Document/Exhibit Description Pages Size
1: 10-Q Paxson Communications, Inc. Form 10-Q 21 142K
13: EX-10.100 Asset Purchase Agreement 40 175K
14: EX-10.101 Asset Purchase Agreement 41 177K
15: EX-10.102 Asset Purchase Agreement 45 190K
16: EX-10.103 Construction Agreement 9 37K
17: EX-10.104 Loan Agreement 29 120K
18: EX-10.105 Asset Purchase Agreement 44 184K
19: EX-10.106 Asset Purchase Agreement 42 176K
20: EX-10.107 Agreement and Plan of Merger 34 110K
21: EX-10.107.01 First Amendment to Agreement and Plan of Merger 3 17K
22: EX-10.108 Asset Purchase Agreement 41 174K
23: EX-10.109 Option Agreement 9 35K
24: EX-10.110 Subordinated Note 13 50K
25: EX-10.111 Asset Purchase Agreement 40 142K
26: EX-10.112 Asset Purchase Agreement 40 169K
27: EX-10.113 Time Brokerage Agreement 28 96K
28: EX-10.114 Purchase Agreement 17 63K
29: EX-10.115 Asset Purchase Agreement 32 138K
30: EX-10.116 Asset Purchase Agreement 32 148K
31: EX-10.117 Asset Purchase Agreement 32 144K
32: EX-10.118 Asset Purchase Agreement 33 147K
33: EX-10.119 Time Brokerage Agreement 16 70K
34: EX-10.120 Loan Agreement 28 109K
35: EX-10.121 Second Amendment to Asset Purchase Agreement 6 22K
36: EX-10.122 Asset Purchase Agreement 41 180K
37: EX-10.123 Asset Purchase Agreement 94 303K
38: EX-10.124 Loan Agreement 52 170K
39: EX-10.125 Time Brokerage Agreement 28 98K
40: EX-10.126 Option Agreement 18 64K
2: EX-10.89 Amended as Restated Promissory Note 6 25K
3: EX-10.90 First Anemdment to Loan Agreement 2 15K
4: EX-10.91 Asset Purchase Agreement 15 73K
5: EX-10.92 Asset Purchase Agreement 41 174K
6: EX-10.93 The Brokerage Agreement 29 97K
7: EX-10.94 Asset Purchase Agreement 38 173K
8: EX-10.95 First Amendment 2 15K
9: EX-10.96 Promissory Note 4 21K
10: EX-10.97 Stock Purchase Agreement 42 199K
11: EX-10.98 Asset Purchase Agreement 42 178K
12: EX-10.99 Asset Purchase Agreement 42 177K
41: EX-27 Financial Data Schedule (For SEC Use Only) 1 12K
EXHIBIT 10.108
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ASSET PURCHASE AGREEMENT
BY AND AMONG
PAXSON COMMUNICATIONS OF TALLAHASSEE, INC.,
B. RADIO, INC.,
AND
BOSS RADIO GROUP, INC.
FOR
RADIO STATIONS
WGNE-AM, PANAMA CITY, FLORIDA
WFSY-FM, PANAMA CITY, FLORIDA
AND
WEBZ-FM, MEXICO BEACH, FLORIDA
MAY 13, 1996
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TABLE OF CONTENTS
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SECTION 1 DEFINITIONS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Accounts Receivable" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Assets" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
"Assumed Contracts" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Closing" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Closing Date" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Consents" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Contracts" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Escrow Agent" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Escrow Agreement" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"FCC" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"FCC Consent" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"FCC Licenses" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Final Order" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
"Intangibles" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Licenses" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Purchase Price" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Real Property" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"Tangible Personal Property" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"WMTO" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
"WMTO Asset Purchase Agreement" . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2 PURCHASE AND SALE OF ASSETS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.1 Agreement to Sell and Buy . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.2 Excluded Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.3 Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
(b) Gross Revenue Adjustment. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
2.4 Payment of Purchase Price . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
2.5 Assumption of Liabilities and Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
SECTION 3 REPRESENTATIONS AND WARRANTIES OF SELLERS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.1 Organization, Standing, and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.2 Authorization and Binding Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.3 Absence of Conflicting Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.4 Governmental Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.5 Title to and Condition of Real Property . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
3.6 Title to and Condition of Tangible Personal Property . . . . . . . . . . . . . . . . . . . . . . . . . . 8
3.7 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
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3.8 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.9 Intangibles . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.10 Financial Statements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
3.11 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.12 Reports . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.13 Personnel . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
3.14 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.15 Claims and Legal Actions . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
3.16 Environmental Matters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
3.17 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.18 Conduct of Business in Ordinary Course . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
3.19 Transactions with Affiliates . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.20 Broker . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
3.21 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 14
SECTION 4 REPRESENTATIONS AND WARRANTIES OF BUYER . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.1 Organization, Standing, and Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.2 Authorization and Binding Obligation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.3 Absence of Conflicting Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.4 Broker . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
4.5 Full Disclosure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 15
SECTION 5 OPERATIONS OF THE STATIONS PRIOR TO CLOSING . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.1 Generally . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.2 Compensation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.3 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.4 Disposition of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.5 Encumbrances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.6 Licenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.7 Rights . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 16
5.8 No Inconsistent Action . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.9 Access to Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.10 Maintenance of Assets . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.11 Insurance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.12 Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 17
5.13 Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
5.14 Notification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
5.15 Financial Information . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
5.16 Compliance with Laws . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
5.17 Financing Leases . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
5.18 Programming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
5.19 Preservation of Business . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 18
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5.20 Collection of Accounts Receivable . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
5.21 Personnel Recommendations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
SECTION 6 SPECIAL COVENANTS AND AGREEMENTS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.1 FCC Consent . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.2 Control of the Station . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 19
6.3 Risk of Loss . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.4 Confidentiality . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.5 Environmental Audit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.6 Engineering Study . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 20
6.7 Cooperation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.8 Bulk Sales Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.9 Title Insurance and Surveys . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 21
6.10 Sales Tax Filings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.11 Access to Books and Records . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.12 Appraisal . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
6.13 Noncompetition Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
SECTION 7 CONDITIONS TO OBLIGATIONS OF BUYER AND SELLERS AT CLOSING . . . . . . . . . . . . . . . . . . . . . 22
7.1 Conditions to Obligations of Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 22
7.2 Conditions to Obligations of Sellers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 23
SECTION 8 CLOSING AND CLOSING DELIVERIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
8.1 Closing . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
8.2 Deliveries by Sellers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 24
8.3 Deliveries by Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 25
SECTION 9 TERMINATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
9.1 Termination by Sellers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
9.2 Termination by Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 26
9.3 Rights on Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
9.4 Escrow Deposit . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 27
SECTION 10 SURVIVAL OF REPRESENTATIONS AND WARRANTIES; INDEMNIFICATION; CERTAIN REMEDIES . . . . . . . . . . . 28
10.1 Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
10.2 Indemnification by Sellers . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 28
10.3 Indemnification by Buyer . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
10.4 Procedure for Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 29
10.5 Specific Performance . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 30
10.6 Attorneys' Fees . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
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SECTION 11 MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
11.1 Fees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
11.2 Arbitration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 31
11.3 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
11.4 Benefit and Binding Effect . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 32
11.5 Further Assurances . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.6 Governing Law. . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.7 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.8 Gender and Number . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.9 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.10 Waiver of Compliance; Consents . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 33
11.11 Press Release . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
11.12 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 34
iv
LIST OF SCHEDULES
[Download Table]
Schedule 2.2 -- Excluded Property
Schedule 3.3 -- Consents
Schedule 3.4 -- Licenses
Schedule 3.5 -- Real Property
Schedule 3.6 -- Tangible Personal Property
Schedule 3.7 -- Contracts
Schedule 3.9 -- Intangibles
Schedule 3.10 -- Financial Matters
Schedule 3.11 -- Insurance Policies
Schedule 3.13 -- Employee Matters
Schedule 3.15 -- Claims
Schedule 3.19 -- Transactions with Affiliates
Schedule 6.13 -- Form of Noncompetition Agreement
Schedule 8.2(i) -- Form of Opinions of Seller's Counsel
Schedule 8.3(d) -- Form of Opinion of Buyer's Counsel
v
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT is dated as of the 13th day of May, 1996,
by and among Paxson Communications of Tallahassee, Inc., a Florida corporation
("Buyer"), B. Radio, Inc., a Florida corporation ("BR"), and Boss Radio Group,
Inc., a Florida corporation ("BRG") (BR and BRG shall be referred to herein
individually as a "Seller" and collectively as the "Sellers").
