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Exhibit 10(j)
TIME BROKERAGE AGREEMENT
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Time Brokerage Agreement ("Agreement") dated as of June 16, 1997, by
and among THE PARK LANE GROUP, a California corporation ("Park Lane"), the
subsidiaries of Park Lane set forth on ATTACHMENT A hereto (collectively, "Park
Lane Subsidiaries") (Park Lane and Park Lane Subsidiaries referred to herein
collectively as "Licensee"), and REGENT COMMUNICATIONS, INC., a Delaware
corporation ("Broker").
WHEREAS, Park Lane Subsidiaries are the licensees of the radio stations
set forth on ATTACHMENT B hereto (referred to herein collectively as the
"Stations"); and
WHEREAS, Broker and the stockholders of Park Lane, have entered into a
Stock Purchase Agreement, dated June 16, 1997 (the "Purchase Agreement") for the
acquisition by Broker of all of the outstanding stock of Park Lane; and
WHEREAS, Licensee, while maintaining control over the Stations'
finances, personnel matters and programming, desires to accept and broadcast
programming supplied by Broker or its subsidiaries on the Stations subject to
the terms and conditions set forth herein;
NOW, THEREFORE, for and in consideration of the mutual covenants herein
contained, the parties hereto have agreed and do agree as follows:
1. AIR TIME AND TRANSMISSION SERVICES. Licensee agrees, beginning on
August 1, 1997 (the "Commencement Date") to make the Stations' studio and
broadcast facilities available to Broker, and to broadcast, or cause to be
broadcast, on the Stations, according to the terms hereof, programming
designated and provided by Broker (the "Programming").
2. PAYMENTS. Broker hereby agrees to pay Licensee the amounts specified
in ATTACHMENT C for the right, from and after the Commencement Date, to
broadcast the Programming on the terms and conditions herein provided. Payments
of the estimated Monthly Fee (as defined in ATTACHMENT C), subject to adjustment
according to ATTACHMENT C, are due and payable in full on the first day of each
calendar month for which such payment is intended to be applied and shall be
prorated for any partial calendar month at the beginning or end of the term
hereof. The failure of Licensee to demand or insist upon prompt payment in
accordance herewith shall not constitute a waiver of its right to do so. Broker
shall receive a payment credit for any Programming not broadcast by any Station
(a "Credit"), such Credit to be in the amount of the revenue certified by Broker
as having been lost because such Programming was not broadcast and not recovered
in the ordinary course of business during that same month. Broker shall use its
best efforts in the ordinary course of business to make good any advertising not
broadcast so as to minimize the potential loss of revenue hereunder. No credit
shall be due on account of any Programming rejected for failure to comply with
the standards for Programming set forth in this Agreement.
3. TERM. The term of this Agreement shall begin on the Commencement
Date and end on the earliest of (i) the Closing Date, as defined in the Purchase
Agreement, or (ii) the date which is ten (10) days following any termination of
the Purchase Agreement in accordance with the terms
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thereof (such date hereinafter referred to as the "Termination Date," and such
period of time as the "Term").
4. PROGRAMMING. Broker shall furnish or cause to be furnished the
Programming, which shall be an entertainment format and may include, without
limitation, news, talk, sports, promotions (including on-air giveaways),
contests, syndicated programs, barter programs, paid-for programs,
locally-produced programs, advertising commercial matter, including that in both
program or spot announcement forms, and public service information; provided,
however, that the Programming on each Station shall include news, public service
announcements and other programming on issues of importance to the local
community as reasonably requested by Licensee and in compliance with Licensee's
regulatory obligations. The Programming shall be consistent with the standards
set forth in ATTACHMENT E. All actions or activities of Broker under this
Agreement, and all Programming provided by Broker shall be in accordance with
(i) the Communications Act of 1934, as amended; (ii) Federal Communications
Commission (the "FCC") rules, requirements and policies, including, without
limitation, the FCC's rules on plugola/payola, lotteries, station
identification, minimum operating schedule, sponsorship identification,
political programming and political advertising rates; (iii) all applicable
federal, state and local regulations and policies; and (iv) generally accepted
quality standards consistent with Licensee's past practices. Broker agrees that,
if in the sole, good faith judgment of the affected Station's General Manager
and/or officers of Licensee Broker does not comply with the standards of this
paragraph, Licensee may suspend or cancel any Programming not in compliance.
Broker shall not be entitled to a Credit for Programming not broadcast over the
Station on account of any Programming rejected for failure to comply with the
standards for Programming set forth in this Section 4. The right to use the
Programming and to authorize its use in any manner and in any media whatsoever
shall be, and remain, vested solely in Broker, subject in all events to the
rights, if any, of others in such Programming.
5. SPECIAL EVENTS. Licensee reserves the right in its discretion, and
without liability, to preempt, delay or delete any of the broadcasts of the
Programming and to substitute programming which in Licensee's judgment is of
greater local, regional or national importance. In all such cases, Licensee
shall use its best efforts to give Broker reasonable notice of its intention to
preempt such Programming, and, in the event of such preemption, Broker shall
receive a payment credit for the Programming so omitted consistent with the
intent and pursuant to the terms of Section 2 hereof.
6. ADVERTISING AND PROGRAMMING REVENUES. Broker shall retain all
advertising and other revenues, and all accounts receivable, with respect to
Programming broadcast during the Term, and relating to the Programming it
delivers to the Stations for broadcast during the Term, including without
limitation, promotion-related revenues. Licensee and Broker each shall have the
right, at their own expense, to seek copyright royalty payments for their own
programming. Broker may sell advertising on the Stations in combination with the
sale of advertising on other broadcasting stations of its choosing, subject to
compliance with applicable law.
7. STATION FACILITIES. Subject to the qualifications set forth in this
Agreement, throughout the term of this Agreement, Licensee shall make the
facilities and equipment of the Stations available to Broker in good operating
condition and repair for operation and broadcast with the maximum authorized
facilities twenty-four (24) hours a day, seven (7) days a week, except for
downtime
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occasioned by either (i) emergency maintenance or (ii) routine maintenance not
to exceed four (4) hours weekly between the hours of 12 midnight and 5:00 a.m.,
and except for such programs and announcements prepared by and put on the air by
Licensee in order to meet local needs and issues requirements, said programs and
announcements not to exceed one (1) hour each Sunday morning at a mutually
agreed upon time between the hours of 5:00 a.m. and 7:00 a.m. Broker will make
its personnel available to Licensee to produce and broadcast such programming.
Broker shall not be entitled to a credit for Programming not broadcast over the
Stations for periods specified in this Section 7 hereof unless downtime for
emergency maintenance exceeds twelve (12) hours at a given time or thirty-six
(36) hours during a given month, in which event Broker shall receive a payment
credit for Programming not broadcast consistent with the intent and pursuant to
the terms of Section 2 hereof. To the extent practicable, any maintenance work
affecting the operation of the Stations at full power shall be scheduled upon at
least forty-eight (48) hours prior notice with the agreement of Broker, such
agreement not to be unreasonably withheld.
8. RIGHT OF ACCESS. Broker and Broker's employees or agents shall at
all times be afforded reasonable access to the Stations in order to perform
their duties in connection with the production and transmission of the
Programming over the facilities of the Stations. Broker shall have the right to
install at Licensee's and/or Broker's premises, and to maintain throughout the
term of this Agreement, at Broker's expense, any microwave studio/transmitter
relay equipment, telephone lines, transmitter remote control, monitoring devices
or any other equipment necessary for the proper transmission of the Programming
on the Stations, and Licensee and Broker shall take all steps reasonably
necessary to prepare and file any applications with the FCC to effectuate such
proper transmission.
9. FORCE MAJEURE. Any failure or impairment of facilities or any delay
or interruption in broadcasting the Programming, or failure at any time to
furnish facilities, in whole or in part, for broadcasting, due to acts of God,
strikes, or threats thereof, force majeure, or due to causes beyond the control
of Licensee, shall not constitute a breach of this Agreement, and Licensee shall
not be liable to Broker for any damages or adjustments for such failure,
impairment, delay or interruption, except to the extent of allowing in each such
case an appropriate payment credit for Programming available to Licensee but not
carried consistent with the intent and pursuant to the terms of Section 2
hereof.
10. LICENSEE CONTROL OF STATIONS. Notwithstanding anything to the
contrary in this Agreement, Licensee shall have full authority, control and
power over the operation of the Stations during the period of this Agreement.
