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
MEMBERSHIP CONTRIBUTION AGREEMENT
among
ROBERTS BROADCASTING OF SALT LAKE CITY, L.L.C.,
MICHAEL V. ROBERTS and STEVEN C. ROBERTS
and
ACME TELEVISION HOLDINGS, L.L.C.
MEMBERSHIP CONTRIBUTION AGREEMENT
THIS MEMBERSHIP CONTRIBUTION AGREEMENT (this "Agreement") is
executed as of August 22, 1997 by and among ROBERTS BROADCASTING OF SALT LAKE
CITY, L.L.C., a Delaware limited liability company ("RBSLC"), MICHAEL V. ROBERTS
and STEVEN C. ROBERTS (collectively, "Members"), and ACME TELEVISION HOLDINGS,
L.L.C., a Delaware limited liability company ("ACME").
RECITALS:
1. Each of the Members holds fifty (50) percent of the ownership
interest in RBSLC, which holds a construction permit (the "CP") from the Federal
Communications Commission ("FCC") to build a new television station under the
call sign of KZAR-TV in Provo, Utah (the "Station").
2. The Members desire to contribute, assign, and transfer, to the
fullest extent permitted by law, forty-nine (49) percent of their collective
ownership interest (the "Membership Interest") in RBSLC to ACME, in
consideration for the issuance by ACME to the Members, to the fullest extent
permitted by law, of Six Million Dollars ($6,000,000) in ownership interests in
ACME, all in accordance with the terms and conditions of this Agreement.
3. RBSLC and ACME Television Holdings of Utah, L.L.C., a Utah
limited liability company ("ATHU") propose to execute, at the time of execution
of this Agreement a Management Agreement (the "MA") which will enable ATHU to
provide programming and other services to the Station in exchange for certain
consideration specified therein.
4. The Members propose to issue and sell, and ACME proposes to
buy, for Three Million Dollars ($3,000,000) at the closing of the transaction
hereunder, an option to acquire all the Members' ownership in RBSLC remaining
after such exchange, pursuant to the Option Agreement attached as EXHIBIT A
hereto (the "Option Agreement"), at which time ACME will simultaneously lend the
Members Four Million Dollars ($4,000,000), which loan will be evidenced by a
promissory note in the form of EXHIBIT B hereto (the "Note").
5. RBSLC and ATHU also propose to undertake, beginning on the
date of the closing of the transaction hereunder, the exchange of the CP or the
Station (as the case may be) for the construction permit or any resulting
licenses for television station KOOG-TV in Salt Lake City, Utah.
PROVISIONS:
In consideration of the foregoing and the mutual promises and
covenants contained herein, the parties hereby agree as follows:
ARTICLE I. EXCHANGE OF CONSIDERATION.
1.1. CONSIDERATION PROVIDED BY THE MEMBERS. Subject to the terms and
conditions of this Agreement, the Members shall, to the fullest extent permitted
by law, assign, convey, transfer and deliver to ACME at Closing, and ACME shall,
to the fullest extent permitted by law, acquire from the Members at Closing,
free and clear of all debts, liens, claims, options, warrants, financing leases,
security interests, and encumbrances as well existing and future ownership
interests of any kind whatsoever, except as permitted herein, the Membership
Interest. To that end, each of the Members shall assign, convey, transfer and
deliver to ACME at Closing twenty-four and one-half (24.5) percent of the
ownership interest which each Seller currently holds in RBSLC.
1.2. CONSIDERATION PROVIDED BY ACME.
1.2.1. OWNERSHIP INTEREST IN ACME. At the Closing, as defined
herein, ACME will issue and deliver to the Members membership interests in ACME
consisting of Six Thousand (6,000) Seller Units (as defined in the ACME Limited
Liability Company Operating Agreement of June 17, 1997 [the "ACME Operating
Agreement"]) , with one-half (1/2) of such units being issued and delivered to
each of the two (2) Members. The Seller Units of ACME to be provided to the
Members under this Section are hereinafter collectively referred to as the
"Ownership Interest".
1.2.2. PRO-RATA DILUTION. The Members' Ownership Interest
will be subject to dilution for financing agreements, management incentives, and
acquisition of capital after Closing from third parties, ratably with other
Seller Units as a result of issuance of additional membership interests in ACME,
as permitted by the ACME Operating Agreement.
1.3. BOARD SEAT. At Closing, Michael Roberts, or a person designated
by him and approved by ACME (which approval shall not unreasonably be withheld),
will be appointed to the ACME Board of Advisors. Thereafter, until it is subject
to a change of control or completes a public offering of its securities, ACME
will cause Michael Roberts (or his designee approved as foresaid) to be elected
to such Board at any subsequent election in respect thereto. If FCC regulations
prohibit the service of Mr. Roberts or his designee on such Board, he or his
designee (as the case may be) will resign from the Board. ACME will cooperate
with Mr. Roberts' applications to obtain any necessary waivers from the FCC in
respect to his service on the Board, and will allow Mr. Roberts to attend Board
meetings in a non-voting capacity during any period when he is entitled herein
to a Board seat but prohibited from service by FCC regulations.
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1.4. EXECUTION OF OTHER AGREEMENTS.
1.4.1. EXECUTION OF MA. Also at Closing, ATHU and RBSLC will
execute the MA, and the parties thereto will make all payments provided by the
MA to be made at the execution thereof.
1.4.2. ISSUANCE AND SALE OF OPTION. Also at Closing, the
Members, ACME and RBSLC will execute the Option Agreement, and the parties
thereto will make all payments provided by the Option Agreement to be made at
the execution thereof.
