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EXHIBIT 10.39.3
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EXHIBIT 10.39.3
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TIME BROKERAGE AGREEMENT
BY AND BETWEEN
▇▇▇▇▇▇▇▇▇ MEDIA, INC.
AND
▇▇▇▇▇▇ COMMUNICATIONS OF CLEVELAND-67, INC.
FOR
TELEVISION STATION WOAC(TV), CANTON, OHIO
OCTOBER 30, 1995
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TABLE OF CONTENTS
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SECTION 1. LEASE OF STATION AIR TIME . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.1 Representations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.2 Effective Date; Term . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.3 Scope . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 1
1.4 Option to Renew . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.5 Consideration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.6 Licensee Operation of Station . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.7 Licensee Representations and Warranties . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 2
1.8 Programmer Responsibility . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
1.9 Contracts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
SECTION 2. STATION OBLIGATIONS TO ITS COMMUNITY OF LICENSE . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.1 Licensee Authority . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 3
2.2 Additional Licensee Obligations . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
2.3 Responsibility for Employees and Expenses . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
SECTION 3. STATION PROGRAMMING POLICIES . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.1 Broadcast Station Programming Policy Statement . . . . . . . . . . . . . . . . . . . . . . . . . . . 4
3.2 Licensee Control of Programming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.3 Programmer Compliance with Copyright Act . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.4 Sales . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 5
3.5 Children's Television Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.6 Payola . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.7 Cooperation on Programming . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 6
3.8 Staffing Requirements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 4. INDEMNIFICATION . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.1 Programmer's Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.2 Licensee's Indemnification . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.3 Limitation . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
4.4 Time Brokerage Challenge . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 7
SECTION 5. ACCESS TO PROGRAMMER MATERIALS AND CORRESPONDENCE . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.1 Confidential Review . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
5.2 Political Advertising . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
SECTION 6. TERMINATION AND REMEDIES UPON DEFAULT . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
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6.1 Termination . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 8
6.3 Force Majeure . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 9
6.4 Other Agreements . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
SECTION 7. MISCELLANEOUS . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
7.1 Assignment . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 10
7.2 Call Letters . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.3 Counterparts . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.4 Entire Agreement . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.5 Taxes . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.6 Headings . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.7 Governing Law . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.8 Notices . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 11
7.9 Severability . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
7.10 Arbitration . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 12
7.11 No Joint Venture . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . . 13
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TIME BROKERAGE AGREEMENT
TIME BROKERAGE AGREEMENT, made this 30 th day of October, 1995, by and
between ▇▇▇▇▇▇▇▇▇ MEDIA, INC., a Florida corporation (the "Licensee") and ▇▇▇▇▇▇
COMMUNICATIONS OF CLEVELAND-67, INC., a Florida corporation (the "Programmer").
WHEREAS, Licensee is seeking to acquire Television Station WOAC(TV),
Canton, Ohio (the "Station") pursuant to authorizations issued by the Federal
Communications Commission ("FCC").
WHEREAS, Programmer is involved in television station ownership and
operation.
WHEREAS, the Licensee wishes to retain Programmer to provide
programming for the Station that is in conformity with Station policies and
procedures, FCC policies for time brokerage arrangements, and the provisions
hereof.
WHEREAS, Programmer agrees to use the Station to broadcast such
programming of its selection that is in conformity with all rules, regulations
and policies of the FCC, subject to Licensee's full authority to manage and
control the operation of the Station.
WHEREAS, Programmer and Licensee agree to cooperate to make this Time
Brokerage Agreement work to the benefit of the public and both parties and as
contemplated in this Agreement.
NOW, THEREFORE, in consideration of the above recitals and mutual
promises and covenants contained herein, the parties, intending to be legally
bound, agree as follows:
SECTION 1. LEASE OF STATION AIR TIME
1.1 Representations. Both Licensee and Programmer 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 material agreement, contract or other obligation to
which either party is subject or by which it is bound.
1.2 Effective Date; Term. The effective date of this Agreement
shall be the date of consummation of Licensee's acquisition of the Station
following FCC approval (the "Closing"). It shall continue in force for an
initial term of ten years from that date unless otherwise extended or
terminated as set forth below.
1.3 Scope. During the term of this Agreement and any renewal
thereof, Licensee shall make available to Programmer broadcast time upon the
Station as set forth in this Agreement. Programmer shall deliver such
programming, at its expense, to the Station's transmitter facilities or other
authorized remote control points as reasonably designated by Licensee. Subject
to Licensee's reasonable approval, as set forth in this Agreement,
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Programmer shall provide programming of Programmer's selection complete with
commercial matter, news, public service announcements and other suitable
programming to the Licensee up to ninety-eight hours per week. Notwithstanding
the foregoing, the Licensee may designate such additional time as it may
require without any adjustment of the monthly consideration to be paid to
Licensee under Section 1.5 for the broadcast of programming necessary for the
Station to broadcast news, public affairs, children's, religious and
non-entertainment programming as required by the FCC. All program time not
reserved by or designated for Licensee shall be available for use by Programmer
and no other party.
1.4 Option to Renew. Subject to the termination provisions of
Section 6 hereof, this Agreement may be renewed for an additional term as
mutually agreed upon by the Licensee and the Programmer.
1.5 Consideration. As consideration for the air time made
available hereunder Programmer shall make payments to Licensee as set forth in
Attachment I.
1.6 Licensee Operation of Station. Licensee will have full
authority, power and control over the management and operations of the Station
during the term of this Agreement and during any renewal of such term.