Broker will make no material change in formats of the Stations without
Licensee's approval not to be unreasonably withheld. Licensee shall retain
control, said control to be reasonably exercised, over the policies, programming
and operations of the Stations, including, without limitation, the right to
decide whether to accept or reject any Programming or advertisements, the right
to preempt any Programming in order to broadcast a program deemed by Licensee to
be of greater national, regional, or local interest, and the right to take any
other actions necessary for compliance with the laws of the United States; the
laws of the relevant states; the rules, regulations, and policies of the FCC
(including without limitation all technical regulations governing the operations
of the Stations and the prohibition on unauthorized transfers of control); and
the rules, regulations and policies of other federal governmental authorities,
including without limitation the
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Federal Trade Commission and the Department of Justice. Licensee shall be
responsible for ensuring that FCC requirements are met with respect to
ascertainment of the problems, needs and interests of the community, public
service programming, main studio staffing, maintenance of public section files
and the preparation of quarterly issues/programs lists. Broker shall, upon
request by Licensee, provide Licensee with information with respect to such of
Broker's programs which are responsive to the problems, needs and interests of
the community, so as to assist Licensee in the preparation of required quarterly
issues/programs lists, and shall provide upon request other information to
enable Licensee to prepare other records, reports and logs required by the FCC
or other local, state or federal governmental agencies. Whenever on the
Stations' premises, all Broker personnel shall be subject to the supervision and
the direction of Licensee's designated personnel.
11. RESPONSIBILITY FOR EMPLOYEES AND EXPENSES. Licensee shall employ
two full time employees at each main studio of the Stations, one of whom shall
be a manager, both of whom shall report to and be accountable to Licensee, and
who shall be ultimately responsible for the day-to-day operation of the
Stations. Licensee shall be directly responsible for paying the salaries, taxes,
insurance and related costs for such employees (the "Licensee Employee
Expenses"). Licensee shall also be responsible for paying directly (i)
transmitter site rent/mortgage for the Stations; (ii) costs for maintenance and
repair of the transmission and other technical equipment, including costs for
capital improvements and replacements necessary or appropriate to maintain the
facilities of the Stations; and (iii) transmitter site utilities for the
Stations ("Licensee Transmitter Expenses"). Licensee shall be responsible for
paying directly all income taxes relating to Licensee's earnings from this
arrangement. Broker shall employ and be responsible for the salaries, taxes,
insurance and related costs for all personnel used in the production of the
Programming (including, without limitation, salespeople, traffic personnel,
administrative and programming staff), for Broker's use of the studios and
offices (including rent and utilities therefor), and for routine maintenance and
repair thereto (as opposed to maintenance and repair of the transmission and
other technical equipment and capital improvements and replacements which shall
be Licensee's responsibility). Excluding those expenses for which Licensee is
making payments as set forth in this Agreement, during the Term Broker shall be
responsible for paying all other expenses reasonably and directly related to the
continued operation of the Stations subject to the covenants of the parties to
this Agreement and further subject to the ultimate authority, control and power
of Licensee.
11.1 EMPLOYEE MATTERS.
11.1.1 Licensee shall be responsible for the payment
of all compensation and accrued employee benefits payable to all Licensee
employees through the Commencement Date.
11.1.2 Broker will maintain key employee staffing at
a level sufficient to operate the Stations consistent with the manner in which
the Stations are operated as of the Commencement Date. Broker shall offer
employment to commence on the Effective Date to all current salaried employees
of Licensee whose duties relate to the day-to-day operations of the Stations,
except for corporate-level employees and those retained employees of Licensee
specified on ATTACHMENT G hereto (collectively, the "Retained Employees"), and
Broker shall maintain compensation and benefit arrangements, plans and programs
for the benefit of those Licensee employees accepting employment with Broker
under Broker's compensation and benefit
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arrangements, plans and programs for their similarly situated current salaried
employees; provided, however, that nothing in this Agreement shall preclude or
restrict Broker from terminating the employment of any employee, other than as
provided in the Station Agreements. Licensee acknowledges and agrees that
Licensee, and not Broker, is and shall be solely responsible 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, up to the Commencement Date is a
retiree, former employee, or current employee of Licensee, relating to the
period up to the Commencement Date. Broker shall assume no employee benefit
plans, programs or practices, whether or not set forth in writing, maintained by
Licensee at any time.
11.1.3 Broker shall cause any salaried employee of
Licensee that becomes a participant in any employee benefit plan, practice or
policy of Broker or any of its affiliates or any of their respective successors,
to be given credit under such plan, practice or policy (if permitted by such
plan, practice or policy) for all service prior to the Commencement Date with
Licensee, or any predecessor employer, for all purposes (including eligibility,
vesting and determination of benefits) for which such service is either taken
into account or recognized. Licensee agrees to cooperate with Broker in the
prompt rollover of any pension, profit sharing or cash or deferred (Section
401(K)) plans and trusts and any other employee benefit plan or arrangement,
provided that any such rollovers are permitted and made in accordance with the
applicable provisions of Licensee's and Broker's benefit plans.
11.1.4 In the event that this Agreement is terminated
for any reason other than the Closing pursuant to the Purchase Agreement, then
on the Termination Date, Licensee shall rehire all current salaried employees of
Broker who were previously employees of Licensee, and, with Broker's prior
written consent (which consent shall not be withheld for employees of Broker,
other than ▇▇▇▇ ▇▇▇▇, whose continued service at the Stations is necessary in
order to have an orderly transition permitting the Stations to be operated in a
manner consistent with the Stations' operation by Licensee prior to the
Commencement Date. Others hired after the Commencement Date, and Licensee shall
assume all other obligations pursuant to this Section 11.1 of Broker relating to
such employees as of the Termination Date in place of the Commencement Date.
12. STATION AGREEMENTS.
12.1. ASSIGNMENT AND ASSUMPTION OF STATION AGREEMENTS. On the
Commencement Date, Licensee shall assign to Broker and Broker shall assume,
subject to the provisions of this Section 12, the obligations of Licensee
arising or to be performed on and after the Commencement Date (except to the
extent such obligations represent liabilities for activities, events or
transactions occurring, or conditions existing, prior to the Commencement Date)
under all contracts relating to the day-to-day operations and business
activities of the Stations, excluding (i) contracts and agreements relating to
the Licensee Employee Expenses, (ii) contracts and agreements relating to the
Licensee Transmitter Expenses, (iii) Licensee's financing agreements and (iv)
corporate level contracts and agreements, except, if any, those listed on
ATTACHMENT D (collectively, the contracts and agreements to be assigned by
Licensee and assumed by Broker are referred to as the "Station Agreements").
Licensee hereby makes and incorporates by reference the representations and
warranties of Sellers in
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Section 4.13 of the Purchase Agreement. Licensee represents and warrants that
the Station Agreements are freely assignable, or, if consent of the other
contracting party to the assignment is required, Licensee covenants to use its
reasonable best efforts to obtain such consent as promptly as practicable. As of
the Commencement Date, Licensee shall have paid (or will pay when due) all
amounts accrued on and shall have performed all obligations due under the
Station Agreements as of that date.
12.2 CONSENTS TO ASSIGNMENT. To the extent that any Station
Agreement is not capable of being assigned, transferred, delivered or subleased
without the waiver or consent of any third person (including a government or
governmental unit), or if such assignment, transfer, delivery or sublease or
attempted 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 thereto shall not constitute an assignment,
transfer, delivery or sublease or an attempted assignment, transfer, delivery or
sublease thereof. In those cases where consents, assignments, releases and/or
waivers have not been obtained at or prior to the Commencement Date to the
transfer and assignment to Broker of any Station Agreement, this Agreement and
any assignment executed pursuant hereto, to the extent permitted by law, shall
constitute an equitable assignment by Licensee to Broker of all of Licensee's
rights, benefits, title and interest in and to the Station Agreements, and where
necessary or appropriate, Broker shall be deemed to be Licensee's agent for the
purpose of completion, fulfilling and discharging all of Licensee's rights and
liabilities arising after the Commencement Date under such Station Agreements.
Licensee shall use its reasonable best efforts to provide Broker with the
financial and business benefits of such Station Agreements (including, without
limitation, permitting Broker to enforce any rights of licensee arising under
such Station Agreements), and Broker shall, to the extent Broker is provided
with the benefits of such Station Agreements, assume, perform and in due course
pay and discharge all debts, obligations and liabilities of Licensee under such
Station Agreements to the extent that Broker was to assume those obligations
pursuant to the terms hereof.