1.4.3. LOAN. Also at Closing, ACME will lend the Members Four
Million Dollars ($4,000,000) and the Members will issue and deliver to ACME the
Note.
1.4.4. EXCHANGE OF KZAR-TV FOR KOOG-TV. Beginning on the date
of Closing, or on any earlier date after the execution hereof if requested in
writing by ATHU, the parties hereto shall each cooperate with the others and
otherwise use any and all commercially reasonable efforts (which shall not, in
the case of the Members or RBSLC, include the incurring of any liability by the
Members, or disbursement of funds unless previously advanced or indemnified by
ACME) in good faith to arrange a transaction which will result in an exchange of
the CP or the license issued to cover it and other assets for KZAR-TV, for the
FCC licenses and other assets for KOOG-TV in Salt Lake City, Utah. To such end,
the parties hereto will from time-to-time provide such information and execute
such documents as may reasonably be requested to effect such a transaction.
1.5. ESCROW FUND. Upon execution of this Agreement, ACME shall
deposit One Hundred Thousand Dollars ($100,000), hereinafter referred to as the
"Escrow Deposit," with the law firm of Dow, Lohnes & Albertson, PLLC ("Escrow
Agent") pursuant to an Escrow Agreement in the form of EXHIBIT C annexed hereto.
At the Closing, the parties shall issue joint instructions to the Escrow Agent
to pay the Escrow Deposit to the Members, and the amount of the Escrow Deposit
shall be deducted from the Purchase Price which ACME is otherwise is required to
pay the Members at Closing. If this Agreement is terminated due to ACME's
material breach, the Escrow Deposit shall be paid to the Members as liquidated
damages and such payment shall be the Members' exclusive remedy for such a
breach, unless such a breach is intentional. If this Agreement is terminated for
any other reason, the Escrow Deposit shall be immediately returned to ACME.
Interest on the Escrow Deposit shall at all times belong to ACME and shall be
paid to ACME at the Closing or upon termination upon of this Agreement, as the
case may be.
1.6. HART-SCOTT-RODINO FILING. Upon execution of this Agreement ACME
shall prepare and file any filings which may be necessary under the Anti-Trust
Improvements Act of 1976, as amended (the "HSR Act"), and pay the necessary
filing fee. The Members will provide and cause RBSLC to provide any information
needed from them in respect to such filing, and otherwise cooperate in respect
thereto.
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1.7. CLOSING.
1.7.1. 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 place mutually agreed to by the parties, commencing at
10:00 a.m. on a date (the "Closing Date") selected by ACME which shall be within
ninety (90) days after the date on which the FCC order (the "Order") approving
the transaction contemplated hereby is placed on public notice; provided, that
the parties shall not be obligated to proceed to Closing if (1) the Order
includes conditions materially adverse to ACME or the Members or (2) the
conditions precedent to Closing have not been satisfied or waived; and provided
further, that ACME shall have the unilateral right to require that Closing occur
only after the Order has become 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). At
Closing, ACME will pay to the Members One Thousand One Hundred Eleven Dollars
($1,111) per day, to the extent the Closing Date is more than fifty-four (54)
days later than the date the Order is placed on public notice.
1.7.2. EXCHANGE OF DOCUMENTS. At the Closing, the Members and
ACME will each execute and join in the operating agreements of ACME and RBSLC,
respectively, and each party hereto shall execute and deliver to the other party
or parties 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.
1.8. 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 June 1, 1998.
ARTICLE 2. REPRESENTATIONS AND WARRANTIES OF THE MEMBERS AND RBSLC.
RBSLC and the Members represent and warrant to ACME that the
following matters are true and correct as of the date of this Agreement:
2.1. COMPANY STATUS. RBSLC is a limited liability company duly
organized, validly existing, and in good standing in the State of Delaware.
RBSLC has the power to hold the CP for the Station and to construct the Station
in accordance with the terms of the CP.
2.2. AUTHORIZATIONS. RBSLC is the holder of the CP and all
extensions thereof, copies of which are included in SCHEDULE 1 to this
Agreement. The CP is in full force and effect. The CP and the extensions
constitute all of the authorizations required under the Communications Act of
1934, as amended (the "Act"), and the current rules,
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regulations, and policies of the FCC for the construction of the Station. The
Members have timely 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 the Members'
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 extend the CP,
or which would otherwise have a material adverse impact on the construction or
operation of the Station, except for proceedings of general applicability to the
broadcast industry. Except as set out in Schedule 1, and for proceedings of
general applicability to the broadcasting industry, there is not now pending, or
to the best of the Members' knowledge, threatened, any other petition,
complaint, violation, notice of apparent liability, or notice of forfeiture or
other proceeding by or before the FCC or any court against the Members with
respect to any matter affecting the Station. RBSLC and the Members are in
material compliance with the CP, and the rules, regulations and policies of the
FCC. The CP requires that construction of the Station be completed by May 21,
1997. Currently pending before the FCC is a Form 307 application to extend the
CP to November 21, 1997. The Members have no reason to believe that the latter
application will not be granted by the FCC in due course.