Licensee will bear all responsibility for Station's compliance with all
applicable provisions of the Communications Act of 1934, as amended, (the
"Act") the rules, regulations and policies of the FCC and all other applicable
laws. Licensee shall be solely responsible for and pay in a timely manner all
operating costs of the Station, including but not limited to maintenance of the
studio and transmitting facility and costs of electricity, except that
Programmer shall be responsible for the costs of its programming as provided in
Sections 1.8 and 2.3 hereof. Licensee shall employ at its expense management
level and other employees consisting of a General Manager and such operational
and other personnel as outlined in the budget previously provided to
Programmer, who will direct the day-to-day operations of the Station, and who
will report to and be accountable to the Licensee. Licensee shall be
responsible for the salaries, taxes, insurance and related costs for all
personnel employed by the Station and shall maintain insurance satisfactory to
Programmer covering the Station's transmission facilities. During the term of
the Agreement and any renewal hereof, Programmer agrees to perform, without
charge, routine monitoring of the Station's transmitter performance and tower
lighting by remote control, if and when requested by Licensee.
1.7 Licensee Representations and Warranties. Licensee represents
and warrants as follows:
(a) Licensee owns and holds or will hold all licenses and
other permits and authorizations necessary for the operation of the Station,
and such licenses, permits and authorizations are and will be in full force and
effect throughout the term of this Agreement. There is not now pending, or to
Licensee's best knowledge, threatened, any action by the FCC or by any other
party to revoke, cancel, suspend, refuse to renew or modify adversely any of
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such licenses, permits or authorizations. Licensee is not in material
violation of any statute, ordinance, rule, regulation, policy, order or decree
of any federal, state or local entity, court or authority having jurisdiction
over it or the Station, which would have an adverse effect upon the Licensee,
the Station or upon Licensee's ability to perform this Agreement. Licensee
shall not take any action or omit to take any action which would have an
adverse impact upon the Licensee, the Station or upon Licensee's ability to
perform this Agreement. All reports and applications required to be filed with
the FCC or any other governmental body have been, and during the course of the
term of this Agreement or any renewal thereof, will be filed in a timely and
complete manner. During the term of this Agreement and any renewal thereof,
Licensee shall not dispose of, transfer, assign or pledge any of Licensee's
assets and properties except with the prior written consent of the Programmer,
if such action would adversely affect Licensee's performance hereunder or the
business and operations of Licensee or the Station permitted hereby.
(b) Licensee shall pay, in a timely fashion, all of the
expenses incurred in operating the Station including salaries and benefits of
its employees, lease payments, utilities, taxes, programming expenses, etc., as
set forth in Attachment II (except those for which a good faith dispute has
been raised with the vendor or taxing authority), and shall provide Programmer
with a certificate of such timely payment within thirty (30) days of the end of
each month.
1.8 Programmer Responsibility. Programmer shall be solely
responsible for any expenses incurred in the origination and/or delivery of
programming from any remote location and for any publicity or promotional
expenses incurred by Programmer, including, without limitation, ASCAP and BMI
music license fees for all programming provided by Programmer. Such payments
by Programmer shall be in addition to any other payments to be made by
Programmer under this Agreement.
1.9 Contracts. Programmer will enter into no third-party
contracts, leases or agreements which will bind Licensee in any way except with
Licensee's prior written approval.
SECTION 2. STATION OBLIGATIONS TO ITS COMMUNITY OF LICENSE
2.1 Licensee Authority. Notwithstanding any other provision of
this Agreement, Programmer recognizes that Licensee has certain obligations to
broadcast programming to meet the needs and interests of viewers in Canton,
Ohio, the station's service area and the educational and informational needs of
children. From time to time the Licensee shall air specific programming on
issues of importance to the local community and educational and informational
programming for children. Nothing in this Agreement shall abrogate the
unrestricted authority of the Licensee to discharge its obligations to the
public and to comply with the Act and the rules and policies of the FCC.
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2.2 Additional Licensee Obligations. Although both parties shall
cooperate in the broadcast of emergency information over the Station, Licensee
shall also retain the right to interrupt Programmer's programming in case of an
emergency or for programming which, in the good faith judgment of Licensee, is
of greater local or national public importance. Licensee shall also coordinate
with Programmer the Station's hourly station identification and any other
announcements required to be aired by FCC rules. Licensee shall continue to
maintain a main studio, as that term is defined by the FCC, within the
Station's principal community contour, shall maintain its local public
inspection file in accordance with FCC rules, regulations and policies, and
shall prepare and place in such inspection file or files in a timely manner all
material required by Section 73.3526 of the FCC's Rules, including without
limitation the Station's quarterly issues and program lists; information
concerning the broadcast of children's educational and informational
programming; and documentation of compliance with commercial limits applicable
to certain children's television programming. Programmer shall, upon request
by Licensee, provide Licensee with such information concerning Programmer's
programs and advertising as is necessary to assist Licensee in the preparation
of such information. Licensee shall also maintain the station logs, receive
and respond to telephone inquiries, and control and oversee any remote control
point which may be established for the Station.
2.3 Responsibility for Employees and Expenses. Programmer shall
employ and be solely responsible for the salaries, taxes, insurance and related
costs for all personnel used in the production of its programming (including,
but not limited to, salespeople, technical staff, traffic personnel, board
operators and programming staff). Licensee will provide and be responsible for
the Station personnel necessary for the broadcast transmission of its own
programs (including, without limitation, the Station's General Manager and such
operational and other personnel as may be necessary or appropriate), and will
be responsible for the salaries, taxes, benefits, insurance and related costs
for all the Licensee's employees used in the broadcast transmission of its
programs and necessary to other aspects of Station operation. Whenever on the
Station's premises, all personnel shall be subject to the overall supervision
of Licensee's General Manager.