12.3 RETAINED LIABILITIES. Except as set forth in Sections 11
and 12 hereof, Broker 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
Licensee of any nature whatsoever whether accrued, absolute, contingent or
otherwise and whether or not disclosed by Broker, other than those arising or to
be performed under the Station Agreements on and after the Commencement Date
(except to the extent such obligations represent liabilities for activities,
events or transactions occurring, or conditions existing prior to the
Commencement Date). Licensee will retain and pay, satisfy, discharge and perform
in accordance with the terms thereof, all liabilities and obligations of the
Licensee, other than those arising or to be performed under the Station
Agreements before the Commencement Date (or representing liabilities for
activities, events or transactions occurring, or conditions existing, prior to
the Commencement Date), 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 Licensee 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, copyright, trademarks, service ▇▇▇▇, trade name
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and other intellectual property, or other obligations, claims or judgments
asserted against Broker as successor in interest to Licensee. All such
liabilities, obligations and commitments of Licensee described in this Section
12.3 shall be referred to herein collectively as the "Retained Liabilities."
13. ACCOUNTS RECEIVABLE. Broker acknowledges that all accounts
receivable arising prior to the Commencement Date in connection with the
operation of the Stations, including but not limited to accounts receivable for
advertising revenues for programs and announcements performed prior to the
Commencement Date and other broadcast revenues for services performed prior to
the Commencement Date, shall remain the property of Licensee (the "Licensee
Accounts Receivable") and that Broker shall not acquire any beneficial right or
interest therein or responsibility therefor. During the term of this Agreement,
Broker agrees to use such efforts as it ordinarily uses for the collection of
its own accounts receivable to assist Licensee in collection of the Licensee
Accounts Receivable in the normal and ordinary course of business and will apply
all such amounts collected to the debtor's oldest account receivable first,
except that any such accounts collected by Broker from persons who are also
indebted to Broker may be applied to Broker's account if so directed by the
debtor or under circumstances in which there is a bona fide dispute between
Licensee and such account debtor with respect to such account provided that such
disputed accounts are reassigned to Licensee. Broker's obligation and authority
shall not extend to the institution of litigation, employment of counsel or a
collection agency or any other extraordinary means of collection. Broker agrees
to reasonably cooperate with Licensee, at Licensee' expense, as to any
litigation or other collection efforts instituted by Licensee to collect any
delinquent Licensee Accounts Receivable. During the term of this Agreement,
neither Licensee nor its agents shall make any direct solicitation of any
account debtor for collection purposes or institute litigation for the
collection of amounts due except with respect to any accounts that may be
reassigned to Licensee. Any amounts relating to the Licensee Accounts Receivable
that are paid directly to the Licensee shall be retained by the Licensee, but
Licensee shall provide Broker with prompt notice of any such payment. Every
thirty (30) days during the term of this Agreement, Licensee shall make a
payment to Licensee equal to the amount of all collections of Licensee Accounts
Receivable during such thirty (30) day period, provided that Broker shall deduct
from such amounts and shall be responsible for paying commissions due on the
collected Licensee Accounts Receivable in accordance with ATTACHMENT H hereto.
At the end of the term of this Agreement, any remaining Licensee Accounts
Receivable shall be returned to Licensee for collection.
14. PRORATION OF INCOME AND EXPENSES: TRADE AGREEMENTS
ADJUSTMENT.
14.1 Except as otherwise provided herein, all deposits,
reserves and prepaid and deferred income and expenses relating to the Station
Agreements shall be prorated between Broker and Licensee in accordance with
general accepted accounting principles as of 11:59 p.m., Pacific time, on the
date immediately preceding the Commencement Date.
14.2 SCHEDULE 14.2 will include a list of all Barter or Trade
Agreements ("Trade Agreements") involving a Barter Payable or Barter Receivable
in excess of $1,000 as of the Commencement Date included in the Station
Agreements and the aggregate value of time owed ("Barter Payable") pursuant to
each of the Trade Agreements and the aggregate value of goods and services to be
received ("Barter Receivable") pursuant to each of the Trade Agreements, in each
case
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as of the date specified on Schedule 14.2 hereof. On the Commencement Date,
Licensee shall deliver to Broker a report, dated as of the Commencement Date
(the "Commencement Date Trade Report"), which report lists all Trade Agreements
included in the Station Agreements and the contract end date for each Trade
Agreement together with a true and correct itemized statement of the aggregate
value of the Barter Payable and Barter Receivable pursuant to each of the Trade
Agreements. To the extent, if any, that the aggregate net value as reflected on
the Commencement Date Trade Report of the Stations' Barter Payable exceeds the
aggregate net value as reflected on the Commencement Date Trade Report of the
Barter Receivable by more than $50,000.00, Broker shall be entitled to receive
the difference as a credit at the end of the term of this Agreement against the
total fee due; provided, however, the amount of the credit shall be reduced by
the amount, if any, by which this negative barter balance can be reduced by
Broker with its reasonable best efforts in the normal course of business during
the term of this Agreement without adverse economic impact on Broker.
14.3 Except as otherwise provided herein, the prorations and
adjustments contemplated by this Section 14, to the extent practicable, shall be
made on the Commencement Date. As to those prorations and adjustments not
capable of being ascertained on the Commencement Date, an adjustment and
proration shall be made within ninety (90) calendar days after the Commencement
Date.
14.4 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 14.3 hereof and such disputes shall be determined by an
independent certified public accountant mutually acceptable to the parties, and
the fees and expenses of such accountant shall be paid one-half by Licensee and
one-half by Broker.
15. INDEMNIFICATION.
15.1 INDEMNIFICATION. Broker shall indemnify and hold Licensee
and its stockholders, directors, partners, officers, agents, employees,
successors, and assigns harmless from and against any and all claims, expenses,
causes of action and liability resulting from or relating to (i) the broadcast
of Programming during the Term, (ii) any and all promotions, contests and on-air
"giveaways" by Broker relating to the Stations during the Term, (iii) a breach
of Broker's representations, warranties, covenants or agreements contained
herein, (iv) any liability resulting from Broker's default under the Station
Agreements, and (v) all other matters arising out of or related to the
activities of Broker, its employees or agents, involving the Stations or use of
the Licensee Station facilities or relating to the obligations assumed by Broker
in connection with this Agreement including but not limited to any damage caused
to Station equipment by Broker, its employees, or agents. Licensee agrees to
indemnify, defend, and hold harmless Broker and its stockholders, directors,
officers, agents, employees, successors and assigns from and against any and all
liability that arises out of (i) material broadcast by Licensee other than the
Programming, (ii) liabilities (but not loss of advertising revenue) that arise
as a result of Licensee's alteration of any and/or all Programming prior to
broadcast by Licensee; (iii) a breach of Licensee's representations, warranties,
covenants or agreements contained herein; and (iv) the Retained Liabilities.
15.2 PROCEDURES: THIRD PARTY AND DIRECT INDEMNIFICATION
CLAIMS. The indemnified
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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 obligations and liabilities of the parties hereto with respect to
their respective indemnities pursuant to Section 15.1 resulting from any Claim
shall be subject to the following additional terms and conditions:
15.2.1 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.
15.2.2 In the event that the indemnifying party shall
elect not to undertake such defense or opposition, or within ten days after
notice of any such Claim from the indemnified 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).
15.2.3 Anything in this Section 15.2 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
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.
15.2.4 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.
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16. EVENTS OF DEFAULT: CURE PERIODS AND REMEDIES.
16.1. EVENTS OF DEFAULT. The following shall, after the
expiration of the applicable cure periods, constitute Events of Default under
the Agreement:
16.1.1 NON-PAYMENT. Broker's failure to
timely pay the consideration provided for in Section 2 and ATTACHMENT C hereof
which is not cured within five (5) business days following notice in accordance
with Section 16.2 hereof;
16.1.2 DEFAULT IN COVENANTS OR ADVERSE
LEGAL ACTION. The default by any party hereto in the material observance or
performance of any material covenant, condition or agreement contained herein
which is not cured within five (5) business days following notice in accordance
with Section 16.2 hereof, or if (a) any party shall make a general assignment
for the benefit of creditors, (b) any party shall file or have filed against it
a petition for bankruptcy, for reorganization or an arrangement, or for the
appointment of a receiver, trustee or similar creditors' representative for the
property or assets of such party under any federal or state insolvency law,
which, if filed against such party, has not been dismissed or discharged within
sixty (60) days thereof, or (c) specifically and without limitation, if
Licensee's successors and assigns, including, without limitation, any assignee
of the FCC license for the Stations, except if such successor or assign is
Broker or an affiliate of Broker, refuses to abide by or terminates this
Agreement during the term of this Agreement.
16.1.3 BREACH OF REPRESENTATION. If any
material representation or warranty herein made by either party hereto, or in
any certificate or document furnished by either party to the other pursuant to
the provisions hereof, shall prove to have been false in any material respect as
of the time made or furnished and is not cured within thirty (30) days following
notice in accordance with Section 16.2 hereof.