2.3. TITLE. On the Closing Date, the assets of RBSLC will be 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.
2.4. EMPLOYEES. RBSLC is not a party to any pending or, to the
Members knowledge, threatened labor dispute affecting the Station. RBSLC (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. RBSLC and the Members
will hold ACME 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 RBSLC which relate to the period prior to the Closing Date, (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 which relate to the period prior to the Closing Date,
(3) all claims for severance which relate to the period prior to the Closing
Date, and (4) any other claims by employees of RBSLC relating to or arising from
their employment (or severance therefrom) by RBSLC. There are no collective
bargaining agreements, or negotiations for the same, in existence which affect
any of the Station's employees.
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2.5. TAXES. Except as disclosed in SCHEDULE 2 annexed hereto, RBSLC
has duly and timely filed all required federal, state and local tax returns and
paid all taxes, interest and penalties due, 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, RBSLC 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).
2.6. CONTRACTS. SCHEDULE 3 hereto includes true copies of all
written contracts and describes the material terms of all oral contracts
(collectively, the "Contracts") to which RBSLC is a party as of the date of this
Agreement. RBSLC 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 the Members' 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.
2.7. ENVIRONMENTAL. No Hazardous Waste, as defined under any
Environmental Laws has been released, emitted or discharged or, to the Members'
knowledge, is currently located in or on any asset owned or held by RBSLC or in,
on or under the real property on which any of RBSLC assets are or will be
situated in violation of any Environmental Laws. The construction of the Station
is not in material violation of any Environmental Laws, including but not
limited to FCC rules, policies and guidelines concerning RF radiation. Neither
the Members nor RBSLC have received any notice, summons, citation, directive,
letter or other communication, written or oral, from the United States, the
State of Utah, or any other party concerning any intentional or unintentional
action or omission on the part of RBSLC, the Members or any other party which
resulted in the releasing, spilling, leaking, pumping, pouring, emitting,
emptying, discharging, injecting, escaping, leeching, dumping or disposing of
Hazardous Waste on, above or under property owned or used by RBSLC.
2.8. BALANCE SHEET. The Members have provided ACME with true copies
of an unaudited balance sheet for RBSLC dated June 30, 1997 (the "Balance
Sheet"). True copies of the Balance Sheet are attached as SCHEDULE 4 hereto. The
Balance Sheet (1) has been compiled in accordance with Statements on Standards
for Accounting and Review Services issued by the American Institute of Certified
Public Accountants consistently applied, (2) identifies all of RBSLC's material
obligations and liabilities (contingent or matured), and (3) fairly reflects the
financial position of RBSLC as of the date indicated.
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2.9. LITIGATION. Neither the Members nor RBSLC have 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. Except for proceedings of general
applicability to the broadcast industry, there is no Litigation pending by or
against, or, to the best of the Members' knowledge, threatened against the RBSLC
or the Members which relates to or affects the Station or which materially
interferes or could reasonably be expected materially to interfere with (1) the
Members' right, title to, or interest in the Membership Interest, (2) the
construction or operation of the Station or (3) the Members' ability to transfer
the Membership Interest to ACME free of such Litigation.
2.10. COMPLIANCE WITH LAWS. Except as disclosed in SCHEDULE 5
annexed hereto, RBSLC 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 construction of the Station will not violate
any such laws, regulations, policies or orders in any material respect, and
except for proceedings of general applicability to the broadcast industry, there
is no investigation or proceeding regarding the foregoing which is currently
pending or, to the Members' knowledge, threatened.
2.11. NO DEFAULTS. Neither the execution and delivery by RBSLC or
the Members of this Agreement nor the consummation by the Members 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 (1) the terms, conditions, or provisions of any arbitration award,
judgment, law, order, decree, writ, or regulation to which RBSLC or the Members
are subject, (2) RBSLC's certificate, operating agreement or other
organizational documents, or (3) any agreement or instrument to which the
Members or RBSLC is a party or by which the Members or RBSLC is bound, or result
in the creation of imposition of any lien, charge, or encumbrance on any asset
owned or held by RBSLC or the Membership Interest.
2.12. BROKERS. There is no broker or finder or other person who
would, as a result of any agreement of or action taken by the Members, 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 ACME).
2.13. RBSLC AND THE MEMBERS ACTION. This Agreement has been duly and
validly authorized, executed, and delivered by RBSLC and the Members and
constitutes the valid and binding agreement of RBSLC and the Members,
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.
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2.14. LEASES. Annexed hereto as SCHEDULE 6 are all the leases
relating to real property (the "Real Estate Leases") to which RBSLC is a party.
All of the Real Estate Leases have been complied with in all material respects
by RBSLC, and no material default of RBSLC in respect to any duties or
obligations required to be performed by RBSLC has occurred. All such leases are
valid, binding, and enforceable in accordance with their respective terms. To
the Members' 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.
2.15. INSOLVENCY. No insolvency proceedings of any character,
including, without limitation, bankruptcy, receivership, reorganization,
composition or arrangement with creditors, voluntary or involuntary, affecting
RBSLC or the Members' is pending or, to the best of the Members' knowledge,
threatened, and neither RBSLC nor the Members have 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.
2.16. APPROVALS. No approval of any third party, governmental agency
or court is required to be obtained by the Members with regard to the assignment
of the Membership Interest except the approval by the FCC as provided herein.
2.17. FAA APPROVAL. No approval or other action by the Federal
Aviation Administration ("FAA") is required to complete construction of the
Station.
2.18. NO MATERIAL OMISSION. Neither RBSLC nor the Members have
failed to disclose any material fact within their knowledge which would make any
statement or representation in this Agreement inaccurate or misleading.
