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EXHIBIT 2.7
TANGIBLE PROPERTY PURCHASE AGREEMENT
THIS TANGIBLE PROPERTY PURCHASE AGREEMENT (this "Agreement") is made as of
October 2, 2000, among the company designated as Clear Channel on the signature
page hereto ("Clear Channel"), and the companies designated as Exchange Party on
the signature page hereto (collectively, "Exchange Party").
Recitals
A. Exchange Party owns and operates or is purchasing the following radio
broadcast stations (collectively, the "Stations") pursuant to certain
authorizations issued by the FCC:
Jonesboro, Arkansas KIYS-FM, Jonesboro, Arkansas
KBTM-AM, Jonesboro, Arkansas
KFIN-FM, Jonesboro, Arkansas
Augusta, Georgia WZNY-FM, Augusta, Georgia
WEKL-FM, Augusta, Georgia
WBBQ-FM, Augusta, Georgia
WBBQ-AM, Augusta, Georgia
WGUS-AM, North Augusta, Georgia
WKSP-FM, Aiken, South Carolina
WPRW-FM, ▇▇▇▇▇▇▇▇, Georgia
Augusta-Waterville, Maine WIGY-FM, Madison, Maine
WFAU-AM, Gardiner, Maine
WABK-FM, Gardiner, Maine
WTOS-FM, Skowhegan, Maine
WKCG-FM, Augusta, Maine
WCME-FM, Boothbay Harbor, Maine
Florence/Muscle Shoals, Alabama WLAY-AM, Muscle Shoals, Alabama
WLAY-FM, Tuscumbia, Alabama
WKGL-FM, Russellville, Alabama
WVNA-FM, Tuscumbia, Alabama
WVNA-AM, Muscle Shoals, Alabama
Tupelo, Mississippi WKMQ-AM, Tupelo, Mississippi
WTUP-AM, Tupelo, Mississippi
WWKZ-FM, Aberdeen, Mississippi
WWZD-FM, New Albany, Mississippi
WESE-FM, Baldwyn, Mississippi
Marion-Carbondale, IL WVZA-FM, ▇▇▇▇▇▇, IL
WFRX-AM, West Frankfort, IL
WTAO-FM, Murphysboro, IL
WDDD-AM. ▇▇▇▇▇▇▇▇ City, IL
WHTE-AM, ▇▇▇▇▇▇▇▇ City, IL
WDDD-FM, Marion, IL
WQUL-FM, West Frankfort, IL
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Laurel-Hattiesburg, Mississippi WEEZ-AM, Laurel, Mississippi
WJKX-FM, Ellisville, Mississippi
WHER-FM, Heidelberg, Mississippi
WUSW-FM, Hattiesburg, Mississippi
WMFM-FM, Petal, Mississippi
WFOR-AM, Hattiesburg, Mississippi
WNSL-FM, Laurel, Mississippi
Muskegon, Michigan WMUS-FM, Muskegon, Michigan
WMUS-AM, Muskegon, Michigan
WMRR-FM, Muskegon Heights, Michigan
WMHG-AM, Muskegon, Michigan
WSHZ-FM, Muskegon, Michigan
B. Pursuant to an Asset Exchange Agreement of even date herewith ("Asset
Exchange Agreement"), the parties have agreed to exchange certain assets used in
the operation of the Stations for certain assets owned by Clear Channel.
C. The parties have agreed that certain other assets of the stations will be
purchased by Clear Channel.
D. Clear Channel and Exchange Party have made filings with the Federal Trade
Commission and the Department of Justice pursuant to the ▇▇▇▇-▇▇▇▇▇-▇▇▇▇▇▇
Antitrust Improvements Act of 1976, as amended (the "HSR Act") with respect to
the transactions contemplated hereby and by the Asset Exchange Agreement
(including a request for early termination of the waiting period thereunder),
and HSR Act clearance has been obtained.