RECITALS
A. BR is the licensee of and owns and operates radio stations WGNE-AM,
Panama City, Florida and WFSY-FM, Panama City, Florida (the "BR Stations") and
BRG is the licensee of and owns and operates radio station WEBZ-FM, Mexico
Beach, Florida (the "BRG Station" and together with the BR Stations,
individually, a "Station" and collectively, the "Stations"), pursuant to
licenses issued by the Federal Communications Commission (the "FCC").
B. Sellers desire to sell, and Buyer desires 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 or program time run on the Stations by Sellers prior to the
Closing Date.
"Assets" means the assets to be sold, transferred, or otherwise
conveyed to Buyer under this Agreement, as specified in Section 2.1.
"Assumed Contracts" means (i) all Contracts listed in Schedule 3.7 that
are specifically designated on Schedule 3.7 as Contracts that are to be assumed
by Buyer upon its purchase of the Stations, (ii) any Contracts entered into by
any Seller between the date of this Agreement and the Closing Date that Buyer
agrees in writing to assume, and (iii) time sales contracts entered into by any
Seller 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 any Seller is a party or which are binding upon any Seller and
which relate to or affect the Assets or the business or operations of the
Stations, and (i) which are in effect on the date of this Agreement or (ii)
which are entered into by any Seller between the date of this Agreement and the
Closing Date.
"Escrow Agent" means First Union National Bank of Florida.
"Escrow Agreement" means the Escrow Agreement dated as of the date
hereof among Buyer, Sellers and the Escrow Agent.
"FCC" means the Federal Communications Commission.
"FCC Consent" means action by the FCC granting its consent to the
assignment of the FCC Licenses to Buyer as contemplated by this Agreement.
"FCC Licenses" means all Licenses issued by the FCC to any Seller 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.
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"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 any Seller or under which any Seller is 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 Federal Aviation Administration, or any other federal,
state, or local governmental authorities to any Seller 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 all real property and interests in real
property, including fee estates, leaseholds and subleaseholds, purchase
options, easements, licenses, rights to access, and rights of way, and all
buildings and other improvements thereon, and other real property interests
which are used or useful in the business or operations of the Stations,
together with any additions thereto between the date of this Agreement and the
Closing Date.
"Tangible Personal Property" means all machinery, equipment, tools,
vehicles, furniture, leasehold improvements, office equipment, plant,
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.
"WMTO" means radio station WMTO-FM, Port St. Joe, Florida.
"WMTO Asset Purchase Agreement" means that certain Asset Purchase
Agreement, by and between DP Media, Inc. and Transportation Group
International, Inc. relating to the sale of WMTO.
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, all of the
tangible and intangible assets used or useful 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, but excluding the
assets described in Section 2.2, free and clear of any claims, liabilities,
security interests,
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mortgages, liens, pledges, conditions, charges, or encumbrances of any nature
whatsoever (except for 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;
(e) The Accounts Receivable as of 11:59 p.m., Panama City
time, on the day prior to the Closing Date;
(f) 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;
(g) 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;
(h) All choses in action of Sellers relating to the Stations;
and
(i) All books and records relating to the business or
operations of the Stations, including executed copies of the Assumed Contracts,
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; and any stocks, bonds, certificates of deposit and similar
investments;
(b) All books and records that Sellers are required by law to
retain and that pertain to Sellers' corporate organization;
(c) Any pension, profit-sharing, or employee benefit plans,
and any collective bargaining agreements; and
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(d) All property listed on Schedule 2.2 hereto.
2.3 Purchase Price. The Purchase Price for the Assets and the
covenants of Sellers set forth in the Noncompetition Agreement referred to in
Section 6.13 shall be TWO MILLION EIGHT HUNDRED FIFTY THOUSAND DOLLARS
($2,850,000) adjusted as provided below:
(a) Prorations. The Purchase Price shall be increased or
decreased as required to effectuate the proration of expenses. All expenses
arising from the operation of the Stations, including business and license
fees, utility charges, real and personal property taxes and assessments levied
against the Assets, property and equipment rentals, applicable copyright or
other fees, sales and service charges, taxes (except for taxes arising from the
transfer of the Assets under this Agreement), FCC annual regulatory fees and
similar prepaid and deferred items, shall be prorated between Buyer and Sellers
in accordance with the principle that Sellers shall be responsible for all
expenses, costs, and liabilities allocable to the period prior to the Closing
Date, and Buyer shall be responsible for all expenses, costs, and obligations
allocable to the period on and after the Closing Date. Notwithstanding the
preceding sentence, there shall be no adjustment for, and Sellers shall remain
solely liable with respect to, any Contracts not included in the Assumed
Contracts and any other obligation or liability not being assumed by Buyer in
accordance with Section 2.5.
(b) Gross Revenue Adjustment. The Purchase Price shall
be decreased by 2.375 times the amount, if any, by which the gross revenue of
the Stations and WMTO for the latest period of twelve consecutive calendar
months ending at least twenty days prior to the Closing Date is less than
$1,200,000; provided, however, that the sum of (i) the Purchase Price payable
under this Agreement, as reduced pursuant to this Section 2.3(b), and (ii) the
Purchase Price payable under the WMTO Asset Purchase Agreement, shall in no
event be less than $3,100,000 prior to any adjustments to the Purchase Price
under Section 2.3(a) of this Agreement and of the WMTO Asset Purchase
Agreement.
(c) Manner of Determining Adjustments. Any adjustments
will, insofar as feasible, be determined and paid on the Closing Date, with
final settlement and payment by the appropriate party occurring no later than
ninety (90) days after the Closing Date or such other date as the parties shall
mutually agree upon. Sellers shall prepare and deliver to Buyer not later than
five (5) days before the Closing Date a preliminary settlement statement which
shall set forth Sellers' good faith estimate of the adjustments to the Purchase
Price under Sections 2.3(a) and (b). The preliminary settlement statement (i)
shall contain all information reasonably necessary to determine the adjustments
to the Purchase Price under Sections 2.3(a) and (b), to the extent such
adjustments can be determined or estimated as of the date of the preliminary
settlement statement, and such other information as may be reasonably requested
by Buyer, and (ii) shall be certified by Sellers to be true and complete in all
material respects as of the date thereof.
