers
breach this Agreement and refuse 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, in addition to any other
remedies that may be available, including money damages, to obtain specific
performance of the terms of this Agreement. If any action is brought by Buyer
to enforce this Agreement, Sellers shall waive the defense that there is an
adequate remedy at law.
10.6 Attorneys' Fees. In the event of a default by either party
which results in a 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. Buyer shall pay any escrow agent fees
under the Escrow Agreement. Sellers shall pay on or before Closing the
brokers' fee due to Media Venture Partners in connection with the transactions
contemplated by this Agreement. Any federal, state, or local sales or transfer
tax arising in connection with the conveyance of the Assets by Sellers to Buyer
pursuant to this Agreement shall be paid by Sellers. Buyer and Sellers shall
each pay one-half of (i) the fees payable to the FCC in connection with the
filing of the applications for the 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 Adjustments and Pro-Rations.
(a) The operating income and expenses of the Stations
shall be prorated between Buyer and Sellers as of 12:01 a.m. on the Closing
Date, and the net amount thereof shall be paid to Sellers or the Buyer as
appropriate at the Closing as an adjustment of the Purchase Price. Such
prorations shall include, without limitation, all ad valorem, real estate, and
other property taxes, water and sewer use charges, business and license fees,
pre-paid fees and expenses, rents, utility expenses, Assumed Contracts, prepaid
trade and barter agreements, prepaid time sale agreements, but shall exclude
(i) wages, salaries, bonuses, accrued vacation and sick pay, and any other
obligations of Sellers to its employees, other
- 33 -
than pursuant to such employment agreements, if any, that constitute Assumed
Contracts, (ii) all of the liabilities assumed pursuant to Section 2.4 hereof,
(iii) legal and professional fees and closing costs; (iv) financing costs,
capital expenditures, and other costs and expenses not pertaining to the
day-to-day operations of the Stations. Revenues, expenses, costs and
liabilities earned or incurred in particular programs and announcements shall
be allocated to the time of performance of such programs and announcements
without regard to the date of payment therefor. However, Sellers shall be
entitled to all income, and shall be responsible for all expenses, arising out
of contracts, agreements and commitments to which Seller is a party other than
the Assumed Contracts. Seller shall provide Buyer with an itemized statement
evidencing all proposed adjustments not less than five (5) business days prior
to the Closing Date.
(b) If the amount of any of the aforesaid taxes is not
known on the Closing Date, the same shall be apportioned on the basis of taxes
assessed for the preceding year, with a reapportionment as soon as the new tax
rate and valuation can be ascertained; and, if the taxes which are to be
apportioned shall thereafter be reduced by abatement, the amount of such
abatement, less the reasonable cost of obtaining the same, shall also be
apportioned between Buyer and Sellers, provided that no party shall be
obligated to institute proceedings for an abatement. All other prorations
shall, to the extent feasible, be determined and paid on the Closing Date, with
a final settlement thereof to be made within sixty (60) days after the Closing
Date.
(c) Any item for which a party receives credit from the
other party under this Section 11.2 shall be paid when due in accordance with
its terms by the party so receiving credit.
11.3 Arbitration. Except as otherwise provided to the contrary
below, any dispute arising out of or related to this Agreement that Sellers and
Buyer are unable to resolve by themselves shall be settled by arbitration in
the District of Columbia, by a panel of three arbitrators. Sellers 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 Sellers and Buyer. The costs and expenses of the
arbitration proceeding shall be assessed between Sellers 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 Sellers or Buyer against the other except (i) an action to compel
arbitration pursuant
- 34 -
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.
11.4 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 forth in
the records of the delivery service or on the return receipt, and (d) addressed
as follows:
If to Sellers: Mr. Paul C. Stone
WSNI Radio
3360 Capital Circle, N.E.
Suite D
Tallahassee, Florida 32308
Mr. Charles E. Giddens
Media Venture Partners
1650 Tysons Boulevard
Suite 790
McLean, Virginia 22102
Mr. R. Sanders Hickey
WTNT, Inc.
c/o Radio Station
WGMG(FM)
1137 Cedar Shoals Drive
Athens, Georgia 30605
With a copy to: (which shall not Mark S. Levine, Esquire
constituted notice) Levine & Stivers
245 E. Virginia Street
Tallahassee, Florida 32301
Gary S. Smithwick, Esquire
Smithwick & Belendiuk, P.C.