SECTION 3. STATION PROGRAMMING POLICIES
3.1 Broadcast Station Programming Policy Statement. Licensee has
adopted and will enforce a Broadcast Station Programming Policy Statement (the
"Policy Statement"), a copy of which appears as Attachment III hereto and which
may be amended in a reasonable manner from time to time by Licensee upon notice
to Programmer. Programmer agrees and covenants to comply in all material
respects with the Policy Statement, to all rules and regulations of the FCC,
and to all changes subsequently made by Licensee or the FCC. Programmer shall
furnish or cause to be furnished the artistic personnel and material for the
programs as provided by this Agreement and all programs shall be prepared and
presented in conformity with the rules, regulations and policies of the FCC and
with the Policy Statement set forth in Attachment III hereto. All advertising
spots and promotional material or announcements shall comply with
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applicable federal, state and local regulations and policies and shall be
produced in accordance with quality standards established by Programmer. If
Licensee determines that a program supplied by Programmer is for any reason,
within Licensee's sole discretion, unsatisfactory or unsuitable or contrary to
the public interest, or does not comply with the Policy Statement it may, upon
prior written notice to Programmer (to the extent time permits such notice),
suspend or cancel such program without liability to Programmer. Licensee will
use reasonable efforts to provide such written notice to Programmer prior to
the suspension or cancellation of such program.
3.2 Licensee Control of Programming. Programmer recognizes that
the Licensee has full authority to control the operation of the Station. The
parties agree that Licensee's authority includes but is not limited to the
right to reject or refuse such portions of the Programmer's programming which
Licensee believes to be unsatisfactory, unsuitable or contrary to the public
interest. Programmer shall have the right to change the programming supplied
to Licensee and shall give Licensee at least twenty-four (24) hours notice of
substantial and material changes in such programming.
3.3 Programmer Compliance with Copyright Act. Programmer
represents and warrants to Licensee that Programmer has full authority to
broadcast its programming on the Station, and that Programmer shall not
broadcast any material in violation of the Copyright Act. All music supplied
by Programmer shall be: (i) licensed by ASCAP, SESAC or BMI; (ii) in the
public domain; or (iii) cleared at the source by Programmer. Licensee will
maintain ASCAP, BMI and SESAC licenses as necessary. The right to use the
programming and to authorize its use in any manner shall be and remain vested
in Programmer.
3.4 Sales. Programmer shall retain all of the Station's network
compensation revenues, any revenues received from any network or program
supplier with respect to affiliation or use of programming by Programmer, any
retransmission consent revenues and all revenues from the sale of advertising
time within the programming it provides to the Licensee. Programmer shall be
responsible for payment of the commissions due to any national sales
representative engaged by it for the purpose of selling national advertising
which is carried during the programming it provides to Licensee. Unless
otherwise agreed between the parties, Licensee shall retain all revenues from
the sale of Station's advertising during the hours each week in which the
Licensee airs its own programming pursuant to Section 1.3 hereof.
3.5 Children's Television Advertising. Programmer agrees that it
will not broadcast advertising within programs originally designed for children
aged 12 years and under in excess of the amounts permitted under applicable FCC
rules, and will take all steps necessary to pre-screen children's programming
broadcast during the hours it is providing such programming, to establish that
advertising is not being broadcast in excess of the applicable FCC rules.
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3.6 Payola. Programmer agrees that it will not 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, material, supplies or other merchandise, services or labor
(collectively "Consideration"), whether or not pursuant to written contracts or
agreements between Programmer and merchants or advertisers, unless the payer is
identified in the program for which Consideration was provided as having paid
for or furnished such Consideration, in accordance with the Act and FCC
requirements. Programmer agrees to annually, or more frequently at the request
of the Licensee, execute and provide Licensee with a Payola Affidavit from each
of its employees involved with the Station substantially in the form attached
hereto as Attachment IV.
3.7 Cooperation on Programming. Programmer and Licensee mutually
acknowledge their interest in ensuring that the Station serves the needs and
interests of viewers in Canton and the surrounding service area and agree to
cooperate to provide such service. Licensee shall, on a regular basis, assess
the issues of concern to residents of Canton and the surrounding area and
address those issues in its public service programming. Programmer, in
cooperation with Licensee, will endeavor to ensure that programming responsive
to the needs and interests of the community of license and surrounding area is
broadcast, in compliance with applicable FCC requirements. Licensee will
describe those issues and the programming that is broadcast in response to
those issues and place issues/programs lists in the Station's public inspection
file as required by FCC rules. Further, Licensee may request, and Programmer
shall provide, information concerning such of Programmer's programs as are
responsive to community issues so as to assist Licensee in the satisfaction of
its public service programming obligations. Licensee shall also evaluate the
local need for children's educational and informational programming and shall
inform Programmer of its conclusions in that regard. Licensee, in cooperation
with Programmer, will ensure that educational and informational programming for
children is broadcast over the Station in compliance with applicable FCC
requirements. Programmer shall also provide Licensee upon request such other
information necessary to enable Licensee to prepare records and reports
required by the Commission or other local, state or federal government
entities.
3.8 Staffing Requirements. Licensee will be in full compliance
with the main studio staff requirements as specified by the FCC.
SECTION 4. INDEMNIFICATION
4.1 Programmer's Indemnification. Programmer shall indemnify and
hold harmless Licensee from and against any and all claims, losses, costs,
liabilities, damages, forfeitures and expenses (including reasonable legal fees
and other expenses incidental thereto) of every kind, nature and description
(collectively, "Damages") resulting from (i) Programmer's breach of any
representation, warranty, covenant or agreement contained in this Agreement, or
(ii) any action taken by Programmer or its employees and agents with respect to
the Station, or any failure by
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Programmer or its employees and agents to take any action with respect to the
Station, including, without limitation, Damages relating to violations of the
Act or any rule, regulation or policy of the FCC, slander, defamation or other
claims relating to programming provided by Programmer and Programmer's
broadcast and sale of advertising time on the Station.
