Registration of Securities Issued in a Business-Combination Transaction — Form S-4
Filing Table of Contents
Document/Exhibit Description Pages Size
1: S-4 Registration of Securities Issued in a 180 1.08M
Business-Combination Transaction
2: EX-3.1 Certificate of Formation 1 15K
3: EX-3.2 Limited Liability Company Agreemen 35 137K
4: EX-3.3 Articles of Incorporation 2 18K
5: EX-3.4 Acme Intermediate Finance, Inc. By-Laws 14 56K
6: EX-4.1 Indenture 148 473K
7: EX-4.2 Indenture 135 432K
9: EX-5.1-INT Exhibit 5.1-Int - Opinion Re: Legality 3 23K
8: EX-5.1-INT Intermediate Opinion 3 24K
10: EX-10.1 Stock Purchase Agreement 46 204K
19: EX-10.10 Management Agreement 14 53K
20: EX-10.11 Exhibit 10.11 - Amendment (Channel 32) 2 20K
21: EX-10.12 Exhibit 10.12 - Noncompetition Agreement for Kwbp 5 28K
22: EX-10.13 Exhibit 10.13 - Management Agreement for Station 16 50K
23: EX-10.14 Management Agreement 14 47K
24: EX-10.15 Exhibit 10.15-Wint Escrow 9 43K
25: EX-10.18 Exhibit 10.18 - Affiliation Agreement for Kwbp 21 67K
26: EX-10.19 Exhibit 10.19 - Commitment Letter From Wb 1 18K
11: EX-10.2 Exhibit 10.2 - Escrow Agreement for Kplr 14 61K
27: EX-10.20 Exhibit 10.20 - Employment Agreement With Gealy 6 33K
28: EX-10.21 Exhibit 10.21 - Employment Agreement With Allen 6 32K
29: EX-10.22 Exhibit 10.22 - Consulting Agreement With Kellner 6 30K
30: EX-10.23 Exhibit 10.23 - Commercial Building Lease for Kwbp 15 68K
31: EX-10.24 Exhibit 10.24 - Lease Agreement for Kwbp Tower 16 65K
32: EX-10.25 Exhibit 10.25 - Lease Agreement for Wbxx 22 74K
33: EX-10.26 Exhibit 10.26 - Tower Lease for Wbxx 13 38K
34: EX-10.27 Exhibit 10.27 - First Modification to Agreement 4 24K
12: EX-10.3 Exhibit 10.3 - Time Brokerage Agreement 19 69K
35: EX-10.30 Exhibit 10.30 - Studio Lease for Kplr 4 27K
36: EX-10.31 Exhibit 10.31 - Tower Lease for Kplr 26 51K
37: EX-10.32 Exhibit 10.32 - Amendment to Tower Leases for Kplr 3 22K
38: EX-10.33 Exhibit 10.33 - Koplar/Roberts - Agreement 15 69K
39: EX-10.35-INT Exhibit 10.35 - Registration Rights Agreement 34 119K
40: EX-10.36-INT Exhibit 10.36 - Membership Unitholders Agreement 31 108K
41: EX-10.37 Purchase Agreement for Intermediate 41 152K
42: EX-10.38-INT Exhibit 10.38 - Securities Pledge Agreement 21 73K
13: EX-10.4 Membership Contribution Agreement 28 102K
14: EX-10.5 Exhibit 10.5 - Asset Purchase Agreement 25 87K
15: EX-10.6 Exhibit 10.6 - Purchase Agreement for Wbxx 63 133K
16: EX-10.7 Exhibit 10.7-Asset Purchase Agreement for Kwbp 38 163K
17: EX-10.8 Exhibit 10.8 - Amendment 3 20K
18: EX-10.9 Exhibit 10.9 - Amendment (Acme) 3 18K
43: EX-21.1-INT Exhibit 21.1 - Subsidiaries 1 15K
44: EX-23.2 Consent of Experts and Counsel 1 15K
45: EX-23.3 Consents of Experts 1 15K
46: EX-23.4 Consent of Experts and Counsel 1 15K
47: EX-24.1-INT Power of Attorney - Allen 1 16K
48: EX-24.2-INT Power of Attorney - Gealy 1 16K
49: EX-24.3-INT Power of Attorney - Kellner 1 16K
50: EX-25.1-INT Exhibit 25.1-Int - Statement of Eligibility 30 106K
51: EX-27.1 Financial Data Schedule 1 19K
52: EX-99.1-INT Exhibit 99.1-Int - Letter of Transmittal 20 68K
53: EX-99.2-INT Exhibit 99.2-Int - Notice of Guaranteed Delivery 5 26K
54: EX-99.3-INT Exhibit 99.3-Int - Letter to Brokers 2 19K
55: EX-99.4-INT Exhibit 99.4-Int - Letter to Clients 2 18K
56: EX-99.5-INT Exhibit 99.5-Int - Instruction to Holder 2 19K
57: EX-99.6-INT Exhibit 99.6-Int - Guidelines for Certification 7 27K
58: EX-99.7 Consent as Member-Koplar 1 16K
59: EX-99.8 Consent as Member-Roberts 1 16K
EX-10.7 — Exhibit 10.7-Asset Purchase Agreement for Kwbp
Exhibit Table of Contents
ASSET PURCHASE AGREEMENT
FOR
KWBP-TV
SALEM, OREGON
BETWEEN
CHANNEL 32 INCORPORATED
AND
NEWCO, INC.
TABLE OF CONTENTS
PAGE
ARTICLE 1. Exchange of Consideration................................1
1.1. Consideration Conveyed by Seller.............................1
1.1.1. Station Assets........................................1
1.1.2. Excluded Assets.......................................3
1.1.3. Seller's Retained Liabilities.........................4
1.2. Consideration Conveyed by Buyer..............................4
1.2.1. Purchase Price........................................4
1.2.2. Seller's Stock Acquisition............................5
1.2.3. Loan to Seller........................................5
1.2.4. Noncompetition Agreement..............................5
1.3. Adjustments..................................................6
1.3.1. Prorations............................................6
1.3.2. Trade and Barter Items................................6
1.3.3. Disputes..............................................6
1.4. Allocation...................................................6
1.5. Closing......................................................6
1.5.1. Date and Location.....................................6
1.5.2. Exchange of Documents.................................7
1.6. Timing.......................................................7
ARTICLE 2. Representation and Warranties of Seller..................7
2.1. Corporate Status.............................................7
2.2. Licenses.....................................................7
2.3. Condition of Assets..........................................8
2.4. Title........................................................8
2.5. Employees....................................................8
2.6. Taxes........................................................9
2.7. Contracts....................................................9
2.8. Environmental................................................9
2.9. Financial Statements.........................................10
2.10. Litigation...................................................10
2.11. Compliance with Laws.........................................10
2.12. No Defaults..................................................10
2.13. Brokers......................................................10
2.14. Seller Action................................................11
2.15. Station Assets...............................................11
2.16. Leases.......................................................11
2.17. Insolvency...................................................11
2.18. Approvals....................................................11
2.19. Cable Carriage...............................................12
2.20. Bulk Sales Law...............................................12
2.21. No Material Omission.........................................12
ARTICLE 3. Representation and Warranties of Buyer...................12
3.1. Status.......................................................12
3.2. Corporate Action.............................................12
3.3. No Defaults..................................................12
3.4. Brokers......................................................13
3.5. Litigation...................................................13
3.6. Qualification as a Broadcast Licensee........................13
3.7. No Material Omission.........................................13
ARTICLE 4. Covenants of Seller Pending Closing......................13
4.1. Maintenance of Station.......................................13
4.1.1. Sell, Lease, Transfer.................................13
4.1.2. Enter into any........................................13
4.1.3. Renew, Renegotiate, Modify............................14
4.1.4. Subject to Section 1.1.1.(c)..........................14
4.1.5. Make, Allow, or Consent...............................14
4.1.6. Make Any Material Change..............................14
4.1.7. Take Any Action.......................................14
4.2. Organization, Good Will, Promotion...........................14
4.3. Access to Facilities, Files, and Records.....................14
4.4. Representations and Warranties...............................14
4.5. Application for FCC Consent..................................14
4.6. Consents.....................................................15
4.7. Notice of Proceedings........................................15
4.8. Confidential Information.....................................15
4.9. Consummation of Agreement....................................15
4.10. Compliance with Law..........................................15
4.11. Performance under Contracts and Leases.......................15
4.12. HSR Filing...................................................15
ARTICLE 5. Convenants of Buyer Pending the Closing..................16
5.1. Representation and Warranties................................16
5.2. Application for Commission Consent...........................16
5.3. Confidential Information.....................................16
5.4. Consummation of Agreement....................................16
5.5. Notice of Proceedings........................................16
5.6. HSR Filing...................................................17
ARTICLE 6. Conditions Precedent to Obligations of Seller to Close...17
6.1. Representations, Warranties, Covenants.......................17
6.1.1. Buyer's Representation and Warranties.................17
6.1.2. Buyer's Performance Under Agreement...................17
6.1.3. Buyer's Deliveries....................................17
6.2. Proceedings..................................................17
6.2.1. Absence of Litigation.................................17
6.2.2. Notice of Investigation...............................17
6.3. FCC Approval.................................................17
6.4. HSR Approval.................................................18
6.5. Legal Opinion................................................18
6.6. Cancellation of Note.........................................18
6.7. Issuance of Stock............................................18
ARTICLE 7. Conditions Precedent to Obligations of Buyer to Close....18
7.1. Representations, Warranties, Covenants.......................18
7.1.1. Seller's Representations and Warranties...............18
7.1.2. Seller's Performance Under Agreement..................18
7.1.3. Seller's Deliveries...................................18
7.2. Proceedings..................................................18
7.2.1. Absence of Litigation.................................18
7.2.2. Absence of Investigation..............................19
7.3. Damage to the Assets.........................................19
7.3.1. No Material Damage....................................19
7.3.2. Rick of Loss..........................................19
7.3.3. Broadcast Interruption................................19
7.4. FCC Approval.................................................19
7.5. Contract and Real Estate Lease Payments......................20
7.6. Bulk Sale Law................................................20
7.7. Legal Opinion................................................20
7.8. Environmental Audits.........................................20
7.9. HSR Approval.................................................20
7.10. Noncompetition Agreement.....................................20
7.11. Building Lease...............................................20
7.12. No Material Adverse Change...................................20
ARTICLE 8. Indemnification..........................................20
8.1. Survival.....................................................20
8.2. Indemnification of Buyer.....................................21
8.3. Indemnification of Seller....................................21
8.4. Notice of Claim..............................................21
8.5. Defense of Third Party Claim.................................21
8.6. Limitations..................................................22
8.7. Offset Against Stock Purchase................................22
ARTICLE 9. Miscellaneous............................................22
9.1. Termination of Agreement.....................................22
9.1.1. By the Mutual Consent.................................22
9.1.2. By Seller.............................................22
9.1.3. By Buyer..............................................22
9.1.4. By Seller or buyer....................................22
9.1.5. By Any Party..........................................22
9.2. Liabilities Upon Termination.................................22
9.2.1. Seller's Remedies.....................................23
9.2.2. Buyer's Remedies......................................23
9.2.3. Notice of Breach......................................23
9.2.4. Survival of Confidentiality Obligations...............23
9.3. Expenses.....................................................23
9.4. Assignments..................................................23
9.5. Further Assurances...........................................24
9.6. Notices......................................................24
9.6.1. If to Seller..........................................24
9.7. Law Governing................................................25
9.8. Waiver of Provisions.........................................25
9.9. Counterparts.................................................25
9.10. Reimbursement of Legal Expenses..............................25
9.11. Publicity....................................................25
9.12. Seller's Access to Records...................................25
9.13. Entire Agreement.............................................26
ARTICLE 10. Rules of Construction...................................26
10.1. Defined Terms................................................26
10.2. Number and Gender............................................28
10.3. Headings and Cross-References................................28
10.4. Computation of Time..........................................28
ASSET PURCHASE AGREEMENT
THIS AGREEMENT is dated as of January 31, 1997, and is between Channel
32 Incorporated (the "Seller"), a corporation organized under the laws of
Oregon, and NewCo of Oregon, Inc. (the "Buyer"), a corporation organized under
the laws of Oregon.