Agreement
NOW, THEREFORE, taking the foregoing into account, and in consideration of
the mutual covenants and agreements set forth herein, the parties, intending to
be legally bound, hereby agree as follows:
ARTICLE 1: PURCHASE AND SALE OF STATIONS' ASSETS
1.1. Exchange Party Station Assets. On the terms and subject to the
conditions hereof, on the Closing Date (defined below), Exchange Party shall
assign, transfer, convey and deliver to Clear Channel, and Clear Channel shall
acquire from Exchange Party, all of the right, title and interest of Exchange
Party in and to all of the assets, properties, interests and rights of Exchange
Party, real, personal and tangible, specifically described in this Section 1.1,
but excluding the Excluded Assets as hereafter defined (the "Station Assets"):
(a) all equipment, electrical devices, antennae, cables, tools,
hardware, office furniture and fixtures, office materials and supplies,
inventory, motor vehicles, spare parts and other tangible personal property of
every kind and description which are used exclusively in the operation of the
Stations and listed on Schedule 1.1(a), except any retirements or dispositions
thereof made between the date hereof and Closing in the ordinary course of
business and consistent with past practices of Exchange Party (the "Tangible
Personal Property");
(b) all owned real property which is used exclusively in the operation
of the Stations (including any of Exchange Party's appurtenant easements and
improvements located thereon) and described on Schedule 1.1(b) and Exhibit A
hereto (the "Real Property");
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(c) any and all claims and rights against third parties if and to the
extent that they relate to the Station Assets, including, without limitation,
all rights under manufacturers' and vendors' warranties; and
(d) all deposits, reserves, prepaid expenses and prepaid taxes relating
to the Station Assets.
The Station Assets shall be transferred to Clear Channel free and clear
of Liens except for (i) liens for taxes not yet due and payable and for which
Clear Channel receives a credit pursuant to Section 3.2, (ii) such liens,
easements, rights of way, building and use restrictions, exceptions,
reservations and limitations that do not in any material respect detract from
the value of the property subject thereto or impair the use thereof in the
ordinary course of the business of the Stations, and (iii) any items listed on
Schedule 1.1(b) (collectively, "Permitted Liens").
1.2. Excluded Assets. Notwithstanding anything to the contrary contained
herein, the Station Assets hall not include the following assets along with all
rights, title and interest therein (the "Excluded Assets"):
(a) all cash and cash equivalents of Exchange Party, including without
limitation certificates of deposit, commercial paper, treasury bills, marketable
securities, asset or money market accounts and all such similar accounts or
investments;
(b) all Exchange Party's accounts receivable or notes receivable
arising from the operation of the Stations;
(c) all tangible personal property of Exchange Party disposed of or
consumed in the ordinary course of business of Exchange Party between the date
of this Agreement and Closing;
(d) Exchange Party's name, corporate minute books, charter documents,
corporate stock record books and such other books and records as pertain to the
organization, existence or share capitalization of Exchange Party, duplicate
copies of the records of the Stations, and all records not relating exclusively
to the operation of the Stations;
(e) contracts of insurance, and all insurance proceeds or claims made
thereunder;
(f) all pension, profit sharing or cash or deferred (Section 401(k))
plans and trusts and the assets thereof and any other employee benefit plan or
arrangement and the assets thereof, if any, maintained by Exchange Party; and
(g) all rights, properties and assets not specifically described in
Section 1.1 and all Station assets to be exchanged with Clear Channel pursuant
to the Asset Exchange Agreement.
1.3. LMAs. On October 2, 2000, Clear Channel and Exchange Party shall enter
into local marketing agreements, effective as of such date, in substantially the
form attached hereto as Exhibit B, pursuant to which Clear Channel will provide
programming for, and be entitled to receive revenues from the sale of
advertising on, the Stations.
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ARTICLE 2: ASSUMPTION OF OBLIGATIONS
2.1. Exchange Party Retained Obligations. Clear Channel does not assume or
agree to discharge or perform and will not be deemed by reason of the execution
and delivery of this Agreement or any agreement, instrument or document
delivered pursuant to or in connection with this Agreement or otherwise by
reason of the consummation of the transactions contemplated hereby, to have
assumed or to have agreed to discharge or perform, any liabilities, obligations
or commitments of Exchange Party of any nature whatsoever whether accrued,
absolute, contingent or otherwise and whether or not disclosed to Clear Channel
(the "Retained Obligations").
ARTICLE 3: PURCHASE PRICE, ETC.
3.1. Purchase Price. The "Purchase Price" for the Station Assets shall be
Fifteen Million Dollars ($15,000,000). Clear Channel shall at Closing (defined
below) deliver to Exchange Party by wire transfer of immediately available funds
the Purchase Price, subject to adjustment pursuant to Section 3.2.
3.2. Prorations and Adjustments. Except as otherwise provided herein, all
deposits, reserves and prepaid and deferred expenses related to the Station
Assets shall be prorated in accordance with generally accepted accounting
principles as of 11:59 p.m. on the date immediately preceding the Closing Date.