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2.4 Payment of Purchase Price. The Purchase Price, as adjusted,
shall be paid by Buyer to Sellers at Closing by wire transfer of same-day funds
pursuant to wire instructions which shall be delivered by Sellers to Buyer at
least two (2) days prior to the Closing Date.
2.5 Assumption of Liabilities and Obligations. As of the Closing
Date, Buyer shall assume and undertake to pay, discharge, and perform all
obligations and liabilities of 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 not assume any other
obligations or liabilities of any Seller, 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 any Station prior to the Closing, (iv)
any obligations or liabilities arising under capitalized leases or other
financing agreements, (v) any obligations or liabilities arising under
agreements entered into other than in the ordinary course of business, (vi) any
obligations or liabilities of any Seller under any employee pension,
retirement, health and welfare or other benefit plans or collective bargaining
agreements, (vii) any obligation to any employee of any Station for severance
benefits, vacation time, or sick leave accrued prior to the Closing Date, and
(viii) any obligations or liabilities caused by, arising out of, or resulting
from any action or omission of any Seller prior to the Closing, and all such
obligations and liabilities shall remain and be the obligations and liabilities
solely of Sellers.
SECTION 3 REPRESENTATIONS AND WARRANTIES OF SELLERS
Each Seller jointly and severally represents and warrants to Buyer as
follows:
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. Such Seller has 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, the Escrow Agreement and the
documents contemplated hereby and thereby, and to perform and comply with all
of the terms, covenants, and conditions to be performed and complied with by
such Seller hereunder and thereunder. Neither 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 and the Escrow Agreement by each Seller have
been duly authorized by all necessary actions on the part of such Seller and
its shareholder. This Agreement and the
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Escrow Agreement have been duly executed and delivered by such Seller and
constitute the legal, valid, and binding obligations of such Seller,
enforceable against it in accordance with their respective terms except as the
enforceability of this Agreement and the Escrow Agreement may be affected by
bankruptcy, insolvency, or similar laws affecting creditors' rights generally,
and by judicial discretion in the enforcement of equitable remedies.
3.3 Absence of Conflicting Agreements. Subject to obtaining the
Consents listed on Schedule 3.3, the execution, delivery, and performance of
this Agreement and the Escrow Agreement and the documents contemplated hereby
and thereby (with or without the giving of notice, the lapse of time, or both):
(i) do not require the consent of any third party; (ii) will not conflict with
any provision of the Certificate of Incorporation or Bylaws of any Seller;
(iii) will not conflict with, result in a breach of, or constitute a default
under, any law, judgment, order, ordinance, injunction, decree, rule,
regulation, or ruling of any court or governmental instrumentality; (iv) will
not conflict with, constitute grounds for termination of, result in a breach
of, constitute a default under, or accelerate or permit the acceleration of any
performance required by the terms of, any agreement, instrument, license, or
permit to which any Seller is a party or by which any Seller may be bound; and
(v) will not create any claim, liability, mortgage, lien, pledge, condition,
charge, or encumbrance of any nature whatsoever upon any of the Assets.
3.4 Governmental Licenses. Schedule 3.4 includes a true and complete
list of the 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 each Seller as indicated on Schedule
3.4 is the authorized legal holder thereof. The Licenses listed on Schedule
3.4 comprise all of the licenses, permits, 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 full extent
they are now conducted, and none of the Licenses is subject to any restriction
or condition that would limit the full operation of the Stations as now
operated. The Licenses are in full force and effect, and the conduct of the
business and operations of the Stations is in accordance therewith. Neither
Seller has any reason to believe that any of the Licenses would not be renewed
by the FCC or other granting authority in the ordinary course.
3.5 Title to and Condition of Real Property. 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. Except as described
in Schedule 3.5, Sellers have good and marketable fee simple title to all fee
estates included in the Real Property and have good title to all other
interests included in the Real Property, free and clear of all liens,
mortgages, pledges, covenants, easements, encroachments, leases, charges and
other claims and encumbrances, except liens for taxes not
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yet due and payable. With respect to each leasehold or subleasehold interest
included in the Real Property being conveyed under this Agreement so long as
each Seller fulfills its obligations under the lease therefor, such Seller has
enforceable rights to nondisturbance and quiet enjoyment, and no third party
holds any interest in the leased premises with the right to foreclose upon such
Seller's leasehold or subleasehold interest. All towers, guy anchors, and
buildings and other improvements included in the Assets are located entirely on
the Real Property listed in Schedule 3.5. All Real Property (including the
improvements thereon) (i) is in good condition and repair consistent with its
present use, (ii) is available for immediate use in the conduct of the business
and operations of the Stations, and (iii) complies with all applicable building
or zoning codes and the regulations of any governmental authority having
jurisdiction. Each Seller has full legal and practical access to the Real
Property. All easements, rights-of-way, and real property licenses have been
properly recorded in the appropriate public recording offices.
3.6 Title to and Condition of Tangible Personal Property. Schedule
3.6 lists all material items of Tangible Personal Property. The Tangible
Personal Property listed on Schedule 3.6 comprises all material items of
tangible personal property necessary to conduct the business and operations of
the Stations as now conducted. 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 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
stations used in connection with the operation of the Stations to operate in
accordance with the terms of the FCC Licenses and the rules and regulations of
the FCC, and with all other applicable federal, state, and local statutes,
ordinances, rules, and regulations.
3.7 Contracts. Schedule 3.7 is a true and complete list of all
Contracts except 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. Sellers have delivered to Buyer true and complete copies of all
written Assumed Contracts, true and complete memoranda of all oral Assumed
Contracts (including any amendments and other modifications to such Assumed
Contracts), and a schedule summarizing Sellers' obligations under trade and
barter agreements relating to the Stations. Other than the Contracts listed on
Schedule 3.7 and cash programming contracts, Sellers require no contract,
lease, or other agreement to enable them to carry on their respective
businesses as now conducted. 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 default by any party
thereto or any
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event that, after notice or lapse of time or both, could constitute a 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
respective rights under the Assumed Contracts to Buyer in accordance with this
Agreement, and such assignment will not affect the validity, enforceability, or
continuation of any of the Assumed Contracts.
3.8 Consents. Except for the FCC Consent provided 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
Intangibles (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 documents establishing or evidencing all Intangibles. Neither Seller is
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 Statements. Schedule 3.10 hereto contains true and
complete copies of Sellers' financial statements including a balance sheet as
of March 31, 1996 and an income statement and a statement of operating cash
flow for the period ending March 31, 1996 and a statement setting forth the
gross revenue of the Stations and WMTO for the twelve-month period ended March
31, 1996 (collectively, the "Financial Statements"). The Financial Statements
have been prepared from the books and records of Sellers, have been prepared in
accordance with generally accepted accounting principles consistently applied
and maintained throughout the periods indicated, accurately reflect the books,
records, and accounts of the Stations and to the extent applicable, WMTO (which
books, records, and accounts are complete and correct), are complete and
correct in all material respects, and present fairly the financial condition of
the Stations and to the extent applicable, WMTO, as at their respective dates
and the results of operations for the periods then ended. None of the
Financial Statements understates the true costs and expenses of conducting the
business or operations of the Stations and to the extent applicable, WMTO,
fails to disclose any material
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contingent liabilities, or inflates the revenues of the Stations and to the
extent applicable, WMTO.