4.2 Licensee's Indemnification. Licensee shall indemnify and hold
harmless Programmer from and against any and all claims, losses, consents,
liabilities, damages, FCC forfeitures and expenses (including reasonable legal
fees and other expenses incidental thereto) of every kind, nature and
description, arising out of Licensee's operations and broadcasts to the extent
permitted by law and any action taken by the Licensee or its employees and
agents with respect to the Station, or any failure by Licensee or its employees
and agents to take any action with respect to the Station.
4.3 Limitation. Neither Licensee nor Programmer shall be entitled
to indemnification pursuant to this section unless such claim for
indemnification is asserted in writing delivered to the other party.
4.4 Time Brokerage Challenge. If this Agreement is challenged at
the FCC, whether or not in connection with the Station's license renewal
application, counsel for the Licensee and counsel for the Programmer shall
jointly defend the Agreement and the parties' performance thereunder throughout
all FCC proceedings at the sole expense of the Programmer. If portions of this
Agreement do not receive the approval of the FCC Staff, then the parties shall
reform the Agreement as necessary to satisfy the FCC Staff's concerns or, at
Programmer's option and expense, seek reversal of the Staff's decision and
approval from the full Commission or a court of law.
SECTION 5. ACCESS TO PROGRAMMER MATERIALS AND CORRESPONDENCE
5.1 Confidential Review. Prior to the commencement of any
programming by Programmer under this Agreement, Programmer shall acquaint the
Licensee with the nature and type of the programming to be provided. Licensee
shall be entitled to review at its discretion from time to time on a
confidential basis any of Programmer's programming material it may reasonably
request. Programmer shall promptly provide Licensee with copies of all
correspondence and complaints received from the public (including any telephone
logs of complaints called in), and copies of all program logs and promotional
materials. However, nothing in this section shall entitle Licensee to review
the internal corporate or financial records of the Programmer.
5.2 Political Advertising. Programmer shall cooperate with
Licensee to assist Licensee in complying with all rules of the FCC regarding
political broadcasting. Licensee shall promptly supply to Programmer, and
Programmer shall promptly supply to Licensee, such
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information, including all inquiries concerning the broadcast of political
advertising, as may be necessary to comply with FCC rules and policies,
including the lowest unit rate, equal opportunities, reasonable access,
political file and related requirements of federal law. Licensee, in
consultation with Programmer, shall develop a statement which discloses its
political broadcasting policies to political candidates, and Programmer shall
follow those policies and rates in the sale of political programming and
advertising. In the event that Programmer fails to satisfy the political
broadcasting requirements under the Act and the rules and regulations of the
FCC and such failure inhibits Licensee in its compliance with the political
broadcasting requirements of the FCC, then to the extent reasonably necessary
to assure such compliance, Programmer shall either provide rebates to political
advertisers or release broadcast time and/or advertising availabilities to
Licensee at no cost to Licensee.
SECTION 6. TERMINATION AND REMEDIES UPON DEFAULT
6.1 Termination. In addition to other remedies available at law
or equity, this Agreement may be terminated as set forth below by either
Licensee or Programmer by written notice to the other if the party seeking to
terminate is not then in material default or breach hereof, upon the occurrence
of any of the following:
(a) subject to the provisions of Section 7.9, this
Agreement is declared invalid or illegal in whole or substantial part by an
order or decree of an administrative agency or court of competent jurisdiction
and such order or decree has become final and no longer subject to further
administrative or judicial review;
(b) the other party is in material breach of its
obligations hereunder and has failed to cure such breach within thirty (30)
days of notice from the non-breaching party;
(c) the mutual consent of both parties;
(d) there has been a material change in FCC rules,
policies or precedent that would cause this Agreement to be in violation
thereof and such change is in effect and not the subject of an appeal or
further administrative review and this Agreement cannot be reformed, in a
manner acceptable to Buyer and Seller, to remove and/or eliminate the
violation; or
(e) by either party upon six months written notice to the
other party.
6.2 Termination Requirements and Procedures.
(a) Programmer may terminate this Agreement pursuant to
Section 6.1(e) hereof only if it pays Licensee an amount equal to six times the
monthly compensation due for the month preceding the notice of termination by
Programmer pursuant to Attachment I.
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(b) Licensee may terminate this Agreement pursuant to
Section 6.1(e) hereof only if it pays Programmer Liquidated Damages, calculated
in accordance with Attachment V.
(c) During any period prior to the effective date of any
termination of this Agreement, Programmer and Licensee agree to cooperate in
good faith to ensure that Station operations will continue, to the extent
possible, in accordance with the terms of this Agreement and that the
termination of this Agreement is effected in a manner that will minimize, to
the extent possible, the resulting disruption of the Station's ongoing
operations.
6.3 Force Majeure. Any failure or impairment of the Station's
facilities or any delay or interruption in the broadcast of programs, or
failure at any time to furnish facilities, in whole or in part, for broadcast,
due to Acts of God, strikes, lockouts, material or labor restrictions by any
governmental authority, civil riot, floods and any other cause not reasonably
within the control of Licensee, or for power reductions necessitated for
maintenance of the Station or for maintenance of other stations located on the
tower from which the Station will be broadcasting, shall not constitute a
breach of this Agreement and Licensee will not be liable to Programmer for
reimbursement or reduction of the consideration owed to Licensee.
