1
Exhibit 2(c)
ASSET PURCHASE AGREEMENT
by and between
RUBY BROADCASTING, INC.
and
REGENT BROADCASTING OF VICTORVILLE, INC.
2
TABLE OF CONTENTS
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PAGE
ARTICLE I - PURCHASE OF ASSETS ----
1.1 Transfer of Assets 1
1.2 Excluded Assets 3
ARTICLE 2 ASSUMPTION OF OBLIGATIONS
2.1 Assumption of Obligations 4
2.2 Retained Liabilities 5
ARTICLE 3 CONSIDERATION
3.1 Delivery of Consideration 5
3.2 Escrow Deposit 5
3.3 Proration of Income and Expenses 6
3.4 Allocation of Purchase Price 7
3.5 Adjustment for Barter 7
ARTICLE 4 CLOSING
4.1 Closing 7
4.2 Time Brokerage Agreement 8
ARTICLE 5 GOVERNMENTAL CONSENTS
5.1 FCC Consent 8
5.2 FCC Application 8
ARTICLE 6 REPRESENTATIONS AND WARRANTIES OF BUYER
6.1 Organization and Standing 9
6.2 Authorization and Binding Obligation 9
6.3 Qualification As Assignee 9
6.4 Absence of Conflicting Agreements or
Required Consents 9
6.5 Commissions or Finder's Fees 9
6.6 Litigation 9
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6.7 Bankruptcy 10
6.8 Committed Sources of Financing 10
ARTICLE 7 REPRESENTATIONS AND WARRANTIES OF SELLER
7.1 Organization and Standing 11
7.2 Authorization and Binding Obligation 11
7.3 Absence of Conflicting Agreements or Required
Consents 11
7.4 Government Authorizations 11
7.5 Compliance with FCC Regulations 12
7.6 Taxes 12
7.7 Personal Property 12
7.8 Real Property 13
7.9 Contracts 13
7.10 Status of Contracts, etc. 14
7.11 Environmental 14
7.12 Intellectual Property 14
7.13 Financial Statements 15
7.14 Personnel Information 15
7.15 Litigation 16
7.16 Compliance With Laws 16
7.17 Employee Benefit Plans 16
7.18 Commissions or Finder's Fees 16
7.19 Conduct of Business in Ordinary Course: Adverse
Change 16
7.20 Instruments of Conveyance; Good Title 16
7.21 Undisclosed Liabilities 17
7.22 Full Disclosure 17
7.23 Bankruptcy 17
ARTICLE 8 COVENANTS OF BUYER
8.1 Closing 17
8.2 Notification 17
8.3 No Inconsistent Action 18
ARTICLE 9 COVENANTS OF SELLER
9.1 Pre-Closing Covenants 18
9.2 Notification 19
9.3 No Inconsistent Action 20
9.4 Closing 20
9.5 Other Items 20
9.6 Exclusivity 20
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ARTICLE 10 JOINT COVENANTS
10.1 Confidentiality 21
10.2 Cooperation 21
10.3 Control of Stations 21
10.4 Consents to Assignment 22
10.5 Filings 22
10.6 Bulk Sales Laws 22
10.7 Employee Matters 22
ARTICLE 11 CONDITIONS OF CLOSING BY BUYER
11.1 Representations, Warranties and Covenants 23
11.2 Governmental Consents 23
11.3 Governmental Authorizations 23
11.4 Adverse Proceedings 24
11.5 Third-Party Consents 24
11.6 Closing Documents 24
11.7 Time Brokerage Agreement Compliance 24
11.8 No Adverse Change 24
11.9 Closing on Topaz Merger Agreement 24
ARTICLE 12 CONDITIONS OF CLOSING BY SELLER
12.1 Representations, Warranties and Covenants 25
12.2 Governmental Consents 25
12.3 Adverse Proceedings 25
12.4 Closing Documents 25
12.5 Time Brokerage Agreement Compliance 25
12.6 Closing on Topaz Merger Agreement 26
ARTICLE 13 TRANSFER TAXES; FEES AND EXPENSES
13.1 Expenses 26
13.2 Specific Charges 26
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ARTICLE 14 DOCUMENTS TO BE DELIVERED AT CLOSING
14.1 Seller's Documents 26
14.2 Buyer's Documents 27
ARTICLE 15 SURVIVAL, INDEMNIFICATION, ETC.
15.1 Survival of Representations, Etc 28
15.2 Indemnification 28
15.3 Procedures: Third Party and Direct Indemnification
Claims 29
ARTICLE 16 TERMINATION RIGHTS
16.1 Termination 30
16.2 Liability 31
16.3 Monetary Damages, Specific Performance and Other
Remedies 31
16.4 Seller's Liquidated Damages 31
ARTICLE 17 MISCELLANEOUS PROVISIONS
17.1 Risk of Loss 33
17.2 Certain Interpretive Matters and Definitions 33
17.3 Further Assurances 33
17.4 Preservation of Records 34
17.5 Benefit and Assignment 34
17.6 Amendments 34
17.7 Headings 34
17.8 Governing Law 34
17.9 Notices 35
17.10 Counterparts 35
17.11 No Third Party Beneficiaries 36
17.12 Severability 36
17.13 Entire Agreement 36
17.14 Disclosure 36
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LIST OF SCHEDULES
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Schedule 1.2.9 Miscellaneous Excluded Assets
7.4 Stations Licenses, Etc.
7.7 Tangible Personal Property
7.8 Real Property
7.9 Contracts (including identification of
Material Contracts)
7.11 Environmental Matters
7.12 Intellectual Property
7.13 Financial Statements
7.14 Personnel Information
7.15 Litigation
7.16 Compliance With Laws
7.17 Employee Benefit Plans
A Indemnification Escrow Agreement
B Deposit Escrow Agreement
C Time Brokerage Agreement
D Assignment and Assumption Agreement
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ASSET PURCHASE AGREEMENT
------------------------
THIS ASSET PURCHASE AGREEMENT (this "Agreement") is made and entered
this 17th day of December, 1997 by and between RUBY BROADCASTING, INC., a
Delaware corporation (hereinafter referred to as "Seller") and REGENT
BROADCASTING OF VICTORVILLE, INC., a Delaware corporation ("Buyer").
RECITALS
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WHEREAS, Seller owns and operates radio stations KIXW (AM) and KZXY-FM
licensed to Apple Valley, California (together the "Stations" and each
individually, a "Station") pursuant to licenses issued by the Federal
Communications Commission ("FCC"); and
WHEREAS, Seller desires to sell, and Buyer desires to purchase, certain
assets and assume certain obligations associated with the ownership and
operation of the Stations, all on the terms and subject to the conditions set
forth herein; and
WHEREAS, Buyer and Regent Communications, Inc. have entered into an
Agreement of Merger of even date herewith with Topaz Broadcasting, Inc., a
sister corporation and Affiliate of Seller (hereinafter the "Topaz Merger
Agreement").
NOW, THEREFORE, in consideration of the foregoing premises and the
mutual covenants and agreements hereinafter set forth, the parties hereto,
intending to be legally bound, hereby agree as follows:
ARTICLE I
PURCHASE OF ASSETS
------------------
1.1 TRANSFER OF ASSETS. On the terms and subject to the conditions
hereof and subject to Section 1.2, on the Closing Date (as hereinafter defined),
Seller shall sell, assign, transfer, convey and deliver to Buyer, and Buyer
shall purchase and assume from Seller, all of the right, title and interest of
Seller in and to all of the assets, properties, interests and rights of Seller
of whatsoever kind and nature, real and personal, tangible and intangible, owned
or leased (to the extent of Seller's leasehold interest) by Seller as the case
may be, wherever situated, which are used or held for use in the operation of
the Stations (the "Stations Assets"), including but not limited to all of
Seller's right, title and interest in and to the assets, properties, interests
and rights described in this Section 1. 1:
1.1.1 all licenses, permits and other authorizations issued to
Seller by any governmental or regulatory authority including without limitation
those issued by the FCC (the licenses, permits and authorizations issued by the
FCC are hereafter referred to as the "Stations Licenses") used or useful in
connection with the operation of the Stations, including but not limited to
those described in SCHEDULE 7.4, along with renewals or modifications of such
items between the date hereof and the Closing Date but excluding any license
listed on SCHEDULE 1.2.9;
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1.1.2 all equipment, electrical devices, antennae, cables,
tools, hardware, office furniture and fixtures, office materials and supplies,
inventory, motor vehicles, spare parts and all other tangible personal property
of every kind and description, and Seller's rights therein, owned, leased (to
the extent of Seller's leasehold interest) or held by Seller and used or useful
in connection with the operations of the Stations, including but not limited to
those items described or listed in SCHEDULE 7.7, together with any replacements
thereof and additions thereto, made between the date hereof and the Closing
Date, and less any retirements or dispositions thereof made between the date
hereof and the Closing Date in the ordinary course of business and consistent
with past practices of Seller; provided, however, Seller agrees that the value
of all such assets retired or disposed of and not replaced with an asset of like
kind and quality shall not exceed $5,000 in the aggregate unless Seller has
obtained the prior written approval of Buyer which shall not be unreasonably
withheld;
1.1.3 subject to the prior assignment and assumption thereof
pursuant to the Time Brokerage Agreement (as defined in Section 4.2 hereof) (i)
all Time Sales Agreements and Trade Agreements (as defined in the Time Brokerage
Agreement relating to the operation of the Stations), and (ii) all other
contracts, agreements, leases and legally binding contractual rights of any
kind, written or oral, relating to the operation of the Stations and which are
listed in SCHEDULE 7.8 and SCHEDULE 7.9, together with (a) all contracts,
agreements, leases and legal binding contractual rights entered into or acquired
by Seller between the date hereof and the Closing Date in the ordinary course of
business, consistent with past practices of Seller; (b) contracts, agreements,
leases and legal binding contractual rights entered into or acquired by Seller
between the date hereof and the Closing Date, which are not in the ordinary
course of business and with respect to which the Buyer specifically consents in
writing prior to Closing or agrees at Closing to assume; and (c) other
miscellaneous contracts not uncommon to broadcast properties which do not exceed
$100,000 of expenditures or revenues annually in the aggregate ("Miscellaneous
Agreements") (collectively (i) and (ii) above are referred to herein as the
"Contracts"); for the purpose of this Agreement, Contracts shall be deemed in
the ordinary course of business if they are: (x) marked with the number one (1)
on SCHEDULE 7.9 or (y) have a term not greater than twelve (12) months and
payment obligations on behalf of the Seller that do not exceed $25,000 in the
aggregate.
1.1.4 all of Seller's rights in and to the call letters KZXY-FM
and any variations thereof, as well as all of Seller's rights in and to all
trademarks, trade names, service marks, franchises, copyrights, including
registrations and applications for registration of any of them, computer
software, programs and programming material of whatever form or nature, jingles,
slogans, the Stations' logos and all other logos or licenses to use same and all
other intangible property rights of Seller, which are used or useful in
connection with the operation of the Stations, including but not limited to
those listed in SCHEDULE 7.12 (collectively, the "Intellectual Property")
together with any associated goodwill and any additions thereto between the date
hereof and the Closing Date;
1.1.5 all programming materials and elements of whatever form
or nature owned by Seller that are used or useful in connection with the
operation of the Stations, whether recorded on tape or other medium or intended
for live performance, and all copyrights owned by or licensed to Seller that are
used or useful in connection with the operation of the Stations,
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including all such programs, materials, elements and copyrights acquired by
Seller between the date hereof and the Closing Date;
1.1.6 all of Seller's rights in and to all the files, documents,
records, and books of account relating to the operation of the Stations or to
the Stations Assets, including, without limitation, the Stations' local public
files, programming information and studies, blueprints, technical information
and engineering data, news and advertising studies or consulting reports,
marketing and demographic data, sales correspondence, lists of advertisers,
promotional materials, credit and sales reports and filings with the FCC and all
written Contracts to be assigned hereunder, logs, software programs and books
and records relating to employees, financial, accounting and operation matters,
but excluding records relating solely to any Excluded Asset (as hereinafter
defined);
1.1.7 all of Seller's rights under manufacturers' and vendors'
warranties relating to items included in the Stations Assets and all similar
rights against third parties relating to items included in the Stations Assets;
1.1.8 the real property and fixtures thereon described in
Section 7.8 but excluding any real property and fixtures thereon listed on
SCHEDULE 1.2.9;
1.1.9 subject to the prior assignment and assumption thereof
pursuant to the Time Brokerage Agreement, all of Seller's rights in all accounts
receivable from Time Sales Agreements and Trade Agreements relating to the sale
of time on the Stations; and
1.1.10 except for Excluded Assets, such other assets,
properties, interests and rights owned by Seller that are located at the
Stations' Facilities and used or useful in connection with the operation of the
Stations.