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. All policies of insurance listed in Schedule 3.11
are in full force and effect. The insurance 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. During the past
three years, no insurance policy of Sellers on the Assets or the Stations has
been canceled by the insurer and no application of Sellers for insurance has
been rejected by any insurer.
3.12 Reports. All returns, reports, and statements 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. All of such returns, reports, and statements are
substantially complete and correct as filed. Each Seller has timely paid to
the FCC all annual regulatory fees payable with respect to the FCC Licenses.
3.13 Personnel.
(a) Employees and Compensation. Schedule 3.13 contains a
true and complete list of all employees of the Stations, their job titles, date
of hire, current salary and date and amount of last salary increase. Except as
disclosed on Schedule 3.13, Sellers do not have any employee benefit plans or
arrangements applicable to the employees of the Stations or any fixed or
contingent liabilities or obligations with respect to any person now or
formerly employed by any Seller at the Stations, including any pension or
thrift plans, individual or supplemental pension or accrued compensation
arrangements, contributions to hospitalization or other health or life
insurance programs, incentive plans, bonus arrangements, and vacation, sick
leave, disability and termination arrangements or policies, including workers'
compensation policies. At Buyer's request, Sellers will furnish Buyer with
true and complete copies of all applicable plan documents, trust documents, and
insurance contracts with respect to any plans and arrangements listed on
Schedule 3.13. All employee benefits and welfare plans or arrangements listed
in Schedule 3.13 were established and have been executed, managed and
administered in accordance with the Internal Revenue Code of 1986, as amended,
the Employee Retirement Income Security Act of 1974, as amended ("ERISA"), and
all other laws. Neither Seller is aware of the existence of any governmental
audit or examination of any of such plans or arrangements or of any facts which
would lead it to believe that any such audit or examination is pending or
threatened. No action, suit, or claim with respect to any of such plans or
arrangements (other than routine claims for benefits) is pending or, to the
knowledge of Sellers, threatened, and no
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Seller possesses knowledge of any facts which could give rise to any such
action, suit or claim;
(b) Labor Relations. Neither Seller is a party to or subject
to any collective bargaining agreements with respect to any Station. Neither
Seller has any written or oral contracts of employment with any employee of any
Station, other than those listed in Schedule 3.7. Each Seller has complied
with all laws, rules, and regulations relating to the employment of labor,
including those related to wages, hours, collective bargaining, occupational
safety, discrimination, and the payment of social security and other payroll
related taxes, and it has not received any notice alleging that it has failed
to comply in any material respect with any such laws, rules, or regulations.
No controversies, disputes, or proceedings are pending or, to the best of
Sellers' knowledge, threatened, between any Seller and any employee (singly or
collectively) of any Station. No labor union or other collective bargaining
unit represents or claims to represent any of the employees of any Station. To
Sellers' knowledge, there is no union campaign being conducted to represent
employees of any Station or solicit cards from employees to authorize a union
to request a National Labor Relations Board certification election with respect
to any employees at any Station; and
(c) Liabilities. Neither Seller has any liability of any
kind to or in respect of any employee benefit plan, including withdrawal
liability under Section 4201 of ERISA. Neither Seller has incurred any
accumulated funding deficiency within the meaning of ERISA or Section 4971 of
the Internal Revenue Code. Neither Seller has failed to make any required
contributions to any employee benefit plan. The Pension Benefit Guaranty
Corporation has not asserted that any Seller has incurred any liability in
connection with any such plan. No lien has been attached and no person has
threatened to attach a lien on any property of Seller as a result of a failure
to comply with ERISA.
3.14 Taxes. Each Seller has filed or caused to be filed all federal
income tax returns and all other federal, state, county, local, or city tax
returns which are required to be filed, and it has paid or caused to be paid
all taxes shown on those returns or on any tax assessment received by it to the
extent that such taxes have become due, or has set aside on its books adequate
reserves (segregated to the extent required by generally accepted accounting
principles) with respect thereto. There are no governmental investigations or
other legal, administrative, or tax proceedings pursuant to which any Seller is
or could be made liable for any taxes, penalties, interest, or other charges,
the liability for which could extend to Buyer as transferee of the business of
the 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 any Seller.
3.15 Claims and Legal Actions. Except for any FCC rulemaking
proceedings generally affecting the broadcasting industry, there is no claim,
legal action, counterclaim, suit, arbitration, governmental investigation or
other legal, administrative, or tax proceeding,
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nor any order, decree or judgment, in progress or pending, or to the knowledge
of Sellers threatened, against or relating to any Seller with respect to its
ownership or operation of any Station or otherwise relating to the Assets or
the business or operations of any Station, 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, there are no applications, complaints or
proceedings pending or, to the best of their knowledge, threatened (i) before
the FCC relating to the business or operations of any Station other than rule
making proceedings which affect the radio broadcasting industry generally, (ii)
before any federal or state agency relating to the business or operations of
any Station involving charges of illegal discrimination under any federal or
state employment laws or regulations, or (iii) before any federal, state, or
local agency relating to the business or operations of any Station involving
zoning issues under any federal, state, or local zoning law, rule, or
regulation.
3.16 Environmental Matters.
(a) Each Seller has complied in all material respects with all
laws, rules, and regulations of all federal, state, and local governments (and
all agencies thereof) concerning the environment, public health and safety, and
employee health and safety, and no charge, complaint, action, suit, proceeding,
hearing, investigation, claim, demand, or notice has been filed or commenced
against such Seller in connection with its ownership or operation of the
Stations alleging any failure to comply with any such law, rule, or regulation;
(b) To the best of Sellers' knowledge, after due
investigation, neither Seller has any liability relating to its ownership and
operation of the Stations (and there is no basis related to the past or present
operations, properties, or facilities of such Seller for any present or future
charge, complaint, action, suit, proceeding, hearing, investigation, claim, or
demand against such Seller giving rise to any such liability) under any law,
rule, or regulation of any federal, state, or local government (or agency
thereof) concerning release or threatened release of hazardous substances,
public health and safety, or pollution or protection of the environment;
(c) To the best of Sellers' knowledge, after due
investigation, neither Seller has any liability relating to its ownership and
operation of the Stations (and such Seller has not handled or disposed of any
substance, arranged for the disposal of any substance, or owned or operated any
property or facility in any manner that could form the 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 such
Seller giving rise to any such liability) for damage to any site, location, or
body of water (surface of subsurface) or for illness or personal injury;
(d) To the best of Sellers' knowledge, after due
investigation, neither Seller has any liability relating to its ownership and
operation of the Stations (and there is no basis
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for any present or future charge, complaint, action, suit, proceeding, hearing,
investigation, claim, or demand against such Seller giving rise to any such
liability) under any law, rule, or regulation of any federal, state, or local
government (or agency thereof) concerning employee health and safety;
(e) To the best of Sellers' knowledge, after due
investigation, neither Seller has any liability relating to its ownership and
operation of the Stations (and such Seller has not exposed any employee to any
substance or condition that could form the basis for any present or future
charge, complaint, action, suit, proceeding, hearing, investigation, claim, or
demand (under the common law or pursuant to statute) against such Seller giving
rise to any such liability) for any illness or personal injury to any employee;
(f) In connection with its ownership or operation of the
Stations, each Seller has obtained and been in compliance in all material
respects with all of the terms and conditions of all permits, licenses, and
other authorizations which are required under, and has complied with all other
limitations, restrictions, conditions, standards, prohibitions, requirements,
obligations, schedules, and timetables which are contained in, all federal,
state, and local laws, rules, and regulations (including all codes, plans,
judgments, orders, decrees, stipulations, injunctions, and charges thereunder)
relating to public health and safety, worker health and safety, and pollution
or protection of the environment, including laws relating to emissions,
discharges, releases, or threatened releases of pollutants, contaminants, or
chemical, industrial, hazardous, or toxic materials or wastes into ambient air,
surface water, ground water, or lands or otherwise relating to the manufacture,
processing, distribution, use, treatment, storage, disposal, transport, or
handling of pollutants, contaminants, or chemical, industrial, hazardous, or
toxic materials or wastes; and
(g) No pollutant, contaminant, or chemical, industrial,
hazardous, or toxic material or waste has ever been manufactured, buried,
stored, spilled, leaked, discharged, emitted, or released by any Seller in
connection with its ownership and operation of the Stations or, to the best of
Sellers' knowledge, after due investigation, by any other party on any Real
Property.