6.4 Other Agreements. During the term of this Agreement or any
renewal hereof, Licensee will not enter into any other agreement with any third
party that would conflict with or result in a material breach of this Agreement
by Licensee.
SECTION 7. MISCELLANEOUS
7.1 Assignment.
(a) Neither this Agreement nor any of the rights,
interests or obligations of either party hereunder shall be assigned,
encumbered, hypothecated or otherwise transferred without the prior written
consent of the other party, such consent not to be unreasonably withheld.
Notwithstanding the foregoing, Programmer shall have the right to collaterally
assign its rights and interests hereunder to its senior lenders.
(b) This Agreement shall be binding upon and inure to the
benefit of the parties hereto and their respective successors and permitted
assigns.
(c) Licensee agrees to enter into such agreements and
confirmations as Programmer's senior lenders may reasonably require: (i) to
acknowledge and confirm any collateral assignment of this Agreement to such
senior lenders; (ii) to provide for simultaneous notice and reasonable cure
rights, which rights must be exercised within 30 days after the 30-day period
specified in Section 6.1(b) hereof, to such senior lenders of any default by
Programmer under this Agreement; (iii) to provide simultaneous notice and
reasonable cure rights, which rights must be exercised within 30 days after the
expiration of the 30-day period specified in
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Section 6.1(b) hereof, to such senior lenders prior to any election or action
by Licensee to terminate or cancel this Agreement pursuant to Section 6.1(b)
and, if requested by such senior lenders, to enter into a new Agreement on the
same terms and conditions as this Agreement with such senior lenders or their
nominee, successor or purchaser who (x) possesses all requisite qualifications
to hold FCC licenses, (y) has not had an authorization issued by the FCC
revoked or an application for license renewal denied by the FCC, and (z)
possesses the financial capacity to perform Programmer's obligations hereunder
("Lenders' Assignee"); (iv) in the event that such senior lenders shall be
entitled to foreclose or otherwise acquire Programmer's interest in this
Agreement, or if such senior lenders (or their nominee, successor or purchaser
who qualifies as a "Lenders' Assignee") shall have elected to enter into a new
Agreement, on the same terms and conditions as this Agreement, with Licensee,
to enable such senior lenders to acquire Programmer's interest in this
Agreement or assign such interest to any purchaser or assignee of such senior
lenders who qualifies as a "Lenders' Assignee", or require Licensee to enter
into a new Agreement, on the same terms and conditions as this Agreement,
directly with any purchaser or assignee of such senior lenders who qualifies as
a "Lenders' Assignee"; and (v) provide for such other assurances as such senior
lenders shall reasonably request in connection with the exercise of their
rights under this paragraph 7.1(c).
7.2 Call Letters. Upon request of Programmer, subject to the
consent of the Licensee, Licensee shall apply to the FCC for authority to
change the call letters of the Station (with the consent of the FCC) to such
call letters that Programmer shall reasonably designate. Licensee must
coordinate with Programmer any proposed changes to the call letters of the
Station before taking any action to change such letters.
7.3 Counterparts. This Agreement may be executed in one or more
counterparts, each of which will be deemed an original but all of which
together will constitute one and the same instrument.
7.4 Entire Agreement. This Agreement and the Attachments hereto
embodies the entire agreement and understanding of the parties relating to the
operation of the Station. No amendment, waiver of compliance with any
provision or condition hereof, or consent pursuant to this Agreement will be
effective unless evidenced by an instrument in writing signed by the parties.
7.5 Taxes. Licensee and Programmer shall each pay its own ad
valorem taxes, if any, which may be assessed on such party's respective
personal property for the periods that such items are owned by such party.
Programmer shall pay all taxes, if any, to which the consideration specified in
Section 1.5 herein is subject, provided that Licensee is responsible for
payment of its own income taxes.
7.6 Headings. The headings are for convenience only and will not
control or affect the meaning or construction of the provisions of this
Agreement.
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7.7 Governing Law. The obligations of Licensee and Programmer are
subject to applicable federal, state and local law, rules and regulations,
including, but not limited to, the Act and the Rules and Regulations of the
FCC. The construction and performance of the Agreement will be governed by the
laws of the State of Florida.
7.8 Notices. All notices, demands and requests required or
permitted to be given under the provisions of this Agreement shall be (i) in
writing, (ii) sent by telecopy (with receipt personally confirmed by
telephone), delivered by personal delivery, or sent by commercial delivery
service or certified mail, return receipt requested, (iii) deemed to have been
given on the date telecopied with receipt confirmed, the date of personal
delivery, or the date set forth in the records of the delivery service or on
the return receipt, and (iv) addressed as follows:
To Programmer: ▇▇▇▇▇▇ Communications of Cleveland-67, Inc.
▇▇▇ ▇▇▇▇▇▇▇▇▇▇ ▇▇▇▇ ▇▇▇▇
▇▇▇▇ ▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
To Licensee: ▇▇▇▇▇▇▇▇▇ Media, Inc.
▇▇▇▇▇ ▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
Telephone: (▇▇▇) ▇▇▇-▇▇▇▇
or to any such other or additional persons and addresses as the parties
may from time to time designate in a writing delivered in accordance with this
Section 7.8.
7.9 Severability. If any provision of this Agreement or the
application thereof to any person or circumstances shall be invalid or
unenforceable to any extent, the remainder of this Agreement and the
application of such provision to other persons or circumstances shall not be
affected thereby and shall be enforced to the greatest extent permitted by law.