Such prorations shall include, without limitation, all ad valorem real estate
and other property taxes (but excluding transfer taxes which shall be paid as
set forth in Section 10.1). Real estate taxes shall be apportioned on the basis
of taxes assessed for the preceding year, with a reapportionment, if any, as
soon as the new tax rate and valuation can be ascertained. The prorations and
adjustments contemplated by this Section 3.2 shall be made within ninety (90)
calendar days after the Closing Date. In the event of any disputes between the
parties as to such adjustments, the amounts not in dispute shall nonetheless be
paid at the time provided herein and such disputes shall be determined by an
independent certified public accountant mutually acceptable to the parties, and
the fees and expenses of such accountant shall be paid one-half by Clear Channel
and one-half by Exchange Party.
3.3. Allocations and Exchange Assets and Replacement Assets Designations.
The values of the assets comprising the Station Assets shall be determined by an
appraisal (the "Appraisal") prepared by Bond & ▇▇▇▇▇▇ (whose fees shall be paid
one-half by Clear Channel and one-half by Exchange Party). After Closing, Clear
Channel shall prepare and provide to Exchange Party schedules which, for each
party to this Agreement, show the respective Station Assets to be conveyed and
acquired and Purchase Price to be made and received at Closing under this
Agreement.
ARTICLE 4: CLOSING
4.1. Closing. The consummation of the sale of Station Assets under this
Agreement (the "Closing") shall occur on October 2, 2000, at a time and place
designated solely by Clear Channel, subject to satisfaction or waiver of the
conditions to Closing contained herein (other than those to be satisfied at
Closing). If requested by Clear Channel, prior to Closing the parties shall hold
a pre-closing conference at a time and place designated by Clear Channel, at
which the parties shall provide (for review only) all documents to be delivered
at Closing under this Agreement, each duly executed but undated, and otherwise
confirm their ability to timely consummate the Closing.
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ARTICLE 5: REPRESENTATIONS AND WARRANTIES OF CLEAR CHANNEL
Clear Channel makes the following representations and warranties to Exchange
Party:
5.1. Organization. Clear Channel is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, and is
qualified to do business in each jurisdiction in which the Station Assets are
located. Clear Channel has the requisite power and authority to execute and
deliver this Agreement and all of the other agreements and instruments to be
executed and delivered by Clear Channel pursuant hereto (collectively, the
"Clear Channel Ancillary Agreements"), to consummate the transactions
contemplated hereby and thereby and to comply with the terms, conditions and
provisions hereof and thereof.
5.2. Authorization. The execution, delivery and performance of this
Agreement and the Clear Channel Ancillary Agreements by Clear Channel have been
duly authorized and approved by all necessary action of Clear Channel and do not
require any further authorization or consent of Clear Channel. This Agreement
is, and each Clear Channel Ancillary Agreement when executed and delivered by
Clear Channel and the other parties thereto will be, a legal, valid and binding
agreement of Clear Channel enforceable in accordance with its respective terms,
except in each case as such enforceability may be limited by bankruptcy,
moratorium, insolvency, reorganization or other similar laws affecting or
limiting the enforcement of creditors' rights generally and except as such
enforceability is subject to general principles of equity (regardless of whether
such enforceability is considered in a proceeding in equity or at law).
5.3. No Conflicts. Neither the execution and delivery by Clear Channel of
this Agreement and the Clear Channel Ancillary Agreements or the consummation by
Clear Channel of any of the transactions contemplated hereby or thereby nor
compliance by Clear Channel with or fulfillment by Clear Channel of the terms,
conditions and provisions hereof or thereof will: (i) conflict with any
organizational documents of Clear Channel or any law, judgment, order, or decree
to which Clear Channel is subject or any Clear Channel contract; or (ii) require
the approval, consent, authorization or act of, or the making by Clear Channel
of any declaration, filing or registration with, any third party or any foreign,
federal, state or local court, governmental or regulatory authority or body,
except the HSR clearance.
5.4. No Finder. No broker, finder or other person is entitled to a
commission, brokerage fee or other similar payment in connection with this
Agreement or the transactions contemplated hereby as a result of any agreement
or action of Clear Channel or any party acting on Clear Channel's behalf.
5.5. Disclosure. No provision or information contained in this Agreement
relating to Clear Channel, or in any Schedule or Exhibit hereto, or the
information to be provided to Exchange Party pursuant hereto, contains or will
contain any untrue statement of a material fact or omits or will omit to state a
material fact required to be stated in order to make the statement, in light of
the circumstances in which it is made, not misleading.
ARTICLE 6: REPRESENTATIONS AND WARRANTIES OF EXCHANGE PARTY
Exchange Party makes the following representations and warranties to Clear
Channel:
6.1. Organization. Exchange Party is duly organized, validly existing and in
good standing under the laws of the jurisdiction of its organization, and is
qualified to do business in
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each jurisdiction in which the Station Assets are located. Exchange Party has
the requisite power and authority to execute and deliver this Agreement and all
of the other agreements and instruments to be executed and delivered by Exchange
Party pursuant hereto (collectively, the "Exchange Party Ancillary Agreements"),
to consummate the transactions contemplated hereby and thereby and to comply
with the terms, conditions and provisions hereof and thereof.