The Stations Assets shall be transferred to Buyer free and clear of all
debts, security interests, mortgages, trusts, claims, pledges or other liens,
liabilities, encumbrances or rights of third parties whatsoever
("Encumbrances"), except for Permitted Encumbrances, if any, as provided for in
Section 7.8.2, except as set forth in SCHEDULE 7.7.and SCHEDULE 7.8, and except
for Assumed Liabilities.
1.2 EXCLUDED ASSETS. Notwithstanding anything to the contrary contained
herein, it is expressly understood and agreed that the Stations Assets shall not
include the following assets along with all rights, title and interest therein
(the "Excluded Assets"):
1.2.1 all cash and cash equivalents of Seller on hand and/or
in banks, including without limitation certificates of deposit, commercial
paper, treasury bills, marketable securities, asset or money market accounts and
all such similar accounts or investments;
1.2.2 all assets of the Seller that are used exclusively in
connection with the operation of radio stations KIXW-FM, Lenwood, California and
KIXF (FM), ▇▇▇▇▇, California, which radio stations are owned and operated by
Turquoise Broadcasting, Inc., an Affiliate of Seller, and which are operated
from the same location and with part of the same facilities as the Stations.
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1.2.3 all real property owned by Seller and all tangible and
intangible personal property of Seller not located at the Stations' facilities
and not used by Seller in connection with the operation of the Stations;
1.2.4 subject to the limitation set forth in Section 1.1.2 of
this Agreement, all tangible and intangible personal property of Seller disposed
of or consumed in the ordinary course of business consistent with the past
practices of Seller between the date of this Agreement and the Closing Date;
1.2.5 all Contracts that have terminated or expired prior to
the Closing Date in the ordinary course of business consistent with the past
practices of Seller;
1.2.6 Seller's corporate minute books and records, corporate
stock record books and such other books and records as pertain to the
organization, existence or share capitalization of Seller and duplicate copies
of such records as are necessary to enable Seller to file its tax returns and
reports, as well as any other records or materials relating to Seller generally
and not involving or relating to the Stations Assets or the operation or
operations of the Stations;
1.2.7 contracts of insurance, and any insurance proceeds or
claims made by, Seller relating to property or equipment repaired, replaced or
restored by Seller prior to the Closing Date;
1.2.8 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 Seller;
1.2.9 any right, property or asset described in SCHEDULE
1.2.9; and
1.2.10 Seller's pending application with the FCC for a
Construction Permit for a new radio station in Lenwood (Barstow), California,
which application is not transferable under FCC rules and regulations.
ARTICLE 2
ASSUMPTION OF OBLIGATIONS
-------------------------
2.1 ASSUMPTION OF OBLIGATIONS. Subject to the provisions of this Section
2. 1, Section 2.2 and Section 3.3, on the Closing Date, and subject to any prior
assumption under the Time Brokerage Agreement, Buyer shall assume the
obligations of Seller arising or to be performed on and after the Closing Date
(except to the extent such obligations represent liabilities for activities,
events or transactions occurring, or conditions existing, on or prior to the
Closing Date) under: (a) the Contracts; (b) all property taxes and other similar
governmental charges on the Stations Assets; and (c) all Time Sales Agreements
and Trade Agreements (subject to Section 3.5). All of the foregoing liabilities
and obligations shall be referred to herein collectively as the "Assumed
Liabilities. "
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2.2 RETAINED LIABILITIES. Notwithstanding anything contained in this
Agreement to the contrary, Buyer expressly does not, and shall not, assume or
agree to pay, satisfy, discharge or perform and will not be deemed by virtue 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 or in connection with the consummation of the transactions
contemplated hereby or thereby, to have assumed or to have agreed to pay,
satisfy, discharge or perform, any liabilities, obligations or commitments of
Seller of any nature whatsoever whether accrued, absolute, contingent or
otherwise and whether or not disclosed to Buyer, other than the Assumed
Liabilities. Seller will retain and pay, satisfy, discharge and perform in
accordance with the terms thereof, all liabilities and obligations of the
Seller, other than the Assumed Liabilities, including but not limited to, the
obligation to assume, perform, satisfy or pay any liability, obligation,
agreement, debt, charge, claim, judgment or expense incurred by or asserted
against Seller related to taxes, environmental matters, pension or retirement
plans or trusts, profit-sharing plans, employment contracts, employee benefits,
severance of employees, product liability or warranty, negligence, contract
breach or default, or other obligations, claims or judgments asserted against
Buyer as successor in interest to Seller. All of such liabilities, obligations
and commitments of Seller described in this Section 2.2 shall be referred to
herein collectively as the "Retained Liabilities. "
ARTICLE 3
CONSIDERATION
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3.1 DELIVERY OF CONSIDERATION. In consideration for the sale of the
Stations Assets to Buyer, in addition to the assumption of certain obligations
of Seller pursuant to Section 2.1 above, Buyer shall, at the Closing (as
hereinafter defined), deliver to Seller Six Million Dollars ($6,000,000) by wire
transfer of immediately available funds, subject to adjustment pursuant to the
provisions of Section 3.2 and 3.3 below (the "Purchase Price"). Notwithstanding
the foregoing, the parties agree that at the Closing, Buyer, Seller and Security
Title & Guaranty Agency, Inc. as Escrow Agent (the "Indemnification Escrow
Agent"), shall enter into an Indemnification Escrow Agreement in the form of
Schedule 22(b) to the Topaz Merger Agreement, pursuant to which Seller shall
make an escrow deposit as provided therein, which deposit will be used to
satisfy indemnification claims of Buyer pursuant to Section 15.2.1 hereof and
under the Topaz Merger Agreement and which deposit shall otherwise be
administered and released as specifically provided for in the Indemnification
Escrow Agreement.
3.2 ESCROW DEPOSIT. (a) Simultaneous with execution and delivery of this
Agreement, Buyer, Seller and Security Title & Guaranty Agency, Inc. as Escrow
Agent (the "Deposit Escrow Agent"), shall enter into a Deposit Escrow Agreement
in the form of SCHEDULE A hereto (the "Deposit Escrow Agreement") pursuant to
which Buyer shall deposit Four Hundred Thousand Dollars ($400,000.00) or deliver
an irrevocable, stand-by letter of credit for such amount as a deposit on the
full amount of the Purchase Price. Such amounts held in escrow shall be applied
as set forth herein and in the Deposit Escrow Agreement.
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(b) Pursuant to the terms of the Deposit Escrow Agreement,
Buyer shall wire transfer Four Hundred Thousand Dollars ($400,000), or
alternatively, deliver an irrevocable, stand-by letter of credit for such amount
in form and substance acceptable to Seller, to an escrow account established
pursuant to the Deposit Escrow Agreement (the "Escrow Deposit"). At the Closing,
the Escrow Deposit if, in the form of cash, shall be applied to the Purchase
Price to be paid to Seller and the interest accrued thereon shall be paid to
Buyer, or if in the form of a letter of credit, shall be returned to Buyer. As
more fully described in the Deposit Escrow Agreement: (a) in the event this
Agreement is terminated because of Buyer's material breach of this Agreement and
all other conditions to Closing that are within Seller's control are at such
time satisfied or waived (other than such conditions as can reasonably be
expected to be satisfied by the Closing), the Escrow Deposit shall be paid to or
delivered for draw thereon to Seller as liquidated damages as provided in
Section 16.4 hereof for Buyer's material breach of this Agreement (the payment
of such sum to Seller shall discharge any liability Buyer may have to Seller),
and the interest accrued on the Escrow Deposit shall be paid to Buyer; and (b)
in the event this Agreement is terminated under any circumstances other than
those set forth in the immediately preceding clause (a), the Escrow Deposit and
the interest accrued thereon shall be paid or returned to Buyer. The Escrow
Deposit is the same cash or letter of credit deposited in escrow pursuant to the
terms of the Topaz Merger Agreement and may be used to pay any liquidated
damages under this Agreement or the Topaz Merger Agreement in the event of
certain defaults or breaches hereunder or thereunder.
3.3 PRORATION OF INCOME AND EXPENSES.
3.3.1 Except as otherwise provided herein, and except as
previously prorated pursuant to the Time Brokerage Agreement (as hereinafter
defined), all deposits, reserves and prepaid and deferred income and expenses
relating to the Stations Assets or the Assumed Liabilities and arising from the
conduct of the business and operations of the Stations shall be prorated between
Buyer and Seller in accordance with generally accepted accounting principles as
of 11:59 p.m. Pacific time, on the date immediately preceding the Closing Date.
Such prorations shall include, without limitation, all ad valorem, real estate
property taxes and other governmental charges on the Stations Assets (but
excluding taxes arising by reason of the transfer of the Stations Assets as
contemplated hereby which shall be paid as set forth in Section 13.2), business
and license fees, music and other license fees (including any retroactive
adjustments thereof, which retroactive adjustments shall not be subject to the
sixty-day limitation set forth in Section 3.3.2), utility expenses, accrued
vacation pay, amounts due or to become due under Contracts, rents and similar
prepaid and deferred items.
3.3.2 Except as otherwise provided herein or in the Time
Brokerage Agreement, the prorations and adjustments contemplated by this Section
3.3, to the extent practicable, shall be made on the Closing Date. As to those
prorations and adjustments not capable of being ascertained on the Closing Date,
an adjustment and proration shall be made within sixty (60) calendar days after
the Closing Date.
3.3.3 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 in Section 3.3.2 and such disputes shall be determined by an
independent certified public accountant mutually acceptable
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to the parties, and the fees and expenses of such accountant shall be paid
one-half by Seller and one-half by Buyer. If the aggregate amount in dispute
under this Agreement and the Time Brokerage Agreement is equal to or less than
Three Thousand Dollars ($3,000.00), such amount shall be divided equally between
Buyer and Seller.
3.4 ALLOCATION OF PURCHASE PRICE. The parties agree that One Hundred
Thousand Dollars ($100,000.00) of the Purchase Price shall be allocated to
tangible personal property included in the Stations Assets, with the balance of
the Purchase Price being allocated among such assets as the Stations Licenses,
goodwill and other intangible assets included hereunder. Seller and Buyer agree
to use the agreed upon allocation, if any, for all tax purposes, including
without limitation, those matters subject to Section 1060 of the Internal
Revenue Code of 1986, as amended.
3.5 ADJUSTMENT FOR BARTER. In the event the Commencement Date under the
Time Brokerage Agreement has not occurred prior to the Closing Date, then the
parties shall make the calculations set forth in the Time Brokerage Agreement as
of the Closing Date and Buyer shall be entitled to a credit against the Purchase
Price, for the amount, if any, by which the aggregate net value of the Stations'
Barter Payable (as defined below) in excess of $25,000 as of the Closing Date
exceeds the aggregate net value of the Stations' Barter Receivable (as defined
below) as of the Closing Date.
"Barter Payable" means the aggregate value of time owed pursuant to
each of the Trade Agreements calculated in accordance with generally accepted
accounting principles.. "Barter Receivable" means the aggregate value of goods
and services to be received pursuant to each of the Trade Agreements.