In the event that the FCC alters or modifies its rules or policies in a fashion
which would raise substantial and material question as to the validity of any
provision of this Agreement, the parties hereto shall negotiate in good faith
to revise any such provision of this Agreement with a view toward assuring
compliance with all then existing FCC rules and policies which may be
applicable, while attempting to preserve, as closely as possible, the intent of
the parties as embodied in the provision of this Agreement which is to be so
modified.
7.10 Arbitration. Any dispute arising out of or related to this
Agreement that Licensee and Programmer are unable to resolve by themselves
shall be settled by arbitration in Miami, Florida by a panel of three
arbitrators. Licensee and Programmer shall each designate one
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disinterested arbitrator and the two arbitrators designed shall select the
third arbitrator. The persons selected as arbitrators need not be professional
arbitrators, and persons such as lawyers, accountants and bankers shall be
acceptable. Before undertaking to resolve a dispute, each arbitrator shall be
duly sworn faithfully and fairly to hear and examine the matters in controversy
and to make a just award according to the best of his or her understanding.
The arbitration hearing shall be conducted in accordance with the commercial
arbitration rules of the American Arbitration Association. The written
decision of a majority of the arbitrators shall be final and binding on
Licensee and Programmer. The costs and expenses of the arbitration proceeding
shall be assessed between Licensee and Programmer in a manner to be decided by
a majority of the arbitrators, and the assessment shall be set forth in the
decision and award of the arbitrators. Judgment on the award, if it is not
paid within thirty days, may be entered in any court having jurisdiction over
the matter. No action at law or in equity based upon any claim arising out of
or related to this Agreement shall be instituted in any court by Licensee or
Programmer against the other except: (i) an action to compel arbitration
pursuant to this Section; or (ii) an action to enforce the award of the
arbitration panel rendered in accordance with this Section.
7.11 No Joint Venture. Nothing in this Agreement shall be deemed
to create a joint venture between the Licensee and the Programmer.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
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IN WITNESS WHEREOF, the parties hereto have executed this Agreement
the day and year first above written.
LICENSEE: ▇▇▇▇▇▇▇▇▇ MEDIA, INC.
By: /s/ ▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇▇
President
PROGRAMMER: ▇▇▇▇▇▇ COMMUNICATIONS
OF CLEVELAND-67, INC.
By: /s/ ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
-----------------------------------------
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Secretary
18
ATTACHMENT I
Compensation Schedule
Upon execution of Licensee's acquisition of the Station, Programmer
shall pay Licensee an imprest deposit of Ten Thousand Dollars ($10,000) and,
thereafter, on a monthly basis, a fee of Seven Thousand Dollars ($7,000)
payable by the fifth day of each month. Programmer shall also reimburse
Licensee on a monthly basis for Licensee's payment of Station expenses listed
on Attachment II upon receipt from the Licensee of a certificate (with attached
invoices, etc.) documenting payment of those expenses.
Payments shall be made by delivery of a check to Licensee at an
address to be designated.
19
ATTACHMENT II
Categories of Anticipated Station Expenses
(1) Lease and Utility Payments
(2) Employee Salaries and Benefits
(3) Property Insurance and Taxes
(4) Fees, Licenses and Professional Fees
(5) Miscellaneous Station Expenses
(6) Equipment Repair and Replacement
(7) Programming Expenses
(8) Debt Service
20
ATTACHMENT III
Broadcast Station Programming Policy Statement
21
BROADCAST STATION PROGRAMMING POLICY STATEMENT
The following sets forth the policies generally applicable to
the presentation of programming and advertising over Television Station
WOAC(TV), Canton, Ohio. All programming and advertising broadcast by the
station must conform to these policies and to the provisions of the
Communications Act of 1934, as amended [the "Act"], and the Rules and
Regulations of the Federal Communications Commission ["FCC"].
Station Identification
The station must broadcast a station identification announcement once an hour
as close to the hour as feasible in a natural break in the programming. The
announcement must include (1) the station's call letters (currently, WOAC);
followed immediately by (2) the station's city of license (Canton, Ohio).
Broadcast of Telephone Conversations
Before recording a telephone conversation for broadcast or broadcasting such a
conversation simultaneously with its occurrent, any party to the call must be
informed that the call will be broadcast or will be recorded for later
broadcast, and the party's consent to such broadcast must be obtained. This
requirement does not apply to calls initiated by the other party which are made
in a context in which it is customary for the station to broadcast telephone
calls.
Sponsorship Identification
When money, service, or other valuable consideration is either directly or
indirectly paid or promised as part of an arrangement to transmit any
programming, the station at the time of broadcast shall announce (1) that the
matter is sponsored, either whole or in part; and (2) by whom or on whose
behalf the matter is sponsored. Products or services furnished to the station
in consideration for an identification of any person, product, service,
trademark or brand name shall be identified in this manner.
In the case of any political or controversial issue broadcast for which any
material or service is furnished as an inducement for its transmission, an
announcement shall be made at the beginning and conclusion of the broadcast
stating (1) the material or service that has been furnished; and (2) the
person(s) or association(s) on whose behalf the programming is transmitted.
However, if the broadcast is 5 minutes duration or less, the required
announcement need only be made either at its beginning or end.
Prior to any sponsored broadcast involving political matters or controversial
issues, the station shall obtain a list of the chief executive officers,
members of the executive committee or board of directors of the sponsoring
organization and shall place this list in the station's public inspection file.
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Payola/Plugola
The station, its personnel, or its programmers shall not accept or agree to
accept from any person any money, service, or other valuable consideration for
the broadcast of any matter unless such fact is disclosed to the station so
that all required station identification announcements can be made. All
persons responsible for station programming must, from time to time, execute
such documents as may be required by station management to confirm their
understanding of and compliance with the FCC's sponsorship identification
requirements.