R E C I T A L S:
1. Seller holds licenses from the Federal Communications
Commission (the "FCC") for broadcast television station KWBP-TV in Salem, Oregon
(the "Station") and owns or holds other assets used or useful in the operation
of the Station.
2. Seller desires to sell, assign, and transfer, to the fullest
extent permitted by law, the FCC licenses and other assets owned or held by
Seller and used or useful in the operation of the Station.
3. To the fullest extent permitted by law, Buyer desires to
acquire the FCC licenses for the Station and other assets owned or held by
Seller and used or useful in the operation of the Station, all under the terms
described herein.
4. On this same day, Seller and Buyer shall, subject to the
expiration of any applicable waiting period under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976 ("HSR"), execute a Management Agreement
("MA") under which Buyer shall provide programming to be aired on the Station,
which shall remain under the exclusive control of Seller pending consummation of
the transactions contemplated by this Agreement.
NOW, THEREFORE, in consideration of the foregoing and the mutual
promises and covenants contained herein, the parties hereby agree as follows:
ARTICLE 1. EXCHANGE OF CONSIDERATION
1.1 CONSIDERATION CONVEYED BY SELLER. At the Closing, as defined
herein, Seller shall provide Buyer with the following consideration:
1.1.1. STATION ASSETS. Subject to the terms and conditions
of this Agreement, Seller shall, to the fullest extent permitted by law, assign,
convey, transfer, and deliver to Buyer, and Buyer shall, to the fullest extent
permitted by law, acquire from Seller free and clear of all debts, liens,
claims, financing leases, security interests and encumbrances of any kind
whatsoever (except as permitted herein), all of Seller's right, title and
interest in and to Seller's assets, real and personal, tangible and intangible,
of every kind and description, owned or held by Seller and used or useful in the
operation of the Station (collectively the "Station Assets") except the assets
described in Section 1.1.2. of this Agreement. The Station Assets consist of the
following items:
(a) GOVERNMENT LICENSES. All licenses and other
authorizations issued by the FCC to Seller (the "FCC Licenses") with respect to
the Station, as well as any licenses and authorizations issued by any other
governmental authority, true copies of which are included in SCHEDULE 1 to this
Agreement, together with any and all applications pending before the FCC or any
other governmental authority with respect to renewals, extensions, or
modifications thereof.
(b) TANGIBLE PERSONAL PROPERTY. All equipment, furniture,
fixtures, office materials and supplies, spare parts, and other tangible
personal property of every kind and description owned as of the date of this
Agreement by Seller and used or useful in the operation of the Station, with all
material items set forth on SCHEDULE 2 to this Agreement, less any non-material
tangible assets consumed in the ordinary course of the Station's business after
the date hereof, and any additions, improvements, replacements, and alterations
made thereto in the ordinary course of business between the date of this
Agreement and the Closing Date, as defined herein. For purposes of this
paragraph only, a material asset is deemed to be one with a value of at least
$100.
(c) CONTRACTS. All rights in and under certain contracts,
agreements, and leases of any kind (except those relating to real property and
sale of time on the Station) relating to the operation of the Station which
Buyer has agreed to assume, whether in existence as of the date of this
Agreement or entered into or acquired between the date hereof and the Closing
Date, as defined herein, in the ordinary course of business (all of the
foregoing collectively referred to herein as the "Contracts"): provided, that
SCHEDULE 3 includes true copies of all written Contracts as well as accurate
descriptions of all oral Contracts to be assumed by Buyer; provided further,
that, except as provided herein, Buyer shall not assume any Contract not
identified in SCHEDULE 3; provided further, that the discounted value of any
equipment leased pursuant to a Contract to be assumed by Buyer hereunder is
equal to or less than the fair market value of the equipment; provided further,
that no Contract created subsequent to the date of this Agreement shall be
assigned to Buyer without Buyer's written approval unless such Contract involves
less than $5000 value in goods or services (or $50,000 in the aggregate of such
Contracts) and can be canceled upon 30 days notice without liability to Buyer;
and provided further, that Seller shall promptly provide Buyer with a true copy
or, in the event of an oral agreement, an accurate description of all material
terms, of any such Contract entered into subsequent to the date of this
Agreement which is to be assumed by Buyer.
(d) LEASES. All leases relating to real property (the
"Real Estate Leases"), true copies of which or, in the case of oral agreements,
summaries of which are annexed hereto in SCHEDULE 4.
(e) TIME SALES AGREEMENTS. All agreements, including
trade and barter agreements (collectively, the "Trade Agreements"), for the sale
of time on the Station in the ordinary course of business and in accordance with
past practices of the Station: provided, that Buyer shall only assume Trade
Agreements which involve the provision of goods or services related to and
useful in the business of the Station.
2
(f) MARKETING ITEMS. All trademarks, call signs, service
marks, franchises, patents, trade names, jingles, fictitious names, slogans, and
logotypes owned and used by Seller as of the date hereof, as well as those
acquired between the date hereof and the Closing Date in connection with the
operation of the Station.
(g) PROGRAMMING AND COPYRIGHTS. All programs and
programming materials and elements of whatever form or nature owned or licensed
for use by Seller and used in the operation of the Station as of the date hereof
(except those included in the Excluded Assets), all of which are identified in
SCHEDULE 5 annexed hereto, together with all such programs, materials, elements,
intellectual property rights, and copyrights acquired between the date hereof
and the Closing Date, whether recorded on tape or any other medium or intended
for live performance, and whether completed or in production, and all related
common law and statutory copyrights owned or licensed for use by Seller and used
or useful in the operation of the Station.
(h) RECORDS. Any and all files, program logs, public
inspection files, and other records that relate to the operation of the Station
in the possession of Seller on the Closing Date, except Seller's records that
pertain to the organization of Seller.
(i) GOODWILL. All of Seller's goodwill in and going
concern value of the Station.
(j) ACCOUNTS RECEIVABLE. All notes and accounts receivable
of Seller relating to or arising out of the sale of advertising time on the
Station at any time on or after January 1, 1997 (the "1997 Accounts
Receivable").
1.1.2. EXCLUDED ASSETS. Notwithstanding the foregoing, there
shall be excluded from the Station Assets and retained by Seller, to the extent
in existence on the Closing Date, the following assets (the "Excluded Assets"):
(a) ACCOUNTS RECEIVABLE. All notes and accounts
receivable of Seller relating to or arising out of the sale of advertising time
on the Station prior to January 1, 1997 (the "1996 Accounts Receivable").
(b) CASH AND INVESTMENTS. All cash on hand or in bank
accounts and all cash equivalents and similar investments of Seller, such as
certificates of deposit.
(c) PREPAID ITEMS. All deposits, reserves, and prepaid
expenses and taxes (unless prorated as provided in Section 1.3. of this
Agreement).
(d) PERSONAL PROPERTY. All non-material tangible personal
property disposed of or consumed in the ordinary course of business of the
Station.
(e) INSURANCE. All contracts of insurance.
3
(f) SECURITIES. Any and all securities owned or held by
Seller.
(g) CLAIMS. Any and all claims of Seller with respect to
transactions which transpire prior to the Closing Date, including, without
limitation, claims for tax refunds.
(h) CONTRACTS. Programming contracts as well as all
other agreements, leases, and contracts not assumed by Buyer in accordance with
Section 1.1.1.(c), (e) and (f) of this Agreement.
(i) MISCELLANEOUS ASSETS. Pension, profit-sharing, and
savings plans and trusts and any assets thereof.
(j) ORGANIZATIONAL DOCUMENTS. Seller's books and original
records that pertain to the organization, existence or capitalization of Seller.
(k) REAL PROPERTY. The real property and improvements
located thereon at 10255 SW Arctic Drive, Beaverton, Oregon 97005;
(l) REAL ESTATE LEASES. Any and all leases for use of
the real property described in Subsection 1.1.2. (k).