2.19. ACQUISITION FOR OWN ACCOUNT. The Ownership Interest will be
acquired for investment for each Member's own account, not as a nominee or
agent, and not with a view to the resale or distribution of any part thereof,
and neither Member has a present intention of selling, granting any
participation in, or otherwise distributing the same. By executing this
Agreement, each Member further represents that he does not have any contract,
undertaking, agreement or arrangement with any person to sell, transfer or grant
participation to such person or to any third person, with respect to any of the
Ownership Interest.
2.20 DISCLOSURE OF INFORMATION. Each Member represents that he has
received all the information he considers necessary or appropriate for deciding
whether to acquire the Ownership Interest. Each Member further represents that
he has had an opportunity to ask questions and receive answers from ACME
regarding the terms and conditions of the transaction herein and the business,
properties, prospects and financial condition of ACME.
2.21 INVESTMENT EXPERIENCE. Each Member is an investor in securities
of companies in the development stage and acknowledges that he is able to fend
for himself,
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can bear the economic risk of his investment, and has such knowledge and
experience in financial or business matters that he is capable of evaluating the
merits and risks of the investment in the Ownership Interest.
2.22. ACCREDITED INVESTOR. Each Member is an "accredited investor"
within the meaning of Securities and Exchange Commission ("SEC") Rule 501 of
Regulation D under the Act, as presently in effect.
2.23. RESTRICTED SECURITIES. Each Member understands that the
Ownership Interest is characterized as a "restricted securities" under the
federal securities laws inasmuch as it is being acquired from ACME in a
transaction not involving a public offering and that under such laws and
applicable regulations such Ownership Interest may be resold without
registration under the Act only in certain limited circumstances. In this
connection, each Member represents that he is familiar with SEC Rule 144, as
presently in effect, and understands the resale limitations imposed thereby and
by the Act.
2.24. RBSLC OPERATING AGREEMENT. RBSLC has provided ACME a true and
complete copy of its operating agreement and all amendments thereto, if any
(collectively, the "RBSLC Operating Agreement"), true copies of which are
annexed hereto as EXHIBIT D. The transfer of the Membership Interest to ACME has
been authorized by all required actions, corporate and otherwise, and when so
transferred the Membership Interest will be duly and validly issued, fully paid
and nonassessable and will conform to the description thereof contained in the
RBSLC Operating Agreement.
2.25. RBSLC MEMBERSHIP INTERESTS. All of RBSLC's currently
outstanding membership interests are set forth on SCHEDULE 7 annexed hereto. The
option previously issued to Paxson Communications has expired without exercise.
There are no options, warrants or other rights to acquire any interest in RBSLC
or securities convertible into interests in RBSLC except pursuant to the Option
Agreement.
ARTICLE 3. REPRESENTATIONS AND WARRANTIES OF ACME.
ACME represents and warrants to RBSLC and the Members as to the
truth of the following matters as of the date of this Agreement:
3.1. STATUS. ATHU is a limited liability company duly organized,
validly existing, and in good standing in the State of Utah, and has the power
to enter into and consummate the transactions contemplated by this Agreement.
ACME is a limited liability company, duly organized, validly existing, and in
good standing in the State of Delaware, and has the power to enter into and
consummate the transactions contemplated by this Agreement.
3.2. COMPANY ACTION. All actions and proceedings necessary to be
taken by or on the part of ACME in connection with the transactions contemplated
by this Agreement and necessary to make the Agreement effective have been duly
and validly
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taken. This Agreement has been duly and validly authorized, executed, and
delivered by ACME and constitutes the valid and binding agreement of ACME,
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.
3.3. NO DEFAULTS. Neither the execution and delivery by ACME of this
Agreement nor the consummation by ACME 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 ACME is subject, (b) the certificate, operating agreement or
other organizational documents of ACME, or (c) any agreement or instrument to
which ACME is a party or by which it is bound.
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 ACME, 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 ACME).
3.5. LITIGATION. There is no litigation, proceeding, or
investigation of any nature pending or, to the best of ACME's knowledge,
threatened against or affecting ACME that would affect ACME's ability to carry
out the transactions contemplated herein.
3.6. QUALIFICATION AS A BROADCAST OWNER. ACME 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 ACME as an assignee of
the Membership Interest.
3.7. NO MATERIAL OMISSION. ACME has not failed to disclose any
material fact within its knowledge which would make any statement or
representation in this Agreement inaccurate or misleading.
3.8. ACME OPERATING AGREEMENT. ACME has provided to the Members a
true and complete copy of the ACME Operating Agreement, a true copy of which is
annexed hereto as EXHIBIT E. The issuance of the Ownership Interest to the
Members has been authorized by all required actions, corporate and otherwise,
and when issued to the Members the Ownership Interest be duly and validly
issued, fully paid and nonassessable and will conform to the description thereof
contained in the ACME Operating Agreement.
3.9. ACME MEMBERSHIP INTERESTS. All of ACME's currently outstanding
membership interests and the consideration received therefor are set forth on
SCHEDULE 8 annexed hereto. There are no options, warrants or other rights to
acquire any interest in ACME or securities convertible into interests in ACME
except as set forth on SCHEDULE 8 annexed hereto.
10
3.10. ACME MANAGEMENT. ACME's managing members and other management
and executive personnel are set forth on SCHEDULE 9 annexed hereto.
3.11. COMPLIANCE WITH LAWS. ACME is in material compliance with all
applicable laws, rules, regulations, policies and orders of all federal, state
and local governments or agencies.
3.12. APPROVALS. No approval of any third party, governmental agency
or court is required to be obtained by ACME for the execution, delivery and
performance of this agreement except for the approval by the FCC as provided
herein.