16.1.4 BREACH OF PURCHASE AGREEMENT. The
breach by any party or their affiliates in the observance or performance of any
representation, warranty, covenant, condition or agreement in the Purchase
Agreement which is not cured within any time period provided for such cure under
the Purchase Agreement and which breach gives rise to a right to a party to
terminate the Purchase Agreement pursuant to Section 13.01 of the Purchase
Agreement, provided that no party may use its or its affiliate's own breach
under the Purchase Agreement as grounds to terminate this Agreement.
16.2 CURE PERIODS. An Event of Default shall not be deemed to
have occurred until after the nondefaulting party has provided the defaulting
party with written notice specifying the event or events that if not cured would
constitute an Event of Default and specifying the actions necessary to cure
within the relevant cure period. The Event of Default shall not be deemed to
have occurred if actions necessary to cure are completed during the relevant
cure period.
16.3 TERMINATION UPON DEFAULT. Upon the occurrence of an Event
of Default, the non-defaulting party may terminate this Agreement provided that
it is not also in material default
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hereunder, and may seek such remedies at law and/or equity as are available,
including without limitation specific performance. If Broker has defaulted in
the performance of its obligations, Licensee shall be under no further
obligation to make available to Broker any further broadcast time or broadcast
transmission facilities and, without limitation of remedies, all amounts accrued
or payable to Licensee up to the date of termination which have not been paid,
less any payment credits, shall immediately become due and payable.
16.4 LIABILITIES UPON TERMINATION. Upon termination of this
Agreement, Broker shall be responsible for all liabilities, debts and
obligations of Broker accrued from the purchase of air time and transmission
services including, without limitation, accounts payable, barter agreements and
unaired advertisements, but not for Licensee's federal, state, and local tax
liabilities associated with Broker's payments to Licensee as provided for
herein. With respect to Broker's obligations to broadcast material over the
Stations after termination hereunder, Broker may propose compensation to
Licensee for meeting these obligations, but Licensee shall be under no duty to
accept such compensation or to perform such obligations. Upon termination,
Broker shall return to Licensee any equipment or property of the Stations used
by Broker, its employees or agents, in substantially the same condition and
location as such equipment existed on the date of this Agreement, ordinary wear
and tear excepted, and Broker shall assign to Licensee the still outstanding
Station Agreements that were assigned to Broker pursuant to Section 12 hereof
and any new contracts entered into by Broker relating to the Stations that
Licensee expressly agrees to assume. Notwithstanding anything in the foregoing
to the contrary, termination shall not extinguish any rights of either party as
may be provided by Section 15 hereof.
17. BROKER TERMINATION OPTION. Broker may elect to terminate this
Agreement at any time during the term hereof in the event that Licensee preempts
or substitutes other programming for that supplied by the Broker during ten
percent (10%) or more of the total hours of operation of the Stations during any
calendar month. In the event Broker elects to terminate this Agreement pursuant
to this provision, it shall give Licensee notice of such election at least ten
(10) days prior to the termination date. Upon termination, neither party shall
have any further liability to the other except as may be provided by Sections 15
and 16.4 hereof
18. RESPONSIVE PROGRAMMING. Broker and Licensee mutually acknowledge
their interest in ensuring that the Stations serve the needs and interests of
the residents of the Stations' community of license and service areas and agree
to cooperate in doing so. Licensee shall, on a regular basis, assess the issues
of concern to residents of the Stations' community of license and service areas
and address those issues in its public service programming. Licensee shall
describe those issues and responsive programming and place issues/programs lists
in the Stations' public inspection file as required by FCC rules. The
Programming shall include material that is responsive to the issues identified
by Licensee. Licensee may request, and Broker shall provide, information
concerning such of Broker's Programming that is responsive to community issues
so as to assist Licensee in the satisfaction of its public service programming
obligations. Broker shall also provide to Licensee upon request such other
information necessary to enable Licensee to prepare records and reports required
by the FCC or other local, state or federal government entities.
19. TIME BROKERAGE CHALLENGE. If this Agreement is challenged in whole
or in part at or
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12
by a governmental authority or is challenged in whole or in part in a judicial
forum, counsel for the Licensee and counsel for the Broker shall jointly defend
this Agreement and the parties' performance thereunder throughout all such
proceedings. If this Agreement is declared invalid or illegal in whole or in
substantial part by a ruling, order or decree of a governmental authority or
court, and such ruling, order or decree has become effective, then the parties
shall endeavor in good faith to reform the Agreement as necessary. If the
parties are unable to reform this Agreement within thirty (30) days of the
effective date of such ruling, order or decree, then this Agreement shall
terminate, and all sums owing to Licensee shall be paid and neither party shall
have any further liability to the other except as may be provided by Section 15
hereof.
20. ADDITIONAL REPRESENTATIONS, WARRANTIES AND COVENANTS.
20.1. MUTUAL REPRESENTATIONS, WARRANTIES AND
COVENANTS. Both Licensee and Broker represent that they are legally qualified,
empowered, and able to enter into this Agreement, and that the execution,
delivery and performance hereof shall not constitute a breach or violation of
any agreement, contract or other obligation to which either party is subject or
by which it is bound.
20.2. ADDITIONAL LICENSEE REPRESENTATIONS, WARRANTIES
AND COVENANTS. Licensee makes the following further representations, warranties
and covenants:
20.2.1 AUTHORIZATIONS. During the term of
this Agreement, Licensee shall own and hold all licenses and other permits and
authorizations necessary for the operation of the Stations as presently
conducted (including licenses, permits and authorizations issued by the FCC),
and such licenses, permits and authorizations shall be in full force and effect
for the entire Term hereunder, unimpaired by any acts or omissions of Licensee,
its principals, employees or agents. Licensee hereby makes and incorporates by
reference the representations, warranties and covenants of Sellers set forth in
the Purchase Agreement that pertain to Licensee, its assets or its operation of
the Stations.
20.2.2 PAYMENT OF OBLIGATIONS. Licensee
shall not incur any debt, obligation or liability without the prior written
consent of Broker if such undertaking would adversely affect Licensee's
performance hereunder or the business and operations of the Broker permitted
hereby. Subject to the provisions of Sections 2 and 11 hereof, Licensee shall
pay in a timely fashion all of its debts, assessments and obligations, including
without limitation tax liabilities and payments in each case attributable to the
operations of the Stations, as they come due during the Term of this Agreement.
20.2.3 BROADCAST OBLIGATIONS. Licensee has
no agreement, contract, commitment or understanding to broadcast on the Stations
on or after the Commencement Date, any programs or commercial matter other than
the Station Agreements. Licensee shall not incur any other programming
obligations without the prior written consent of Broker except in connection
with programming obligations incurred by Licensee for programming that replaces
Programming that does not meet the standards set forth in this Agreement.
20.2.4 LICENSEE CONTROL. Licensee hereby
verifies that for the term
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13
of this Agreement it shall maintain ultimate control over the Stations'
facilities, including specifically control over the Stations' finances,
personnel and programming, and nothing herein shall be interpreted as depriving
Licensee of the power or right of such ultimate control.
20.2.5 INSURANCE. Licensee shall maintain in
full force and effect (at Broker's expense) throughout the term of this
Agreement insurance with responsible and reputable insurance companies or
associations covering such risks (including fire and other risks insured against
by extended coverage, public liability insurance, insurance for claims against
personal injury or death or property damage and such other insurance as may be
applicable) and in such amounts and on such terms as is conventionally carried
by broadcasters operating radio stations with facilities in the area comparable
to those of the Stations. Broker shall be listed as an additional insured on
such insurance policies. Any insurance proceeds received by Licensee in respect
of damaged property shall be used to repair or replace such property so that the
operations of the Stations conform with this Agreement. Licensee shall present
to Broker prior to the execution of this Agreement certificates of insurance or
binders for such insurance policies. If requested by Broker, Licensee shall
maintain, at Broker's expense, business interruption insurance for Broker's
benefit.
20.2.6 COMPLIANCE WITH LAW. Licensee
covenants that, throughout the term of this Agreement, Licensee shall comply
with all laws and regulations applicable in the conduct of Licensee's business
and Licensee acknowledges that Broker has not urged, counseled, or advised the
use of any unfair business practice.
20.3 ADDITIONAL BROKER REPRESENTATIONS, WARRANTIES AND
COVENANTS. Broker makes the following further representatives, warranties, and
covenants:
20.3.1 COMPLIANCE WITH 47 C.F.R.
Section 73.3555(a). Broker hereby verifies that execution and performance of
this Agreement complies with the Commission's restrictions on local radio
ownership set out in Section 73.3555(a) of the FCC Rules.