3.17 Compliance with Laws. Each Seller has complied in all material
respects with the Licenses and all federal, state, and local laws, rules,
regulations, and ordinances applicable or relating to the ownership and
operation of the 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.
3.18 Conduct of Business in Ordinary Course. Since October 31, 1995,
each Seller has conducted the business and operations of the Stations only in
the ordinary course and has not:
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(a) Suffered any material adverse change in the business,
assets, or 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 other than in the normal and usual course of
business with suitable replacements being obtained therefor;
(d) Canceled any debts owed to or claims held by such 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; or
(f) Transferred or granted any 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.
3.19 Transactions with Affiliates. Except as disclosed on Schedule
3.19, neither Seller has been involved in any business arrangement or
relationship relating to the Stations with any affiliate of any Seller, and no
affiliate of any Seller owns any property or right, tangible or intangible,
which is used in the business of the Stations. As used in this paragraph,
"affiliate" has the meaning set forth in Rule 12b-2 promulgated under the
Securities and Exchange Act of 1934.
3.20 Broker. Neither Sellers nor any person acting on Sellers'
behalf have incurred any liability for any finders' or brokers' fees or
commissions in connection with the transactions contemplated by this Agreement.
3.21 Full Disclosure. No representation or warranty made by any
Seller in this Agreement or in any certificate, document, or other instrument
furnished or to be furnished by any Seller pursuant hereto contains or will
contain any untrue statement of a material fact, or omits or will omit to state
any material fact and required to make any statement made herein or therein not
misleading.
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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 Escrow Agreement and the documents contemplated
hereby and thereby, and to perform and comply with all of the terms, covenants,
and conditions to be performed and complied with by Buyer hereunder and
thereunder.
4.2 Authorization and Binding Obligation. The execution, delivery,
and performance of this Agreement and the Escrow Agreement by Buyer have been
duly authorized by all necessary actions on the part of Buyer. This Agreement
and the Escrow Agreement have been duly executed and delivered by Buyer and
constitute the legal, valid, and binding obligations of Buyer, enforceable
against Buyer in accordance with their respective terms except as the
enforceability of this Agreement and the Escrow Agreement may be affected by
bankruptcy, insolvency, or similar laws affecting creditors' rights generally
and by judicial discretion in the enforcement of equitable remedies.
4.3 Absence of Conflicting Agreements. Subject to obtaining the
Consents, the execution, delivery, and performance by Buyer of this Agreement
and the Escrow Agreement and the documents contemplated hereby and thereby
(with or without the giving of notice, the lapse of time, or both): (i) do not
require the consent of any third party; (ii) will not conflict with the
Articles of Incorporation or Bylaws of Buyer; (iii) will not conflict with,
result in a breach of, or constitute a default under, any law, judgment, order,
injunction, decree, rule, regulation, or ruling of any court or governmental
instrumentality; or (iv) will not conflict with, constitute grounds for
termination of, result in a breach of, constitute a default under, or
accelerate or permit the acceleration of any performance required by the terms
of, any agreement, instrument, license, or permit to which Buyer is a party or
by which Buyer may be bound, such that Buyer could not acquire or operate the
Assets.
4.4 Broker. Neither Buyer nor any person acting on Buyer's behalf
has 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 by Buyer to Media Services Group, Inc..
4.5 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
and required to make any statement made herein or therein not misleading.
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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 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. Sellers will not 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), or incur any obligation
(including obligations relating to the borrowing of money or the guaranteeing
of indebtedness) that will be binding on Buyer after Closing, except for cash
time sales agreements made in the ordinary course of business. 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. Sellers shall not sell, assign, lease, or
otherwise transfer or dispose of any of the Assets, except where no longer used
or useful in the business or operations of the Stations or 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) liens
disclosed on Schedule 3.5 and Schedule 3.6, which shall be removed prior to the
Closing Date, (ii) liens for current taxes not yet due and payable, and (iii)
mechanics' liens and other similar liens, which shall be removed prior to the
Closing Date.
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.
5.7 Rights. Sellers shall not waive any right relating to the
Stations or any of the Assets.
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5.8 No Inconsistent Action. Sellers shall not take any action that
is inconsistent with its obligations under this Agreement or that could hinder
or delay the consummation of the transactions contemplated by this Agreement.
5.9 Access to Information. Sellers shall give Buyer and its counsel,
accountants, engineers, and other authorized representatives 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, including inspections incident to the environmental study described
in Section 6.5 and the engineering study described in Section 6.6, 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 such financial
statements as Buyer determines, in its sole 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.
5.10 Maintenance of Assets. Sellers shall use their best efforts and
take all reasonable actions to 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 and in accordance with the terms of the FCC
Licenses, all rules and regulations of the FCC and generally accepted standards
of good engineering practice. Sellers shall maintain inventories of spare
parts and expendable supplies at levels consistent with past practices. If any
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.
5.11 Insurance. Sellers shall maintain the existing insurance
policies on the Stations and the Assets.
5.12 Consents. Sellers shall 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. Upon Buyer's
request, Sellers shall cooperate with Buyer and use their best efforts to
obtain from the lessors under each
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Real Property lease such estoppel certificates and consents to the collateral
assignment of the lessee's interest under each such lease as Buyer's lenders
may request.
5.13 Books and Records. Sellers shall maintain their books and
records relating to the Stations in accordance with past practices.
5.14 Notification. Sellers shall promptly notify Buyer in writing of
any unusual or material developments with respect to the business or operations
of any Station, and of any material change in any of the information contained
in Sellers' representations and warranties contained in Section 3 of this
Agreement.