ARTICLE 4. COVENANTS OF THE MEMBERS PENDING CLOSING.
RBSLC and the Members covenant and agree that, from the date of this
Agreement to and including the Closing Date, subject to the provisions of this
Agreement and the MA they will take, or refrain from taking, the following
actions:
4.1. MAINTENANCE OF STATION. RBSLC and the Members shall continue to
carry on the Station business in accordance with past practices (it being
acknowledge that the Station has not yet been constructed) and keep its books of
account, records, and files in the ordinary course of business and shall
construct the Station in accordance with the terms of the CP and in material
compliance with all applicable rules, regulations, policies and laws. To that
end, the Members will cause RBSLC to (1) timely file with the FCC any and all
reports, applications, and disclosures as may be required by the Act or FCC
rules or policies; and (2) maintain in full force and effect through and
including the Closing Date property damage, liability, and other insurance with
respect to RBSLC's assets to cover contingencies that can reasonably be
anticipated. Prior to the Closing, the Members will not, without the prior
written consent of ACME, allow or cause RBSLC to:
4.1.1. sell, lease, transfer, or agree to sell, lease, or
transfer any of RBSLC's assets without replacement thereof with an asset of
equivalent kind, condition, and value, except that RBSLC may distribute to its
members or otherwise dispose of cash and notes receivable from affiliated
entities without replacement thereof;
4.1.2. enter into any collective bargaining agreement or
written contract of employment, unless said contract is subject to cancellation
upon thirty (30) days notice;
4.1.3. enter into any contract or agreement; or
4.1.4. make, allow, or consent to any material change in the
Real Estate Leases or in any buildings, leasehold improvements, or fixtures used
or useful in the construction or operation of the Station, except in order to
effectuate the construction of the Station in accordance with the terms of the
MA.
11
4.2. ORGANIZATION, GOOD WILL, PROMOTION. Subject to the provisions
of this Agreement, the Members will cause RBSLC to use its best efforts to
preserve the business organization of the Station intact and shall cooperate
with ACME 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 ACME, the Members shall give ACME and its representatives (1)
reasonable access during normal business hours to all facilities, property,
accounts, title papers, insurance policies, licenses and other authorizations,
agreements, commitments, records, machinery, fixtures, furniture, and
inventories related to the Station, and (2) all such other information
concerning the affairs of RBSLC or the Station as ACME may reasonably request.
4.4. REPRESENTATIONS AND WARRANTIES. The Members shall give notice
to ACME 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 Members' representations or warranties in this Agreement.
4.5. APPLICATION FOR FCC CONSENT. Within five (5) business days
after execution of this Agreement, the Members shall prepare and file an
appropriate application (the "Application") with the FCC requesting its written
consent to the transaction contemplated by this Agreement. The Members shall
diligently take, or cooperate in the taking of, all steps reasonably necessary
and appropriate to expedite the preparation of the Application and its
prosecution to a favorable conclusion. The Members will promptly provide ACME
with a copy of any pleading, order, or other document served on it relating to
the Application. The Members will use commercially reasonable efforts and
otherwise cooperate with ACME in responding to any information requested by the
FCC related to the Application, in making any amendment to this Agreement
requested by the FCC which does not adversely affect the Members 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 paid by the
Members.
4.6. NOTICE OF PROCEEDINGS. The Members will promptly (and in any
event within five (5) business days) notify ACME upon becoming aware of any
actual or threatened claim, dispute, arbitration, litigation, complaint,
judgment, order, decree action or proceeding relating to the Members, RBSLC, the
Station, or the consummation of this Agreement or any transaction contemplated
herein.
4.7. CONFIDENTIAL INFORMATION. If the transactions contemplated in
this Agreement are not consummated for any reason, the Members shall not
disclose to third parties any information designated as confidential and
received from ACME 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 the Members; (2) is
rightfully received by the Members from a third party; or (3) is independently
12
developed by the Members. All originals of all material provided to the Members
by ACME or its agents shall be returned to ACME and all copies thereof shall be
destroyed.
4.8. CONSUMMATION OF AGREEMENT. RBSLC and the Members shall fulfill
and perform all conditions and obligations to be fulfilled and performed by
RBSLC and the Members under this Agreement and make every reasonable effort to
cause the transactions contemplated by this Agreement to be fully carried out.
4.9. COMPLIANCE WITH LAW. The Members will comply and will cause
RBSLC to 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.
4.10. PERFORMANCE UNDER CONTRACTS AND LEASES. The Members will cause
RBSLC to perform in all material respects its obligations under, and keep in
good standing, all Contracts and Real Estate Leases to which RBSLC is a party.
4.11. PAYMENT OF LIABILITIES. At or prior to Closing, the Members
will pay or otherwise discharge all liabilities reflected on the Balance Sheet.
4.12. OPERATING AGREEMENT. Prior to Closing, the Members shall cause
the RBSLC Operating Agreement to be amended, in a form reasonably satisfactory
to ACME, to provide the following:
4.12.1 Distributions shall be made according to percentage
interests, and allocations or profits and losses shall be made according to
distributions, substantially as provided in the ACME Operating Agreement; and
4.12.2 The unanimous vote of all member's representatives on
the Management Committee of RBSLC shall be required to increase any Member's
Capital Commitment, request any additional Capital Contributions, issue
additional Membership interests in RBSLC, make distributions other than to
defray imputed tax liabilities of members, or pledge or compel a pledge of any
member's membership interest.