1.1.3. SELLER'S RETAINED LIABILITIES. The Station Assets shall
be sold and conveyed to Buyer free and clear of all debts, liens, claims,
financing leases, security interests and encumbrances or liabilities of any kind
or nature except for liens for current taxes not yet due and payable (the
"Permitted Encumbrances"). Unless reflected in a document executed by Buyer,
Buyer shall not assume or be liable for (a) any programming contract or other
contract, agreement or lease not specifically assumed by Buyer hereunder; (b)
any obligation of Seller arising out of any contract of insurance, any pension,
retirement or profit-sharing plan, or any trust or other benefit plan; (c) any
litigation, proceeding, or claim relating to the business or operation of the
Station prior to the Closing, regardless of whether such litigation, proceeding,
or claim is pending, threatened, or asserted before, on, or after the Closing;
or (d) any obligation (including but not limited to wages, salaries, vacation
pay, payroll taxes, COBRA coverage or severance payments) to or for persons
employed by Seller (recognizing that Buyer has no obligation to employ any of
Seller's employees).
1.2. Consideration Conveyed by Buyer.
1.2.1. PURCHASE PRICE. Except as otherwise provided herein,
Buyer shall pay Seller at the Closing Seventeen Million Six Hundred Thousand
Dollars ($17,600,000) (the "Purchase Price") by wire transfer of immediately
available federal funds pursuant to instructions from Seller, less adjustments
made pursuant to this Agreement.
4
1.2.2. SELLER'S STOCK ACQUISITION. At the Closing, as defined
herein, Buyer will sell, transfer, convey and otherwise assign to Seller a 20
percent ownership interest in Buyer (subject to pro rata dilution for financing
agreements, management incentives, and acquisition of capital after closing from
third parties) provided, that Seller would have the option within six (6) months
of Closing to convert its ownership interest in Buyer to an ownership interest
of comparable value in Buyer's parent on the same terms and conditions provided
to original investors in Buyer or its parent (other than Buyer's founding
parties). The ownership interest in Buyer or its assignee acquired by Seller
under this subsection shall be reconveyed, retransferred, resold, and reassigned
to Buyer on the Fifth Anniversary date of the Closing in accordance with an
appraisal performed by a qualified appraiser. To that end, Seller and Buyer
shall each select a qualified appraiser six (6) months prior to the date of
sale, and the two appraisers shall, within thirty (30) days thereafter, jointly
select the appraiser to provide the appraisal.
1.2.3. LOAN TO SELLER. If the Closing does not occur by May 31,
1997, Buyer will loan or cause to be loaned to Seller Ten Million Dollars
($10,000,000) on that date to be used to pay in full all outstanding balances of
any debt of Seller. The loan will be payable at the Closing or, in the event
there is no Closing, within twelve (12) months from the termination of the
Purchase Agreement. The loan will be evidenced by a Promissory Note (the "Note")
in the form of Exhibit A annexed hereto which will bear annual interest on the
outstanding principal (with the rate of interest to be determined by the third
party lender providing the funds). If there is no Closing then, in that event,
Seller and Buyer will immediately commence efforts to refinance or recapitalize
the Seller. If no agreement can be reached by the parties within 120 days after
termination with respect to any refinancing or recapitalization plan, then, in
that event, Seller shall initiate efforts in conjunction with Buyer and/or its
principals to sell the Station to a third party. The proceeds of the sale to a
third party will be used to (1) first repay the aforementioned loan and accrued
interest (to the extent not previously paid), (2) then reimburse Buyer for any
net losses incurred by Buyer under the MA and (3) then pay Buyer 50% of the
gross amount received in excess of $22 Million. The loan will be secured by (1)
a first security interest in accordance with the form annexed hereto as Exhibit
B in all of the Station Assets, including but not limited to licenses issued by
the FCC (to the extent permitted by law) and the proceeds of the sale of the
Station Assets, (2) pledges of stock for Seller and Peregrine Communication,
Ltd. ("Peregrine") and (3) the personal guarantees of Roy Rose, Daniel J.
Alderman, and Hampton Holdings, L.L.C., an Oregon limited liability company, in
the form of Exhibit C annexed hereto: provided, that Buyer will not invoke its
remedies under those guarantees unless and until it is determined the
aforementioned pledged stock is insufficient to repay the amounts due Buyer
under the aforementioned loan.
1.2.4. NONCOMPETITION AGREEMENT. One Thousand Dollars ($1,000) of
the Purchase Price will be allocated as consideration for the execution by
Seller and its parent company, Peregrine Communications, Ltd., of the
Noncompetition Agreement annexed hereto as EXHIBIT D.
5
1.3. ADJUSTMENTS.
1.3.1. PRORATIONS. At the Closing, all income of the Station and all
taxes and assessments, rent, water, sewer and other utility charges and lienable
municipal services, if any, with respect to the Station Assets to be acquired by
Buyer shall be apportioned and allocated between Buyer and Seller as of January
1, 1997 on the basis of the period of time to which such income or liabilities
apply. To the extent such items cannot be determined at Closing, a final
settlement on such prorations shall be made within thirty (30) days after the
Closing Date. If the Closing occurs before the tax rate is fixed for the then
current term, the apportionment of taxes at Closing shall be upon the basis of
the tax rate for the preceding tax year applied to the latest assessed
valuation. If the tax rate is changed with respect to any period of time prior
to the Closing Date, as defined herein, the post-Closing proration shall include
a corresponding adjustment in the final proration made pursuant to this Section.
1.3.2. TRADE AND BARTER ITEMS. At the Closing, Seller shall deliver
to Buyer a report, dated the Closing Date (the "Trade Report"), which lists all
Trade Agreements included in the Station Assets, together with an itemized
statement of the aggregate value of time owed (based on the Station's current
rates) pursuant to each of the Trade Agreements and the fair market value of
goods and services to be received pursuant to each of the Trade Agreements as of
the Closing Date. The Purchase Price to be paid by Buyer to Seller at Closing
shall be reduced to the extent that the aggregate value of the Station's
post-Closing obligations under Trade Agreements for the broadcast of advertising
time exceeds the aggregate value of the goods and services to be received by the
Station under the Trade Agreements after the Closing.
1.3.3. DISPUTES. In the event of any disputes between the parties as
to any adjustments under this Section, the amounts not in dispute shall be paid
at the time provided herein and the dispute shall be resolved by an independent
certified public accountant ("CPA") who shall be jointly selected by the parties
within thirty (30) days after the Closing or after the final settlement on
prorations, as the case may be. The decision of the CPA shall be binding on each
of the parties and enforceable by a court of competent jurisdiction. The fees
and expenses of the CPA shall be paid one-half by Seller and one-half by Buyer.
1.4. ALLOCATION. The Purchase Price shall be allocated in accordance
with SCHEDULE 6 annexed hereto and incorporated in an Internal Revenue Service
("IRS") Form 8594. Each party shall be bound by such allocation in any reports,
filings or disclosures to the IRS as well as any and every other governmental
authority.
1.5. CLOSING.
1.5.1. DATE AND LOCATION. The closing of the transactions
provided for in this Agreement (the "Closing") shall be held at the offices of
Dickstein, Shapiro, Morin & Oshinsky, LLP, 2101 L Street, N.W., Washington, D.C.
20037, or at such other
6
place mutually agreed to by the parties, commencing at 10:00 a.m. on a date (the
"Closing Date") selected by Buyer which shall be within ten (10) business days
after the date on which the FCC order (the "Order") approving the assignment of
the FCC Licenses from Seller to Buyer becomes a "Final Order" (which, for
purposes of this Agreement, means that the Order has not been stayed, is not
subject to reconsideration or review by the FCC or a court of competent
jurisdiction, and the time to institute such administrative or judicial review
has expired): provided, that the parties shall not be obligated to proceed to
Closing if (1) the Order includes conditions materially adverse to Buyer or
Seller; or (2) the conditions precedent to Closing have not been satisfied or
waived; and provided further, that the Closing shall be held at a date set by
Buyer within ten (10) business days after issuance of the FCC Order if no
petition to deny or other challenge has been filed against the Application, as
defined in Section 4.5 of this Agreement.
1.5.2. EXCHANGE OF DOCUMENTS. At the Closing, each party shall
execute and deliver to the other party the other items specified herein as well
as any additional document(s) and item(s) reasonably necessary for the
consummation of the transactions contemplated herein. Such additional documents
shall be reasonably satisfactory to the other party as to both form and
substance.
1.6. TIMING. Time is of the essence to implementation of this
Agreement. It is the intention of the parties that the Closing of the
transactions contemplated herein occur not later than 270 days from the date of
this Agreement.
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF SELLER.
Seller represents and warrants to Buyer that the following matters are
true and correct as of the date of this Agreement:
2.1 CORPORATE STATUS. Seller is a Corporation duly organized, validly
existing, and in good standing in the State of Oregon. Seller has the power to
carry on the business of the Station as it is now being conducted, to own, hold
and use the Station Assets, and to enter into and consummate the transactions
contemplated by this Agreement.
2.2. LICENSES. Seller is the holder of the Licenses included in
SCHEDULE 1 to this Agreement, all of which are in full force and effect. The FCC
Licenses constitute all of the licenses required under the Communications Act of
1934, as amended (the "Act"), and the current rules, regulations, and policies
of the FCC for the operation of the Station as currently conducted. The FCC
Licenses authorize the operation of the Station for the license term expiring on
February 1, 1999. The Seller has filed with the FCC all material applications,
reports and other disclosures required by the Act and by FCC rules and policies.
As of the date of this Agreement, there is not pending or, to the best of
Seller's knowledge, threatened, any petition, complaint, objection (whether
formal or informal), order to show cause, investigation, or other action by or
before the FCC or any court to revoke, cancel, rescind, modify, or refuse to
renew any of the FCC Licenses, or which
7
would otherwise have a material adverse impact on the operation of the Station.
Other than proceedings of general applicability to the broadcasting industry,
there is not now pending or, to the best of Seller's knowledge, threatened, any
other petition, complaint, objection (whether formal or informal),
investigation, order to show cause, notice of violation, notice of apparent
liability, or notice of forfeiture or other proceeding by or before the FCC or
any court against Seller with respect to any matter affecting the Station. The
Station is operating in material compliance with the FCC Licenses, the Act, and
the rules, regulations and policies of the FCC, and the Station's signal
coverage is not subject to any interference which materially impairs the
reception of its signal within the Station's Grade A or Grade B contours. As
more particularly described in SCHEDULE 1, the Station is not currently
operating at its fully authorized power under its FCC Licenses, but such
operation does not and will not affect the validity of the FCC Licenses,
Seller's ability to assign the FCC Licenses to Buyer as contemplated by this
Agreement, Buyer's ability to broadcast the Station at the full power currently
authorized by the FCC Licenses, or Buyer's ability to secure a timely renewal of
the FCC Licenses.