1990 M Street, N.W.
Suite 510
Washington, D.C. 20036
- 35 -
If to Buyer: Paxson Broadcasting of Tallahassee,
Limited Partnership
601 Clearwater Park Road
West Palm Beach, Florida 33401
Attention: Mr. Lowell W. Paxson
With a copy to: John R. Feore, Jr., Esquire
Dow, Lohnes & Albertson
1200 New Hampshire Avenue, N.W.
Suite 800
Washington, D.C. 20036
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
11.5.
11.5 Benefit and Binding Effect. Neither party hereto may assign
this Agreement without the prior written consent of the other party hereto,
which shall not be unreasonably withheld, except that Buyer may assign its
rights and obligations under this Agreement, in whole or in part, without
Sellers' consent to one or more subsidiaries or commonly controlled affiliates
of Buyer and Buyer may collaterally assign its rights and obligations hereunder
to its lenders without obtaining Sellers' consent, provided that any such
assignments do not delay the FCC Consent. Upon any permitted assignment by
Buyer or Sellers in accordance with this Section 11.5, all reference to "Buyer"
herein shall be deemed to be references to Buyer's assignee and all references
to "Sellers" herein shall be deemed to be references to Sellers' assignee.
This Agreement shall be binding upon and inure to the benefit of the parties
hereto and their respective successors and permitted assigns.
11.6 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
Sellers, any additional bills of sale, deeds, or other transfer documents that,
in the reasonable opinion of Buyer, may be necessary to ensure, complete, and
evidence the full and effective transfer of the Assets to Buyer pursuant to
this Agreement.
11.7 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).
- 36 -
11.8 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.
11.9 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.
11.10 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 Sellers with respect to the subject matter hereof. This
Agreement supersedes all prior negotiations among the parties, including,
without limitation, the letter of intent among the parties hereto dated
February 23, 1996, 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. The parties hereto acknowledge that no
representations or warranties have been made with respect to matters relating
to the transactions contemplated by this Agreement other than as expressly set
forth in this Agreement.
11.11 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 parry 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 11.12.
11.12 Counterparts. This Agreement may be signed in counterparts
with the same effect as if the signature on each counterpart were upon the same
instrument.
11.13 Press Releases. Neither party shall publish any press
release, make any other public announcement or otherwise communicate with any
news media concerning this Agreement or the transactions contemplated hereby
without the prior written consent of the other party; provided, however, that
nothing contained herein shall prevent either party from promptly making all
filings with governmental authorities as may, in its judgment, be
- 37 -
required or advisable in connection with the execution and delivery of this
Agreement or the consummation of the transactions contemplated hereby, in which
case the other party shall be first notified in writing.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
- 38 -
| EX-10.111 | Last Page of 40 | TOC | 1st | Previous | Next | ↓Bottom | Just 40th |
|---|
IN WITNESS WHEREOF, the parties hereto have duly executed this Asset
Purchase Agreement as of the day and year first above written.
PAXSON COMMUNICATIONS OF TALLAHASSEE, INC.
By: /s/ Lowell W. Paxson
-------------------------------------------
Name: Lowell W. Paxson
Title: Chairman and Chief Executive Officer
WTNT, INC.
By: /s/ R. Sanders Hickey
-------------------------------------------
Name: R. Sanders Hickey
Title: President
SOUTHERN BROADCASTING COMPANIES, INC.
By: /s/ Paul Stone
-------------------------------------------
Name: Paul Stone
Title: President
GREAT SOUTH BROADCASTING, INC.
By: /s/ Paul Stone
-------------------------------------------
Name: Paul Stone
Title: President
CHARLES E. GIDDENS, INC.
By: /s/ Charles E. Giddens
-------------------------------------------
Name: Charles E. Giddens
Title:
SOUTHERN BROADCASTING OF PENSACOLA, INC.
By: /s/ Paul Stone
-------------------------------------------
Name: Paul Stone
Title: President
Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
|---|
| This ‘10-Q’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 1/31/97 | | 29 |
| Filed on: | | 8/13/96 |
| For Period End: | | 6/30/96 |
| | 4/29/96 | | 2 |
| | 4/22/96 | | 1 |
| | 2/23/96 | | 38 |
| | 12/31/95 | | 10 | | 14 | | | 10-K |
| 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, 9:39:15.1pm ET 