ARTICLE 5. COVENANTS OF ACME PENDING THE CLOSING.
ACME 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. ACME shall give notice to the
Members promptly (and in any event within five (5) business days) 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 ACME in this Agreement.
13
5.2. APPLICATION FOR COMMISSION CONSENT. ACME 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. ACME will promptly provide the Members with a copy of any pleading,
order, or other document served on it relating to the Application. ACME will use
commercially reasonable efforts and otherwise cooperate with the Members 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 ACME 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, ACME shall not disclose to
third parties any information designated as confidential and received from the
Members 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 ACME; (2) is rightfully
received by ACME from a third party; or (3) is independently developed by ACME.
All originals of material provided by the Members to ACME or its agents shall be
returned to the Members and all copies thereof destroyed.
5.4. OFFERING MATERIALS. ACME will provide to the Members true and
complete copies of all private placement memoranda and offering documents used
by ACME in connection with any financings or securities offerings after the date
hereof. Such materials and documents will not contain any untrue statement of a
material fact or omit to state a material fact required to be stated therein or
necessary to make the statements made therein or in this Agreement, in the light
of the circumstances under which they were made, not misleading.
5.5. CONSUMMATION OF AGREEMENT. ACME shall fulfill and perform in
all material respects all conditions and obligations to be fulfilled and
performed by ACME under this Agreement and make every reasonable effort to cause
the transactions contemplated by this Agreement to be fully carried out.
5.6. NOTICE OF PROCEEDINGS. ACME will promptly (and in any event
within five (5) business days) notify the Members upon becoming aware of any
actual or threatened claim, dispute, arbitration, litigation, complaint,
judgment, order, decree, action or proceeding relating to ACME, or the
consummation of this Agreement or any transaction contemplated herein.
14
ARTICLE 6. CONDITIONS PRECEDENT TO
OBLIGATIONS OF THE MEMBERS TO CLOSE.
The obligation of the Members 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. ACME'S REPRESENTATIONS AND WARRANTIES. Each of the
representations and warranties of ACME 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. ACME'S PERFORMANCE UNDER AGREEMENT. ACME 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;
6.1.3. ACME'S DELIVERIES. ACME shall have delivered to the
Members a certificate executed by a managing member of ACME, dated the Closing
Date, certifying to the fulfillment of the conditions set forth in Sections
6.1.1. and 6.1.2 and any documents executed by ACME sufficient to convey the
Ownership Interest to the Members upon the Members' satisfactions of their
obligations under this Agreement.
6.2. PROCEEDINGS.
6.2.1. 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 the Members,
may reasonably be expected to result in the issuance of a preliminary or
permanent injunction against such consummation or otherwise result in a decision
materially adverse to the Members.
6.2.2. NOTICE 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.
6.3. FCC AND FTC APPROVAL. The FCC approval contemplated by this
Agreement shall have been granted without any conditions materially adverse to
Seller; and (in a case where filings are deemed necessary under the HSR Act),
expiration or early termination of the waiting period under such Act has
occurred.
15
6.4. LEGAL OPINION. The Members shall have received an opinion from
ACME's counsel in the form annexed hereto as EXHIBIT F.
6.5. ISSUANCE OF INTERESTS. The Members shall have been issued the
Ownership Interest.
6.6. SIGNING OF MANAGEMENT AND OPTION AGREEMENTS. The MA and the
Option Agreement referenced above shall be executed, and all payments and other
performance due thereunder at execution shall be paid or performed,
simultaneously with Closing hereof.
6.7. No Material Adverse Change. Between the date of this Agreement
and Closing, none of ACME's business, operations or financial condition shall
have incurred or otherwise be subject to any material adverse change. For
purposes hereof, a change shall be material and adverse only if it materially
impairs the ability of ACME to carry out its business plan.
ARTICLE 7. CONDITIONS PRECEDENT TO
OBLIGATIONS OF ACME TO CLOSE.
The obligation of ACME 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. THE MEMBERS' REPRESENTATIONS AND WARRANTIES. Each of
the representations and warranties of RBSLC and the Members 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 THE MEMBERS' PERFORMANCE UNDER AGREEMENT. RBSLC and the
Members 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 them prior to or at the Closing.
7.1.3. THE MEMBERS' DELIVERIES. The Members shall have
delivered to ACME (a) certificates executed by the Members, dated the Closing
Date, certifying to the fulfillment of the conditions set forth in Sections
7.1.1 and 7.1.2, and (b) documents executed by the Members sufficient to convey
the Membership Interest to ACME upon ACME's satisfaction of its obligations
underthis Agreement.
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
16
Agreement that, in the reasonable opinion of ACME, may reasonably be expected to
result in the issuance of a preliminary or permanent injunction against such
consummation or otherwise result in a decision materially adverse to ACME.
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. FCC AND FTC APPROVAL. The FCC approval contemplated by this
Agreement shall have been granted without any conditions materially adverse to
ACME and shall have become a Final Order: provided, that the ACME shall have the
unilateral right to waive the requirement that the Order become a Final Order ;
and (in a case where filings are deemed necessary under the HSR Act), expiration
or early termination of the waiting period under such Act has occurred.
7.4. LEGAL OPINION. ACME shall have received an opinion from the
Members' counsel in the form annexed hereto as EXHIBIT G.