ARTICLE 4
CLOSING
-------
4.1 CLOSING. Except as otherwise mutually agreed upon by Buyer and
Seller, the consummation of the transactions contemplated herein (the "Closing")
shall occur within ten (10) days after the later to occur of (a) the
satisfaction or waiver of each condition to closing contained herein, other than
such conditions as are reasonably anticipated to be satisfied at Closing
(provided that each party hereto shall use its reasonable best efforts to cause
each condition to closing to be satisfied so that the Closing may occur at the
earliest possible date); and (b) the issuance of the Final Order (as defined
below), or such other date as may be mutually agreed by the parties hereto (the
"Closing Date"); provided, however, that Buyer may in its sole discretion waive
the requirement that a Final Order be issued and elect (subject to clause (a)
above) to close at any time (upon not less than ten (10) days notice to Seller)
after the release of initial FCC approval on public notice that it has consented
to the transaction contemplated hereby (the "Initial Approval"). For purposes of
this Agreement, "Final Order" (and "Final") means an order or grant by the FCC
which is no longer subject to reconsideration or review by the FCC or a court of
competent jurisdiction and pursuant to which the FCC consents, as the case may
be, to the assignments of the FCC Licenses contemplated by this Agreement or to
the renewal of the FCC Licenses, each such order or grant being without the
imposition of any
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conditions adverse to Buyer or any Affiliate (as hereinafter defined) of Buyer
with respect to the assignment of the FCC Licenses to Buyer or the continued
operation by Buyer of the Stations or the Stations Assets. The Closing shall be
held in the offices of ▇▇▇▇▇▇▇ & ▇▇▇▇, 2100 PNC Center, ▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇,
▇▇▇▇▇▇▇▇▇▇, ▇▇▇▇, or at such place and in such manner as the parties hereto may
agree.
4.2 TIME BROKERAGE AGREEMENT. On even date herewith, Buyer and Seller
shall enter into a Time Brokerage Agreement, substantially in the form of
SCHEDULE B hereto (the "Time Brokerage Agreement"), pursuant to which Seller has
agreed to make available to Buyer the broadcasting transmission facilities of
the Stations and/or cause to be broadcast on the Stations Buyer's programming
from the Commencement Date (as defined in the Time Brokerage Agreement) during
the term thereof. An Event of Default by either party under the Time Brokerage
Agreement shall constitute a material default under this Agreement and insofar
as the cure period specified in the Time Brokerage Agreement has expired with
respect to the default, no further cure period shall be afforded under the
provisions of Section 16.1.2 or Section 16.1.3 hereof.
ARTICLE 5
GOVERNMENTAL CONSENTS
---------------------
5.1 FCC CONSENT. It is specifically understood and agreed by Buyer and
Seller that the Closing and the assignment of the Stations Licenses and the
transfer of the Stations Assets are expressly conditioned on and are subject to
the prior consent and approval of the FCC without the imposition of any
conditions adverse to Seller, Buyer or any Affiliate of Buyer (the "FCC
Consent").
5.2 FCC APPLICATION. Within five (5) business days after the execution
of this Agreement, Buyer and Seller shall file an application with the FCC for
the FCC Consent (the "FCC Application"). Buyer and Seller shall prosecute the
FCC Application with all reasonable diligence and otherwise use their best
efforts to obtain the FCC Consent as expeditiously as practicable (but neither
Buyer nor Seller shall have any obligation to satisfy complainants or the FCC by
taking any steps which would have a material adverse effect upon Buyer or Seller
or upon any of their respective Affiliates). If the FCC Consent imposes any
condition on Buyer or Seller or any of their respective Affiliates, such party
shall use its best efforts to comply with such condition; provided, however,
that neither Buyer nor Seller shall be required hereunder to comply with any
condition that would have a material adverse effect upon it or any of its
Affiliates. If reconsideration or judicial review is sought with respect to the
FCC Consent, the party affected shall vigorously oppose such efforts for
reconsideration or judicial review; provided, however, that nothing herein shall
be construed to limit either party's right to terminate this Agreement pursuant
to Article 16
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ARTICLE 6
REPRESENTATIONS AND WARRANTIES OF BUYER
---------------------------------------
Buyer hereby makes the following representations and warranties to
Seller, each of which is true and correct on the date hereof, shall survive the
Closing and shall be unaffected by any investigation heretofore or hereafter
made by Seller:
6.1 ORGANIZATION AND STANDING. Buyer is a corporation duly organized
validly existing and in good standing under the laws of the State of Delaware,
and by the Closing Date will be authorized, as necessary, to conduct business
within the State of California.
6.2 AUTHORIZATION AND BINDING OBLIGATIONS. Buyer has all necessary
corporate power and authority to enter into and perform this Agreement and the
transactions contemplated hereby, and to own or lease the Stations Assets and to
carry on the business of the Stations upon the consummation of the transactions
contemplated by this Agreement. Buyer's execution, delivery and performance of
this Agreement and the transactions contemplated hereby have been duly and
validly authorized by all necessary action on its part and, assuming the due
authorization, execution and delivery of this Agreement by Seller, this
Agreement will constitute the legal, valid and binding obligation of Buyer,
enforceable against it in accordance with its terms, except as limited by laws
affecting creditors' rights or equitable principles generally.
6.3 QUALIFICATION AS ASSIGNEE. To the best of Buyer's knowledge, there
are no facts which, under the Communications Act of 1934, as amended, or the
existing rules and regulations of the FCC, would disqualify Buyer as an assignee
of the Stations Licenses.
6.4 ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS. Except as
set forth in Article 5 hereof with respect to governmental consents, the
execution, delivery and performance of this Agreement by Buyer: (a) do not
conflict with the provisions of the articles of incorporation or by-laws of
Buyer; (b) do not require the consent of any third party not affiliated with
Buyer (including, without limitation, the consent of any governmental,
regulatory, administrative or similar authority); (c) will not violate any
applicable law, judgment, order, injunction, decree, rule, regulation or ruling
of any governmental authority to which Buyer is a party or is subject; and (d)
will not, either alone or with the giving of notice or the passage of time, or
both, conflict with, constitute grounds for termination of or result in a breach
of the terms, conditions or provisions of, or constitute a default under, any
agreement, instrument, license or permit to which Buyer is now subject.
6.5 COMMISSIONS OR FINDER'S FEES. Buyer has agreed to pay a commission
or similar payment in connection with this Agreement and the matters related
hereto only to Star Media Group and to no other person or entity.
6.6 LITIGATION. Buyer is not subject to any judgment, award, order, writ,
injunction, arbitration decision or decree that would prohibit the consummation
of the transactions contemplated by this Agreement, and there are no suits,
legal proceedings or investigations of any nature pending, or to the best
knowledge of Buyer, threatened against or affecting Buyer that would affect
Buyer's ability to carry out the transactions contemplated by this Agreement.
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6.7 BANKRUPTCY. No insolvency proceedings of any character, including,
without limitation, bankruptcy, receivership, reorganization, composition or
arrangement with creditors, voluntary or involuntary, against Buyer or any of
its Affiliates are pending or threatened, and neither Buyer nor any of its
Affiliates has made any assignment for the benefit of creditors or taken any
action in contemplation of or which would constitute the basis for the
institution of such insolvency proceedings.
6.8 COMMITTED SOURCES OF FINANCING. Seller has sufficient net liquid
assets on hand or available from committed sources of financing to consummate
the transaction contemplated by this Agreement.
ARTICLE 7
REPRESENTATIONS AND WARRANTIES OF SELLER
----------------------------------------
Seller makes the following representations and warranties to Buyer, each
of which is true and correct on the date hereof, shall survive the Closing and
shall be unaffected by any investigation heretofore or hereafter made by Buyer:
7.1 ORGANIZATION AND STANDING. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
is authorized to conduct business within the State of California, and has the
requisite power and authority to own, lease and operate the Stations Assets
owned or leased by it and to carry on the business of the Stations as now being
conducted by it and as proposed to be conducted by it between the date hereof
and the Closing Date.
7.2 AUTHORIZATION AND BINDING OBLIGATION. Seller has the power and
authority, and has taken all necessary and proper action to enter into and
perform this Agreement and to consummate the actions contemplated hereby. This
Agreement has been duly authorized, executed and delivered by Seller and,
assuming the due authorization, execution and delivery of this Agreement by
Buyer, constitutes the legal, valid and binding obligation of Seller enforceable
against it in accordance with its terms, except as limited by laws affecting the
enforcement of creditors' rights or equitable principles generally.
7.3 ABSENCE OF CONFLICTING AGREEMENTS OR REQUIRED CONSENTS. Except as
set forth in Article 5 with respect to governmental consents and in SCHEDULE 7.9
with respect to consents required in connection with the assignment of certain
Contracts, the execution, delivery and performance of this Agreement by Seller:
(a) do not require the consent of any third party not affiliated with Seller
(including, without limitation, the consent of any governmental, regulatory,
administrative or similar authority); (b) will not conflict with, result in a
breach of, or constitute a violation of or default under, the provisions of
Seller's articles of incorporation (or other charter or organizational
documents), or any applicable law, judgment, order, injunction, decree, rule,
regulation or ruling of any governmental authority to which Seller is a party or
by which Seller or any of the Stations Assets are bound; (c) will not either
alone or with the giving of notice or the passage of time, or both, conflict
with, constitute grounds for termination of or result in a breach of the terms,
conditions or provisions of, or constitute a default under, any Contract,
agreement, instrument, license or permit to which Seller or any of the Stations
Assets is now
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subject; and (d) will not result in the creation of any lien, charge or
encumbrance on any of the Stations Assets.
7.4 GOVERNMENT AUTHORIZATIONS.
--------------------------
7.4.1 SCHEDULE 7.4 hereto contains a true and complete list of
the Stations Licenses and other licenses, permits or other authorizations from
governmental and regulatory authorities which are required for the lawful
conduct of the business and operations of the Stations in the manner and to the
full extent they are presently conducted (including, without limitation,
auxiliary licenses associated with each Station), except for such licenses,
permits and authorizations the failure of which to obtain would not have a
material adverse effect on Buyer or the Stations. Seller has delivered to Buyer
true and complete copies of the Stations Licenses and the other licenses,
permits and authorizations listed in SCHEDULE 7.4, including any and all
amendments and other modifications thereto.
7.4.2 Seller is the authorized legal holder of the Stations
Licenses and other licenses, permits and authorizations listed in SCHEDULE 7.4.
Except as set forth Schedule 7.4 or on the face of the licenses, none of the
Stations Licenses and other licenses, permits and authorizations listed in
SCHEDULE 7.4 is subject to any restrictions or conditions which would materially
limit the full operation of the Stations as now operated.
7.4.3 Except as set forth in SCHEDULE 7.4, and except for
matters affecting the radio broadcast industry generally, there are no
applications, complaints, petitions or proceedings pending or, to the best of
Seller's knowledge, threatened as of the date hereof before the FCC or any other
governmental or regulatory authority relating to the business or operations of
the Stations. Except as set forth in SCHEDULE 7.4, the Stations Licenses and the
other licenses, permits and authorizations listed in SCHEDULE 7.4 are in good
standing, are in full force and effect and are unimpaired by any act or omission
of Seller or its members, managers, officers, or employees. The operations of
the Stations are in accordance with the Stations Licenses and the underlying
construction permits and the other licenses, permits and authorizations listed
in SCHEDULE 7.4. Except as set forth in SCHEDULE 7.4, no proceedings are pending
or, to the best of Seller's knowledge, threatened, and to the best of Seller's
knowledge there has not been any act or omission of Seller or any of its
officers, directors, or employees, which may result in the revocation,
modification, non-renewal or suspension of any of the Stations Licenses or the
other licenses, permits and authorizations listed in SCHEDULE 7.4, the denial of
any pending applications, the issuance of any cease and desist order, the
imposition of any administrative actions by the FCC or any other governmental or
regulatory authority with respect to the Stations Licenses or the other
licenses, permits and authorizations listed in SCHEDULE 7.4 or which may affect
Buyer's ability to continue to operate the Stations as they are currently
operated.
7.4.4 To the best of Seller's knowledge, each Station is
operating with the maximum facilities specified in the respective Station
License.
7.4.5 To the best of Seller's knowledge: (i) neither of the
Stations is causing objectionable interference to the transmissions of any other
broadcast station or communications facility nor has either of the Stations
received any complaints with respect thereto; and (ii) no
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other broadcast station or communications facility is causing objectionable
interference to respective transmissions of either Station or the public's
reception of such transmissions.