Rebroadcasts
The station shall not rebroadcast the signal of any other broadcast station
without first obtaining such station's prior written consent to such
rebroadcast.
Fairness
Station shall seek to afford coverage to contrasting viewpoints concerning
controversial issues of public importance.
Personal Attacks
The station shall not air attacks upon the honesty, character, integrity or
like personal qualities of any identified person or group. If such an attack
should nonetheless occur during the presentation of views on a controversial
issue of public importance, those responsible for programming shall submit a
tape or transcript of the broadcast to station management and to the person
attacked within 48 hours, and shall offer the person attacked a reasonable
opportunity to respond.
Political Editorials
Unless specifically authorized by station management, the station shall not air
any editorial which either endorses or opposes a legally qualified candidate
for public office.
Political Broadcasting
All "uses" of the station by legally qualified candidates for elective office
shall be in accordance with the Act and the FCC's Rules and policies, including
without limitation, equal opportunities requirements, reasonable access
requirements, lowest unit charge requirements and similar rules and
regulations.
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Obscenity and Indecency
The station shall not broadcast any obscene material. Material is deemed to be
obscene if the average person, applying contemporary community standards in the
local community, would find that the material, taken as a whole, appeals to the
prurient interest; depicts or describes in a patently offensive way sexual
conduct specifically defined by applicable state law; and taken as a whole,
lacks serious literary artistic, political or scientific value.
The station shall not broadcast any indecent material outside of the periods of
time prescribed by the Commission. Material is deemed to be indecent if it
includes language or material that, in context, depicts or describes, in terms
patently offensive as measured by contemporary community standards for the
broadcast medium, sexual or excretory activities or organs.
Billing
No entity which sells advertising for airing on the station shall knowingly
issue any ▇▇▇▇, invoice or other document which contains false information
concerning the amount charged or the broadcast of advertising which is the
subject of the ▇▇▇▇ or invoice. No entity which sells advertising for airing
on the station shall misrepresent the nature or content of aired advertising,
nor the quantity, time of day, or day on which such advertising was broadcast.
Contests
Any contests conducted on the station shall be conducted substantially as
announced or advertised. Advertisements or announcements concerning such
contests shall fully and accurately disclose the contest's material terms. No
contest description shall be false, misleading or deceptive with respect to any
material term.
Hoaxes
The station shall not knowingly broadcast false information concerning a crime
or catastrophe.
Children's Programming
The station shall broadcast reasonable amounts of educational and informational
programming designed for children aged 16 years and younger.
Children's Advertising
Programming designed for children aged 12 years and younger shall not include
more than 12 minutes of commercial matter per hour, Monday through Friday, and
shall not include more than
24
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10.5 minutes of commercial matter per hour on weekend programming. There shall
be no host selling, as that term is defined by the FCC, in children's
programming on the station.
Emergency Information
Any emergency information which is broadcast by the station shall be
transmitted both aurally and visually or only visually.
Lottery
The station shall not advertise or broadcast any information concerning any
lottery (except the Ohio State Lottery and any other state lottery). The
station may advertise and provide information about lotteries conducted by
non-profit groups, governmental entities and in certain situations, by
commercial organizations, if and only if there is no state or local restriction
or ban on such advertising or information and the lottery is legal under state
or local law. Any and all lottery advertising must first be approved by
station management.
Advertising
Station shall comply with all federal, state and local laws concerning
advertising, including without limitation, all laws concerning misleading
advertising, and the advertising of alcoholic beverages.
Programming Prohibitions.
Knowing broadcast of the following types of programs and announcements is
prohibited:
False Claims. False or unwarranted claims for any product or
service.
Unfair Imitation. Infringements of another advertiser's
rights through plagiarism or unfair imitation of either
program idea or copy, or any other unfair competition.
Commercial Disparagement. Any unfair disparagement of
competitors or competitive goods.
Profanity. Any programs or announcements that are slanderous,
obscene, profane, vulgar, repulsive or offensive, as evaluated
by station management.
Violence. Any programs which are excessively violent.
Unauthenticated Testimonials. Any testimonials which cannot
be authenticated.
25
ATTACHMENT IV
Payola Statement
26
FORM OF PAYOLA AFFIDAVIT
City of ________________________ )
)
County of ______________________ ) SS:
)
State of _______________________ )
ANTI-PAYOLA/PLUGOLA AFFIDAVIT
________________________, being first duly sworn, deposes and says as follows:
1. He is _____________________ for _____________________.
Position
2. He has acted in the above capacity since ____________.
3. No matter has been broadcast by Station _____ for which
service, money or other valuable consideration has been
directly or indirectly paid, or promised to, or charged, or
accepted, by him from any person, which matter at the time so
broadcast has not been announced or otherwise indicated as
paid for or furnished by such person.
4. So far as he is aware, no matter has been broadcast by Station
_____ for which service, money, or other valuable
consideration has been directly or indirectly paid, or
promised to, or charged, or accepted by Station _____ or by
any independent contractor engaged by Station _____ in
furnishing programs, from any person, which matter at the time
so broadcast has not been announced or otherwise indicated as
paid for or furnished by such person.
5. In future, he will not pay, promise to pay, request, or
receive any service, money, or any other valuable
consideration, direct or indirect, from a third party, in
exchange for the influencing of, or the attempt to influence,
the preparation of presentation of broadcast matter on Station
_____.
6. Nothing contained herein is intended to, or shall prohibit
receipt or acceptance of anything with the expressed knowledge
and approval of my employer, but henceforth any such approval
must be given in writing by someone expressly authorized to
give such approval.