6.2. Authorization. The execution, delivery and performance of this
Agreement and the Exchange Party Ancillary Agreements by Exchange Party have
been duly authorized and approved by all necessary action of Exchange Party and
do not require any further authorization or consent of Exchange Party. This
Agreement is, and each Exchange Party Ancillary Agreement when executed and
delivered by Exchange Party and the other parties thereto will be, a legal,
valid and binding agreement of Exchange Party enforceable in accordance with its
respective terms, except in each case as such enforceability may be limited by
bankruptcy, moratorium, insolvency, reorganization or other similar laws
affecting or limiting the enforcement of creditors' rights generally and except
as such enforceability is subject to general principles of equity (regardless of
whether such enforceability is considered in a proceeding in equity or at law).
6.3. No Conflicts. Neither the execution and delivery by Exchange Party of
this Agreement and the Exchange Party Ancillary Agreements or the consummation
by Exchange Party of any of the transactions contemplated hereby or thereby nor
compliance by Exchange Party with or fulfillment by Exchange Party of the terms,
conditions and provisions hereof or thereof will: (i) conflict with any
organizational documents of Exchange Party or any law, judgment, order, or
decree to which Exchange Party is subject or any Exchange Party contract; or
(ii) require the approval, consent, authorization or act of, or the making by
Exchange Party of any declaration, filing or registration with, any third party
or any foreign, federal, state or local court, governmental or regulatory
authority or body, except the HSR clearance.
6.4. Taxes. Exchange Party has, in respect of the Station Assets, filed all
foreign, federal, state, county and local income, excise, property, sales, use,
franchise and other tax returns and reports which are required to have been
filed by it under applicable law and has paid all taxes which have become due
pursuant to such returns or pursuant to any assessments which have become
payable.
6.5. Personal Property. Schedule 1.1(a) contains a list of all material
items of Tangible Personal Property included in the Station Assets. Exchange
Party has title (or in the case of Tangible Personal Property used in the
operation of the Muskegon stations, at Closing will have title) to the Tangible
Personal Property free and clear of Liens other than Permitted Liens. All items
of Tangible Personal Property, including without limitation equipment and
electrical devices, are in good operating condition and repair (reasonable wear
and tear in ordinary usage excepted), are free from material defect and damage,
are functioning in the manner and for the purposes for which it was intended,
have been maintained in accordance with industry standards in all material
respects, and do not require any repairs other than normal routine maintenance.
6.6. Real Property. Schedule 1.1(b) contains a description of all Exchange
Party Real Property included in the Station Assets. Exchange Party has fee
simple title (or in the case of Real Property used in the operation of the
Muskegon Stations, at Closing will have fee simple title) to the Real Property
free and clear of Liens other than Permitted Liens. Real Property includes
access to the Stations' facilities. To Exchange Party's knowledge, the Real
Property is not subject to any suit for condemnation or other taking by any
public authority.
6.7. Environmental. Except as set forth in any environmental reports
delivered by Exchange Party to Clear Channel prior to the date of this Agreement
and except as set forth on
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Schedule 1.1(b), to Exchange Party's knowledge, no hazardous or toxic substance
or waste regulated under any applicable environmental, health or safety law has
been generated, stored, transported or released on, in, from or to the Real
Property included in the Station Assets. Except as set forth in any
environmental reports delivered by Exchange Party to Clear Channel prior to the
date of this Agreement and except as set forth on Schedule 1.1(b), to Exchange
Party's knowledge, Exchange Party has complied in all material respects with all
environmental, health and safety laws applicable to the Station Assets.
6.8. Compliance with Law. Exchange Party has complied in all material
respects with all laws, regulations, rules, writs, injunctions, ordinances,
franchises, decrees or orders of any court or of any foreign, federal, state,
municipal or other governmental authority which are applicable to the Station
Assets. There is no action, suit or proceeding pending or threatened against
Exchange Party in respect of the Station Assets that will subject Clear Channel
to liability or which questions the legality or propriety of the transactions
contemplated by this Agreement. To Exchange Party's knowledge, there are no
governmental claims or investigations pending or threatened against Exchange
Party in respect of the Station Assets (except those affecting the industry
generally).
6.9. No Finder. No broker, finder or other person is entitled to a
commission, brokerage fee or other similar payment in connection with this
Agreement or the transactions contemplated hereby as a result of any agreement
or action of Exchange Party or any party acting on Exchange Party's behalf.