5.15 Financial Information. Sellers shall furnish to Buyer within
twenty (20) days after the end of each month ending between the date of this
Agreement and the Closing Date a statement of income and expense and a
statement of Operating Cash Flow and gross revenue of the Stations and WMTO for
the month just ended and such other financial information (including
information on payables and receivables) as Buyer may reasonably request. All
financial information delivered by Sellers to Buyer pursuant to this Section
shall be prepared from the books and records of Sellers in accordance with
generally accepted accounting principles consistently applied, shall accurately
reflect the books, records, and accounts of the Stations and to the extent
applicable, WMTO, shall be complete and correct in all material respects, and
shall present fairly the financial condition of the Stations and to the extent
applicable, WMTO, as at their respective dates and the results of operations
for the periods then ended.
5.16 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.
5.17 Financing Leases. Sellers will 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.
5.18 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 the Sellers are
required by the public interest.
5.19 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 audience of the Stations and the Stations' present relationships
with suppliers, advertisers, and others having business relations with
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them, to the end that the business, operations, and prospects of the Stations
shall be unimpaired at the Closing Date. The ordinary and customary operating,
marketing, promotional, sales, and advertising practices of the Stations shall
be maintained.
5.20 Collection of Accounts Receivable. Sellers shall collect the
accounts receivable of the Stations only in the ordinary course consistent with
their past practices and will not take any action designed or likely to
accelerate the collection of their accounts receivable.
5.21 Personnel Recommendations. Sellers shall promptly notify Buyer
as personnel vacancies occur at the Stations and consider for employment all
personnel recommended by Buyer for such vacant positions.
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; and
(b) Sellers and Buyer shall promptly prepare an appropriate
application for the FCC Consent and shall file the application with the FCC
within five (5) business days of the execution of this Agreement. The parties
shall prosecute the application with all reasonable diligence and otherwise use
their best efforts to obtain a grant of the application 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 the party
of any of its representations, warranties, or covenants under this Agreement,
and (2) compliance with the condition would have a material adverse effect upon
it. Buyer and 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 any party of its
rights under Section 9.
6.2 Control of the Station. Prior to Closing, Buyer shall not,
directly or indirectly, control, supervise, direct, or attempt to control,
supervise, or direct, the operations of the 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.
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6.3 Risk of Loss.
(a) 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; and
(b) If any damage or destruction of the Assets or any other
event occurs which (i) causes any Station to cease broadcasting operations for
a period of three (3) or more days or (ii) prevents in any material respect
signal transmission by any Station in the normal and usual manner and Sellers
fail to restore or replace the Assets so that normal and usual transmission is
resumed within seven days of the damage, destruction or other event, Buyer, in
its sole discretion, may (x) terminate this Agreement forthwith without any
further obligations hereunder upon written notice to Sellers, in which event
all funds held by the Escrow Agent pursuant to the Escrow Agreement, including
all interest and other proceeds from the investment of such funds, shall be
immediately returned to Buyer, or (y) proceed to consummate the transaction
contemplated by this Agreement and complete the restoration and replacement of
the Assets after the Closing Date, in which event Sellers shall deliver to
Buyer all insurance proceeds received in connection with such damage,
destruction or other event.
6.4 Confidentiality. Except as necessary for the consummation of the
transaction contemplated by this Agreement, including Buyer's obtaining of
financing related hereto, and except as and to the extent required by law,
including, without limitation, disclosure requirements of federal or state
securities laws and the rules and regulations of securities markets, each party
will keep confidential any information obtained from the other party in
connection with the transactions contemplated by this Agreement. If this
Agreement is terminated, each party will return to the other party all
information obtained by the such party from the other party in connection with
the transactions contemplated by this Agreement.
6.5 Environmental Audit. Buyer may, at its option and expense,
retain an environmental consultant to be selected by Buyer to perform a Phase I
environmental survey of the properties of the Stations. Buyer shall promptly
notify Sellers if such survey discloses any material environmental hazard or
material possibility of future liability for environmental damages or clean-up
costs.
6.6 Engineering Study. Buyer may, at its option and 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 customary engineering
practices and all applicable FCC rules, regulations, prescribed practices, and
technical standards. Buyer shall promptly notify Sellers if such survey
discloses any material deficiencies in the operations or equipment of the
Stations.
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6.7 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 or desirable to the implementation and consummation of this
Agreement, and otherwise use their best efforts to consummate the transaction
contemplated hereby and to fulfill their obligations under this Agreement.
Notwithstanding the foregoing, Buyer shall have no obligation (i) to expend
funds to obtain any of the Consents or (ii) to agree to any adverse change in
any License or Assumed Contract to obtain a Consent required with respect
thereto.
6.8 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.
6.9 Title Insurance and Surveys.
(a) Title Insurance on Fee Property. With respect to each
parcel of Real Property, Buyer may obtain, at Buyer's expense, at or prior to
Closing, an ALTA Owner's Policy of Title Insurance Form B-1987 (or equivalent
policy acceptable to Buyer), issued by a title insurer satisfactory to Buyer,
in an amount equal to the fair market value of Buyer's interest in the property
as of the Closing and any improvements thereon (as reasonably determined by
Buyer), insuring Buyer's interest in such parcel as of the Closing, subject
only to liens or encumbrances expressly permitted by this Agreement;
(b) General Requirements as to Title Insurance Policies.
Each title insurance policy obtained by Buyer pursuant to this Agreement shall
(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" insuring over the general exceptions customarily contained in
title policies, (3) contain an ALTA Zoning Endorsement 3.1 (or equivalent), (4)
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, (5) contain an inflation endorsement, (6) contain a "contiguity"
endorsement with respect to any Real Property consisting of more than one
record parcel, and (7) not be subject to any survey exception or any defect or
encroachment disclosed by a survey delivered with respect to the property; and
(c) Surveys. With respect to each parcel of Real Property,
as to which a title insurance policy is procured pursuant to this Agreement,
Buyer may procure 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,
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easements, party walls, sidewalks, roadways, utility lines, and other matters
customarily shown on such surveys, and showing access affirmatively to public
streets and roads.
6.10 Sales Tax Filings. Sellers shall file such Florida sales tax
returns with respect to the Stations as required by applicable law and shall
concurrently deliver copies of all such returns to Buyer.
6.11 Access to Books and Records. Sellers shall provide Buyer access
and the right to copy for a period of three (3) years from the Closing Date any
books and records relating to the Assets that are not included in the Assets.
Buyer shall provide Sellers access and the right to copy for a period of three
(3) years from the Closing Date any books and records relating to the Assets
and delivered to Buyer at the Closing.
6.12 Appraisal. Buyer and Sellers agree to allocate the Purchase
Price for tax and recording purposes in accordance with an appraisal to be
conducted by an appraisal firm selected and paid for by Buyer with experience
in the valuation and appraisal of radio station assets.
6.13 Noncompetition Agreement. At Closing, Buyer and Sellers shall
enter into a Noncompetition Agreement in the form of Schedule 6.13 and $57,000
of the Purchase Price shall be allocated to the covenants of Sellers set forth
therein on the Closing Date.
SECTION 7 CONDITIONS TO OBLIGATIONS OF BUYER AND SELLERS AT CLOSING
7.1 Conditions to Obligations of Buyer. All obligations of Buyer at
the Closing are subject at Buyer's option to the fulfillment 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 Consents shall have been obtained and
delivered to Buyer without any adverse change in the terms or conditions of any
agreement or any governmental license, permit, or other authorization;
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(d) FCC Consent. The FCC Consent shall have been granted
without the imposition on Buyer of any 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;
(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 an adverse effect on any Station or the conduct of its
business and operations. No proceeding shall be pending the effect of which
could be to revoke, cancel, fail to renew, suspend, or modify adversely any
License;
(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, properties, financial condition or business prospects of any Station,
including any damage, destruction, or loss affecting any assets used or useful
in the conduct of the business of any Station; and
(h) Asset Purchase Agreement. The transactions contemplated
by the WMTO Asset Purchase Agreement shall have been consummated
contemporaneously with the Closing in accordance with the terms of such Asset
Purchase Agreement.