7.4.6 Except as set forth in SCHEDULE 7.4, Seller has no
reason to believe that the Stations Licenses and the other licenses, permits, or
authorizations listed in SCHEDULE 7.4 will not be renewed in their ordinary
course.
7.4.7 All material reports, forms, and statements required to
be filed by Seller with the FCC with respect to the Stations since the grant of
the last renewal of the Stations Licenses have been filed and are substantially
complete and accurate.
7.4.8 To the best knowledge of Seller, and except as set forth
in SCHEDULE 7.4, there are no facts which, under the Communications Act of 1934,
as amended, or the existing rules and regulations of the FCC, would disqualify
Seller as assignor of the Stations Licenses or cause the Stations Licenses and
the other licenses, permits and authorizations listed in SCHEDULE 7.4 not to be
renewed in their ordinary course.
7.4.9 To the best of Seller's knowledge, the operation of the
Stations and all of the Stations Assets are in compliance in all respects with
ANSI Radiation Standards C95.1-1992.
7.5 COMPLIANCE WITH FCC REGULATIONS. Except as specified in SCHEDULE 7.4,
to the best of Seller's knowledge, the operation of the Stations and all of the
Stations Assets are in compliance in all respects with: (a) all applicable
engineering standards required to be met under applicable FCC rules; and (b) all
other applicable federal, state and local rules, regulations, requirements and
policies, including, but not limited to, equal employment opportunity policies
of the FCC, and all applicable painting and lighting requirements of the FCC and
the Federal Aviation Administration to the extent required to be met under
applicable FCC rules and regulations, and to the best of Seller's knowledge,
there are no filed claims to the contrary.
7.6 TAXES. There are no present disputes as to taxes of any nature
payable by Seller which in any event could adversely affect any of the Stations
Assets or the operation of the Stations by Buyer.
7.7 PERSONAL PROPERTY. SCHEDULE 7.7 hereto contains a list of all
material items of tangible personal property owned by Seller and used in the
conduct of the business and operations of the Stations. SCHEDULE 7.7 also
separately lists any material tangible personal property leased by Seller
pursuant to leases included within the Contracts. Except as disclosed in
SCHEDULE 7.7, Seller has, and following the Closing, Buyer will have, good and
marketable title to all of the items of tangible personal property which are
included in the Stations Assets (other than those subject to lease) and none of
such Stations Assets is, or at the Closing will be, subject to any security
interest, mortgage, pledge, lease, license, lien, encumbrance, title defect or
other charge, except for liens for taxes not yet due and payable, and except for
the Assumed Liabilities. The personal property listed in SCHEDULE 7.7, along
with the personal property subject to lease and included among the Contracts,
constitute all material tangible personal property necessary to operate the
Stations as the same are now being operated. Except as set forth in SCHEDULE
7.7, all items of tangible personal property included in the Stations' Assets
are in good and technically sound operating condition and repair (ordinary wear
and tear excepted),
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are free from all material defect and damage, are suitable for the purposes for
which they are now being used, and have been properly maintained in a manner
consistent with generally accepted standards of good engineering practice.
7.8 REAL PROPERTY.
-------------
7.8.1 SCHEDULE 7.8 hereto contains a complete and accurate
list and description of all real property (including without limitation, real
property relating to the towers, transmitters, studio sites and offices of the
Stations) used by Seller in connection with the operations of the Stations,
identifying thereon the real property that is leased by Seller (the "Leased Real
Estate").
7.8.2 Except as set forth in Schedule 7.8, Seller enjoys quiet
possession of all Real Estate. To Seller's knowledge, there are no present
disputes or claims with respect to offsets or defenses by any party against the
other under any of the Contracts relating to the Leased Real Estate. Seller has
delivered to Buyer true and complete copies of all Contracts relating to the
Real Property. Except as set forth in SCHEDULE 7.9 hereto, the assignment of the
Contracts relating to the Leased Real Property to Buyer will not permit the
other party to accelerate the rent, cause the terms thereof to be renegotiated
or constitute a default thereunder, and will not require the consent of any such
party to the assignment thereof to Buyer.
7.8.3 Except as set forth in Schedule 7.8, Seller has full
legal and practical access to all of the Real Estate, and, to Seller's
knowledge, all easements, rights of way, and real property licenses relating to
Seller's use thereof have been properly recorded in the appropriate public
recording offices. The Real Estate includes all the real property, easements,
rights of way, and other real property interests necessary to conduct the
business and operations of the Stations as they are now conducted. Except as
described in SCHEDULE 7.8, to Seller's knowledge, none of the buildings,
structures, improvements or fixtures constructed on any Real Estate, in
connection with the operation of the Stations, including, but not limited to,
all towers, guy wires and guy anchors and ground radials, encroach upon
adjoining real property, and all such buildings, structures, improvements and
fixtures are constructed and are operated and used in conformance with all "set
back" lines, easements, covenants, restrictions and all applicable building,
fire, zoning, health and safety laws and codes. Except as set forth in Schedule
7.8, to the best of Seller's knowledge, no utility lines serving such Real
Estate pass over the lands of a third party except where appropriate easements
have been obtained. To the best of Seller's knowledge, except as described in
SCHEDULE 7.8, all buildings, structures, towers, antennae, improvements and
fixtures situated on the Real Estate are in good and technically sound operating
condition, ordinary wear and tear excepted, have no latent structural,
mechanical or other defects of material significance, are reasonably suitable
for the purposes for which they are being used and each has adequate rights of
ingress and egress, utility service for water and sewer, telephone, electric
and/or gas, and sanitary service for the conduct of the business and operations
of the Stations as presently conducted. There is no pending or, to the best
knowledge of Seller, threatened condemnation or other legal proceeding or action
of any kind relating to such real property and/or title thereto.
7.9 CONTRACTS. SCHEDULE 7.9 lists all Contracts to which Seller is a
party, or which are binding on Seller, as of the date of this Agreement other
than Time Sales Agreements, Trade
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Agreements and Miscellaneous Agreements. Those Contracts listed on SCHEDULE 7.9,
if any, requiring the consent of a third party to assignment are identified by
an asterisk in the left margin of SCHEDULE 7.9. Those Contracts, if any, that
Seller and Buyer have agreed are material to the operation of the Stations
Assets and the valid assignment of which and receipt by Buyer of consents
thereto (along with appropriate estoppel certificates for the leases related to
the Leased Real Estate) is a condition to the consummation of the transactions
contemplated hereby (the "Material Contracts") are identified by an "M" in the
left margin of SCHEDULE 7.9.
7.10 STATUS OF CONTRACTS, ETC. Seller has delivered to Buyer true and
complete copies of all written Contracts and true and complete memoranda of all
oral Contracts, including any and all amendments and other modifications
thereto. To Seller's knowledge, all of the Contracts are in full force and
effect and are valid, binding and enforceable in accordance with their
respective terms, except as limited by laws affecting creditors' rights or
equitable principles generally. Seller has complied in all respects with all
Contracts and is not in default beyond any applicable grace periods under any
thereof and, to the best of Seller's knowledge, no other contracting party is in
default under any thereof.
7.11 ENVIRONMENTAL. To the best of Seller's knowledge, except as set
forth in SCHEDULE 7.11, Seller has complied with all federal, state and local
environmental laws, rules and regulations as in effect on the date hereof
applicable to each of the Stations and its operations, including but not limited
to the FCC's guidelines regarding RF radiation. To Seller's knowledge, the
technical equipment included in the Stations Assets does not contain any PCBs.
To the best of Seller's knowledge, no hazardous or toxic waste, substance,
material or pollutant (as those or similar terms are defined under the
Comprehensive Environmental Response, Compensation and Liability Act of 1980, as
amended, 42 U.S.C. Sections 9601 ET SEQ., Toxic Substances Control Act. 15 U. S.
C. Sections 2601 ET SEQ., the Resource Conservation and Recovery Act of 1976, 42
U.S.C. Sections 6901 ET SEQ. or any other applicable federal, state and local
environmental law, statute, ordinance, order, judgment rule or regulation
relating to the environment or the protection of human health ("Environmental
Laws")), including but not limited to, any asbestos or asbestos-related
products, oils, or petroleum-derived compounds, CFCs, PCBs, or underground
storage tanks (collectively Hazardous Materials"), have been released, emitted
or discharged in violation of applicable laws or regulations, or are currently
located in quantities in violation of applicable laws and regulations in, on, or
under or about the real property on which the Stations Assets are situated,
including without limitation the transmitter sites, or contained in the tangible
personal property included in the Stations Assets. To the best of Seller's
knowledge, the Stations Assets and Seller's use thereof are not in violation of
any Environmental Laws or any occupational, safety and health or other
applicable law now in effect. With respect to Buyer, Seller shall be as of the
Closing Date and thereafter solely responsible for all environmental
liabilities, of whatsoever kind and nature, arising out of or attributable to
the operation or ownership of the Stations Assets prior to the Commencement Date
of the Time Brokerage Agreement.
7.12 INTELLECTUAL PROPERTY. SCHEDULE 7.12 hereto is a true and complete
list of all material Intellectual Property applied for, registered or issued to,
and owned by Seller or under which Seller is a licensee and which is used in the
conduct of Seller's business and operations. Except as set forth on SCHEDULE
7.12, to the best of Seller's knowledge: (a) Seller's right, title and interest
in the Intellectual Property as owner or licensee, as applicable, is free and
clear of all liens, claims,
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encumbrances, rights, or equities whatsoever of any third party and, to the
extent any of the Intellectual Property is licensed to Seller, such interest is
valid and uncontested by the licensor thereof or any third party; (b) all
computer software located at the Stations' facilities or used in the Stations'
business or operations is properly licensed to Seller, and all of Seller's uses
of such computer software are authorized under such licenses; (c) all of
Seller's right, title and interest in and to the Intellectual Property and
computer software shall be assignable to Buyer at Closing, and upon such
assignment, Buyer shall receive complete and exclusive right, title, and
interest in and to all tangible and intangible property rights existing in the
Intellectual Property; and (d) there are no infringements or unlawful use of
such Intellectual Property by Seller in connection with Seller's business or
operations.
7.13 FINANCIAL STATEMENTS. Seller has delivered to Buyer complete copies
of the financial statements of Seller relating to the Stations for the year
ended 1996 together with monthly income statements for the Stations for each
month ended after January 1, 1997 (collectively, the "Financial Statements").
The Financial Statements are prepared in accordance with the books and records
of Seller. The Financial Statements present fairly the financial condition,
results of operations and cash flow of the Stations for the periods indicated,
except as set forth on SCHEDULE 7.13. None of the Financial Statements
understates the true costs and expenses of conducting the business and
operations of the Stations, fails to disclose any material liability, or
inflates (or will inflate) the revenues of the Stations for any reason, except
as set forth on SCHEDULE 7.13.
7.14 PERSONNEL INFORMATION.
7.14.1 SCHEDULE 7.14 contains a true and complete list of all
persons employed at the Stations, including date of hire, a description of
material compensation arrangements (other than employee benefit plans set forth
in SCHEDULE 7.17) and a list of other material terms of any and all agreements
affecting such persons and their employment by Seller. Seller has received no
notice that, and Seller is not aware of, any individual employee who shall or is
likely to terminate his or her employment relationship with the Stations upon
the execution of this Agreement or after the Closing.
7.14.2 Seller, with respect to the Stations, is not a party to
any contract or agreement with any labor organization, nor has Seller agreed to
recognize any union or other collective bargaining unit, nor has any union or
other collective bargaining unit been certified as representing any employees of
Seller at the Stations. Seller has no knowledge of any organization effort
currently being made or threatened by or on behalf of any labor union with
respect to employees of Seller at the Stations.
7.14.3 To the best of Seller's knowledge, except as disclosed
in SCHEDULE 7.14, Seller, with respect to the Stations, has complied in all
material respects with all laws relating to the employment of labor, including,
without limitation, the Employee Retirement Income Security Act of 1974, as
amended ("ERISA"), and those laws relating to wages, hours, collective
bargaining, unemployment insurance, workers' compensation, equal employment
opportunity and payment and withholding of taxes.