6.10. Litigation. There are no suits, arbitrations, administrative charges
or other legal proceedings, claims or governmental investigations pending
against, or, to Exchange Party's knowledge, threatened against, the Station
Assets or Exchange Party relating to or affecting the Stations nor, to the best
of the knowledge of Exchange Party, is there any basis for any such suit,
arbitration, administrative charge or other legal proceeding, claim or
governmental investigation. Exchange Party has not been operating under or
subject to, or in default with respect to, any judgment, order, writ, injunction
or decree of any court or federal, state, municipal or other governmental
department, commission, board, agency or instrumentality, foreign or domestic.
6.11. Disclosure. No provision or information contained in this Agreement
relating to Exchange Party, the Station Assets, or in any Schedule or Exhibit
hereto, contains or will contain any untrue statement of a material fact or
omits or will omit to state a material fact required to be stated in order to
make the statement, in light of the circumstances in which it is made, not
misleading. Except for facts affecting the radio industry generally, there is no
adverse fact now known to Exchange Party relating to the Station Assets or the
which would have a material adverse impact on the Station Assets which has not
been disclosed to Clear Channel.
ARTICLE 7: COVENANTS
7.1. Exchange Party's Covenants. Exchange Party covenants and agrees with
respect to the Station Assets that, between the date hereof and Closing, except
as permitted by this Agreement or with the prior written consent of Clear
Channel, which shall not be unreasonably withheld, Exchange Party shall:
(a) operate the Station Assets in the ordinary course of business
consistent with past practice and in all material respects in accordance with
FCC rules and regulations and with all other applicable laws, regulations, rules
and orders;
(b) not, other than in the ordinary course of business in accordance
with past practice, sell, lease or dispose of or agree to sell, lease or dispose
of any of the Station Assets, or
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create, assume or permit to exist any Liens upon the Station Assets, except for
Permitted Liens; and,
(c) furnish Clear Channel with such information relating to the Station
Assets as Clear Channel may reasonably request, at Clear Channel's expense and
provided such request does not interfere unreasonably with the business of the
Stations.
7.2. 1031 Exchange. At or prior to Closing, Clear Channel and/or Exchange
Party (either, an "Assigning Party") may assign its rights under this Agreement
(in whole or in part) to a qualified intermediary (as defined in Treasury
regulation section 1.1031(k)-1(g)(4)) or similar entity or arrangement
("Qualified Intermediary"). Upon any such assignment, the Assigning Party shall
promptly give written notice thereof to the other party hereto (the "Other
Party") and the Other Party shall cooperate with the reasonable requests of the
Assigning Party and any Qualified Intermediary in connection therewith. Without
limiting the generality of the foregoing, if an Assigning Party gives notice of
such an assignment, the Other Party shall (i) promptly provide an Assigning
Party with written acknowledgment of such notice and (ii) at Closing, convey all
or part of the Station Assets and pay all or part of the Purchase Price, as the
case may be, (each as designated in writing by the Qualified Intermediary) to or
on behalf of the Qualified Intermediary (which payment and conveyance shall, to
the extent thereof, satisfy the obligation of the Other Party to make such
conveyance and payment hereunder). An Assigning Party's assignment to a
Qualified Intermediary will not relieve the Assigning Party of any of its duties
or obligations herein. Except for the obligations of the Other Party set forth
in this Section, the Other Party shall not have any liability or obligation to
the Assigning Party for the failure of such other exchange to qualify as a like
kind exchange under Section 1031 of the Code unless such failure is the result
of the material breach or default by the Other Party under this Agreement.
ARTICLE 8: CONDITIONS OF CLOSING BY CLEAR CHANNEL
The obligations of Clear Channel hereunder are, at its option, subject to
satisfaction, at or prior to Closing, of the following condition:
8.1. Representations, Warranties and Covenants. The representations and
warranties of Exchange Party made in this Agreement shall be true and correct in
all material respects as of the Closing Date except for changes permitted or
contemplated by the terms of this Agreement, and the covenants and agreements to
be complied with and performed by Exchange Party at or prior to Closing shall
have been complied with or performed in all material respects.
ARTICLE 9: CONDITIONS OF CLOSING BY EXCHANGE PARTY
The obligations of Exchange Party hereunder are, at its option, subject to
satisfaction, at or prior to Closing, of the following condition:
9.1. Representations, Warranties and Covenants. The representations and
warranties of Clear Channel made in this Agreement shall be true and correct in
all material respects as of the Closing Date except for changes permitted or
contemplated by the terms of this Agreement, and the covenants and agreements to
be complied with and performed by Clear Channel at or prior to Closing shall
have been complied with or performed in all material respects.