2.3. CONDITION OF ASSETS. Except as otherwise disclosed herein,
the Station Assets are in good working order, meet all government requirements,
and are being maintained in accordance with generally accepted industry and
engineering practices.
2.4. TITLE. On the Closing Date, the Station Assets will be in each
case free and clear of all debts, claims, liabilities, security interests,
mortgages, pledges, liens, conditional sales agreements, leases, encumbrances,
or charges of any kind or nature whatsoever except for the Permitted
Encumbrances or such liabilities expressly assumed by Buyer hereunder.
2.5. EMPLOYEES. Seller is not a party to any pending or, to its
knowledge, threatened labor dispute affecting the Station. Seller (1) has
complied in all material respects with all applicable federal, state, and local
laws, ordinances, rules and regulations and requirements relating to employment
or labor, including but not limited to provisions relative to wages, hours,
collective bargaining, pension, profit-sharing and savings plans and trusts
including, without limitation, 401-K plans ("Trusts") and payment of Social
Security, unemployment and withholding taxes and (2) is not liable for any
arrears of wages or Trusts or benefit payments ("Payments") or any taxes or
penalties for failure to comply with any of the foregoing. Seller will hold
Buyer harmless from and against (1) any liability for any taxes or Payments or
penalties which have not been paid or made for employment of persons by Seller,
(2) any claims of discrimination or wrongful termination or hiring, including,
without limitation, violations of federal or state law relating to civil rights,
regulations of the United States Equal Employment Opportunity Commission, or the
Americans With Disabilities Act of 1990, (3) all claims for severance
(recognizing that Buyer has no obligation to employ any of Seller's employees),
and (4) any other claims by employees of Seller relating to or arising from
their employment (or severance therefrom) by Seller. There are no collective
bargaining agreements, or negotiations for the same, in existence which affect
any of the Station's employees.
8
2.6. TAXES. Except as disclosed in SCHEDULE 7 annexed hereto, Seller
has duly and timely filed all required federal, state and local tax returns and
paid all taxes, interest and penalties due with respect to Seller's interest in
the Station Assets or its operation of the Station, has sought and obtained
extensions of time to file such and pay same within the time provided therefor,
or is challenging such taxes in good faith in accordance with applicable
procedures (and has in place adequate financial reserves to satisfy any adverse
decision). Between the date hereof and the Closing Date Seller shall duly and
timely file all such required returns and pay all such taxes, interest and
penalties or obtain such extensions within the time provided therefor, unless
such taxes are being challenged in good faith in accordance with applicable
procedures (and has in place adequate financial reserves to satisfy any adverse
decision). Seller shall indemnify, defend, save and hold Buyer harmless from and
against all claims, obligations and liabilities for all taxes, interest and
penalties attributable to Seller's ownership or operation of the Station and the
ownership or holding of the Station Assets prior to the Closing Date.
2.7. CONTRACTS. SCHEDULE 3 hereto includes true copies of all written
Contracts and describes the material terms of all oral Contracts to which Seller
is a party as of the date of this Agreement and which will be assumed by Buyer.
Those Contracts requiring a third party's consent to assignment are identified
by an asterisk in SCHEDULE 3. Seller has complied in all material respects with
all Contracts and is not in default beyond any applicable grace periods under
any of such Contracts. To Seller's knowledge, no other contracting party is in
material default under any of the Contracts. All Contracts are in full force and
effect and are valid, binding and enforceable in accordance with their
respective terms, except as enforceability may be limited by laws affecting
creditor rights or equitable principles generally.
2.8. ENVIRONMENTAL. No hazardous or toxic waste, substance, material
or pollutant (collectively "Hazardous Waste"), as defined under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, 42 U.S.C. ss. 9601 et seq., the Toxic Substances Control Act, as
amended, 15 U.S.C. ss. 2601 et seq., the Resource Conservation and Recovery Act
of 1976, as amended, 42 U.S.C. ss. 6901 et seq., the Clean Water Act, as
amended, 42 U.S.C. ss. 1251 ET SEQ., the Clean Air Act, as amended, 42 U.S.C.
ss. 7401 ET SEQ. or any other applicable federal, state or local law, or any
regulations or policies adopted pursuant to such laws (the foregoing laws,
regulations and policies collectively referred to herein as the "Environmental
Laws") has been released, emitted or discharged or, to Seller's knowledge, is
currently located in or on the Station Assets or in, on or under the real
property on which any of the Station Assets are situated in violation of any
Environmental Laws. The Station Assets and Seller's use thereof are not in
material violation of any Environmental Laws, including but not limited to FCC
rules, policies and guidelines concerning RF radiation. Seller has not received
any notice, summons, citation, directive, letter or other communication, written
or oral, from the United States, the State of Oregon, or any other party
concerning any intentional or unintentional action or omission on the part of
Seller or any other party which resulted in the releasing, spilling, leaking,
pumping, pouring, emitting, emptying, discharging,
9
injecting, escaping, leeching, dumping or disposing of Hazardous Waste on, above
or under Station Assets owned or used by Seller in operation of the Station.
2.9. FINANCIAL STATEMENTS. Seller has provided Buyer with true copies
of a balance sheet dated June 30, 1996, audited financial statements for the
Station for fiscal year 1995, and unaudited interim financial statements for the
period ended on November 30, 1996 (all of the foregoing collectively referred to
herein as the "Financial Statements"). True copies of the Financial Statements
are included in SCHEDULE 8. The Financial Statements (1) have been prepared in
accordance with generally accepted accounting principles consistently applied,
(2) identify all of Seller's material obligations and liabilities (contingent or
matured) with respect to the Station, and (3) fairly reflect the financial
performance of the Station for the periods indicated.
2.10. LITIGATION. Seller has not been operating under and is not
subject to, or in default with respect to, any order, judgment, writ,
injunction, or decree of any court or any federal, state, municipal, or other
governmental department, commission, board, agency, or instrumentality, foreign
or domestic, which has had or could reasonably be expected to have a material
adverse effect on the Station Assets or the manner in which Seller currently
operates the Station. There is no litigation, arbitration, dispute, proceeding
or investigation ("Litigation") pending by or against, or, to the best of
Seller's knowledge, threatened against the Station or Seller which relates to or
affects the Station Assets or the business of the Station or which materially
interferes or could reasonably be expected materially to interfere with Seller's
(1) right, title to, or interest in the Station Assets, (2) operation of the
Station or (3) ability to transfer the Station Assets to Buyer free of such
Litigation.
2.11 COMPLIANCE WITH LAWS. Except as disclosed in SCHEDULE 9 annexed
hereto, Seller is in material compliance with all applicable laws, rules,
regulations, policies and orders of the federal, state, and local governments
with respect to the Station. The present uses by Seller of the Station Assets do
not violate any such laws, regulations, policies or orders in any material
respect, and there is no investigation or proceeding regarding the foregoing
which is currently pending or, to Seller's knowledge, threatened.
2.12 NO DEFAULTS. Neither the execution and delivery by Seller of this
Agreement nor the consummation by Seller of the transactions contemplated herein
are events that, by themselves or with the giving of notice or the passage of
time or both, constitute a material violation of or will conflict with or result
in any material breach of or any default under (a) the terms, conditions, or
provisions of any arbitration award, judgment, law, order, decree, writ, or
regulation to which Seller is subject, (b) Seller's articles of incorporation or
bylaws, or (c) any agreement or instrument to which Seller is a party or by
which Seller is bound, or result in the creation of imposition of any lien,
charge, or encumbrance on any of the Station Assets.
2.13. BROKERS. There is no broker or finder or other person who
would, as a result of any agreement of or action taken by Seller, have any
valid claim against any of the
10
parties to this Agreement for a commission or brokerage fee in connection with
this Agreement or the transactions contemplated herein (except CEA, Inc., whose
fee will be paid by Buyer).
2.14 SELLER ACTION. All Seller actions and proceedings necessary to be
taken by or on the part of Seller in connection with the transactions
contemplated by this Agreement and necessary to make the Agreement effective
have been duly and validly taken. This Agreement has been duly and validly
authorized, executed, and delivered by Seller and constitutes the valid and
binding agreement of Seller, enforceable in accordance with and subject to its
respective terms, except as enforceability may be limited by laws affecting the
enforcement of creditor rights or equitable principles generally. At the
Closing, Seller will provide Buyer with certified resolutions executed by
Seller's stockholders and board of directors authorizing the execution,
delivery, and performance of this Agreement.
2.15. STATION ASSETS. Except as disclosed in SCHEDULE 9 annexed
hereto, the Station Assets are in good working order, meet any and all
applicable governmental and industry standards, and are sufficient to enable
Seller to operate the Station as currently conducted. All of the statements made
and Schedules referred to in this Agreement with respect to the Station Assets
are true, accurate, and complete in all material respects.
2.16. LEASES. All of the Real Estate Leases included in SCHEDULE 5
have been complied with in all material respects by Seller, and no material
default of Seller in respect to any duties or obligations required to be
performed by Seller has occurred. All such leases are valid, binding, and
enforceable in accordance with their respective terms. To Seller's knowledge, no
other party to any of the Real Estate Leases is in default thereunder, except as
enforceability may be limited by laws affecting the enforcement of creditor
rights or equitable principles generally.
2.17 INSOLVENCY. No insolvency proceedings of any character,
including, without limitation, bankruptcy, receivership, reorganization,
composition or arrangement with creditors, voluntary or involuntary, affecting
the Seller or any of the Station Assets is pending or, to the best of Seller's
knowledge, threatened, and Seller has not made any assignment for the benefit of
creditors, nor taken any actions with a view to, or which would constitute the
basis for, the institution of any such insolvency proceedings.