7.5. ENVIRONMENTAL AUDITS. Within thirty (30) days of the execution
of this Agreement, ACME may initiate, at ACME's expense, a Phase 1, and, if ACME
deems it appropriate or necessary, a Phase 2 environmental audit of RBSLC's
assets conducted by an environmental firm licensed in the State of Utah (the
"Environmental Audits"). If the Environmental Audits reveal a condition of
material non-compliance with any Environmental Law, then, in that event, RBSLC
or the Members shall cure or remedy the condition of material non-compliance
prior to Closing. If RBSLC or the Members are unwilling or unable to cure or
remediate the condition of material non-compliance prior to Closing, then, in
that event, ACME may elect to (1) accept the Ownership Interest and reduce the
Purchase Price by an amount mutually agreed as sufficient to cure or remediate
the material non-compliance or (2) terminate this Agreement upon twenty (20)
days' prior written notice to the Members without further liability.
7.6. MODIFICATION AND EXTENSION OF CP. The FCC shall grant RBSLC's
pending application to modify the CP, and shall extend the expiration date of
the CP to a date at least six (6) months after the date of the grant of such
modification.
7.7. BUILDING LEASES. The Members shall cause third parties which
they control to execute leases in the form of EXHIBITS H AND I annexed hereto
providing RBSLC with the right to lease premises for studio and transmission
facilities.
17
7.8. NO MATERIAL ADVERSE CHANGE. Between the date of this Agreement
and the Closing, none of the Station's business, operations, or financial
condition shall have incurred or otherwise be subject to a material adverse
change.
7.9. SIGNING OF MANAGEMENT AND OPTION AGREEMENTS. The MA and the
Option Agreement referenced above shall be executed, and all payments and other
performance due thereunder at execution shall be paid or performed,
simultaneously with Closing hereof.
ARTICLE 8. INDEMNIFICATION.
8.1. SURVIVAL. The several representations, warranties, covenants,
and agreements of the Members and ACME contained in or made pursuant to this
Agreement shall 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
until the earlier of (1) twelve (12) months after the closing under the Purchase
Agreement (as defined in the Option Agreement), and (2) thirty (30) months after
issuance by the FCC of one or more licenses to cover the CP.
8.2. INDEMNIFICATION OF ACME. The Members shall indemnify, defend,
and hold ACME 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 ACME after the Closing Date
by reason of, or arising out of, (1) any material breach of a representation or
warranty made by RBSLC or the Members pursuant to this Agreement, or (2) any
material failure by RBSLC or the Members to perform or fulfill any of its
covenants or agreements set forth in this Agreement.
8.3. INDEMNIFICATION OF THE MEMBERS. ACME shall indemnify, defend
and hold the Members harmless from and against any and all Loss and Expense
suffered, directly or indirectly, by the Members after the Closing Date by
reason of, or arising out of, (1) any material breach of a representation or
warranty made by ACME pursuant to this Agreement or (2) any material failure by
ACME to perform or fulfill any of its covenants or agreements set forth in this
Agreement.
8.4. NOTICE OF CLAIM. If the Members or ACME 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
18
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 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 THRESHOLD. No party shall be required to indemnify
any 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. No party shall be required to indemnify any other
party until the indemnified party's claims exceed $25,000 in the aggregate;
provided, that in case such amount is exceeded, the indemnified party's rights
hereunder shall include the right to recover such initial $25,000 of claims.
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 the Members so long as such party is not in
material default hereunder, 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 ACME so long as such party is not in material
default hereunder, if any of the conditions provided in Article 7 hereof have
not been met by the time required and have not been waived; or
9.1.4. by any party hereto, if the FCC denies the
Application.
19
9.1.5. by any party hereto if Closing has not occurred by
close of business June 1, 1998, so long as such party is not in material default
hereunder.
9.2. LIABILITIES UPON TERMINATION.
9.2.1. RBSLC AND THE MEMBERS' REMEDIES. If the parties hereto
shall fail to consummate this Agreement on the Closing Date due to ACME's
material breach of any representation, warranty, covenant or condition
hereunder, and RBSLC and the Members are not at that time in breach of any
material representation, warranty, covenant or condition hereunder, then RBSLC
and the Members 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 the Members in such event, RBSLC and the Members shall be
entitled to retain the Escrow Deposit as liquidated damages and as their
exclusive remedy.
9.2.2. ACME'S REMEDIES. If the parties hereto shall fail to
consummate this Agreement on the Closing Date due to RBSLC's or the Members'
material breach of any representation, warranty, covenant or condition
hereunder, and ACME is not at that time in material breach of any
representation, warranty, covenant or condition hereunder, then ACME shall be
entitled to specific performance of the terms of this Agreement and of the
Members' obligation to consummate the transaction contemplated hereby. If any
action is brought by ACME to enforce this Agreement by specific performance,
RBSLC and the Members shall waive the defense that ACME 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.
9.2.4. SURVIVAL OF CONFIDENTIALITY OBLIGATIONS.
Notwithstanding any other provision of this Agreement, the provisions of
Sections 4.7, 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 filing fees shall be paid by the Members.
9.4. ASSIGNMENTS. The Members may not assign their rights or
obligations under this Agreement without the prior written consent of ACME. ACME
may assign its
20
rights under this Agreement without the consent of the Members to any party
which (1) is at least majority owned by ACME, or (2) controls ACME or (3) is
controlled by the same parties who control ACME, provided, that such assignment
shall not (1) unreasonably delay the grant by FCC of Consent as provided herein
or (2) relieve ACME of any liability hereunder.
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, waivers 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 the Members --
Mr. Michael V. Roberts
c/o Roberts Broadcasting of Salt Lake City, L.L.C.