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7.15 LITIGATION. Except as set forth in SCHEDULE 7.15, Seller is not
subject to any judgment, award, order, writ, injunction, arbitration decision or
decree relating to the conduct of the business or the operation of the Stations
or any of the Stations Assets, and there is no litigation, administrative
action, arbitration, proceeding or investigation pending or, to the best
knowledge of Seller, threatened against Seller with respect to, related to or in
connection with the operation of the Stations in any federal, state or local
court, or before any administrative agency or arbitrator (including, without
limitation, any proceeding which seeks the forfeiture of, or opposes the renewal
of, any of the Stations Licenses), or before any other tribunal duly authorized
to resolve disputes. In particular, but without limiting the generality of the
foregoing and except as set forth on SCHEDULE 7.4, to the best knowledge of
Seller, there are no applications, complaints or proceedings pending or
threatened before the FCC or any other governmental organization with respect to
the business or operations of the Stations.
7.16 COMPLIANCE WITH LAWS. To the best of Seller's knowledge and except
as set forth in SCHEDULE 7.16 or SCHEDULE 7.4: (i) Seller is not in material
violation of, nor has Seller received any notice asserting any non-compliance by
it in connection with the operation of the Stations or use or ownership of any
of the Stations Assets with, any applicable statute, rule or regulation, whether
federal, state or local; (ii) Seller is not in default with respect to any
judgment, order, injunction or decree of any court administrative agency or
other governmental authority or any other tribunal duly authorized to resolve
disputes which relates to the transactions contemplated hereby; and (iii) Seller
is in full compliance with all laws, regulations and governmental orders
applicable to the conduct of the business and operations of the Stations, and
its present use of the Stations Assets does not violate any of such laws,
regulations or orders.
7.17 EMPLOYEE BENEFIT PLANS. SCHEDULE 7.17 contains a true and complete
list as of the date of this Agreement of all employee benefit plans applicable
to the employees of Seller employed at the Stations, and a brief description
thereof. Seller does not maintain any other employee benefit plan as the term is
defined in Section 3 of ERISA, applicable to the employees of Seller employed at
the Stations.
7.18 COMMISSIONS OR FINDER'S FEES. Neither Seller nor any person or
entity acting on behalf of Seller has agreed to pay a commission, finder's fee
or similar payment in connection with this Agreement or any matter related
hereto to any person or entity. It is acknowledged that Buyer is paying a
commission to Star Media Group.
7.19 CONDUCT OF BUSINESS IN ORDINARY COURSE: ADVERSE CHANGES. Except as
set forth in Schedule 7.19, since September 30, 1997: (a) Seller has conducted
the business of the Stations only in the ordinary course consistent with
Seller's past practices; (b) there has not been any material adverse change in
the business, assets, properties, prospects or condition (financial or
otherwise) of the Stations, or any damage, destruction, or loss affecting any of
the Stations Assets; and (c) Seller has not created, assumed, or suffered any
mortgage, pledge, lien or encumbrance on any of the Stations Assets.
7.20 INSTRUMENTS OF CONVEYANCE: GOOD TITLE. The instruments to be
executed by Seller and delivered to Buyer at the Closing, conveying the Stations
Assets to Buyer, will transfer good and marketable title to the Assets free and
clear of all liabilities (absolute or contingent), security
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interests, mortgages, pledges, liens, obligations and encumbrances, except for
Permitted Encumbrances and except as set forth in SCHEDULE 7.7 and SCHEDULE 7.8
hereto and those obligations referred to in the first sentence of Section 2.1
hereof.
7.21 UNDISCLOSED LIABILITIES. Excepting only for the Assumed
Liabilities, no liability or obligation of any nature, whether accrued,
absolute, contingent or otherwise, relating to Seller, the Stations or the
Stations Assets exists which could, after the Closing result in any form of
transferee liability against Buyer or subject the Stations Assets to any lien,
encumbrance, claim, charge, security interest or imposition whatsoever or
otherwise affect the full, free and unencumbered use of the Stations Assets by
Buyer.
7.22 FULL DISCLOSURE. No written representation or warranty made by
Seller contained in this Agreement nor any certificate, document or other
instrument furnished or to be furnished by Seller pursuant hereto contains or
will contain any untrue statement of a material fact, or omits or shall omit to
state any material fact required to make any statement contained herein or
therein not misleading in light of the circumstances under which such statement
is made. To the best of Seller's knowledge, there is no impending or
contemplated material event or occurrence that would cause any of the foregoing
representations not to be true and complete on the date of such event or
occurrence as if made on that date. To Seller's knowledge as of the date of this
Agreement, there is no fact which materially adversely affects the business,
conditions, affairs or operations of Seller or the Stations which has not been
set forth in this Agreement or otherwise disclosed in writing by Seller to Buyer
or its representatives.
Whenever in this Article 7 a warranty or representation is qualified by
a word or phrase referring to the best of Seller's knowledge (or similar terms),
it shall mean to the actual knowledge of ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
7.23 BANKRUPTCY. No insolvency proceedings of any character, including,
without limitation, bankruptcy, receivership, reorganization, composition or
arrangement with creditors, voluntary or involuntary, against Seller or any of
its Affiliates are pending or threatened, and neither Seller nor any of its
Affiliates has made any assignment for the benefit of creditors or taken any
action in contemplation of or which would constitute the basis for the
institution of such insolvency proceedings.
ARTICLE 8
COVENANTS OF BUYER
------------------
8.1 CLOSING. Subject to Article 11 hereof, on the Closing Date, Buyer
shall purchase the Stations Assets from Seller as provided in Article 1 hereof
and shall assume the Assumed Liabilities of Seller as provided in Article 2
hereof.
8.2 NOTIFICATION. Buyer will provide Seller prompt written notice of any
change in any of the information contained in the representations and warranties
made in Article 6. Buyer shall also notify Seller of any litigation, arbitration
or administrative proceeding pending or, to its knowledge, threatened against
Buyer which challenges the transactions contemplated hereby.
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8.3 NO INCONSISTENT ACTION. Buyer shall not take any action which is
materially inconsistent with its obligations under this Agreement or take any
action which would cause any representation or warranty of Buyer contained
herein to be or become false or invalid or which could hinder or delay the
consummation of the transactions contemplated by this Agreement.
ARTICLE 9
COVENANTS OF SELLER
-------------------
9.1 PRE-CLOSING COVENANTS. Seller covenants and agrees with respect to
the Stations that, between the date hereof and the Closing Date or the earlier
termination of this Agreement in accordance with its terms, except as expressly
permitted by this Agreement or with the prior written consent of Buyer, Seller
shall act in accordance with the following:
9.1.1 Subject to Buyer's time brokering of the Stations
pursuant to the Time Brokerage Agreement, Seller shall use its reasonable best
efforts to conduct the business and operations of the Stations in the ordinary
and prudent course of business consistent with past practice and with the intent
of preserving the ongoing operations and assets of the Stations, including but
not limited to maintaining the independent identity of the Stations, retaining
the current format and programming (including the content thereof) of the
Stations (with the exception that the format of Station KIXW (AM) may change in
the event that Turquoise Broadcasting, Inc. commences a time brokerage agreement
for Stations KIXW-FM and KIXF-FM), continuing at historical levels and
frequencies spending for promotions, advertising, and survey testing, and using
its reasonable best efforts to retain at the Stations the services of all active
employees (with the exception of employees who will remain Seller's employees
under the Time Brokerage Agreement), consultants and agents of the Stations.
9.1.2 Subject to Buyer's time brokering of the Stations
pursuant to the Time Brokerage Agreement, Seller shall use its reasonable best
efforts to: (i) preserve the operation of the Stations intact; (ii) preserve
relationships with the Stations' advertisers, customers, suppliers and others
having business relations with the Stations; and (iii) continue to conduct
financial operations of the Stations, including without limitation, their credit
and collection and pricing policies and practices, all in the ordinary course of
business consistent with past practices.
9.1.3 Subject to Buyer's time brokering of the Stations
pursuant to the Time Brokerage Agreement, Seller shall operate the Stations in
all respects in accordance with FCC rules and regulations and the Stations
Licenses and with all other laws, regulations, rules and orders, and shall not
cause or permit by any act, or failure to act, any of the Stations Licenses or
other licenses, permits or authorizations listed in SCHEDULE 7.4 to expire, be
surrendered, adversely modified, or otherwise terminated, or the FCC to
institute any proceedings for the suspension, revocation or adverse modification
of any of the Stations Licenses, or fail to prosecute with due diligence any
pending applications to the FCC.
9.1.4 Should any fact relating to Seller which would cause the
FCC to deny its consent to the transactions contemplated by this Agreement come
to Seller's attention, Seller will promptly notify Buyer thereof and will take
such steps as may be necessary to remove any such
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impediment to the FCC's consent to the transactions contemplated by this
Agreement, subject to Section 5.2 hereof.
9.1.5 Subject to Buyer's time brokering of the Stations
pursuant to the Time Brokerage Agreement (which provisions shall control over
any inconsistent provision in this Section 9.1.5) and except for changes or
actions in the ordinary course of business consistent with past practices,
Seller shall not: (a) sell broadcast time on a prepaid basis (other than in the
course of existing credit practices); (b) except as required by the applicable
law or written agreements currently in effect, grant or agree to grant any
general increases in the rates of salaries or compensation payable to employees
of the Stations (except increases not to exceed 6 % of such employee's
compensation as set forth on SCHEDULE 7.14 hereto), (c) except as required by
written agreements currently in effect, grant or agree to grant any specific
bonus or increase in compensation to any executive management employee of the
Stations (except an increase to any employee not to exceed 6 % of such
employee's compensation as set forth on SCHEDULE 7.14 hereto); (d) provide for
any new pension, retirement or other employment benefits for employees of the
Stations or any increases in any existing benefits, (e) modify, change or
terminate any material Contract; or (f) change the advertising rates in effect
as of the date hereof.
9.1.6 Seller shall give or cause the Stations to give Buyer
and Buyer's counsel, accountants, engineers and other representatives, at
Buyer's reasonable request and upon reasonable notice, full and reasonable
access during normal business hours to all of Seller's personnel, properties,
books, Contracts, reports and records (including, without limitation, financial
information and tax returns relating to the Stations, and environmental audits
in existence with respect to the Stations Assets), real estate, buildings and
equipment relating to the Stations and to the Stations' employees, and to
furnish Buyer with information and copies of all documents and agreements
relating to the Stations and the operation thereof (including but not limited to
financial and operating data and other information concerning the financial
condition, results of operations and business of the Stations) that Buyer may
reasonably request. The rights of Buyer under this Section 9.1.6 shall not be
exercised in such a manner as to interfere unreasonably with the business of the
Stations.
9.1.7 Seller shall use its reasonable best efforts to obtain
any third party consents necessary for the assignment of any Contract (which
shall not require any payment to any such third party except for such amounts
contemplated by the Contract to be assigned, and any amount then owing by Seller
to such third party).
9.2 NOTIFICATION. Seller will provide Buyer prompt written notice of any
material change in any of the information contained in the representations and
warranties made in Article 7 or any Schedule. Seller agrees to notify Buyer of
any litigation, arbitration or administrative proceeding pending or, to the best
of its knowledge, threatened, which challenges the transactions contemplated
hereby. Seller shall promptly notify Buyer if any of the normal broadcast
transmissions of either Station are interrupted, interfered with or in any way
impaired, and shall provide Buyer with prompt written notice of the problem and
the measures being taken to correct such problem. If such Station is not
restored so that operation is resumed to full licensed power and antenna height
within five (5) days of such event, or if more than five (5) such events occur
within any thirty (30) day period, or if either of the Stations shall be off the
air
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for more than one hundred twenty (120) consecutive hours, then Buyer shall have
the right to terminate this Agreement, provided that notice of termination is
given within thirty (30) days of the occurrence of such event.
9.3 NO INCONSISTENT ACTION. Seller shall not take any action which is
materially inconsistent with its obligations under this Agreement nor take any
action which would cause any representation or warranty of Seller contained
herein to be or become false or invalid or which could hinder or delay the
consummation of the transactions contemplated by this Agreement.
9.4 CLOSING. Subject to Article 12 hereof, on the Closing Date, Seller
shall transfer, convey, assign and deliver to Buyer the Stations Assets and the
Assumed Liabilities as provided in Articles 1 and 2 and Section 7.20 of this
Agreement.