20.3.2 COMPLIANCE WITH APPLICABLE LAW.
Broker covenants that its performance of its obligations under this Agreement
and its furnishing of Programming shall be in compliance with, and shall not
violate, any applicable laws or any applicable rules, regulations, or orders of
the FCC or any other governmental agency and Broker acknowledges that Licensee
has not urged, counseled, or advised the use of any unfair business practice.
20.3.3 HANDLING OF COMPLAINTS. Broker shall
promptly advise Licensee of any public or FCC complaint or inquiry that Broker
receives concerning the Programming on the Stations and shall cooperate with
Licensee and take all actions as may be reasonably requested by licensee in
responding to any such complaint or inquiry.
20.3.4 COPYRIGHT AND LICENSING. Broker has
and shall have throughout the term of this Agreement the full authority to
broadcast the Programming on the Stations and that Broker shall not broadcast on
the Stations any material in violation of the Copyright Act. All music supplied
by Broker shall be: (i) licensed by ASCAP, SESAC or BMI; (ii) in the public
domain; or (iii) cleared at the source by Broker.
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14
20.3.5 INFORMATION FOR FCC REPORTS. Upon
request by Licensee, Broker shall provide in a timely manner any such
information in its possession which shall enable Licensee to prepare, file or
maintain the records and reports required by the FCC.
20.3.6 PAYOLA/PLUGOLA. Broker covenants that
it shall not accept, and shall instruct its employees not to accept, any
consideration, compensation, gift or gratuity of any kind whatsoever, regardless
of its value or form, including, but not limited to, a commission, discount,
bonus, materials, supplies or other merchandise, services or labor, whether or
not pursuant to written contracts or agreements between Broker and merchants or
advertisers, unless the payer is identified in the program as having paid for or
furnished such consideration, in accordance with FCC requirements. Broker agrees
to annually, or more frequently at the request of Licensee, execute and provide
Licensee with an affidavit regarding payola/plugola compliance.
20.3.7 INSURANCE. Broker shall maintain in
full force and effect at its expense throughout the term of this Agreement
insurance with reasonable and reputable insurance companies or associations
covering such risks associated with its activities and the broadcast of its
Programming and in such amounts and on such terms as is conventionally carried
by broadcasters time brokering radio stations comparable to the Station. If
requested by Licensee, Broker shall maintain, at Licensee's expense, business
interruption insurance for Licensee's benefit.
20.3.8 FINANCIAL INFORMATION. For each month
during the term of this Agreement, Broker shall provide to Licensee as soon as
available income statements for the Stations for that month and for the
year-to-date and weekly sales reports for that current month and for the
following two months, each in such form as Broker prepares for its own purposes.
20.3.9 OTHER. Broker hereby makes and
incorporates by reference the representations, warranties and covenants made by
it in the Purchase Agreement.
21. INTELLECTUAL PROPERTY. Effective as of the Commencement Date,
Licensee licenses to Broker the exclusive right to use all intellectual property
owned by or licensed to Licensee and used solely in the operation of the
Stations (including, but not limited to, logos, jingles, promotional materials,
call signs, goodwill, trademarks, service marks, slogans, trade names,
copyrights and any applications and registrations therefor) (the "IP License").
In the event of termination of this Agreement, the IP License shall terminate.
22. SUBCARRIER RIGHTS. Licensee and Broker acknowledge and agree that
any subsidiary communications services transmitted on a subcarrier within the FM
baseband signal of any of the Stations ("Subcarrier"), and any uses, including
uses from any new technologies, of the Subcarrier authorized by the FCC
("Subcarrier Uses"), are subject to the terms and conditions of this Agreement.
Licensee and Broker further acknowledge that if during the term of this
Agreement additional technologies create additional or different capacities on
the Stations, Broker shall have the sole and exclusive right to use such
additional or different capacities during the term hereof. Licensee hereby
agrees (a) to apply, at Broker's expense, for any additional authorization from
the FCC or any other governmental agency or entity that may be necessary in
order to make use of any Subcarrier Uses,
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15
and (b) that Broker has the sole and exclusive right, subject to the terms and
conditions hereof, to make use of any Subcarrier Uses and collect the revenues
therefrom; provided, however, each license for Subcarrier Uses, to the extent
assignable, shall be assigned to Licensee upon termination of this Agreement
because of a termination of the Purchase Agreement and no license for Subcarrier
Uses may extend beyond the term of this Agreement without Licensee's consent,
not to be unreasonably withheld (the withholding of a consent because the
license is not assignable would not be unreasonable). Broker hereby agrees to
reimburse Licensee for Licensee's reasonable expenses incurred in carrying out
Licensee's obligations pursuant to this Section 22, including reasonable
attorneys and engineering fees and expenses.
23. PUBLICITY. Licensee and Broker shall not issue any press release or
otherwise make any public statement with respect to the transactions
contemplated herein except as may be required by law or regulation or as agreed
to by Licensee and Broker.
24. NO WAIVER; REMEDIES CUMULATIVE. No failure or delay on the part of
Licensee or Broker in exercising any right or power hereunder shall operate as a
waiver thereof, nor shall any single or partial exercise of any such right or
power, or any abandonment or discontinuance of steps to enforce such a right or
power, preclude any other or further exercise thereof or the exercise of any
other right or power. The rights and remedies of Licensee and Broker herein
provided are cumulative and are not exclusive of any right or remedies which it
may otherwise have.
25. CONSTRUCTION. This Agreement shall be construed in accordance with
the laws of the State of California, without giving effect to the choice of law
provisions thereunder, and the obligations of the parties hereto are subject to
all federal, state or municipal laws or regulations now or hereafter in force
and to the regulations of the FCC and all other governmental bodies or
authorities presently or hereafter to be constituted.
26. HEADINGS. The headings contained in this Agreement are included for
convenience only and no such heading shall in any way alter the meaning of any
provision.
27. PARTIES IN INTEREST; ASSIGNMENT. All covenants and agreements
contained in this Agreement by or on behalf of any of the parties to this
Agreement shall bind and inure to the benefit of their respective successors and
assigns, whether so expressed or not. No party to this Agreement may assign its
rights or delegate its obligations under this Agreement to any other person or
entity without the express prior written consent of the other parties, except
that (i) Broker may assign its rights and delegate its obligations to one or
more subsidiary or affiliated corporation of Broker; provided, however, that
Broker shall remain fully liable as to all of its obligations and agreements
whether or not delegated or assigned; (ii) in the event that Broker finds it
necessary or is required to provide to a third party a collateral assignment of
Broker's interest in this Agreement or any related documents, Licensee will
cooperate with Broker and any third party requesting such assignment including
but not limited to signing a consent and acknowledgment of such assignment;
provided, however, that Broker shall remain fully liable as to all of its
obligations and agreements whether or not delegated or assigned; and (iii) in
the event that Licensee finds it necessary or is required pursuant to its
existing credit facility to provide to a third party a collateral assignment of
Licensee's interest in this Agreement or any related documents, Broker will
cooperate with Licensee and any third party
-15-
16
requesting such assignment including but not limited to signing a consent and
acknowledgment of such assignment; provided, however, that Licensee shall remain
fully liable as to all of its obligations and agreements whether or not
delegated or assigned.
28. NOTICES. All notices, demands, requests, or other communications
which may be or are required to be given or made by any party to any other party
pursuant to this Agreement shall be in writing and shall be hand delivered,
mailed by first-class registered or certified mail, return receipt requested,
postage prepaid, delivered by overnight air courier, or transmitted by telegram,
telex, or facsimile transmission addressed in accordance with the listing set
forth in ATTACHMENT F hereto or such other address as the addressee may indicate
by written notice to the other parties. Each notice, demand, request, or
communication which shall be given or made in the manner described above shall
be deemed sufficiently given or made for all purposes at such time as it is
delivered to the addressee (with the return receipt, the delivery receipt, the
affidavit of messenger or (with respect to a telex or facsimile) the answerback
being deemed conclusive but not exclusive evidence of such delivery) or at such
time as delivery is refused by the addressee upon presentation.
29. ENTIRE AGREEMENT. This Agreement and the Purchase Agreement and
related documents embody the entire agreement between the parties and there are
no other agreements, representations, warranties, or understandings, oral or
written, between them with respect to the subject matter hereof. No alterations,
modification or change of this Agreement shall be valid unless made in writing,
and signed by like written instrument. No waiver of any provision hereof shall
be valid unless in writing and signed by the party adversely affected by the
waiver, and then such waiver shall be effective only in the specified instance
and for the purpose for which given.
30. SEVERABILITY. In the event that any of the provisions contained in
this Agreement is held to be invalid, illegal or unenforceable such event shall
not affect any other provision hereof, and this Agreement shall be construed as
if such invalid, illegal or unenforceable provisions had not been contained
herein.