ARTICLE 10: EXPENSES
10.1. Expenses. Each party shall be solely responsible for all costs and
expenses incurred by it in connection with the negotiation, preparation and
performance of and compliance
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with the terms of this Agreement, except that (i) all recordation, transfer and
documentary taxes, fees and charges, and any excise, sales or use taxes,
applicable to the transfer of the Station Assets shall be paid by Exchange
Party, and (ii) all HSR Act filing fees and expenses shall be paid equally by
Clear Channel and Exchange Party.
ARTICLE 11: DOCUMENTS TO BE DELIVERED AT CLOSING
11.1. Clear Channel's Documents. At Closing, Clear Channel shall deliver or
cause to be delivered to Exchange Party the Purchase Price in accordance with
Section 3.1 hereof.
11.2. Exchange Party's Documents. At Closing, Exchange Party shall deliver
or cause to be delivered to Clear Channel, such bills of sale, assignments,
special warranty deeds, documents of title and other instruments of conveyance,
assignment and transfer as may be necessary to convey, transfer and assign the
Station Assets to Clear Channel, free and clear of Liens, except for Permitted
Liens.
ARTICLE 12: SURVIVAL; INDEMNIFICATION.
12.1. Survival. The covenants, agreements, representations and warranties in
this Agreement shall survive Closing of the Asset Exchange Agreement for a
period of six (6) months whereupon they shall expire and be of no further force
or effect, except those under (i) this Article 12 that relate to Damages
(defined below) for which written notice is given by the indemnified party to
the indemnifying party prior to the expiration, which shall survive until
resolved and (ii) the following provisions (the "Expense Provisions"): 3.2
(Adjustments), 3.3 (Allocation), and 10.1 (Expenses), and indemnification
obligations with respect to such provisions, which shall survive until
performed.
12.2. Indemnification.
(a) From and after the Closing, Clear Channel shall defend, indemnify
and hold harmless Exchange Party from and against any and all losses, costs,
damages, liabilities and expenses, including reasonable attorneys' fees and
expenses ("Damages") incurred by Exchange Party arising out of or resulting
from: (i) any breach or default by Clear Channel under this Agreement; or
operation of the Station Assets after Closing; provided, however, that, except
for the Expense Provisions (which shall not be subject to such limitations), (y)
Clear Channel shall have no liability to Exchange Party hereunder until, and
only to the extent that, Exchange Party's aggregate Damages exceed $100,000 and
(z) the maximum liability of Clear Channel hereunder shall be $11,000,000.
(b) From and after the Closing, Exchange Party shall defend, indemnify
and hold harmless Clear Channel from and against any and all Damages incurred by
Clear Channel arising out of or resulting from: (i) any breach or default by
Exchange Party under this Agreement; or (ii) the Retained Obligations; provided,
however, that, except for the Expense Provisions (which shall not be subject to
such limitations), (y) Exchange Party shall have no liability to Clear Channel
hereunder until, and only to the extent that, Clear Channel's aggregate Damages
exceed $100,000 and (z) the maximum liability of Exchange Party hereunder shall
be $15,000,000.
12.3. Procedures. The indemnified party shall give prompt written notice to
the indemnifying party of any demand, suit, claim or assertion of liability by
third parties or other circumstances that could give rise to an indemnification
obligation hereunder against the indemnifying party (a "Claim"), but a failure
to give such notice or delaying such notice shall not affect the indemnified
party's right to indemnification and the indemnifying party's obligation to
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indemnify as set forth in this Agreement, except to the extent the indemnifying
party's ability to remedy, contest, defend or settle with respect to such Claim
is thereby prejudiced. The obligations and liabilities of the parties with
respect to any Claim shall be subject to the following additional terms and
conditions:
(a) The indemnifying party shall have the right to undertake, by
counsel or other representatives of its own choosing, the defense or opposition
to such Claim.
(b) In the event that the indemnifying party shall elect not to
undertake such defense or opposition, or, within twenty (20) days after written
notice (which shall include sufficient description of background information
explaining the basis for such Claim) of any such Claim from the indemnified
party, the indemnifying party shall fail to undertake to defend or oppose, the
indemnified party (upon further written notice to the indemnifying party) shall
have the right to undertake the defense, opposition, compromise or settlement of
such Claim, by counsel or other representatives of its own choosing, on behalf
of and for the account and risk of the indemnifying party (subject to the right
of the indemnifying party to assume defense of or opposition to such Claim at
any time prior to settlement, compromise or final determination thereof).