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; and
(d) FCC Consent. The FCC Consent shall have been granted
without the imposition on Sellers of any conditions that need not be complied
with by Sellers under Section 6.1 hereof and Buyer shall have complied with any
conditions imposed on it by the FCC Consent.
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SECTION 8 CLOSING AND CLOSING DELIVERIES
8.1 Closing.
(a) Closing Date. The Closing shall take place at 10:00 a.m.
on a date, to be set by Buyer on at least five (5) 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 (10) business days following the
date upon which the FCC Consent has become a Final Order, subject to the
satisfaction or waiver of all of the other conditions precedent to the holding
of the Closing. If Buyer fails to specify the date for the Closing pursuant to
the preceding sentence prior to the fifth day after the date upon which the FCC
Consent has become a Final Order, the Closing shall take place on the tenth
business day after the date upon which the FCC Consent has become 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 all claims, liabilities, security
interests, mortgages, liens, pledges, conditions, charges or encumbrances,
except for liens for current taxes not yet due and payable;
(b) Estoppel Certificates. Estoppel certificates of the
lessors of all leasehold and subleasehold interests included in the Real
Property and estoppel certificates of contracting parties to those Assumed
Contracts listed in Schedule 3.7 that are designated to indicate that estoppel
certificates are required under this paragraph;
(c) Consents. A manually executed copy of any instrument
evidencing receipt of any Consent;
(d) Officer's Certificate. A certificate, dated as of the
Closing Date, executed on behalf of Sellers by their President, certifying (1)
that the representations and warranties of Sellers 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 Sellers have 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;
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(e) Tax, Lien, and Judgment Searches. Results of a search
for tax, lien, and judgment filings in the Secretary of State's records of the
State of Florida, as well as the records of those counties in Florida in which
any of the Assets are located, such searches having been made no earlier than
fifteen days prior to the Closing Date;
(f) Licenses, Contracts, Business Records, Etc. Copies of
all Licenses, Assumed Contracts, blueprints, schematics, working drawings,
plans, projections, engineering records, and all available files and records
used by Sellers in connection with their operations;
(g) Accounts Receivable. A complete and accurate list of the
Stations' Accounts Receivable as of a date no more than five (5) business days
prior to the Closing Date, including, with respect to each of the Accounts
Receivable, the amount number, date of issuance, name and address of account
debtor, aggregate amount, and balance due;
(h) Opinions of Counsel. Opinions of Sellers' counsel dated
as of the Closing Date, substantially in the form of Schedule 8.2(h) hereto;
(i) Noncompetition Agreement. The Noncompetition Agreement
in the form of Schedule 6.13, duly executed by Sellers; and
(j) Lenders Certificates. Such certificates and
confirmations to Buyer's lenders as Buyer may reasonably request in connection
with obtaining financing for the performance of its payment obligations
hereunder.
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 2.4;
(b) Assumption Agreements. Appropriate assumption agreements
pursuant to which Buyer shall assume and undertake to perform Sellers'
obligations under the Licenses and Assumed Contracts insofar as they relate to
the time on and after the Closing Date;
(c) Officer's Certificate. A certificate, dated as of the
Closing Date, executed on behalf of Buyer by its President, certifying (1) that
the representations and warranties of Buyer contained in this Agreement are
true and complete in all material respects as of the Closing Date as though
made on and as of that date, and (2) that Buyer has in all material respects
performed and complied with all of its obligations, covenants, and agreements
set forth in this Agreement to be performed and complied with on or prior to
the Closing Date;
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(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) hereto;
and
(e) Noncompetition Agreement. The Noncompetition Agreement
in the form of Schedule 6.13 duly executed by Buyer and the payment of $57,000
to Sellers thereunder.
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
April 1, 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; and
(e) Asset Purchase Agreement. If the Seller under the WMTO
Asset Purchase Agreement terminates such Asset Purchase Agreement in accordance
with the terms thereof.
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;
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(c) Upset Date. If the Closing shall not have occurred by
April 1, 1997;
(d) Interruption of Service. If any event shall have
occurred that prevented signal transmission of any Station in the normal and
usual manner for a continuous period of three days;
(e) Environmental Hazards. Buyer shall have notified Sellers
of material environmental hazards or the material possibility of environmental
damages or clean-up costs, as indicated in the environmental study described in
Section 6.5, within thirty (30) days prior to the Closing Date, and the cause
thereof shall not have been remedied prior to the Closing Date;
(f) Technical Deficiencies. Buyer shall have notified
Sellers of material deficiencies in the operations or equipment of any Station,
as indicated in the engineering study described in Section 6.6, within thirty
(30) days prior to the Closing Date, and the cause thereof shall not have been
remedied prior to the Closing Date;
(g) 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; and
(h) Asset Purchase Agreement. If the Buyer under the WMTO
Asset Purchase Agreement terminates such Asset Purchase Agreement in accordance
with the terms thereof.
9.3 Rights on Termination. If this Agreement is terminated pursuant
to Section 9.1 or Section 9.2 and no party is in material breach 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, then
the payment to Sellers of Two Hundred Eighty Thousand Dollars ($280,000)
pursuant to Section 9.4 below 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 Two Hundred Eighty Thousand Dollars ($280,000) is a fair and
equitable amount to reimburse Sellers for damages sustained due to Buyer's
material breach of this Agreement. If this Agreement is terminated by Buyer
due to Sellers' material breach of this Agreement, Buyer shall have all rights
and remedies available at law or equity.
9.4 Escrow Deposit. Buyer has deposited with the Escrow Agent the
sum of Two Hundred Eighty Thousand Dollars ($280,000) in accordance with the
Escrow Agreement.
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All such funds deposited with the Escrow Agent shall be held and disbursed in
accordance with the terms of the Escrow Agreement and the following provisions:
(a) At the Closing, all amounts held by the Escrow Agent
pursuant to the Escrow Agreement, including any interest or other proceeds from
the investment of funds held by the Escrow Agent, shall be disbursed to or at
the direction of Buyer;
(b) If this Agreement is terminated pursuant to Section 9.1
or 9.2 and Buyer is not in material breach 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; and
(c) If this Agreement is terminated by Sellers due to Buyer's
material breach of this Agreement, then all amounts held by the Escrow Agent
pursuant to the Escrow Agreement shall be disbursed to or at the direction of
Sellers as liquidated damages under Section 9.3 above and any interest or other
proceeds from the investment of funds held by the Escrow Agent shall be
disbursed by the Escrow Agent to or at the direction of Buyer.