9.5 OTHER ITEMS. Except as otherwise specifically contemplated by this
Agreement or the Time Brokerage Agreement, until the Closing Date or the earlier
termination of this Agreement in accordance with the terms hereof, Seller shall
not: (a) waive or release any right relating to the business or operations of
the Stations, except for adjustments or settlements made in the ordinary course
of business consistent with its past practices; (b) transfer or grant any rights
under any of the Stations Licenses; (c) enter into any commitment for capital
expenditures for which Buyer would become liable after the Closing Date; (d)
subject to Buyer's time brokering of the Station pursuant to the Time Brokerage
Agreement, introduce any material changes in the broadcast hours or in the
format of the Stations (except a change in the format of Station KIXW (AM) as
set forth in Section 9.1.1 hereof) or any other material change in the Station's
programming policies; (e) change the call letters of either Station except that
Seller will file an application to change the call letters of Station KIXW (AM)
at Buyer's request; and (f) enter into any transaction or make or enter into any
contract or commitment with respect to either of the Stations or the Stations
Assets which by reason of its size or otherwise is not in the ordinary course of
business consistent with past practices.
9.6 EXCLUSIVITY. Seller agrees that, commencing on the date hereof
through the Closing or earlier termination of this Agreement, Buyer shall have
the exclusive right to consummate the transactions contemplated herein, and
during such exclusive period, Seller agrees that neither Seller, nor any
director, officer, employee or other representative of Seller: (a) will
initiate, solicit or encourage, directly or indirectly, any inquiries, or the
making or implementation of any proposal or offer with respect to a merger,
acquisition, consolidation or similar transaction involving, or any purchase of,
all or any portion of the Stations Assets (any such inquiry, proposal or offer
being hereinafter referred to as an "Acquisition Proposal" and any such
transaction being hereinafter referred to as an "Acquisition"); (b) will engage
in any negotiations concerning, or provide any confidential information except
such information relating to combined operations with Turquoise Broadcasting,
Inc. as may be provided to the Buyer of Stations KIXW (FM) and KIXF (FM) or data
to, or have any discussions with, any person relating to an Acquisition
Proposal, or otherwise facilitate any effort or attempt to make or implement an
Acquisition Proposal; or (c) will continue any existing activities, discussions
or negotiations with any parties conducted heretofore with respect to any
Acquisition Proposal or Acquisition. Notwithstanding the foregoing, in the event
that Buyer defaults in any material
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respect in the observance or in the due and timely performance of any of its
covenant or agreements herein contained and such default shall not be cured
within ten (10) business days of notice of default served by Seller, Seller's
obligations under this Section 9.6 shall be null and void.
ARTICLE 10
JOINT COVENANTS
---------------
Buyer and Seller each covenant and agree that between the date hereof
and the Closing Date, they shall act in accordance with the following:
10.1 CONFIDENTIALITY. Subject to the requirements of applicable law,
Buyer and Seller shall each keep confidential all information obtained by it
with respect to the other parties hereto in connection with this Agreement and
the negotiations preceding this Agreement, and the fact of the existence of this
Agreement and will use such information solely in connection with the
transactions contemplated by this Agreement, and if the transactions
contemplated hereby are not consummated for any reason, each shall return to
each other party hereto, without retaining a copy thereof, any schedules,
documents or other written information obtained from such other party in
connection with this Agreement and the transactions contemplated hereby. Both
parties agree that no disclosure of any aspect of this Agreement, no press
release or other publicity shall be released by either party without the consent
of the other. Notwithstanding the foregoing, no party shall be required to keep
confidential or return any information which: (a) is known or available through
other lawful sources, not bound by a confidentiality agreement with the
disclosing party; (b) is or becomes publicly known through no fault of the
receiving party or its agents; (c) is required to be disclosed pursuant to an
order or request of a judicial or governmental authority (provided the
disclosing party is given reasonable prior notice of the order or request and
the purpose of the disclosure); or (d) is developed by the receiving party
independently of the disclosure by the disclosing party. Notwithstanding
anything to the contrary herein, either party may in accordance with its legal
obligations, including but not limited to filings permitted or required by the
Securities Act of 1933 and the Securities and Exchange Act of 1934, make such
press releases and other public statements and announcements as it deems
necessary and appropriate in connection with this Agreement and the transactions
contemplated hereby; provided, however, that prior to making any such unilateral
press release or announcement, such party shall first communicate the same in
writing to the other.
10.2 COOPERATION. Subject to express limitations contained elsewhere
herein, Buyer and Seller agree to cooperate fully with one another in taking any
reasonable actions (including without limitation, reasonable actions to obtain
the required consent of any governmental instrumentality or any third party)
necessary or helpful to accomplish the transactions contemplated by this
Agreement, including but not limited to the satisfaction of any condition to
closing set forth herein.
10.3 CONTROL OF STATIONS. Subject to Buyer's time brokering of the
Stations pursuant to the Time Brokerage Agreement, Buyer shall not, directly or
indirectly, control, supervise or direct the operations of the Stations prior to
the Closing. Such operations, including complete
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control and supervision of all Station programs, employees and policies, shall
be the sole responsibility of Seller.
10.4 CONSENTS TO ASSIGNMENT. To the extent that any Contract identified
in the Schedules is not capable of being sold, assigned, transferred, delivered
or subleased without the waiver or consent of any third person (including a
government or governmental unit), or if such sale, assignment, transfer,
delivery or sublease or attempted sale, assignment, transfer, delivery or
sublease would constitute a breach thereof or a violation of any law or
regulation, this Agreement and any assignment executed pursuant hereto shall not
constitute a sale, assignment, transfer, delivery or sublease or an attempted
sale, assignment, offer, delivery or sublease thereof. Subject to the provisions
of Section 11.5, in those cases where consents, assignments, releases and/or
waivers have not been obtained at or prior to the Closing relating to the
assignment to Buyer of the Contracts, this Agreement and any assignment executed
pursuant hereto, to the extent permitted by law, shall constitute an equitable
assignment by Seller to Buyer of all of Seller's rights, benefits, title and
interest in and to the Contracts, and where necessary or appropriate, Buyer
shall be deemed to be Seller's agent for the purpose of completing, fulfilling
and discharging all of Seller's rights and liabilities arising after the Closing
Date under such Contracts. Seller shall use its reasonable best efforts to
provide Buyer with the financial and business benefits of such Contracts
(including, without limitation, permitting Buyer to enforce any rights of Seller
arising under such Contracts), and Buyer shall, to the extent Buyer is provided
with the benefits of such Contracts, assume, perform and in due course pay and
discharge all debts, obligations and liabilities of Seller under such Contracts
to the extent that Buyer was to assume those obligations pursuant to the terms
hereof.
10.5 FILINGS. In addition to the covenants of the parties set forth in
Article 5 hereto, as promptly as practicable after the execution of this
Agreement, Buyer and Seller shall use their reasonable best efforts to obtain,
and to cooperate with each other in obtaining, all authorizations, consents,
orders and approvals of any governmental authority that may be or become
necessary in connection with the consummation of the transactions contemplated
by this Agreement, and to take all reasonable actions to avoid the entry of any
order or decree by any governmental authority prohibiting the consummation of
the transactions contemplated hereby, including without limitation, any reports
or notifications that may be required to be filed with the FCC, and each shall
furnish to one another all such information in its possession as may be
necessary for the completion of the reports or notifications to be filed by the
other.
10.6 BULK SALES LAWS. Buyer hereby waives compliance by Seller with the
provisions of the "bulk sales" or similar laws of any state. Seller agrees to
indemnify Buyer and hold it harmless from any and all loss, cost, damage and
expense (including but not limited to, reasonable attorney's fees) sustained by
Buyer as a result of any failure of Seller to comply with any "bulk sales" or
similar laws.
10.7 EMPLOYEE MATTERS. The parties agree that this Section 10.7 shall
be subject to the rights and obligations of the parties set forth in, and any
prior actions taken by the parties pursuant to, the Time Brokerage Agreement.
Seller shall be responsible for the payment of all compensation and accrued
employee benefits payable to all employees up to the Commencement Date. Seller
acknowledges and agrees that it, and not Buyer, is and shall be solely
responsible
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for any and all insurance, supplemental pension, deferred compensation,
retirement and any other benefits, and related costs, premiums and claims, due,
to become due, committed or otherwise promised to any person who, as of the
Commencement Date, is a retiree, former employee, or current employee of Seller,
relating to the period up to the Commencement Date. Buyer, as a purchaser of the
Stations Assets, shall assume no employee benefit plans, programs or practices,
whether or not set forth in writing, maintained by Seller at any time.
ARTICLE 11
CONDITIONS OF CLOSING BY BUYER
------------------------------
The obligations of Buyer hereunder are, at its option, subject to
satisfaction, at or prior to the Closing Date, of each of the following
conditions:
11.1 REPRESENTATIONS, WARRANTIES AND COVENANTS.
11.1.1 All representations and warranties of Seller made in
this Agreement or in any Exhibit, Schedule or document delivered pursuant
hereto, shall be true and complete in all respects as of the date hereof and on
and as of the Closing Date as if made on and as of that date, except for changes
(a) expressly permitted or contemplated by the terms of this Agreement; or (b)
caused by the acts of Buyer during the term of the Time Brokerage Agreement; or
(c) in the ordinary course of business which are not, either in individually or
in the aggregate, material and adverse.
11.1.2 All of the terms, covenants and conditions to be
complied with and performed by Seller on or prior to the Closing Date shall have
been complied with or performed in all material respects.
11.1.3 Buyer shall have received a certificate, dated as of
the Closing Date, from Seller, executed by the President of Seller to the effect
that: (a) except for changes occurring as a result of Buyer's actions under the
Time Brokerage Agreement, the representations and warranties of Seller contained
in this Agreement are true and complete in all material respects on and as of
the Closing Date as if made on and as of that date; and (b) Seller has complied
with or performed in all material respects all terms, covenants and conditions
to be complied with or performed by it on or prior to the Closing Date.
11.2 GOVERNMENTAL CONSENTS. The FCC Consent shall have been obtained
and, subject to the provisions of Section 4. 1 hereof, shall have become a Final
Order.
11.3 GOVERNMENTAL AUTHORIZATIONS. Seller shall be the holder of the
Stations Licenses and all other licenses, permits and other authorizations
listed in SCHEDULE 7.4, and there shall not have been any modification of any of
such licenses, permits and other authorizations which has a material adverse
effect on any of the Stations or the operations thereof. No application shall be
pending for the renewal of any of the Stations Licenses. No proceeding shall be
pending which seeks, and the effect of which reasonably could be, to revoke,
cancel, fail to renew, suspend or
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adversely modify any of the Stations Licenses or any other licenses, permits or
other authorizations listed in SCHEDULE 7.4.
11.4 ADVERSE PROCEEDINGS. No suit, action, claim or governmental
proceeding shall be pending or threatened against, and no order, decree or
judgment of any court, agency or other governmental authority shall have been
rendered (and remain in effect) against, any party hereto which: (a) would
render it unlawful, as of the Closing Date, to effect the transactions
contemplated by this Agreement in accordance with its terms; (b) questions the
validity or legality of any transaction contemplated hereby; (c) seeks to enjoin
any transaction contemplated hereby; (d) seeks material damages on account of
the consummation of any transaction contemplated hereby; or (e) is a petition of
bankruptcy by or against Seller, an assignment by Seller for the benefit of its
creditors, or other similar proceeding.
11.5 THIRD-PARTY CONSENTS. All Material Contracts shall be in full
force and effect on the Closing Date, and Seller shall have obtained and shall
have delivered to Buyer all appropriate third-party consents in form and
substance acceptable to Buyer (including estoppel certificates for the leases
related to the Leased Real Estate) in connection with the assignment of the
Material Contracts to Buyer.
11.6 CLOSING DOCUMENTS. Seller shall have delivered or caused to be
delivered to Buyer, on the Closing Date, all bills of sale, general warranty
deeds, endorsements, assignments and other instruments of conveyance reasonably
satisfactory in form and substance to Buyer, effecting the sale, transfer,
assignment and conveyance of the Stations Assets to Buyer, including, without
limitation, each of the documents required to be delivered by it pursuant to
Article 14.