(c) Anything herein to the contrary notwithstanding: (i) the
indemnified party shall have the right, at its own cost and expense, to
participate in the defense, opposition, compromise or settlement of the Claim;
(ii) the indemnifying party shall not, without the indemnified party's written
consent, settle or compromise any Claim or consent to entry of any judgment
which does not include as an unconditional term thereof the giving by the
claimant or the plaintiff to the indemnified party of a release from all
liability in respect of such Claim; and (iii) in the event that the indemnifying
party undertakes defense of or opposition to any Claim, the indemnified party,
by counsel or other representative of its own choosing and at its sole cost and
expense, shall have the right to consult with the indemnifying party and its
counsel or other representatives concerning such Claim and the indemnifying
party and the indemnified party and their respective counsel or other
representatives shall cooperate in good faith with respect to such Claim.
(d) All claims not disputed shall be paid by the indemnifying party
within thirty (30) days after receiving notice of the Claim. "Disputed Claims"
shall mean claims for Damages by an indemnified party which the indemnifying
party objects to in writing within thirty (30) days after receiving notice of
the Claim. In the event there is a Disputed Claim with respect to any Damages,
the indemnifying party shall be required to pay the indemnified party the amount
of such Damages for which the indemnifying party has, pursuant to a final
determination, been found liable within ten (10) days after there is a final
determination with respect to such Disputed Claim. A final determination of a
Disputed Claim shall be (i) a judgment of any court determining the validity of
a Disputed Claim, if no appeal is pending from such judgment and if the time to
appeal therefrom has elapsed; (ii) an award of any arbitration determining the
validity of such disputed claim, if there is not pending any motion to set aside
such award and if the time within which to move to set aside such award has
elapsed; (iii) a written termination of the dispute with respect to such claim
signed by the parties thereto or their attorneys; (iv) a written acknowledgment
of the indemnifying party that it no longer disputes the validity of such claim;
or (v) such other evidence of final determination of a disputed claim as shall
be acceptable to the parties. No undertaking of defense or opposition to a Claim
shall be construed as an acknowledgment by such party that it is liable to the
party claiming indemnification with respect to the Claim at issue or other
similar Claims.
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ARTICLE 13: TERMINATION
13.1. Termination. This Agreement may be terminated at any time prior to
Closing as follows:
(a) by mutual written consent of Clear Channel and Exchange Party;
(b) by written notice of Clear Channel to Exchange Party if Exchange
Party (i) does not satisfy the conditions or perform the obligations to be
satisfied or performed by it on the Closing Date; or (ii) otherwise breaches in
any material respect any of its representations or warranties or defaults in any
material respect in the performance of any of its covenants or agreements herein
contained and such breach or default is not cured within the Cure Period
(defined below);
(c) by written notice of Exchange Party to Clear Channel if Clear
Channel (i) does not satisfy the conditions or perform the obligations to be
satisfied or performed by it on the Closing Date; or (ii) otherwise breaches in
any material respect any of its representations or warranties or defaults in any
material respect in the performance of any of its covenants or agreements herein
contained and such breach or default is not cured within the Cure Period
(defined below); or
(d) by written notice of Clear Channel to Exchange Party, or Exchange
Party to Clear Channel, if the Closing shall not have been consummated on or
before the first anniversary of the date of this Agreement, or if the Asset
Exchange Agreement is terminated.
The term "Cure Period" as used herein means a period commencing the date a
party receives from the other written notice of breach or default hereunder and
continuing until the earlier of (i) thirty (30) days thereafter or (ii) the
Closing Date; provided, however, that if the breach or default cannot reasonably
be cured within such period but can be cured before the Closing Date, and if
diligent efforts to cure promptly commence, then the Cure Period shall continue
as long as such diligent efforts to cure continue, but not beyond the Closing
Date. Except as set forth below, the termination of this Agreement shall not
relieve any party of any liability for breach or default under this Agreement
prior to the date of termination. Notwithstanding anything contained herein to
the contrary, Section 13.1 shall survive any termination of this Agreement.
13.2. Remedies. The parties recognize that if either party refuses to
consummate the Closing pursuant to the provisions of this Agreement or either
party otherwise breaches or defaults such that the Closing has not occurred
("Breaching Party"), monetary damages alone will not be adequate to compensate
the non-breaching party ("Non-Breaching Party") for its injury. Such
Non-Breaching Party shall therefore be entitled to obtain specific performance
of the terms of this Agreement in lieu of, and not in addition to, any other
remedies, including but not limited to monetary damages, that may be available
to it. If any action is brought by the Non-Breaching Party to enforce this
Agreement, the Breaching Party shall waive the defense that there is an adequate
remedy at law. In the event of a default by the Breaching Party which results in
the filing of a lawsuit for damages, specific performance, or other remedy, the
Non-Breaching Party shall be entitled to reimbursement by the Breaching Party of
reasonable legal fees and expenses incurred by the Non-Breaching Party, provided
that the Non-Breaching Party is successful in such lawsuit.