2.18 APPROVALS. Other than Aspen TV LLC (where approval will be
secured by Seller prior to Closing), no approval of any third party,
governmental agency or court is required to be obtained by Seller with regard to
the assignment of the FCC Licenses and other Station Assets except (1) parties
to certain Contracts and Real Estate Leases being assumed by Buyer under this
Agreement, (2) the approval by the FCC as provided herein, and (3) unless
otherwise determined by the parties, the United States Department of Justice
("DOJ") and/or the Federal Trade Commission ("FTC") under the HSR.
11
2.19 CABLE CARRIAGE. To Seller's knowledge, SCHEDULE 10 hereto sets
forth a correct and complete list of (1) all cable television systems which
carry the Station's signal on the date hereof under the FCC's "must carry"
rules; and (2) all cable television systems which carry the Station's signal
pursuant to retransmission consent agreements (with copies of such agreements
included in the schedule).
2.20. BULK SALES LAW. There is no bulk sales law or other comparable
statute in Oregon which is applicable to the transactions contemplated by this
Agreement, and Seller hereby indemnifies Buyer from any and all liability which
may be imposed on or incurred by Buyer (including reasonable attorney fees)
under such laws.
2.21. NO MATERIAL OMISSION. Seller has not failed to disclose any
material fact within its knowledge which would make any statement or
representation in this Agreement inaccurate or misleading.
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF BUYER.
Buyer represents and warrants to Seller as to the truth of the
following matters as of the date of this Agreement:
3.1. STATUS. Buyer is a corporation duly organized, validly
existing, and in good standing in the State of Oregon, and has the power to
enter into and consummate the transactions contemplated by this Agreement.
3.2. CORPORATE ACTION. All corporate actions and proceedings necessary
to be taken by or on the part of Buyer in connection with the transactions
contemplated by this Agreement and necessary to make the Agreement effective
have been duly and validly taken. This Agreement has been duly and validly
authorized, executed, and delivered by Buyer and constitutes the valid and
binding agreement of Buyer, enforceable in accordance with and subject to its
terms, except as enforceability may be limited by laws affecting the enforcement
of creditors' rights or equitable principles generally. At the Closing, Buyer
will provide Seller with a certified copy of the resolutions adopted by Buyer's
stockholders and board of directors authorizing the execution, delivery and
consummation of this Agreement.
3.3. NO DEFAULTS. Neither the execution and delivery by Buyer of this
Agreement nor the consummation by Buyer of the transactions contemplated herein
are events that, by themselves or with the giving of notice or the passage of
time or both, constitute a material violation of or will conflict with or result
in any material breach of or any default under (a) the terms, conditions, or
provisions of any arbitration award, judgment, law, order, or regulation to
which Buyer is subject, (b) the articles of incorporation or by-laws of Buyer,
or (c) any agreement or instrument to which Buyer is a party or by which it is
bound.
12
3.4. BROKERS. There is no broker or finder or other person who would,
as a result of any agreement of or action taken by Buyer, have any valid claim
against any of the parties to this Agreement for a commission or brokerage fee
in connection with this Agreement or the transactions contemplated herein
(except CEA, Inc., whose fee will be paid by Buyer).
3.5. LITIGATION. There is no litigation, proceeding, or
investigation of any nature pending or, to the best of Buyer's knowledge,
threatened against or affecting Buyer that would affect Buyer's ability to
carry out the transactions contemplated herein.
3.6. QUALIFICATION AS A BROADCAST LICENSEE. To the best of its
knowledge, Buyer is legally qualified under the Act and all other applicable
federal, state and local laws, rules and regulations, to acquire the Station
Assets from Seller. Buyer knows of no fact, and will not act in such manner from
and after the date hereof, that would, under the Act and the rules and policies
of the FCC, disqualify Buyer as an assignee of the FCC Licenses or Buyer as
owner and holder of the other Station Assets.
3.7. NO MATERIAL OMISSION. Buyer has not failed to disclose any
material fact within its knowledge which would make any statement or
representation in this Agreement inaccurate or misleading.
ARTICLE 4. COVENANTS OF SELLER PENDING CLOSING.
Seller covenants and agrees that, from the date of this Agreement to
and including the Closing Date, subject to the provisions of this Agreement, it
will take, or refrain from taking, the following actions:
4.1. MAINTENANCE OF STATION. Subject to the MA, Seller shall continue
to carry on the Station business and keep its books of account, records, and
files in the ordinary course of business and shall continue to operate the
Station in all material respects in accordance with the terms of the FCC
Licenses and in material compliance with all applicable rules, regulations,
policies and laws. To that end, Seller will file with the FCC any and all
reports, applications, and disclosures as may be required by the Act or FCC
rules or policies. Seller shall maintain in full force and effect through and
including the Closing Date the existing property damage, liability, and other
insurance with respect to the Station Assets to cover contingencies that can
reasonably be anticipated. Prior to the Closing, Seller will not, without the
prior written consent of Buyer:
4.1.1. sell, lease, transfer, or agree to sell, lease, or
transfer any Station Assets without replacement thereof with an asset of
equivalent kind, condition, and value;
4.1.2. enter into any collective bargaining agreement or written
contract of employment without Buyer's prior approval, unless said contract is
subject to cancellation upon thirty (30) days notice without penalty to Buyer;
13
4.1.3. renew, renegotiate, modify, amend, or terminate any
existing Time Sales Agreements with respect to the Station except in the
ordinary course of business;
4.1.4. Subject to Section 1.1.1.(c) hereof, enter into any
contract or agreement with respect to the Station or the Station Assets
except in the ordinary course of business or as provided in this Agreement;
4.1.5. make, allow, or consent to any material change in the
Real Property or in any buildings, leasehold improvements, or fixtures used
or useful in the operation of the Station except in the ordinary course of
business;
4.1.6. make any material change in the insurance policies
included in SCHEDULE 8; or
4.1.7. take any action or, as the case may be, fail to take any
action necessary to preserve the Station's carriage on cable television
systems identified in SCHEDULE 9.
4.2. ORGANIZATION, GOOD WILL, PROMOTION. Subject to the provisions of
this Agreement and the MA, Seller shall use its best efforts to preserve the
business organization of the Station intact and shall cooperate with Buyer to
preserve the goodwill of the Station's suppliers, customers, and others having
business relations with the Station.
4.3. ACCESS TO FACILITIES, FILES, AND RECORDS. At the reasonable
request of Buyer, Seller shall give Buyer and its representatives (1) reasonable
access during normal business hours to all facilities, property, accounts, title
papers, insurance policies, licenses, agreements, commitments, records,
machinery, fixtures, furniture, and inventories related to the Station or the
Station Assets, and (2) all such other information concerning the affairs of the
Station as Buyer may reasonably request. The rights of Buyer under this Section
shall not be exercised in such a manner as to interfere unreasonably with the
business of the Station.
4.4. REPRESENTATIONS AND WARRANTIES. Seller shall give notice to Buyer
promptly upon the occurrence of, or upon becoming aware of the impending or
threatened occurrence of, any event that would cause or constitute a material
breach of any of Seller's representations or warranties in this Agreement.
4.5. APPLICATION FOR FCC CONSENT. Within five (5) business days after
execution of this Agreement, Seller shall prepare and file an appropriate
application (the "Application") with the FCC requesting its written consent to
the assignment of the FCC Licenses for the Station to Buyer. Seller shall
diligently take, or cooperate in the taking of, all steps necessary and
appropriate to expedite the preparation of the Application and its prosecution
to a favorable conclusion. Seller will promptly provide Buyer with a copy of any
pleading, order, or other document served on it relating to the Application.
Seller will use its best efforts and otherwise cooperate with Buyer in
responding to any information
14
requested by the FCC related to the Application, in making any amendment to this
Agreement requested by the FCC which does not adversely affect Seller in a
material manner, and in defending against any petition, complaint, or objection
which may be filed against the Application. The FCC filing fees shall be divided
equally between Seller and Buyer.
4.6. CONSENTS. Seller shall obtain or cause to be obtained prior to
the Closing consents to the assignment to or assumption by Buyer of all
Contracts and Real Estate Leases included in the Station Assets that require the
consent of any third party by reason of the transactions provided for in this
Agreement.
4.7. NOTICE OF PROCEEDINGS. Seller will promptly notify Buyer (and in
any event within five (5) business days) upon becoming aware of any actual or
threatened claim, dispute, arbitration, litigation, complaint, judgment, order,
decree action or proceeding relating to Seller, the Station, the Station Assets,
or the consummation of this Agreement or any transaction contemplated herein.
4.8. CONFIDENTIAL INFORMATION. If the transactions contemplated in
this Agreement are not consummated for any reason, Seller shall not disclose to
third parties any information designated as confidential and received from Buyer
or its agents in the course of investigating, negotiating, and consummating the
transactions contemplated by this Agreement: provided, that no information shall
be deemed to be confidential that (1) becomes publicly known or available other
than through disclosure by Seller; (2) is rightfully received by Seller from a
third party; or (3) is independently developed by Seller. All originals of all
material provided to Seller by Buyer or its agents shall be returned to Buyer
and all copies thereof shall be destroyed.
4.9. CONSUMMATION OF AGREEMENT. Seller shall fulfill and perform all
conditions and obligations to be fulfilled and performed by Seller under this
Agreement and make every reasonable effort to cause the transactions
contemplated by this Agreement to be fully carried out.
4.10 COMPLIANCE WITH LAW. Seller will comply in all material respects
with all applicable federal, state and local laws, ordinances and regulations,
including but not limited to the Act and the rules, regulations and policies of
the FCC.
4.11 PERFORMANCE UNDER CONTRACTS AND LEASES. Seller will perform in
all material respects its obligations under, and keep in good standing, all
Contracts, Time Sales Agreements, and Real Estate Leases to which Seller is a
party and which will be assigned to Buyer at the Closing pursuant to this
Agreement.
4.12 HSR FILING. Within ten (10) business days after execution of this
Agreement, Seller shall file with DOJ and/or the FTC any and all applications
and other documents necessary to comply with HSR and to secure any necessary
approval under
15
HSR. The filing fees for any HSR application shall be divided equally between
Seller and Buyer.
ARTICLE 5. COVENANTS OF BUYER PENDING THE CLOSING.