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 (18) 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, each Seller hereby jointly and severally agrees
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 any Seller contained in this Agreement or in any certificate,
document, or instrument delivered to Buyer under this Agreement;
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(b) Any and all obligations of any Seller not assumed by
Buyer pursuant to this Agreement, including any liabilities arising at any time
under any Contract not included in the Assumed Contracts;
(c) Any 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 any Station prior to the Closing, including
any liabilities arising under the Licenses or the Assumed Contracts which
relate to events occurring prior the Closing Date; and
(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 any Station on and after the Closing; and
(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:
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(a) The party claiming indemnification (the "Claimant") shall
promptly give notice to the party from which indemnification is claimed (the
"Indemnifying Party") of any claim, whether between the parties or brought by a
third party, specifying in reasonable detail the factual basis for the claim.
If the claim relates to an action, suit, or proceeding filed by a third party
against Claimant, such notice shall be given by Claimant within five days after
written notice of such action, suit, or proceeding was given to Claimant;
(b) With respect to claims solely between the parties,
following receipt of notice from the Claimant of a claim, the Indemnifying
Party shall have thirty days to make such investigation of the claim as the
Indemnifying Party deems necessary or desirable. For the purposes of such
investigation, the Claimant agrees to make available to the Indemnifying Party
and/or its authorized representatives the information relied upon by the
Claimant to 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; and
(e) The indemnifications rights provided in Sections 10.2 and
10.3 shall extend to the shareholders, directors, officers, employees, and
representatives of any Claimant although for the purpose of the procedures set
forth in this Section 10.4, any indemnification claims by such parties shall be
made by and through the Claimant.
10.5 Specific Performance. The parties recognize that if any Seller
breaches this Agreement and refuses to perform under the provisions of this
Agreement, monetary
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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 lawsuit or other proceeding for any remedy available under
this Agreement, the prevailing party shall be entitled to reimbursement from
the other party of its reasonable legal fees and expenses.
SECTION 11 MISCELLANEOUS
11.1 Fees and Expenses. Any federal, state, or local sales or
transfer tax arising in connection with the conveyance of the Assets by Sellers
to Buyer pursuant to this Agreement shall be paid by Sellers. Buyer and
Sellers shall each pay one-half of the fees payable to the Escrow Agent and
one-half of the filing fee required in connection with the application 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 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 by a
panel of three (3) neutral arbitrators who shall be selected in accordance with
the procedures set forth in the commercial arbitration rules of the American
Arbitration Association in the State of Florida. The persons selected as
arbitrators shall have prior experience in the broadcasting industry but need
not be professional arbitrators, and persons such as lawyers, accountants,
brokers and bankers shall be acceptable. 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 in the State of Florida. 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
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against the other except (i) an action to compel arbitration pursuant to this
Section, (ii) an action to enforce the award of the arbitration panel rendered
in accordance with this Section, or (iii) a suit for specific performance
pursuant to Section 10.5.
11.3 Notices. All notices, demands, and requests required or
permitted to be given under the provisions of this Agreement shall be (a) in
writing, (b) delivered by personal delivery, or sent by commercial delivery
service or registered or certified mail, return receipt requested, (c) deemed
to have been given on the date of personal delivery or the date set forth in
the records of the delivery service or on the return receipt, and (d) addressed
as follows:
[Download Table]
If to Sellers: Timothy O'Brien, President
B. Radio, Inc.
Boss Radio Group, Inc.
2615 East 15th Street
Panama City, FL 32405
With a copy to: Larry D. Perry, Esq.
11464 Saga Lane, Suite 400
Knoxville, TN 37931
If to Buyer: Lowell W. Paxson, Chairman
Paxson Communications of Tallahassee, Inc.
601 Clearwater Park Road
West Palm Beach, Florida 33401
With a copy to: John R. Feore, Jr., Esq.
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
11.3.
11.4 Benefit and Binding Effect. No party hereto may assign this
Agreement without the prior written consent of the other parties hereto;
provided, however, that Buyer may assign its rights and obligations under this
Agreement, in whole or in part, to one or more subsidiaries or commonly
controlled affiliates of Buyer without seeking or obtaining Sellers' prior
approval in which event Buyer shall have no further obligation hereunder and
Buyer may assign its rights and interests hereunder to its lenders as
collateral security for Buyer's obligations to such lenders without seeking or
obtaining Sellers' prior approval. Upon any
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permitted assignment by Buyer or Sellers in accordance with this Section 11.4,
all references to"Buyer" herein shall be deemed to be references to Buyer's
assignee and all references to "Sellers" herein shall be deemed to be
references to Sellers' assignee, as the case may be. This Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
11.5 Further Assurances. The parties shall take any actions and
execute any other documents that may be necessary or desirable to the
implementation and consummation of this Agreement, including, in the case of
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.
11.6 Governing Law. THIS AGREEMENT SHALL BE GOVERNED, CONSTRUED, AND
ENFORCED IN ACCORDANCE WITH THE LAWS OF THE STATE OF FLORIDA (WITHOUT REGARD TO
THE CHOICE OF LAW PROVISIONS THEREOF).
11.7 Headings. The headings in this Agreement are included for ease
of reference only and shall not control or affect the meaning or construction
of the provisions of this Agreement.
11.8 Gender and Number. Words used in this Agreement, regardless of
the gender and number specifically used, shall be deemed and construed to
include any other gender, masculine, feminine, or neuter, and any other number,
singular or plural, as the context requires.
11.9 Entire Agreement. This Agreement, the schedules, hereto, and
all documents, certificates, and other documents to be delivered by the parties
pursuant hereto, collectively represent the entire understanding and agreement
between Buyer and Sellers with respect to the subject matter hereof. This
Agreement supersedes all prior negotiations between the parties and cannot be
amended, supplemented, or changed except by an agreement in writing that makes
specific reference to this Agreement and which is signed by the party against
which enforcement of any such amendment, supplement, or modification is sought.
11.10 Waiver of Compliance; Consents. Except as otherwise provided
in this Agreement, any failure of any of the parties to comply with any
obligation, representation, warranty, covenant, agreement, or condition herein
may be waived by the party entitled to the benefits thereof only by a written
instrument signed by the party granting such waiver, but such waiver or failure
to insist upon strict compliance with such obligation, representation,
warranty, covenant, agreement, or condition shall not operate as a waiver of,
or estoppel with respect to, any subsequent or other failure. Whenever this
Agreement
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requires or permits consent by or on behalf of any party hereto, such consent
shall be given in writing in a manner consistent with the requirements for a
waiver of compliance as set forth in this Section 11.10.
11.11 Press Release. No 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 parties; provided, however, that nothing
contained herein shall prevent either party from promptly making all filings
with governmental authorities as may, in its judgement be required or advisable
in connection with the execution and delivery of this Agreement or the
consummation of the transactions contemplated hereby.
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.
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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
B. RADIO, INC.
By: /s/ Timothy O'Brian
-----------------------------
Name: Timothy O'Brian
Title: President
BOSS RADIO GROUP, INC.
By: /s/ Timothy O'Brian
-----------------------------
Name: Timothy O'Brian
Title: President
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Dates Referenced Herein and Documents Incorporated by Reference
| Referenced-On Page |
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This ‘10-Q’ Filing | | Date | | First | | Last | | | Other Filings |
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| | |
| | 4/1/97 | | 32 | | 33 | | | 10-K |
Filed on: | | 8/13/96 |
For Period End: | | 6/30/96 |
| | 5/13/96 | | 1 |
| | 3/31/96 | | 15 | | | | | 10-Q |
| | 10/31/95 | | 19 |
| List all Filings |
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