31. COUNTERPART SIGNATURES. This Agreement may be signed in one or more
counterparts, each of which shall be deemed a duplicate original, binding on the
parties hereto notwithstanding that the parties are not signatory to the
original or the same counterpart. This Agreement shall be binding and effective
as of the date on which the executed counterparts are exchanged by the parties.
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17
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
THE PARK LANE GROUP
PARK LANE SUBSIDIARIES LISTED ON
ATTACHED A HERETO
By: /s/
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
REGENT COMMUNICATIONS, INC.
By: /s/
----------------------------------------
Name:
--------------------------------------
Title:
-------------------------------------
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18
TIME BROKERAGE AGREEMENT
ATTACHMENT A
Park Lane Subsidiaries
Subsidiary State of Incorporation Registered Foreign Corp.
---------- ---------------------- ------------------------
Park ▇▇▇▇ ▇▇▇▇▇▇▇ Radio, Inc. California None
Park Lane Chico, Inc. California None
Park Lane Regency Radio, Inc. California Arizona
Park Lane High Desert, Inc. California None
Park Lane Northern Arizona, Inc. California Arizona
19
TIME BROKERAGE AGREEMENT
ATTACHMENT B
Radio Stations Subject to this Agreement
Call Letters City of License Frequency Type
------------ --------------- --------- ----
KQMS Redding, CA 1400 Class C AM Broadcast
KB-96917 R/P Mobile
KSHA Redding, CA 104.3 Class C FM Broadcast
K272CQ FM Broadcast Translator
KPH-938 R/P Base
WHA-968 Aural STL
KALF Red Bluff, CA 95.7 Class B FM Broadcast
WFD-411 Aural STL
KPL-737 R/P Base
▇▇-▇▇▇▇▇ ▇/▇ ▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇, ▇▇ 93.9 Class ▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇-▇▇▇ ▇▇▇▇▇ ▇▇▇
KPG-980 R/P Base
KC-62804 R/P Mobile
BLP01008 Low Power Broadcast
KPPL Colusa, CA 107.5 Class B FM Broadcast
K300AD FM Broadcast Translator
▇▇▇-▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇-▇▇▇ ▇▇▇▇▇ ▇▇▇
▇▇▇-▇▇▇ R/P Base
KC-23104 R/P Mobile
KTMX-FM1 Booster
KOWL So. Lake Tahoe, CA 1490 Class C AM Broadcast
KA-74965 R/P Mobile
KRLT So. Lake Tahoe, CA 93.9 Class A FM Broadcast
WLO-776 Aural STL
KTPI Tehachapi, CA 103.1 Class A FM Broadcast
WHQ-289 Aural STL
KC-27776 R/P Mobile
KTPI-FM1 Booster
KVOY Mojave, CA 1340 Class C AM Broadcast
WLO-496 Aural STL
WLO-491 Aural STL
KPK-915 R/P Mobile
KROY Victorville, CA 1590 Class D AM Broadcast
KATJ ▇▇▇▇▇▇, CA 100.7 Class A FM Broadcast
WLO-759 Aural STL
KAAA Kingman, AZ 1230 Class C AM Broadcast
KJG-600 R/P Base
KJG-601 R/P Base
KKN-690 R/P Base/Mobile
KZZZ Kingman, CA 94.7 Class C FM Broadcast
WLG-546 Aural STL
KPH-745 R/P Base
KZGL Cottonwood, AZ 95.9 Class ▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇ ▇▇▇▇▇ ▇ ▇▇ ▇▇▇▇▇▇▇▇▇
▇▇▇▇ ▇▇▇▇▇▇▇▇▇, ▇▇ 97.5 Class C FM Broadcast
WLI-505 Aural STL
KPH-485 R/P Base
20
TIME BROKERAGE AGREEMENT
ATTACHMENT C
During the Term of this Agreement, starting on the Commencement Date,
Broker shall pay to Licensee for each month, pro-rated in the event of a partial
month, a monthly fee equal to Broker's Actual Broadcast Cash flow for the
Stations (as defined below) but in no event less than Licensee's Minimum
Broadcast Cash Flow (as defined below) for that month.
Broker's Actual Broadcast Cash Flow shall mean net revenue, excluding
trade and barter revenue, from the sale of advertising time by Broker on the
Stations, plus all other income generated by Broker from the Stations, less
Broker's costs (operating expenses) for actual Station operations, excluding
trade and barter expenses, relating to the Stations, but not including any such
operating expenses for extraordinary activities of Broker which were not
previously budgeted by Licensee for the period, and excluding depreciation and
amortization, interest and corporate overhead, all computed in accordance with
Licensee's historical methods for computing its financial statements.
Licensee's Minimum Broadcast Cash Flow shall mean 82.5% of the sum of
(a) the cumulative average monthly amount of Licensee's budgeted station
operating income for the month of August, 1997 and months thereafter (if the
Applicable Period includes months during 1998, the budgeted amount for that
month during 1997 shall be used) to the applicable computation date (the
"Applicable Period") as shown on the Consolidated ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ Budget attached
hereto as Attachment C-1, plus (b) the cumulative average monthly amount of
Licensee Employee Expenses and Licensee Transmitter Expenses (but excluding
unbudgeted costs for capital improvements and replacements necessary or
appropriate to maintain the facilities of the Stations) paid by Licensee during
the Applicable Period, but not including any depreciation, amortization,
interest or corporate overhead, all computed in accordance with Licensee's
historical methods for computing its financial statements.
Broker shall pay to Licensee at the beginning of each month of the Term
an amount equal to the sum of Licensee's budgeted station operating income for
that month pus Licensee's budget for Licensee Employee Expenses and Licensee
Transmitter Expenses. Commencing with the beginning of the third month of the
Term, each monthly payment shall be adjusted to reflect Broker's Actual
Broadcast Cash Flow or Licensee's Minimum Broadcast Cash Flow, whichever shall
be greater, for the month two months prior, and an adjustment shall be made to
the payment made by Broker to Licensee at the beginning of the third month of
the Term and each succeeding month during the Term to reflect actual amounts due
to Licensee for the month two months prior; provided, however, if there have
been operating expenses of Broker from extraordinary activities excluded from
the calculation of Broker's Actual Broadcast Cash Flow and if for the term of
this Agreement the aggregate amount of Broker's Actual Broadcast Cash Flow
exceeds the aggregate of the sum of Licensee's budgeted station operating
income, Licensee Employee Expenses, and Licensee Transmitter Expenses, then the
excess amount shall be retained by Broker and not included in the fee due
Licensee. At the termination of this Agreement, all remaining adjustments to
estimated payments made to Licensee shall be made as soon as practicable, but in
no event later than 45 days after the termination of this Agreement.
21
TIME BROKERAGE AGREEMENT
ATTACHMENT D
CORPORATE CONTRACTS TO BE ASSUMED BY BROKER
-------------------------------------------
None.
22
TIME BROKERAGE AGREEMENT
ATTACHMENT E
PROGRAMMING POLICIES
--------------------
Broker will comply with and the Programming shall be consistent with
the following policies:
I. Respectful of Faiths. The subject of religion and references
to particular faiths and tenets shall be treated with respect
at all times. None of the Stations will be used as a medium
for attack on any faith, discrimination or sect upon any
individual or organization.
II. Controversial Issues. Any discussion of controversial issues
of public importance shall be reasonably balanced with the
presentation of contrasting viewpoints in the course of
overall programming; no attacks on the honesty, integrity, or
like personal qualities of any person or group of persons
shall be made during the course of political campaigns; and
Station programs (other than public forum or talk features)
are not to be used as a forum for editorializing about
individual candidates. If such events occur, Licensee may
require that responsive programming be aired. In the event
that a statute, regulation or policy is adopted that requires
the airing of responsive programming, programmer agrees to
comply with such statute, regulation or policy and will
prepare such responsive programming.
III. Donation Solicitation. Requests for donations in the form of a
specific amount shall not be made if there is any suggestion
that such donation will result in miracles, physical cures or
life-long prosperity. However, statements generally requesting
donations to support a broadcast or church are permitted.
IV. Treatment of Parapsychology. The advertising or promotion of
fortune telling, occultism, astrology, phrenology, palm
reading, or numerology, mind-reading, character readings, or
subjects of the like nature will not be broadcast.
V. No Ministerial Solicitations. No invitations by a minister or
other individual appearing on the program to have listeners
come and visit him or her for consultation or the like shall
be made if such invitation implies that the listeners will
receive consideration, monetary gain, or physical cures for
illness.
VI. No Vending of Miracles. Any exhortation to listeners to bring
money to a church affair or service containing any suggestion
that miracles, physical cures, or prosperity will result is
prohibited.