Buyer covenants and agrees that, from the date of this Agreement to
and including the Closing, it will take, or refrain from taking, the following
actions:
5.1. REPRESENTATION AND WARRANTIES. Buyer shall give notice to Seller
promptly upon the occurrence of, or upon becoming aware of the impending or
threatened occurrence of, any event that would cause or constitute a material
breach of any of the representations and warranties of Buyer in this Agreement.
5.2. APPLICATION FOR COMMISSION CONSENT. Within five (5) business days
after execution of this Agreement, Buyer will prepare and provide Seller's
counsel with the assignee's portion of the Application. Buyer will diligently
take, or cooperate in the taking of, all steps necessary and appropriate to
expedite the preparation of the Application and its prosecution to a favorable
conclusion. Buyer will promptly provide Seller with a copy of any pleading,
order, or other document served on it relating to the Application. Buyer will
use its best efforts and otherwise cooperate with Seller in responding to any
information requested by the FCC related to the Application or this Agreement,
in making any amendment to this Agreement requested by the FCC which does not
adversely affect Buyer in a material manner, and in defending against any
petition, complaint, and other objection which may be filed against the
Application.
5.3. CONFIDENTIAL INFORMATION. If the transactions contemplated in
this Agreement are not consummated for any reason, Buyer shall not disclose to
third parties any information designated as confidential and received from
Seller or its agents in the course of investigating, negotiating, and performing
the transactions contemplated by this Agreement: provided, however, that no
information shall be deemed to be confidential that (1) becomes publicly known
or available other than through disclosure by Buyer; (2) is rightfully received
by Buyer from a third party; or (3) is independently developed by Buyer. All
originals of material provided by Seller to Buyer or its agents shall be
returned to Seller and all copies thereof destroyed.
5.4. CONSUMMATION OF AGREEMENT. Buyer shall fulfill and perform in all
material respects all conditions and obligations to be fulfilled and performed
by Buyer under this Agreement and make every reasonable effort to cause the
transactions contemplated by this Agreement to be fully carried out.
5.5. NOTICE OF PROCEEDINGS. Buyer will promptly (and in any event
within five (5) business days) notify Seller upon becoming aware of any actual
or threatened claim, dispute, arbitration, litigation, complaint, judgment,
order, decree, action or proceeding relating to Buyer, the Station, the Station
Assets, or the consummation of this Agreement or any transaction contemplated
herein.
16
5.6. HSR FILING. Within ten (10) business days after execution of
this Agreement, Buyer shall file with the DOJ and/or the FTC any and all
applications and other documents necessary to comply with HSR and to secure any
necessary approval under HSR. The filing fees for any HSR application shall be
divided equally between Seller and Buyer.
ARTICLE 6. CONDITIONS PRECEDENT TO
OBLIGATIONS OF SELLER TO CLOSE.
The obligation of Seller to consummate the transactions under this
Agreement is subject to the fulfillment of the following conditions prior to or
at the Closing:
6.1. REPRESENTATIONS, WARRANTIES, COVENANTS.
6.1.1. BUYER'S REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of Buyer contained in this Agreement shall
have been true and accurate in all material respects as of the date when made
and as of the Closing Date;
6.1.2. BUYER'S PERFORMANCE UNDER AGREEMENT. Buyer shall have
performed and complied in all material respects with each and every covenant
and agreement required by this Agreement to be performed or complied with by
Buyer prior to or at the Closing, other than the delivery by Buyer of the
consideration described in Section 1.2.;
6.1.3. BUYER'S DELIVERIES. Buyer shall have delivered to Seller
(a) a certificate executed by an officer of Buyer, dated the Closing Date,
certifying to the fulfillment of the conditions set forth in Sections 6.1.1.
and 6.1.2., and (b) the resolutions referred to in Section 3.2 of this
Agreement.
6.2. PROCEEDINGS.
6.2.1. ABSENCE OF LITIGATION. No action or proceeding shall
have been instituted before any court or governmental body which has resulted
in the issuance of a preliminary or permanent injunction against consummation
of this Agreement.
6.2.2. NOTICE OF INVESTIGATION. Neither of the parties to this
Agreement shall have received written notice from any governmental body of the
institution of any investigation to restrain, enjoin or nullify this Agreement
or the transactions contemplated hereby (other than a routine letter of inquiry,
including a routine Civil Investigative Demand).
6.3. FCC APPROVAL. The FCC approval contemplated by this Agreement
shall have been granted without any conditions materially adverse to Seller.
17
6.4. HSR APPROVAL. The parties shall have received any necessary
approval under HSR (or the applicable waiting period shall have expired without
further action by the United States Government).
6.5. LEGAL OPINION. Seller shall have received an opinion from
Buyer's counsel in the form annexed hereto as EXHIBIT E.
6.6. CANCELLATION OF NOTE. In the event Seller gives Buyer the
Note pursuant to Section 1.2.4. of this Agreement, Buyer shall (upon
deducting from the Purchase Price the amounts owed to Buyer under the Note)
return the Note to Seller marked "Canceled and Paid in Full."
6.7. ISSUANCE OF STOCK. Seller shall have received a stock
certificate reflecting Seller's acquisition of the ownership interest in
Buyer referenced in Section 1.2.2.
ARTICLE 7. CONDITIONS PRECEDENT TO
OBLIGATIONS OF BUYER TO CLOSE.
The obligation of Buyer to consummate the transactions under this
Agreement is subject to the fulfillment of the following conditions prior to or
at the Closing:
7.1. REPRESENTATIONS, WARRANTIES, COVENANTS.
7.1.1. SELLER'S REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of Seller contained in this Agreement shall
have been true and accurate in all material respects as of the date when made
and as of the Closing Date.
7.1.2. SELLER'S PERFORMANCE UNDER AGREEMENT. Seller shall have
performed and complied in all material respects with each and every covenant
and agreement required by this Agreement to be performed or complied with by
it prior to or at the Closing other than the delivery to Buyer of the
instruments conveying the Station Assets to Buyer; and
7.1.3. SELLER'S DELIVERIES. Seller shall have delivered to Buyer (a)
a certificate executed by an officer of Seller, dated the Closing Date,
certifying to the fulfillment of the conditions set forth in Sections 7.1.1. and
7.1.2., (b) the resolutions of Seller's stockholders and board of directors
identified in Section 2.14 of this Agreement, and (c) the consents of third
parties required for the assignment to Buyer of Contracts and Real Estate Leases
specified in Section 1.1.1.
7.2. PROCEEDINGS.
7.2.1. ABSENCE OF LITIGATION. No action or proceeding shall be
pending or have been instituted before any court or governmental body to
restrain or prohibit, or to obtain substantial damages in respect of, the
consummation of this Agreement that, in the reasonable opinion of Buyer, may
reasonably be expected to result
18
in the issuance of a preliminary or permanent injunction against such
consummation or otherwise result in a decision materially adverse to Buyer.
7.2.2. ABSENCE OF INVESTIGATION. Neither of the parties to this
Agreement shall have received written notice from any governmental body of (1)
its intention to institute any action or proceeding to restrain or enjoin or
nullify this Agreement or the transactions contemplated hereby, or to commence
any investigation (other than a routine letter of inquiry, including a routine
Civil Investigative Demand) into the consummation of this Agreement or (2) the
actual commencement of such an investigation.
7.3. DAMAGE TO THE ASSETS.
7.3.1. NO MATERIAL DAMAGE. There shall not have been any material
damage to any of the Station Assets, and, except as otherwise permitted herein,
the Station will have remained on air continuously from the date of this
Agreement to and including the Closing Date (excluding downtime occasioned by
routine maintenance).
7.3.2. RISK OF LOSS. The risk of loss or damage to any of the
Station Assets prior to the Closing shall be upon Seller (except to the extent
caused by Buyer's conduct under the MA). In consultation with Buyer, Seller
shall repair, replace and restore any damaged or lost Station Asset to its prior
condition as soon as possible and in no event later than the Closing, or, in the
alternative and at Buyer's option, provide a reduction in the Purchase Price by
an amount equal to the replacement value of the damaged or lost Station Asset
not covered by an assignment to Buyer of insurance proceeds therefor and payment
by Seller to Buyer of any applicable deductible.
7.3.3. BROADCAST INTERRUPTION. Seller shall promptly notify Buyer
upon learning that the Station's normal broadcast transmissions are interrupted
or interfered with for more than four (4) consecutive hours or are in any way
impaired in any material manner. Seller shall provide Buyer with prompt written
notice of the measures being taken to correct such problems. If the Station is
not restored to 90 percent of the power currently utilized by the Station (as
described in SCHEDULE 1 annexed hereto) within three (3) days and 100 percent of
the power currently utilized by the Station within seven (7) days of such event,
or if two (2) such events occur within any thirty (30) day period, then Buyer
shall have the right to terminate this Agreement upon ten (10) days prior
written notice to Seller.
7.4. FCC APPROVAL. The FCC approval contemplated by this Agreement
shall have been granted without any conditions materially adverse to Buyer and
shall have become a Final Order: provided, that the Buyer shall waive the
requirement that the Order become a Final Order if no petition to deny or other
challenge has been filed against the Application.
19
7.5. CONTRACT AND REAL ESTATE LEASE PAYMENTS. As of the Closing,
Seller shall be current in its payment of any and all obligations under
Contracts or Real Estate Leases to be assumed by Buyer, or such payments
shall be subject to proration hereunder.
7.6. BULK SALE LAW. Seller shall provide a written
indemnification for Buyer with respect to matters relating to the
applicability, if any, of Oregon's bulk sales law.
7.7. LEGAL OPINION. Buyer shall have received an opinion from
Seller's counsel in the form annexed hereto as EXHIBIT F.
7.8. ENVIRONMENTAL AUDITS. Within thirty (30) days of the execution of
this Agreement, Buyer may initiate, at Buyer's expense, a Phase 1, and, if Buyer
deems it appropriate or necessary, a Phase 2 environmental audit of the Station
Assets conducted by an environmental firm licensed in the State of Oregon (the
"Environmental Audits"). If the Environmental Audits reveal a condition of
material non-compliance with any Environmental Law, then, in that event, Seller
shall cure or remedy the condition of material non-compliance prior to Closing.