11.7 TIME BROKERAGE AGREEMENT COMPLIANCE. From the date hereof through
the Closing Date, the Time Brokerage Agreement shall not have been terminated by
Buyer as permitted by the Time Brokerage Agreement as a result of Seller's
material noncompliance with its obligations under the Time Brokerage Agreement.
11.8 NO ADVERSE CHANGE. No material adverse change in condition of the
Stations Assets, which change is caused by or arises out of any breach by Seller
of any of its representations, warranties, covenants or agreements hereunder or
under the Time Brokerage Agreement, shall have occurred, or be threatened. No
material adverse change shall be deemed to occur due to changes in the financial
condition, ratings or operations of the Stations following the start of the Time
Brokerage Agreement.
11.9 CLOSING ON TOPAZ MERGER AGREEMENT. A Closing shall have been
consummated and the merger effected between Buyer and Topaz Broadcasting, Inc.
under the Topaz Merger Agreement, on or before the Closing Date.
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ARTICLE 12
CONDITIONS OF CLOSING BY SELLER
-------------------------------
The obligations of Seller hereunder are, at its option, subject to
satisfaction, at or prior to the Closing Date, of each of the following
conditions:
12.1 REPRESENTATIONS, WARRANTIES AND COVENANTS.
12.1.1 All representations and warranties of Buyer made in
this Agreement or in any Exhibit, Schedule or document delivered pursuant
hereto, shall be true and complete in all material respects as of the date
hereof and on and as of the Closing Date as if made on and as of that date,
except for changes expressly permitted or contemplated by the terms of this
Agreement.
12.1.2 All the terms, covenants and conditions to be complied
with and performed by Buyer on or prior to the Closing Date shall have been
complied with or performed in all material respects.
12.1.3 Seller shall have received a certificate, dated as of
the Closing Date, executed by the President of Buyer, to the effect that: (a)
the representations and warranties of Buyer contained in this Agreement are true
and complete in all material respects on and as of the Closing Date as if made
on and as of that date; and (b) Buyer has complied with or performed in all
material respects all terms, covenants and conditions to be complied with or
performed by it on or prior to the Closing Date.
12.2 GOVERNMENTAL CONSENTS. The FCC Consent shall have been obtained
and, subject to the provisions of Section 4.1 hereof, shall have become a Final
Order.
12.3 ADVERSE PROCEEDINGS. No suit, action, claim or governmental
proceeding shall be pending or threatened against, and no other decree or
judgment of any court, agency or other governmental authority shall have been
rendered (and remain in effect) against, any party hereto which: (a) would
render it unlawful, as of the Closing Date, to effect the transactions
contemplated by this Agreement in accordance with its terms; (b) questions the
validity or legality of any transaction contemplated hereby; (c) seeks to enjoin
any transaction contemplated hereby; or (d) seeks material damages on account of
the consummation of any transaction contemplated hereby.
12.4 CLOSING DOCUMENTS. Buyer shall have delivered or caused to be
delivered to Seller, on the Closing Date, the Purchase Price and each of the
documents required to be delivered by it pursuant to Article 14.
12.5 TIME BROKERAGE AGREEMENT COMPLIANCE. From the date hereof through
the Closing Date, the Time Brokerage Agreement shall not have been terminated by
Seller as permitted by the Time Brokerage Agreement as a result of Buyer's
material noncompliance with its obligations under the Time Brokerage Agreement.
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12.6 CLOSING ON TOPAZ MERGER AGREEMENT. A Closing shall have been
consummated and the merger effected between Buyer and Topaz Broadcasting, Inc.
under the Topaz Merger Agreement, on or before the Closing Date.
ARTICLE 13
SALES AND TRANSFER TAXES: FEES AND EXPENSES
-------------------------------------------
13.1 EXPENSES. Except as set forth in Section 13.2 hereof or otherwise
expressly set forth in this Agreement, each party hereto shall be solely
responsible for all costs and expenses incurred by it in connection with the
negotiation, preparation and performance of and compliance with the terms of
this Agreement including, but not limited to, the costs and expenses incurred
pursuant to Article 5 hereof and the fees and disbursements of counsel and other
advisors.
13.2 SPECIFIC CHARGES. All costs of transferring the Stations Assets in
accordance with this Agreement, including FCC filing fees, sales, recordation,
transfer and documentary taxes and fees, (but excluding any excise, sales or use
taxes which are Seller's obligation), shall be shall be paid equally by Seller
and Buyer. Each party shall pay any filing or grant fees imposed upon it by any
governmental authority the consent of which or the filing with which is required
for the consummation of the transactions contemplated hereby.
ARTICLE 14
DOCUMENTS TO BE DELIVERED AT CLOSING
------------------------------------
14.1 SELLER'S DOCUMENTS. At the Closing, Seller shall deliver or cause
to be delivered to Buyer the following:
14.1.1 Certified resolutions of the Board of Directors of
Seller approving the execution and delivery of this Agreement and authorizing
the consummation of the transactions contemplated hereby;
14.1.2 A certificate of Seller, dated the Closing Date, in the
form described in Section 11.1.3;
14.1.3 Governmental certificates showing that Seller: (a) is
duly organized and in good standing in the State of Delaware; and (b) has filed
all returns, paid all taxes due thereon and is currently subject to no
assessment and is in good standing as a foreign corporation in the State of
California, each certified as of a date not more than thirty (30) days before
the Closing Date;
14.1.4 Such certificates, bills of sale, general warranty
deeds, assignments, documents of title and other instruments of conveyance,
assignment and transfer (including without limitation any necessary consents to
conveyance, assignment or transfer required to be delivered hereunder), and lien
releases, all in form satisfactory to Buyer and Buyer's counsel, as shall be
effective to vest in Buyer good and marketable title in and to the Stations
Assets, free,
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clear and unencumbered except for Permitted Encumbrances, if any, as set forth
on SCHEDULE 7.7 and SCHEDULE 7.8 and Assumed Liabilities.
14.1.5 An Assignment and Assumption Agreement in the form of
SCHEDULE C effectuating the assignment and assumption of the Assumed Liabilities
(the "Assignment and Assumption Agreement");
14.1.6 The Indemnification Escrow Agreement and the Deposit
Escrow Agreement (if not previously delivered);
14.1.7 At the time and place of Closing, originals and all
copies of all program, operations, transmission or maintenance logs and all
other records required to be maintained by the FCC with respect to the Stations,
including the public files of the Stations, shall be left at the Stations and
thereby delivered to Buyer;
14.1.8 A written opinion of Seller's corporate counsel in a
form reasonably acceptable to Buyer, dated as of the Closing Date;
14.1.9 A written opinion of Seller's FCC counsel in a form
reasonably acceptable to Buyer, dated as of the Closing Date; and
14.1.10 Such additional information, materials, agreements,
documents and instruments as Buyer and its counsel may reasonably request in
order to consummate the Closing.
14.2 BUYER'S DOCUMENTS. At the Closing, Buyer shall deliver or cause to
be delivered to Seller the following:
14.2.1 Certified resolutions of the Board of Directors of
Buyer approving the execution and delivery of this Agreement and authorizing the
consummation of the transactions contemplated hereby;
14.2.2 A certificate of Buyer, dated the Closing Date, in the
form described in Section 12.1.3;
14.2.3 The Assignment and Assumption Agreement;
14.2.4 The Indemnification Escrow Agreement and the Deposit
Escrow Agreement (if not previously delivered);
14.2.5 A written opinion of Buyer's counsel in a form
reasonably acceptable to Seller, dated as of the Closing Date;
14.2.6 The Purchase Price in accordance with Section 3.1
hereof; and
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14.2.7 Such additional information, materials, agreement,
documents and instruments as Seller and its counsel may reasonably request in
order to consummate the Closing.
ARTICLE 15
SURVIVAL, INDEMNIFICATION, ETC.
-------------------------------
15.1 SURVIVAL OF REPRESENTATIONS, ETC. It is the express intention and
agreement of the parties to this Agreement that all covenants and agreements
(together, "Agreements") and all representations and warranties (together,
"Warranties") made by Buyer and Seller in this Agreement shall survive the
Closing (regardless of any knowledge, investigation, audit or inspection at any
time made by or on behalf of Buyer or Seller) as follows:
15.1.1 The Agreements shall survive the Closing for a period
from the Closing Date of one (1) year.
15.1.2 The Warranties in Sections 6.2, 6.5 and 7.2, shall
survive the Closing without limitation.
15.1.3 The Warranties in Section 7.6 or otherwise relating to
the federal, state, local or foreign tax obligations of Seller shall survive the
Closing for the period of the applicable statute of limitations plus any
extensions or waivers granted or imposed with respect thereto.
15.1.4 All other Warranties shall survive for a period of one
(1) year from the Closing Date.
15.1.5 The right of any party to recover Damages (as defined
in Section 15.2.1) pursuant to Section 15.2 shall not be affected by the
expiration of any Warranties as set forth herein, provided that notice of the
existence of any Damages (but not necessarily the fixed amount of any such
Damages) has been given by the indemnified party to the indemnifying party prior
to such expiration.
15.1.6 Notwithstanding any provision hereof to the contrary,
there shall be no contractual time limit in which Buyer or Seller may bring any
action for actual fraud (a "Fraud Action"), regardless of whether such actual
fraud also included a breach of any Agreement or Warranty; provided, however,
that any Fraud Action must be brought within the period of the applicable
statute of limitations plus any extensions or waivers granted or imposed with
respect thereto.
15.2 INDEMNIFICATION.
15.2.1 Seller shall defend, indemnify and hold harmless Buyer
from and against any and all losses, costs, damages, liabilities and expenses,
including reasonable attorneys' fees and expenses ("Damages") in excess of
$25,000 in the aggregate, incurred by Buyer arising out of or related to: (a)
any breach of the Warranties given or made by Seller in this Agreement; (b)
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any breach of the Agreements made by Seller in the Agreement; (c) the Retained
Liabilities; (d) any failure of the parties to comply with any "bulk sales" laws
applicable to the transactions contemplated hereby; and (e) the conduct of the
business and operations of the Stations or any portion thereof or the use or
ownership of any of the Stations Assets prior to the Closing Date, except for
such actions as may be taken by Buyer pursuant to the Time Brokerage Agreement.
15.2.2 Buyer shall in addition to any indemnification
obligations it may have under the Time Brokerage Agreement defend, indemnify and
hold harmless Seller from and against any and all Damages incurred by Seller
arising out of or related to: (a) any breach of the Agreements and Warranties
given or made by Buyer in this Agreement; (b) the Assumed Liabilities, and (c)
the conduct of the business and operations of the Stations or any portion
thereof or the use or ownership of any of the Stations Assets on or after the
Closing Date.
15.3 PROCEDURES: THIRD PARTY AND DIRECT INDEMNIFICATION CLAIMS. The
indemnified party agrees to give written notice within a reasonable time 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 (hereinafter collectively
"Claims," and individually a "Claim"), it being understood that the failure to
give such notice shall not affect the indemnified party's right to
indemnification and the indemnifying party's obligation to indemnify as set
forth in this Agreement, unless the indemnifying party's ability to contest,
defend or settle with respect to such Claim is thereby demonstrably and
materially prejudiced. The parties also agree that any claim for Damages arising
directly between the parties relating to this Agreement may be brought at any
time within the applicable survival period specified in Section 15. 1, and that
the only notice required with respect thereto shall be as specified in Section
15.1.5.
The obligations and liabilities of the parties hereto with respect to
their respective indemnities pursuant to Section 15.2 resulting from any Claim
shall be subject to the following additional terms and conditions:
15.3.1 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.
15.3.2 In the event that the indemnifying party shall elect
not to undertake such defense or opposition, or within (10) days after notice of
any such Claim from the indemnified party, the indemnifying party shall fail 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).
15.3.3 Anything in this Section 15.3 to the contrary
notwithstanding: (a) 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; (b) the indemnifying party shall not, without the indemnified
party's written consent, settle or compromise any Claim or consent to entry of
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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 (c) 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.
15.3.4 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.