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ARTICLE 14: MISCELLANEOUS PROVISIONS
14.1. Casualty Loss. In the event any loss or damage of the Tangible
Personal Property or Real Property exists on the Closing Date, the parties shall
consummate the Closing and assign as appropriate the proceeds of any insurance
payable on account of such damage or loss.
14.2. Further Assurances. After the Closing, each party shall from time to
time, at the request of and without further cost or expense to the other,
execute and deliver such other instruments and take such other actions as may
reasonably be requested in order to more effectively consummate the transactions
contemplated hereby to exchange assets and assume obligations as contemplated by
this Agreement.
14.3. Assignment. Neither party may assign this Agreement without the prior
written consent of the other party hereto. With respect to any permitted
assignment, the parties shall take all such actions as are reasonably necessary
to effectuate such assignment, including but not limited to cooperating in any
appropriate filings with governmental authorities. All covenants, agreements,
statements, representations, warranties and indemnities in this Agreement by and
on behalf of any of the parties hereto shall bind and inure to the benefit of
their respective successors and permitted assigns of the parties hereto.
14.4. Amendments. No amendment, waiver of compliance with any provision or
condition hereof or consent pursuant to this Agreement shall be effective unless
evidenced by an instrument in writing signed by the party against whom
enforcement of any waiver, amendment, change, extension or discharge is sought.
14.5. Headings. The headings set forth in this Agreement are for convenience
only and will not control or affect the meaning or construction of the
provisions of this Agreement.
14.6. Governing Law. The construction and performance of this Agreement
shall be governed by the laws of the State of Texas without giving effect to the
choice of law provisions thereof.
14.7. Notices. Any notice, demand or request required or permitted to be
given under the provisions of this Agreement shall be in writing, including by
facsimile, and shall be deemed to have been received on the date of personal
delivery, on the third day after deposit in the U.S. mail if mailed by
registered or certified mail, postage prepaid and return receipt requested, on
the day after delivery to a nationally recognized overnight courier service if
sent by an overnight delivery service for next morning delivery or when
delivered by facsimile transmission, and shall be addressed as follows (or to
such other address as any party may request by written notice):
if to Clear Channel: c/o Clear Channel Broadcasting, Inc.
▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇ ▇▇▇▇▇▇▇, ▇▇▇▇▇ ▇▇▇▇▇
Attention: President
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall
not constitute notice) to: Wiley, Rein & Fielding
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
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if to Exchange Party: Cumulus Broadcasting, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
with a copy (which shall
not constitute notice) to: Paul, Hastings, ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇, ▇.▇.
▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇, Esq.
Facsimile: (▇▇▇) ▇▇▇-▇▇▇▇
14.8. Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original and all of which together
will constitute one and the same instrument.
14.9. No Third Party Beneficiaries. Nothing herein expressed or implied is
intended or shall be construed to confer upon or give to any person or entity
other than the parties hereto and their successors or permitted assigns, any
rights or remedies under or by reason of this Agreement.
14.10. Severability. The parties agree that if one or more provisions
contained in this Agreement shall be deemed or held to be invalid, illegal or
unenforceable in any respect under any applicable law, this Agreement shall be
construed with the invalid, illegal or unenforceable provision deleted, and the
validity, legality and enforceability of the remaining provisions contained
herein shall not be affected or impaired thereby.
14.11. Entire Agreement. This Agreement embodies the entire agreement and
understanding of the parties hereto and supersedes any and all prior agreements,
arrangements and understandings relating to the matters provided for herein.
This Agreement does not supersede any confidentiality agreement relating to the
Clear Channel Stations.
[SIGNATURE PAGE FOLLOWS]
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SIGNATURE PAGE TO TANGIBLE PROPERTY PURCHASE AGREEMENT
IN WITNESS WHEREOF, the parties have executed this Agreement as of the date
first set forth above.
CLEAR CHANNEL: CAPSTAR RADIO OPERATING COMPANY
By:
---------------------------------------
Name:
Title:
EXCHANGE PARTY: CUMULUS BROADCASTING, INC.
By:
---------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇.
President
CUMULUS WIRELESS SERVICES, INC.
By:
---------------------------------------
Name:
Title:
15
Schedules
1.1(a) - Tangible Personal Property
1.1(b) - Real Property
Exhibits
A. - List of Owned Real Property
B. - LMA Form