If Seller is unwilling or unable to cure or remediate the condition of material
non-compliance prior to Closing, then, in that event, Buyer may elect to (1)
accept the Station Assets in their then existing condition and reduce the
Purchase Price by the estimated amount necessary to cure or remediate the
material non-compliance or (2) terminate this Agreement upon twenty (20) days'
prior written notice to Seller without further liability.
7.9. HSR APPROVAL. The parties shall have received any necessary
approval under HSR (or the applicable waiting period shall have expired without
further action by the United States Government).
7.10. NONCOMPETITION AGREEMENT. Seller and Peregrine
Communications, Ltd. shall have executed the Noncompetition Agreement in the
form annexed hereto as EXHIBIT D.
7.11. BUILDING LEASE. Seller shall have provided Buyer with an
executed lease in the form of EXHIBIT G annexed hereto providing Buyer with the
right to lease the premises described therein for a studio for a 10-year period
commencing on the Closing Date at a monthly rental of $12,500.
7.12. NO MATERIAL ADVERSE CHANGE. Between the date of this Agreement
and the Closing, none of the Station Assets, including but not limited to the
FCC Licenses and the Seller's goodwill, or the Station's business, operations,
or financial condition shall have incurred or otherwise be subject to a material
adverse change.
ARTICLE 8. INDEMNIFICATION.
8.1. SURVIVAL. The several representations, warranties, covenants, and
agreements of the Seller and Buyer contained in or made pursuant to this
Agreement shall
20
be deemed to have been made on and as of the Closing, shall survive the Closing,
and shall remain operative and in full force and effect for a period of eighteen
(18) months after the Closing: provided, that all representations, warranties,
covenants and agreements relating to litigation or taxes shall remain operative
until the expiration of any applicable statutes of limitation; provided further,
that Seller's representations concerning any Environmental Law under Section 2.8
shall survive in perpetuity; and provided further, that liabilities assumed or
retained, as the case may be, pursuant to this Agreement shall remain in effect
until such liabilities have been paid or discharged in full.
8.2. INDEMNIFICATION OF BUYER. Seller shall indemnify, defend, and
hold Buyer harmless from and against any and all damages, claims, losses,
expenses, costs, obligations, and liabilities including, without limiting the
generality of the foregoing, liabilities for reasonable attorneys' fees ("Loss
and Expense"), suffered, directly or indirectly, by Buyer after the Closing Date
by reason of, or arising out of, (1) any material breach of a representation or
warranty made by Seller pursuant to this Agreement, (2) any material failure by
Seller to perform or fulfill any of its covenants or agreements set forth in
this Agreement, (3) any material failure by Seller to pay or discharge any
liabilities which remain the responsibility of Seller under this Agreement or to
comply, if required, with Oregon's bulk sales law, or (4) any litigation,
proceeding, or claim by any third party relating to the business or operation of
the Station prior to the Closing.
8.3. INDEMNIFICATION OF SELLER. Buyer shall indemnify, defend and hold
Seller harmless from and against any and all Loss and Expense suffered, directly
or indirectly, by Seller after the Closing Date by reason of, or arising out of,
(1) any material breach of a representation or warranty made by Buyer pursuant
to this Agreement, (2) any material failure by Buyer to perform or fulfill any
of its covenants or agreements set forth in this Agreement, (3) any material
failure by Buyer to pay or discharge any liabilities assumed pursuant to this
Agreement, or (4) any litigation, proceeding, or claim by any third party
relating to the business or operation of the Station after the Closing.
8.4. NOTICE OF CLAIM. If either Seller or Buyer believes that any Loss
and Expense has been suffered or incurred, such party shall notify the other
promptly in writing describing such Loss and Expense, the amount thereof, if
known, and the method of computation of such Loss and Expense, all with
reasonable particularity and containing a reference to the provisions of this
Agreement in respect of which such Loss and Expense shall have occurred. If any
action at law or suit in equity is instituted by a third party with respect to
which any of the parties intends to claim any liability or expense as Loss and
Expense under this Article 8, such party shall promptly notify the indemnifying
party of such action or suit. In no event, however, may the indemnifying party
avoid or limit its obligations under this Article 8 by reason of delay unless
such delay has materially prejudiced the indemnifying party, and then the
indemnifying party's obligations shall be reduced only to the extent of such
prejudice.
8.5. DEFENSE OF THIRD PARTY CLAIMS. The indemnifying party under this
Article 8 shall have the right to conduct and control, through counsel of that
party's own
21
choosing, any third party claim, action, or suit at the indemnifying party's
sole cost and expense, but the indemnified party may, at that latter party's
election, participate in the defense of any such claim, action, or suit at that
party's sole cost and expense: provided, that if the indemnifying party shall
fail to defend any such claim, action, or suit, then the indemnified party may
defend, through counsel of that party's own choosing, such claim, action, or
suit and settle such claim, action, or suit, and recover from the indemnifying
party the amount of such settlement or of any judgment and the costs and
expenses of such defense; and provided further, that the indemnifying party
shall be given at least (15) days prior notice of the terms of any proposed
settlement thereof so that the indemnifying party may then undertake and/or
resume the defense against the claim. The indemnifying party shall not
compromise or settle any third party claim, action, or suit without the prior
written consent of the indemnified party, which consent will not be unreasonably
withheld or delayed: provided, that any such compromise or settlement shall
include a release for the Indemnified Party of all liability with respect to the
matter being compromised or settled.
8.6. LIMITATIONS. Neither party shall be required to indemnify the
other party under this Article 8 unless written notice of a claim under this
Article 8 was received by the party within the pertinent survival period
specified in Section 8.1.
8.7. OFFSET AGAINST STOCK PURCHASE. Buyer may offset such
unsatisfied liabilities against any monies to be paid to Seller in the
re-purchase of Seller's ownership interest in Buyer in accordance with
Section 1.2.2. of this Agreement.
ARTICLE 9. MISCELLANEOUS.
9.1. TERMINATION OF AGREEMENT. This Agreement may be terminated
immediately on or prior to the Closing under one or more of the following
circumstances:
9.1.1. by the mutual consent of the parties hereto;
9.1.2. by Seller, if any of the conditions provided in Article 6
hereof have not been met by the time required and have not been waived;
9.1.3. by Buyer, pursuant to Sections 7.3.3 or 7.9, or if any of
the conditions provided in Article 7 hereof have not been met by the time
required and have not been waived;
9.1.4. by Seller or Buyer, if the FCC has failed to grant the
Application in an Order which has become a Final Order within the time specified
in Section 1.6 of this Agreement (unless the condition set forth in Section
1.5.1 has been satisfied; or
9.1.5. by any party hereto, if the FCC denies the Application.
9.2. LIABILITIES UPON TERMINATION.
22
9.2.1. SELLER'S REMEDIES. If the parties hereto shall fail to
consummate this Agreement on the Closing Date due to Buyer's material breach of
any representation, warranty, covenant or condition hereunder, and Seller is not
at that time in breach of any material representation, warranty, covenant or
condition hereunder, then Seller would suffer direct and substantial damages
that cannot be determined with reasonable certainty. In view of the expense and
loss which would be incurred by Seller in such event, Seller shall be entitled
to institute any action in law or equity to recover any damages or other
compensatory relief which may be warranted.
9.2.2. BUYER'S REMEDIES. If the parties hereto shall fail to
consummate this Agreement on the Closing Date due to Seller's material breach of
any representation, warranty, covenant or condition hereunder, and Buyer is not
at that time in material breach of any representation, warranty, covenant or
condition hereunder, then Buyer shall be entitled to specific performance of the
terms of this Agreement and of Seller's obligation to consummate the transaction
contemplated hereby. If any action is brought by Buyer to enforce this Agreement
by specific performance, Seller shall waive the defense that Buyer has an
adequate remedy at law.
9.2.3. NOTICE OF BREACH. In the event that any party to this
Agreement believes that the other party is in material breach of its
representations, warranties or obligations hereunder, such party shall give
prompt written notice thereof, detailing the nature of the breach and the steps
necessary to cure such breach. For purposes of this Agreement, no "breach" shall
be deemed to have occurred hereunder unless the party alleged to be in breach
has been afforded a cure period of at least twenty (20) business days following
such notice within which to cure such breach: provided, that the cure period may
be extended for an additional 30 days in the event that such party is diligently
and in good faith proceeding to cure such breach and the breach is reasonably
capable of being cured within such extended period.
9.2.4. SURVIVAL OF CONFIDENTIALITY OBLIGATIONS. Notwithstanding
any other provision of this Agreement, the provisions of Sections 4.8, and 5.3
shall survive any termination of this Agreement.
9.3. EXPENSES. Except as otherwise provided herein, each party hereto
shall be solely responsible for all fees and expenses each party incurs in
connection with the transactions contemplated by this Agreement, including,
without limitation, legal fees incurred in connection herewith: provided, that
the FCC and any HSR filing fees shall be divided equally between Seller and
Buyer; and, provided further, that all transfer, sales, use or other taxes or
assessments imposed by any governmental body on the sale of the Station Assets
shall be paid by Seller.
9.4. ASSIGNMENTS. Seller may not assign its rights or obligations
under this Agreement without the prior written consent of Buyer. Buyer may
assign its rights under this Agreement without the prior written consent of
Seller to any party who (1) controls Buyer, (2) is controlled by the same
parties who control Buyer, or (3) demonstrates to the
23
reasonable satisfaction of Seller that it has the capability to satisfy Buyer's
obligations (including financial) under this Agreement.
9.5. FURTHER ASSURANCES. From time to time prior to, at and after the
Closing, each party hereto will execute all such instruments and take all such
actions any other party shall reasonably request in connection with effectuating
the intent and purpose of this Agreement and all transactions contemplated by
this Agreement, including, without limitation, the execution and delivery of any
and all confirmatory and other instruments in addition to those to be delivered
at the Closing.
9.6. NOTICES. All notices, demands and other communications authorized
or required by this Agreement shall be in writing, shall be delivered by
personal delivery, by United States certified mail-return receipt requested
(postage prepaid), or by overnight delivery service (charges prepaid), and shall
be deemed to have been given or made when personally delivered, within five (5)
days after being deposited in the mail, postage prepaid, or within one (1) day
after being delivered to an overnight delivery service, charges prepaid. Notices
shall be delivered to each party at the following addresses (or at such other
address as any party may designate in writing to the other parties.