ARTICLE 16
TERMINATION RIGHTS
------------------
16.1 TERMINATION. This Agreement may be terminated at any time prior to
Closing as follows:
16.1.1 Upon the mutual written consent of Buyer and Seller,
this Agreement may be terminated on such terms and conditions as so agreed; or
16.1.2 By written notice of Buyer to Seller if Seller breaches
in any material respect any of its representations or warranties or defaults in
any material respect in the observance or in the due and timely performance of
any of its covenants or agreements herein contained and such breach or default
shall not be cured within thirty (30) days of the date of notice of breach or
default served by Buyer, provided, however, that if the breach or default is due
to no fault of the Seller and is incapable of cure within such thirty (30) day
period, the cure period shall be extended as long as the Seller is diligently
and in good faith attempting to effectuate a cure, but in no event shall the
cure period be extended beyond the earlier of (i) ninety (90) days or (ii)
December 1, 1998; or
16.1.3 By written notice of Seller to Buyer if Buyer breaches
in any material respect any of its representations or warranties or defaults in
any material respect in the observance or in the due and timely performance of
any of its covenants or agreements herein contained and such breach or default
shall not be cured within thirty (30) days of the date of notice of breach or
default served by Seller, provided, however, that if the breach or default is
due to no fault of the Buyer and is incapable of cure within such thirty (30)
day period, the cure period shall be extended as long as the Buyer is diligently
and in good faith attempting to effectuate a cure, but in no event shall the
cure period be extended beyond ninety days and provided further that Buyer shall
have no right to cure a failure to pay the Purchase Price at the Closing or to
consummate the Topaz Merger Agreement; or
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16.1.4 By written notice of Buyer to Seller or by Seller to
Buyer if the FCC denies the FCC Application under circumstances in which Seller
is NOT entitled to the Escrow Deposit;
16.1.5 By written notice of Buyer to Seller, or by Seller to
Buyer, if any court of competent jurisdiction shall have issued a final and
non-appealable order, decree or ruling (which then remains in effect) or taken
any other action restraining, enjoining or otherwise prohibiting the
transactions contemplated by this Agreement; or
16.1.6 By written notice of Buyer to Seller, or by Seller to
Buyer, if the Closing shall not have been consummated on or before December 1,
1998.
16.1.7 By written notice of Buyer to Seller, or Seller to
Buyer, if it shall become apparent in both Seller's and Buyer's judgment
reasonably exercised that any condition to Buyer's or Seller's obligation to
close as set forth in Articles 11 and 12 hereof will not be satisfied on or
before December 1, 1998.
16.1.8 By written notice of Buyer to Seller under the
conditions set forth in Section 9.2 hereof.
Notwithstanding the foregoing, no party hereto may effect a termination
hereof if such party is in material default or breach of this Agreement or the
Topaz Merger Agreement.
16.2 LIABILITY. Except as set forth in Section 16.4 below, the
termination of this Agreement under Section 16.1 shall not relieve any party of
any liability for breach of this Agreement prior to the date of termination.
16.3 MONETARY DAMAGES, SPECIFIC PERFORMANCE AND OTHER REMEDIES. The
parties recognize that if Seller refuses to perform under the provisions of this
Agreement, monetary damages alone will not be adequate to compensate Buyer for
its injury. Buyer shall therefore be entitled to obtain specific performance of
the terms of this Agreement 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 Buyer to enforce this Agreement, Seller shall waive the defense that
there is an adequate remedy at law. In the event of a default by Seller, which
results in the filing of a lawsuit for damages, specific performance, or other
remedy, Buyer shall be entitled to reimbursement by Seller of reasonable legal
fees and expenses incurred by Buyer.
16.4 SELLER'S LIQUIDATED DAMAGES. As more fully described in the
Deposit Escrow Agreement, in the event this Agreement is terminated because of
Buyer's material breach of this Agreement, and all other conditions within the
Seller's control to Closing are at such time satisfied or waived (other than
such conditions as can reasonably be satisfied by Closing), then the Escrow
Deposit shall be delivered to Seller, and the proceeds thereof shall constitute
liquidated damages. It is understood and agreed that such liquidated damages
amount represents Buyer's and Seller's reasonable estimate of actual damages and
does not constitute a penalty. Recovery of liquidated damages shall be the sole
and exclusive remedy of Seller against Buyer for failing to consummate this
Agreement as a result of Buyer's material breach hereof, and shall
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be applicable regardless of the actual amount of damages sustained and all other
remedies are deemed waived by Seller. Seller acknowledges and agrees that the
Escrow Deposit may be used to pay liquidated damages under the Topaz Merger
Agreement and in such an event, the amount of liquidated damages that can be
paid hereunder shall be reduced by the amount so paid under the Topaz Merger
Agreement. In the event of a default by Buyer, which results in the filing of a
lawsuit for liquidated damages, Seller shall be entitled to reimbursement by
Buyer of reasonable legal fees and expenses incurred by Seller.
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ARTICLE 17
MISCELLANEOUS PROVISIONS
------------------------
17.1 RISK OF LOSS. The risk of loss or damage to any of the Stations
Assets prior to the Closing Date, which is not the responsibility of Buyer under
the express terms of the Time Brokerage Agreement, shall be upon Seller. Seller
shall repair, replace and restore any such damaged or lost Stations Asset to its
prior condition prior to the Closing Date. In the event of substantial damage to
any of the Stations Assets or in the event of the occurrence of any damage or
event which prevents broadcast transmission of the Stations in the normal and
usual manner and substantially in accordance with its license, Seller shall
promptly notify Buyer of the same in writing, specifying with particularity the
loss or damage incurred, the cause thereof if known or reasonably ascertainable,
and an estimate of the extent to which restoration, replacement and repair of
the property lost or destroyed will be reimbursed under the insurance coverage.
In the event the damage has not been restored or repaired by the Closing Date,
then Buyer shall have the option to:
(i) postpone the Closing Date until such time not later than
December 1, 1998 as the property has been completely repaired, replaced or
restored; or
(ii) terminate this Agreement and be refunded the Escrow
Deposit if Seller has not acted diligently to repair, replace or restore such
Stations Assets; or
(iii) elect to consummate the Closing and accept the property
in its then condition in which event all proceeds of insurance received or to be
received shall be the property of the Buyer.
In the event Buyer elects to postpone the Closing Date, Seller and
Buyer will cooperate to extend the time during which this Agreement must be
closed as specified in the Commission's Order.
17.2 CERTAIN INTERPRETIVE MATTERS AND DEFINITIONS. Unless the context
otherwise requires:
(a) all references to Sections, Articles, or Schedules are to
Sections, Articles, or Schedules of or to this Agreement; (b) each term defined
in this Agreement has the meaning assigned to it; (c) each accounting term not
otherwise defined in this Agreement has the meaning assigned to it in accordance
with generally accepted accounting principles as in effect on the date hereof,
(d) "or" is disjunctive but not necessarily exclusive; (e) words in the singular
include the plural and vice versa; (f) the term "Affiliate" has the meaning
given it in Rule 12b-2 of Regulation 12B under the Securities Exchange Act of
1934, as amended; and (g) all references to "$" or dollar amounts will be to
lawful currency of the United States of America.
17.3 FURTHER ASSURANCES. After the Closing, Seller shall from time to
time, at the request of and without further cost or expense to Buyer, execute
and deliver such other instruments of conveyance and transfer and take such
other actions as may reasonably be requested in order more effectively to
consummate the transactions contemplated hereby to vest
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in Buyer good and marketable title to the Stations Assets being transferred
hereunder in accordance with the terms hereof, and Buyer shall from time to
time, at the request of and without further cost or expense to Seller, execute
and deliver such other instruments and take such other actions as may reasonably
be requested in order more effectively to relieve Seller of any obligations
being assumed by Buyer hereunder.
17.4 PRESERVATION OF RECORDS. Subject to Section 10.1 hereof, Buyer
hereby agrees that it will preserve and make available to Seller and its
attorneys and accountants (including the right to inspect and copy at Seller's
cost), during normal business hours and upon reasonable advance notice, for
three (3) years after the Closing Date, such of the books, records, files,
correspondence, memoranda and other documents referred pursuant to this
Agreement as Seller may reasonably require for the preparation of tax reports
and returns, the preparation of financial statements, or the preparation of a
response to any claim by a third party against Seller.
17.5 BENEFIT AND ASSIGNMENT. This Agreement shall be binding upon and
shall inure to the benefit of the parties hereto and their respective successors
and permitted assigns. Seller may not voluntarily or involuntarily assign its
interest under this Agreement without the prior written consent of Buyer. Buyer
shall have the right to assign and/or delegate all or any portion of its rights
and obligations under this Agreement, including without limitation, assignments
as collateral, provided that no such assignment and/or delegation shall relieve
Buyer of its obligations hereunder in the event that its assignee fails to
perform the obligations delegated. 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. In the event
Buyer finds it necessary or is required to provide to a third party a collateral
assignment of the Buyer's interest in this Agreement and/or any related
documents, Seller shall cooperate with the Buyer and any third party requesting
such assignment including but not limited to signing a consent and
acknowledgment of such assignment.
17.6 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.
17.7 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.
17.8 GOVERNING LAW AND FORUM. The construction and performance of this
Agreement shall be governed by the laws of the State of California, without
giving effect to the choice of law provisions thereof. The parties agree that
any action brought to enforce any provisions of this Agreement or to seek any
remedy provided for hereunder shall be brought in a California State court of
competent jurisdiction located in Los Angeles County, California. Each of the
parties hereby irrevocably and unconditionally waives trial by jury in any legal
action or proceeding relating in any way to this Agreement, including any
counterclaim made in such action or proceeding, and agrees that any such action
or proceeding shall be decided solely by a judge in the County of Los Angeles,
California. Each of the parties hereto hereby acknowledges
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that it has been represented by counsel in the negotiation, execution and
delivery of this Agreement and that its lawyers have fully explained the meaning
of the Agreement, including in particular the jury-trial waiver.
17.9 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 duly delivered and 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 dispatched by facsimile transmission (with the facsimile
transmission confirmation being deemed conclusive evidence of such dispatch) and
shall be addressed to the following addresses, or to such other address as any
party may request, in the case of Seller, by notifying Buyer, and in the case of
Buyer, by notifying Seller:
To Seller: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, President
Ruby Broadcasting, Inc.
▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Copy to: ▇▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇, ▇▇., Esq.
▇▇▇▇▇▇▇▇▇, ▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇▇ ▇ ▇▇▇▇▇▇, ▇.▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇.▇. ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
To Buyer: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇, Chairman
Regent Broadcasting of
Victorville, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
Copy to: ▇▇▇▇▇▇▇ & ▇▇▇▇
2100 PNC Center
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Fax: (▇▇▇) ▇▇▇-▇▇▇▇
17.10 COUNTERPARTS. This Agreement may be executed in one or more
counterparts and by facsimile, each of which will be deemed an original and all
of which together will constitute one and the same instrument.
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17.11 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.
17.12 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.
17.13 ENTIRE AGREEMENT. This Agreement and the schedules hereto embody
the entire agreement and understanding of the parties hereto and supersede any
and all prior agreements, arrangements and understandings relating to the
matters provided for herein. Any matter that is disclosed in a Schedule hereto
in such a way as to make its relevance to the information called for by another
Schedule readily apparent shall be deemed to have been included in such other
Schedule, notwithstanding the omission of an appropriate cross-reference.
17.14 DISCLOSURE. The parties agree that the subject matter of this
Agreement is one of the utmost confidentiality and the release of information is
a matter of great importance to both parties. Both parties agree that no
disclosure of any aspect of this Agreement, no press release or other publicity
shall be released by either party without the consent of the other; provided,
however, any party may release any information that is required by state or
federal law, customarily transmitted to any potential or present senior lender,
or a matter of public record on file with the Commission.
[THE BALANCE OF THIS PAGE INTENTIONALLY LEFT BLANK.]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement as
of the date and year first above written.
REGENT BROADCASTING OF
VICTORVILLE, INC.
By:_____________________________
Name:___________________________
Title:__________________________
RUBY BROADCASTING, INC.
By:_____________________________
Name:___________________________
Title:___________________________
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