VII. Sale of Religious Artifacts. The offering for sale of
religious artifacts or other items for which listeners would
send money is prohibited unless such items are normally
available in ordinary commerce or are clearly being sold for
proper fund-raising
23
purposes.
VIII. No Miracle Solicitation. Any invitation to listeners to meet
at places other than a church and/or to attend other than
regular services of a church is prohibited if the invitation,
meeting, or service contains any claim that miracles, physical
cures or prosperity will result.
IX. No Plugola or Payola. The mention of any business activity or
"plug" for any commercial, professional, or other related
endeavor, except where contained in an actual commercial
message of a sponsor, or otherwise lawful, is prohibited. No
commercial messages (plugs) or undue references shall be made
in programming presented over the Stations to any business
venture, profit making activity or other interest (other than
noncommercial announcements for bona fide charities, church
activities or other public service activities) in which Broker
is directly or indirectly interested without the same having
been approved in advance by the Stations' respective Managers
and such broadcast being announced as sponsored material.
X. No Lotteries. Announcements giving any information about
lotteries or games prohibited by federal or state law or
regulations are prohibited.
XI. No Gambling. References to "dream books," the "straight
line," or other direct or indirect descriptions or
solicitations relative to the "numbers game," or the "policy
game," or any other form of gambling are prohibited.
XII. No Numbers Games. References to chapter and verse paragraphs,
paragraph numbers, or song numbers, which involve three digits
should be avoided and, when used, must reasonably relate to a
non-gambling activity.
XIII. Political Programming. At least 90 days before the start of
any election campaign, Broker will review with the Stations'
Managers the rates that will be charged for the time to be
sold to candidates for public office of their supporters to
make certain that such rates conform with applicable law and
Station policy.
XIV. Required Announcements. Programmer shall broadcast an
announcement in form satisfactory to Licensee at the beginning
of each hour to identify the Station and any other
announcement that may be required by law, regulation or
Station policy.
XV. Credit Terms Advertising. Unless all applicable state and
federal guidelines relative to disclosure to credit terms are
complied with, no advertising of credit terms will be made
over the Stations beyond mention of the fact that, if desired,
credit terms are available.
XVI. No Illegal Announcements. No announcement or promotion
prohibited by federal or state law or regulation of any
lottery or game shall be made over the Stations.
24
XVII. Licensee Discretion Paramount. In accordance with Licensee's
responsibility under the Communications Act of 1934, as
amended, and the rules and regulations of the FCC, Licensee
reserves the right to reject or terminate any advertising or
programming being presented over the Stations which is in
conflict with Station policy or which in Licensee's sole but
reasonable judgment would not serve the public interest.
XVIII. Programming Prohibitions. Programmer shall not knowingly
broadcast any of the following programs or announcements:
A. False Claims. False or unwarranted claims for any
product or service.
B. Unfair Imitation. Infringements of another
advertiser's rights through plagiarism or unfair
imitation of either program idea or copy, or any
other unfair competition.
C. Commercial Disparagement. Any unfair disparagement of
competitors or competitive goods.
D. Indecency, Obscenity, Profanity. Any programs or
announcements that are slanderous, obscene, indecent,
profane, vulgar, repulsive or offensive, either in
theme or treatment.
E. Unauthenticated Testimonials. Any testimonials which
cannot be authenticated.
F. Descriptions of Bodily Functions. Any presentation
which describes in a repellent manner bodily
functions.
G. Conflicting Advertising. Any advertising matter or
announcement which may, in the opinion of Licensee,
be injurious or prejudicial to the interests of the
public or the Stations, or to honest advertising and
reputable business in general.
H. Contests. Any contests or promotions which are in any
way misleading or constitute a public nuisance or are
likely to lead to injury to persons or property.
I. Telephone Conversations. Any programming in violation
of any statute, regulation or policy, including
without limitation to, Section 73.1206 of the FCC's
rules, or any successor regulation, dealing with the
taping and/or broadcast of telephone conversations.
In any case where obvious questions of policy or interpretation arise,
programmer will submit
25
the same to the general manager of the station for decision before any broadcast
of such material.
26
TIME BROKERAGE AGREEMENT
ATTACHMENT F
If the notice is to Licensee:
The Park Lane Group
▇▇▇ ▇▇▇▇▇ ▇▇▇., ▇▇▇▇▇ ▇▇▇
▇▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇
Telecopy No: (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to (which shall not constitute notice):
▇▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇ & ▇▇▇▇▇▇
▇▇▇ ▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇, ▇▇. ▇▇▇▇▇
Attention: ▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇▇▇▇, Esq.
Telecopy No: (▇▇▇) ▇▇▇-▇▇▇▇
If the notice is to Broker:
Regent Communications, Inc.
▇▇ ▇▇▇▇ ▇▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇.
▇▇▇▇▇ ▇▇▇
▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy No. (▇▇▇) ▇▇▇-▇▇▇▇
With a copy to (which shall not constitute notice):
▇▇▇▇▇▇▇ & ▇▇▇▇
2100 PNC Center
▇▇▇ ▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Telecopy No: (▇▇▇) ▇▇▇-▇▇▇▇
27
TIME BROKERAGE AGREEMENT
ATTACHMENT G
LICENSEE'S RETAINED EMPLOYEES
-----------------------------
(Subject to adjustment prior to Commencement Date)
MARKET EMPLOYEES
------ ---------
Redding ▇▇▇▇▇ ▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
Chico ▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇▇▇
Tahoe ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Palmdale ▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Victorville ▇▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
Kingman ▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇
Flagstaff ▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇ ▇▇▇▇▇▇
28
TIME BROKERAGE AGREEMENT
ATTACHMENT H
COMMISSIONS
-----------
Licensee's sales personnel and certain of Licensee's managers receive
commissions based on sales of advertising time for the Stations. Licensee has
previously provided to Broker a listing of such sales commissions and statements
of its sales policies.
Sales personnel of Licensee generally are paid commissions based on
monthly net sales ▇▇▇▇▇▇▇▇ for advertising time run on the Stations each month,
subject to charge back if accounts receivable are not collected within 90 days,
with reinstatement of charge back amounts if accounts receivable are collected
between 90 and 120 days. All commissions due to sales personnel as a result of
▇▇▇▇▇▇▇▇ for advertising time run on the Stations prior to the Commencement Date
will be paid directly by Licensee to such sales personnel on or before the first
payroll period AFTER the Commencement Date. To the extent that any commissions
due for ▇▇▇▇▇▇▇▇ for advertising time run on the Stations prior to the
Commencement Date are paid by Broker to sales personnel after the Commencement
Date, Broker may deduct such commissions from amounts collected on behalf of
Licensee prior to remitting such collections to Licensee. Broker may deduct only
such amounts as it pays to sales personnel who were employed by Licensee
immediately prior to the Commencement Date, are due such commissions by virtue
of their employment by Licensee prior to the Commencement Date, and are hired by
Broker. Broker shall make payment of such commissions to each employee to whom
such commissions are due on a payroll schedule consistent with that employed by
Licensee prior to the Commencement Date.
Certain of Licensee's managers receive commissions based on monthly
collections of cash accounts receivable. All commissions due to such managers
based on collections prior to the Commencement Date will be paid directly by
Licensee to such managers on or before the first payroll period after the
Commencement Date. Broker shall pay directly to such managers any commissions
due on collections of Licensee's accounts receivable which are made by Broker on
Licensee's behalf on or after the Commencement Date and may deduct such
commissions from amounts collected on behalf of Licensee prior to remitting such
collections to Licensee. Broker may deduct only such amounts as it pays to
Licensee's managers who were employed by Licensee immediately prior to the
Commencement Date, are hired by Broker, and would be due such commissions by
virtue of their employment with Licensee prior to the Commencement Date. Broker
shall make payment of such commissions to each manager to whom such commissions
are due on a payroll schedule consistent with that employed by Licensee prior to
the Commencement Date.
29
FIRST AMENDMENT
TO
TIME BROKERAGE AGREEMENT
This First Amendment (the "Amendment") to Time Brokerage Agreement
entered into this 2nd day of February, 1998, amends that certain Time Brokerage
Agreement, dated June 16, 1997 (the "Agreement"), by and among THE PARK LANE
GROUP ("Park Lane"), its subsidiaries, and REGENT COMMUNICATIONS, INC.
("Broker").