9.6.1. If to Seller --
Daniel J. Alderman
Executive Vice President
Channel 32 Incorporated
Boardwalk Plaza, Suite 350
9725 S.W. Beaverton Hillsdale Highway
Beaverton, Oregon 97005-3366
with a copy to (but which shall not
constitute
notice to Seller):
Allan A. Fulsher, Esq.
Boardwalk Plaza, Suite 350
9725 S.W. Beaverton Hillsdale Highway
Beaverton, Oregon 97005-3366
If to Buyer --
Douglas Gealy,
President
7125 Bluffstream Ct.
Columbus, OH 43235
24
with a copy to (but which shall not
constitute notice to Buyer):
Lewis J. Paper, Esq.
Dickstein Shapiro Morin & Oshinsky LLP
2101 L Street, N.W.
Washington, DC 20037
9.7. LAW GOVERNING. This Agreement shall be governed by,
construed, and enforced in accordance with the laws of the State of
California without regard to conflict of laws provisions.
9.8. WAIVER OF PROVISIONS. The terms, covenants, representations,
warranties, and conditions of this Agreement may be waived only by a written
instrument executed by the party waiving compliance. The failure of any party at
any time or times to require performance of any provision of this Agreement
shall not affect the exercise of a party's rights at a later date. No waiver by
any party of any condition or the breach of any provision, term, covenant,
representation, or warranty contained in this Agreement in any one or more
instances shall be deemed to be or construed as a further or continuing waiver
of any such condition or of the breach of any other provision, term, covenant,
representation, or warranty of this Agreement.
9.9. COUNTERPARTS. This Agreement may be executed in
counterparts, and all counterparts so executed shall collectively constitute
one agreement, binding on all of the parties hereto, notwithstanding that all
the parties are not signatory to the original or the same counterpart.
9.10. REIMBURSEMENT OF LEGAL EXPENSES. If a formal legal proceeding is
instituted by a party to enforce that party's rights under this Agreement, the
party prevailing in the proceeding shall be reimbursed by the other party for
all reasonable costs incurred thereby, including but not limited to reasonable
attorneys' fees.
9.11. PUBLICITY. Except as required by applicable law or with the
other party's express written consent, which shall not be unreasonably withheld,
no party to this Agreement nor any affiliate of any party shall issue any press
release or make any public statement (oral or written) regarding the
transactions contemplated by this Agreement.
9.12. SELLER'S ACCESS TO RECORDS. Any records delivered to Buyer by
Seller relating to the operation of the Station or Seller's business shall be
maintained by Buyer for a period of seven (7) years from and after the Closing
Date. Upon reasonable prior notice, Seller shall be entitled to inspect and copy
any of such records for purposes of preparing and completing any tax returns or
other compilations of its operation of the Station. In the event that it wishes
to dispose of such records, Buyer shall give Seller thirty (30) days' prior
written notice and an opportunity to retrieve such records at Seller's expense.
25
9.13. ENTIRE AGREEMENT. This Agreement constitutes the entire
agreement among the parties, supersedes and cancels any and all prior or
contemporaneous agreements and understandings between them, and may not be
amended except in a writing signed by the parties.
ARTICLE 10. RULES OF CONSTRUCTION
10.1. DEFINED TERMS. As used in this Agreement, the following terms
shall have the following meanings:
10.1.1. "ACCOUNTS RECEIVABLE" means all notes and accounts
receivable of Seller relating to or arising out of the broadcasting of
advertising time by the Station at any time prior to the Closing Date.
10.1.2. "BUYER" means NewCo of Oregon, Inc., an Oregon corporation,
or its assignee.
10.1.3. "CONTRACTS" means those contracts, leases and other
agreements listed or described in Section 1.1.1.(c) which Buyer has agreed to
assume (but not including Time Sales Agreements, Trade Agreements or Real Estate
Leases.)
10.1.4. "DOJ" means the United States Department of Justice.
10.1.5. "ENVIRONMENTAL LAWS" means the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, as amended, 42 U.S.C. ss. 9601
ET SEQ., the Substances Control Act, as amended, 15 U.S.C. 2601 ET SEQ., the
Resource Conservation and Recovery Act of 1976, as amended, U.S.C. ss. 6901 ET
SEQ., the Clean Water Act, as amended, 42 U.S.C. ss. 1251 ET SEQ., the Clean Air
Act, as amended, 42 U.S.C. ss. 7401 ET SEQ., any other federal, state or local
law relating to the environment, and any regulations or policies adopted
pursuant to such laws.
10.1.6. "ESCROW FUNDS" means funds which are part of the Purchase
Price and placed in a post-Closing escrow account to secure Seller's
indemnification obligations under Article 8 of this Agreement.
10.1.7. "EXCLUDED ASSETS" means those assets excluded from the
Station Assets and retained by Seller, to the extent in existence on the Closing
Date, as specifically described in Section 1.1.2.
10.1.8. "FCC" means the Federal Communications Commission.
10.1.9. "FCC LICENSES" means all licenses and other authorizations
issued by the FCC for the Station and included in SCHEDULE 1.
10.1.10. "FTC" means the Federal Trade Commission.
26
10.1.11 "FINANCIAL STATEMENTS" means the balance sheet of Seller
dated June 30, 1996, the audited financial statements for the Station for fiscal
year 1995, and the unaudited interim financial statement for the period ended on
November 30, 1996.
10.1.12. "HAZARDOUS WASTE" means any hazardous or toxic waste,
substance, material or pollutant.
10.1.13. "IRS" means the Internal Revenue Service.
10.1.14. "LITIGATION" means any litigation, arbitration, dispute,
proceeding or investigation pending by or against, or, to the best of Seller's
knowledge, threatened against the Station or Seller which relates to or affect
the Station Assets or the business of the Station or which materially interferes
or could reasonably be expected to materially to interfere with Seller's (a)
right, title to or interest in the Station Assets, (b) operation of the Station
or (c) ability to transfer the Station Assets to Buyer free of such litigation.
10.1.15. "PAYMENTS" means arrearages of wages or Trust or
benefit payments.
10.1.16. "PURCHASE PRICE" means the total consideration for the
Station Assets, the Noncompetition Agreement, and Seller's Stock Purchase as
described in Section 1.2.
10.1.17. "REAL ESTATE LEASES" means all leases relating to real
property to be assumed by Buyer, copies of which are annexed hereto in
SCHEDULE 4.
10.1.18. "SELLER" means Channel 32 Incorporated, an [Oregon]
corporation.
10.1.19. "STATION" means broadcast television station KWBP-TV in
Salem, Oregon.
10.1.20. "STATION ASSETS" means the rights, title and interest, real
and personal, tangible and intangible, owned or held by Seller and used or
useful in the operation of the Station to be acquired by Buyer under this
Agreement.
10.1.21. "TIME BROKERAGE AGREEMENT" means the agreement to be
executed by Buyer and Seller this same date for the provision of programming by
Buyer to be aired on the Station.
10.1.22. "TRADE AGREEMENTS" means trade and barter agreements for the
sale of time on the Station.
10.1.23. "TRADE REPORT" means a listing of all Trade Agreements
included in the Station Assets together with an itemized statement of the
aggregate value of time owed pursuant to each of the Trade Agreements and the
fair market value of goods
27
and services to be received pursuant to each of the Trade Agreements as of the
Closing Date.
10.1.24. "TRUSTS" means pension, profit-sharing and savings plans
and trusts, including without limitation, 401-K plans established by Seller for
its employees.
10.1.25. OTHER DEFINITIONS. Other capitalized terms used in this
Agreement shall have the meanings ascribed to them herein.
10.2. NUMBER AND GENDER. Whenever the context so requires, words used
in the singular shall be construed to mean or include the plural and vice versa,
and pronouns of any gender shall be construed to mean or include any other
gender or genders.
10.3. HEADINGS AND CROSS-REFERENCES. Headings of the sections have
been included for convenience of reference only and shall in no way limit or
affect the meaning or interpretation of the specific provisions of this
Agreement. All cross-references to sections herein shall mean the section of
this Agreement unless otherwise stated or clearly required by the context. Words
such as "herein" and "hereof" shall be deemed to refer to this Agreement as a
whole and not to any particular provision of this Agreement unless otherwise
stated or clearly required by the context. The term "including" means "including
without limitation."
10.4. COMPUTATION OF TIME. Whenever any time period provided for in
this Agreement is measured in "business days," there shall be excluded from such
time period each day that is a Saturday, Sunday, recognized federal legal
holiday, or other day on which the FCC's offices are closed and are not reopened
prior to 5:30 p.m. Washington, D.C. time. In all other cases all days shall be
counted.
[REMAINDER OF PAGE INTENTIONALLY LEFT BLANK]
28
IN WITNESS WHEREOF, the parties have caused this Agreement to be duly
executed as of the day and year written above.
CHANNEL 32 INCORPORATED
By: /s/ Roy Rose
---------------------------------
Roy Rose, Chief Executive Officer
NEWCO OF OREGON, INC.
By: /s/ Douglas E. Gealy
----------------------------------
Douglas E. Gealy, President
The following page contains a list of Exhibits and Schedules which have
been intentionally omitted by the Registrants.
A copy of any omitted Exhibit or Schedule will be provided to the
Securities and Exchange Commission upon request.
EXHIBITS
A Promissory Note
B Security Agreement
C Personal Guarantees of Roy Rose, Daniel J. Alderman and Hampton
Holdings, LLC
D Noncompetition Agreement
E Opinion of Seller's Counsel
F Opinion of Buyer's Counsel
G Commercial Building Lease
SCHEDULES
1 Government Licenses
2 Tangible Personal Property
3 Contracts
4 Leases
5 Programming and Copyrights
6 Allocation
7 Taxes
8 Financial Statements
9 Exceptions to Real Property
10 Cable Carriage
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-4’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 2/1/99 | | 14 | | | | | None on these Dates |
| | 11/19/97 |
| Filed on: | | 11/14/97 |
| | 5/31/97 | | 12 |
| | 1/31/97 | | 8 |
| | 1/1/97 | | 10 | | 13 |
| | 11/30/96 | | 17 | | 34 |
| | 6/30/96 | | 17 | | 34 |
| List all Filings |
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