7. He, his spouse and his immediate family do___ do not___ have
any present direct or indirect ownership interest in (other
than an investment in a corporation whose stock is publicly
held), serve as an officer or director of, whether with or
without
27
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compensation, or serve as an employee of, any person, firm or
corporation engaged in:
1. The publishing of music;
2. The production, distribution (including wholesale and
retail sales outlets), manufacture or exploitation of
music, films, tapes, recordings or electrical
transcriptions of any program material intended for
radio broadcast use;
3. The exploitation, promotion, or management or persons
rendering artistic, production and/or other services
in the entertainment field;
4. The ownership or operation of one or more radio or
television stations;
5. The wholesale or retail sale of records intended for
public purchase;
6. Advertising on Station _____, or any other station
owned by its licensee (excluding nominal
stockholdings in publicly owned companies).
8. The facts and circumstances relating to such interest are
none____ as follows___:
_______________________________________________________________
_______________________________________________________________
___________________________________________
Affiant
Subscribed and sworn to before me
this ____ day of _________, 19___.
_________________________________
Notary Public
My Commission expires: ____________.
28
ATTACHMENT V
Liquidated Damages
Licensee acknowledges that Programmer will make a substantial
advance payment in order to enter into the Time Brokerage Agreement; that
Programmer will acquire certain assets associated uniquely with the Station's
operation and will enter into various long-term agreements with program
suppliers and other third parties to produce programming for the Station at
substantial expense and risk; that Programmer will recruit, hire and maintain a
staff of employees dedicated to acquiring and producing quality programming to
be broadcast on the Station; and that Programmer will make substantial
investments in additional hard assets to produce quality programming for the
Station. Licensee also acknowledges that Programmer will make substantial
investments, both in tangible and intangible terms, to promote the Station
under the Time Brokerage Agreement, to create a unique image for the Station,
and to develop a competitive position in the market for the Station and that
such efforts on the part of Programmer will add substantial value to the
Station. Licensee and Programmer acknowledge and agree that any measure of
actual damages cannot compensate Programmer for the loss of Licensee's
performance under this Agreement and that the true measure of damages to
Programmer for termination or material breach of the Time Brokerage Agreement
by Licensee is incapable of accurate estimation with reasonable certainty.
Licensee and Programmer therefore agree that it is a fair and reasonable
forecast of just compensation for the harm caused to be measured by liquidated
damages, as defined in subparagraph (a) of this Attachment, to be paid to
Programmer upon the termination or material breach of the Time Brokerage
Agreement by Licensee.
(a) "Liquidated Damages" shall mean an amount equal to
funds expended and/or committed to be expended by Programmer (except (i) with
respect to items (3) through (8) below, such expenditures and/or commitments
shall be consistent with industry practices and (ii) to the extent not
theretofore recovered by Programmer from the Station 's gross revenues prior to
the termination or material breach) in each of the following categories:
(1) the full value of all of Programmer's capital
expenditures incurred in connection with this
Agreement, less any consideration received by
Programmer as a consequence of any sale of such
assets;
(2) the aggregate of the monthly payments made by
Programmer to Licensee pursuant to Attachment I;
(3) the full value of all service contracts and
programming agreements assumed and entered into by
Programmer for purposes of providing programming and
advertising to be broadcast on the Station, which
Programmer owns at the time of termination or breach
less any consideration received by Programmer as a
consequence of its good faith efforts to sell or
assign such agreements;
29
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(4) the full value of all severance and employee
benefit packages that Programmer, in its discretion,
shall provide to employees whose services would not
be required in the absence of the Time Brokerage
Agreement;
(5) the full value of any contract with third
parties, which could not be performed owing to
termination of breach, for services to be rendered in
connection with programming provided to the Station
including, without limitation, producers, advertising
salespeople, technicians, engineers, and any other
independent contractors whose services would not be
required in the absence of the Time Brokerage
Agreement;
(6) the full value of all expenses incurred to
promote the Station and position the Station in the
marketplace;
(7) all corporate, legal, administrative,
professional and brokerage expenses attributable to
Programmer's negotiation and performance of the Time
Brokerage Agreement; and
(8) the good will and intangible value associated
with Programmer's efforts under this Agreement to
create a unique image and competitive market position
for the Station.
(b) Should Licensee terminate or materially breach the
Time Brokerage Agreement, Programmer shall submit its computation of Liquidated
Damages under the categories set forth above to a "Big Six" accounting firm
mutually acceptable to the parties for independent auditing and verification.
Within thirty (30) days of verification, Licensee agrees to tender payment of
all verified amounts to Programmer; provided, however, that if Licensee objects
to any particular enumerated component of the Liquidated Damages, as verified,
it shall notify Programmer of such objection within fifteen (15) days of
verification. If thereafter Programmer and Licensee cannot agree as to the
amount of the objectionable component, either party shall have the right to
elect to arbitrate such dispute pursuant to Section 7.10 of the Time Brokerage
Agreement provided it gives written notice of its election to arbitrate by the
thirtieth (30) day following the date of Licensee's objection to Programmer's
verification. Notwithstanding that Licensee may question a particular
component of the Liquidated Damages and either party may elect arbitration of
the dispute, the reminder of the items comprising the Liquidated Damages shall
be paid by Licensee to Programmer within thirty (30) days of accounting
verification, as specified above. No payment shall be required as to any
contested component until the earlier of (i) Programmer and Licensee reaching
an agreement on the amount or (ii) entering of the arbitration award.
(c) If any category of Liquidated Damages is held
to be invalid, illegal or unenforceable, the validity, legality and
enforceability of the remainder of the categories of
30
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Liquidated Damages shall not be affected thereby, and the parties agree to use
their best efforts to negotiate a replacement category that is not invalid,
illegal or unenforceable.