WHEREAS, Broker and the shareholders of Park Lane have negotiated terms
and conditions related to an extension of the Closing Date of the purchase by
Broker of all of the issued and outstanding capital stock of Park Lane; and
WHEREAS, included among the terms of such extension is a modification
of responsibilities for the maintenance of equipment and property of the
Licensee and of the fees and expenses payable to the Licensee under the terms of
the Agreement; and
WHEREAS, Broker, on behalf of itself and certain of its subsidiaries,
and Park Lane desire to amend the Agreement to reflect such modifications;
NOW, THEREFORE, it is hereby agreed that the Agreement is hereby
amended as follows:
1. Section 11 of the Agreement is hereby amended to the effect
that effective on and after January 1, 1998, except as otherwise
provided in Section 14.13 of the Purchase Agreement, the maintenance
and repair of the transmission and other technical equipment, including
capital improvements and replacements deemed necessary or appropriate
in the reasonable discretion of Broker to maintain the facilities of
the Stations in their same condition, reasonable wear and tear
excepted, shall be the responsibility of Broker at Broker's expense for
the balance of the Term (except for conditions requiring repair or
replacement existing on December 31, 1997).
2. The Agreement is further amended by the substitution for
Attachment C of Attachment C-A attached hereto, and all references in
the Agreement to Attachment C shall mean Attachment C-A.
3. Broker hereby acknowledges that, as of the date hereof, it
has no actual knowledge of the existence of any Event of Default as a
result of any breach by Licensee under any representation, warranty,
covenant or other obligation under the Agreement which has not been
waived in writing signed by Broker. Actual knowledge of Broker shall
mean the actual knowledge of Broker's officers after they have made due
inquiry of the employees, representatives and agents of Broker who
would be expected to have knowledge of the matter, and with respect to
the condition of any Station Assets, records or other object, after
either Broker's officers and/or employees, representatives or agents of
Broker have inspected it.
30
4. Broker hereby acknowledges that the aggregate net value of
the Stations' Barter Payable, as reflected on the Commencement Date
Trade Report, and as offset by the aggregate net value of the Barter
Receivable, as reflected on the Commencement Date Trade Report, has
been reduced as of December 31, 1997 to below $50,000 and Broker hereby
waives any claim for credits under Section 14.2 of the Agreement.
This Amendment 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. This Amendment and a
contemporaneous amendment to the Purchase Agreement embody the entire agreement
and understanding of the parties and supercede any and all prior agreements and
understandings relating to the matters specifically covered herein. Except as
amended hereby, the terms and conditions of the Agreement remain in full force
and effect.
This Amendment has been duly authorized, validly executed, and delivered
and constitutes the valid and binding agreement of the parties hereto. All
capitalized terms used herein and not otherwise defined have the meaning
ascribed to them in the Agreement.
IN WITNESS WHEREOF, the parties have executed this Amendment as of the
date first written above.
REGENT COMMUNICATIONS, INC. THE PARK LANE GROUP
and each of the subsidiaries of and each of the PARK LANE
Regent Communications, Inc. which is SUBSIDIARIES listed on Attachment A to
an assignee thereof under the Agreement the Agreement
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇ By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇
-------------------------------------- -----------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇ ▇▇▇▇▇ ▇. ▇▇▇▇
Chairman and Chief Executive Officer President
31
TIME BROKERAGE AGREEMENT
ATTACHMENT C-A
During the Term of this Agreement Broker shall pay to Licensee a
monthly fee as follows:
1997
Starting on the Commencement Date to and including December 31, 1997,
Broker shall pay to Licensee for each month, pro-rated in the event of a partial
month, a monthly fee equal to Broker's Actual Broadcast Cash flow for the
Stations (as defined below) but in no event less than Licensee's Minimum
Broadcast Cash Flow (as defined below) for that month.
Broker's Actual Broadcast Cash Flow shall mean net revenue, excluding
trade and barter revenue, from the sale of advertising time by Broker on the
Stations, plus all other income generated by Broker from the Stations, less
Broker's costs (operating expenses) for actual Station operations, excluding
trade and barter expenses, relating to the Stations, but not including any such
operating expenses for extraordinary activities of Broker which were not
previously budgeted by Licensee for the period, and excluding depreciation and
amortization, interest and corporate overhead, all computed in accordance with
Licensee's historical methods for computing its financial statements.
Licensee's Minimum Broadcast Cash Flow shall mean 82.5% of the sum of
(a) the cumulative average monthly amount of Licensee's budgeted station
operating income for the month of August, 1997 and months thereafter to the
applicable computation date (the "Applicable Period") as shown on the
Consolidated ▇▇▇▇ ▇▇▇▇ ▇▇▇▇ Budget attached hereto as Attachment C-1, plus (b)
the cumulative average monthly amount of Licensee Employee Expenses and Licensee
Transmitter Expenses (but excluding unbudgeted costs for capital improvements
and replacements necessary or appropriate to maintain the facilities of the
Stations) paid by Licensee during the Applicable Period, but not including any
depreciation, amortization, interest or corporate overhead, all computed in
accordance with Licensee's historical methods for computing its financial
statements.
Broker shall pay to Licensee at the beginning of each month of the Term
through December 31, 1997 an amount equal to the sum of Licensee's budgeted
station operating income for that month plus Licensee's budget for Licensee
Employee Expenses and Licensee Transmitter Expenses. Commencing with the
beginning of the third month of the Term, each monthly payment shall be adjusted
to reflect Broker's Actual Broadcast Cash Flow or Licensee's Minimum Broadcast
Cash Flow, whichever shall be greater, for the month two months prior, and an
adjustment shall be made to the payment made by Broker to Licensee at the
beginning of the third month of the Term and each succeeding month during the
Term to and including the payment due December 1, 1997 to reflect actual amounts
due to Licensee for the month two months prior; provided, however, if there have
been operating expenses of Broker from extraordinary activities excluded from
the calculation of Broker's Actual Broadcast Cash Flow and if for the Term of
this Agreement the aggregate amount of Broker's Actual Broadcast Cash Flow
exceeds the aggregate of the sum of Licensee's budgeted station operating
income, Licensee Employee Expenses, and Licensee Transmitter Expenses, then the
excess amount shall be retained by Broker and not included in the fee due
Licensee. A similar adjustment to reflect actual amounts due to Licensee for the
months of
32
November and December, 1997 shall be made on the Termination Date (and if that
is the Closing Date as defined in the Purchase Agreement, the adjustment shall
be made by including the amount of the adjustment as a Liability of Park Lane if
in favor of Broker and as an Asset if in favor of Park Lane on the Closing
Statement).
1998
Starting on January 1, 1998 to and including the Termination Date,
Broker shall pay to Licensee for each month, pro-rated in the event of a partial
month, a monthly fee equal to the sum of Licensee's actual or accrued
out-of-pocket (a) Licensee Employee Expenses, (b) Licensee Transmitter Expenses,
(c) corporate expenses necessarily incurred by Park Lane because of the
extension of the Closing Date beyond December 31, 1997, and (d) interest expense
on Park Lane's senior and subordinated debt in the amount of $6,558,689.09 for
the period from January 1, 1998 to the Termination Date.
Broker shall pay to Licensee at the beginning of each month of the Term
beginning with January, 1998 the amount of $158,000 which constitutes an
estimate of the sum of Licensee's expected monthly expenses of the nature
described above. As soon as practicable after the Termination Date, an
adjustment to the estimated payments made to Licensee for the 1998 period shall
be made to reflect actual amounts due to Licensee for such period, supported by
such documentation as Broker may reasonably request. If the Termination Date is
the Closing Date, as defined in the Purchase Agreement, the adjustment in
Broker's favor shall be made by including the amount of the adjustment as a
Liability of Park Lane on the Closing Statement.
For purposes of this Agreement, corporate expenses necessarily incurred
by Park Lane shall include only those expenses which Park Lane is obligated to
incur to retain its limited staff consistent with existing arrangements and
benefits, to protect its properties, to continue its existence, to meet its
currently existing contractual obligations, and to comply with applicable law,
it being the intent that expenses of a discretionary nature, as opposed to
necessary, will not be included. The parties hereto acknowledge that expenses
which are of the same nature as those expenses incurred during the three month
period ended December 31, 1997 and disclosed to Broker in writing prior to the
date hereof and which are incurred by Park Lane in the exercise of reasonable
business judgment in the context of this Agreement shall constitute expenses
necessarily incurred within the meaning of this Agreement. In no event, however,
may Park Lane's actual corporate expenses for purposes of the fee exceed $47,000
for any month.
At the termination of this Agreement, all remaining adjustments to
estimated payments made to Licensee shall be made as soon as practicable, but in
no event later than 45 days after the termination of this Agreement.
In the event Park Lane should prepay any of its necessary corporate
expenses for a period extending beyond the current month or should pay for the
cost of repair or maintenance of the Stations' facilities which this Agreement
requires Broker to have preformed, Broker shall promptly reimburse Licensee for
such payments upon receipt from Park Lane of statements therefor, supported by
such documentation as Broker may reasonably request.
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