Suite 300
1400 No. Kingshighway
St. Louis, MO 63113
with a copy to (but which shall not constitute
notice to the Members):
Dow, Lohnes & Albertston, P.L.L.C.
1200 New Hampshire Avenue, NW
Washington, DC 20036
Attention: John R. Feore, Jr., Esquire
and
Armstrong, Teasdale, Schlafly & Davis
One Metropolitan Square, Suite 2600
St. Louis, MO 63102
Attention: Joseph S. von Kaenel, Esquire
21
If to ACME --
ACME Television Holdings, L.L.C.
7125 Bluffstream Ct.
Columbus, OH 43235
Attention: Douglas Gealy, President
with a copy to (but which shall not constitute
notice to ACME):
Dickstein Shapiro Morin & Oshinsky L.L.P.
2101 L Street, N.W.
Washington, DC 20037
Attention: Lewis J. Paper, Esquire
9.7. LAW GOVERNING. This Agreement shall be governed by, construed,
and enforced in accordance with the laws of the State of Delaware 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.
22
9.12. ENTIRE AGREEMENT. This Agreement and the documents referenced
herein constitute the entire agreement among the parties in respect to the
subject matter hereof, 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."CLOSING" shall have the meaning set out in Section
1.6.1 hereof.
10.1.2."CONTRACTS" shall have the meaning set out in Section
2.6 hereof.
10.1.3."CP" shall have the meaning set out in Recital 1
hereof.
10.1.4."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.
10.1.5."ESCROW DEPOSIT" shall have the meaning set out in
Section 1.3 hereof.
10.1.6."FCC" means the Federal Communications Commission.
10.1.7."BALANCE SHEET" shall have the meaning set out in
Section 2.8 hereof.
10.1.8."HAZARDOUS WASTE" means any hazardous or toxic waste,
substance, material or pollutant.
10.1.9."IRS" means the Internal Revenue Service.
10.1.10"LITIGATION" means any litigation, arbitration,
dispute, proceeding or investigation.
10.1.11. "MA" shall have the meaning set out in Recital 5
hereof.
10.1.12. "MEMBERSHIP INTEREST" shall have the meaning set out
in Recital 2 hereof.
23
10.1.13. "OPTION AGREEMENT" shall have the meaning set out in
Recital 3 hereof.
10.1.14. "OWNERSHIP INTEREST" shall have the meaning set out
in Section 1.2 hereof.
10.1.15. "PAYMENTS" means arrearages of wages or Trust or
benefit payments.
10.1.16. "REAL ESTATE LEASES" shall have the meaning set out
in Recital 1 hereof.
10.1.17. "STATION" shall have the meaning set out in Recital
1 hereof.
10.1.18. "TRUSTS" means pension, profit-sharing and savings
plans and trusts, including without limitation, 401-K plans established by RBSLC
for its employees.
10.1.19. 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
24
IN WITNESS WHEREOF, the parties have caused this Agreement to be
duly executed as of the day and year written above.
The Members:
/s/Michael V. Roberts
--------------------------------------------
Michael V. Roberts, individually
/s/Steven C. Roberts
--------------------------------------------
Steven C. Roberts, individually
RBSLC: ROBERTS BROADCASTING OF SALT LAKE CITY, L.L.C.
By:/s/Michael V. Roberts
--------------------------------------------
Michael V. Roberts, Managing Member
ACME: ACME TELEVISION HOLDINGS, L.L.C.
By:/s/Douglas E. Gealy
--------------------------------------------
Douglas E. Gealy, President
25
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 povided to the Securities
and Exchange Commission upon request.
Exhibit A - OPTION AGREEMENT
Exhibit B - FORM OF PROMISSORY NOTE
Exhibit C - ESCROW AGREEMENT
Exhibit D - RBSLC OPERATING AGREEMENT
Exhibit E - ACME OPERATING AGREEMENT
Exhibit F - FORM OF OPINION OF ACME'S COUNSEL
Exhibit G - FORM OF OPINION OF MEMBER'S COUNSEL
Exhibit H - STUDIO LEASE
Exhibit I - TRANSMISSION FACILITY LEASE
Schedule 1 - LICENSES AND PERMITS OF RBSLC
Schedule 2 - UNFILLED OR UNPAID TAXES, ETC.
Schedule 3 - MATERIAL CONTRACTS OF RBSLC
Schedule 4 - BALANCE SHEET OF RBSLC
Schedule 5 - MATERIAL BREACHES AND VIOLATIONS BY RBSLC
Schedule 6 - REAL ESTATE LEASES OF RBSLC
SCHEDULE 7 - Membership Interests of RBSLC
Schedule 8 - MEMBERSHIP INTEREST, CONSIDERATION, OPTIONS ETC. OF ACME
Schedule 9 - ACME MANAGING MEMBERS AND OTHER MANAGEMENT AND EXECUTIVE
PERSONNEL
27
Dates Referenced Herein
| Referenced-On Page |
|---|
| This ‘S-4’ Filing | | Date | | First | | Last | | | Other Filings |
|---|
| |  |
| | 6/1/98 | | 5 | | 21 | | | None on these Dates |
| | 11/21/97 | | 6 |
| | 11/19/97 |
| Filed on: | | 11/14/97 |
| | 8/22/97 | | 2 |
| | 6/30/97 | | 7 |
| | 6/17/97 | | 3 |
| | 5/21/97 | | 6 |
| List all Filings |
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