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EXHIBIT 2.1
ASSET PURCHASE AGREEMENT
by and between
OUTDOOR SYSTEMS, INC.,
as Seller
and
THE ▇▇▇▇▇ CORPORATION
as Buyer
August 15, 1997
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TABLE OF CONTENTS
Page
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1. PROPERTY TO BE SOLD............................................................. 1
1.1 Purchase and Sale......................................................... 1
1.2 Liabilities Assumed....................................................... 2
2. CLOSING AND PAYMENT OF THE PURCHASE PRICE....................................... 4
2.1 Closing / Closing Date.................................................... 4
2.2 Purchase Price and Payment................................................ 5
2.3 Deposit................................................................... 6
2.4 Allocation of Purchase Price.............................................. 6
2.5 Execution and Delivery of Documents....................................... 6
3. TRANSFER OF TITLE............................................................... 8
3.1 Personal Property......................................................... 8
3.2 Real Property............................................................. 8
3.3 Vehicles.................................................................. 8
3.4 Title..................................................................... 8
4. REPRESENTATIONS AND WARRANTIES OF SELLER........................................ 8
4.1 Existence................................................................. 8
4.2 Authority; Agreement Will Not Cause Breach or Violation; Effect of
Agreement................................................................. 8
4.3 Title to Assets........................................................... 9
4.4 Financial Statements...................................................... 9
4.5 Absence of Certain Changes or Events...................................... 10
4.6 Litigation; Compliance with Laws.......................................... 10
4.7 Permits................................................................... 10
4.8 Environmental............................................................. 10
4.9 Commitments............................................................... 11
4.10 Employee Benefit Plans.................................................... 11
4.11 Taxes..................................................................... 11
4.12 Consents.................................................................. 11
4.13 Fees...................................................................... 12
5. REPRESENTATIONS AND WARRANTIES OF BUYER......................................... 12
5.1 Corporate Power and Authority; Effect of Agreement........................ 12
5.2 Consents.................................................................. 12
5.3 Litigation................................................................ 12
5.4 Availability of Funds..................................................... 13
6. COVENANTS OF SELLER....................................................... 13
6.1 FIRPTA Certificate/Withholding............................................ 13
6.2 Conduct of Business....................................................... 13
6.3 Access.................................................................... 13
6.4 Further Assurances........................................................ 13
6.5 Interim Statements........................................................ 14
6.6 Post-Closing Access to Books and Records.................................. 14
6.7 Related Party Leases...................................................... 14
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7. COVENANTS OF BUYER.............................................................. 14
7.1 Buyer's Knowledge of Business; Representations of Seller Modified by
Buyer's Knowledge......................................................... 15
7.2 Assumed Liabilities....................................................... 15
7.3 Replacement Insurance..................................................... 15
7.4 Performance Bonds......................................................... 16
7.5 Imprints.................................................................. 16
7.6 Consummation of Agreement................................................. 16
7.7 Further Assurances........................................................ 16
7.8 Books and Records; Personnel.............................................. 16
8. ADDITIONAL COVENANTS............................................................ 17
8.1 Corporate Name............................................................ 17
8.2 Filings; Other Action..................................................... 17
8.3 Buyer Investigation; No Representations or Warranties; Exclusivity of
Remedies.................................................................. 18
8.4 Transition Matters........................................................ 20
9. CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS..................................... 21
9.1 Representations, Warranties, Covenants of Seller.......................... 21
9.2 No Prohibition............................................................ 21
9.3 Consents.................................................................. 21
9.4 Non-Foreign Status Statements............................................. 21
9.5 Lease Amendments and Sub-Leases........................................... 21
10. CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS.................................... 21
10.1 3M Agreement Closed....................................................... 22
10.2 Representations, Warranties, Covenants of Buyer........................... 22
10.3 No Prohibition............................................................ 22
10.4 Performance Bonds; Insurance.............................................. 22
10.5 Governmental Consents..................................................... 22
11. EMPLOYMENT AND EMPLOYEE BENEFIT ARRANGEMENTS.................................... 22
11.1 Obligations to Employees.................................................. 22
11.2 Union Employees........................................................... 22
11.3 Hiring of Employees....................................................... 23
12. TERMINATION OF AGREEMENT........................................................ 23
12.1 Termination............................................................... 23
12.2 Effect on Obligations..................................................... 23
12.3 Termination Fee........................................................... 24
13. INDEMNIFICATION................................................................. 24
13.1 Survival.................................................................. 24
13.2 Indemnification........................................................... 25
14. MISCELLANEOUS................................................................... 27
14.1 Dispute Resolution; Unaided Negotiations.................................. 27
14.2 Mediation; Litigation..................................................... 28
14.3 Interpretive Provisions................................................... 28
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14.4 Entire Agreement.......................................................... 29
14.5 Successors and Assigns.................................................... 29
14.6 Headings.................................................................. 29
14.7 Modification and Waiver................................................... 29
14.8 Broker's Fees............................................................. 29
14.9 Expenses.................................................................. 30
14.10 Notices................................................................... 30
14.11 Public Announcements...................................................... 30
14.12 Bulk Sales Law............................................................ 31
14.13 Nonassignable Assets...................................................... 31
14.14 Governing Law and Venue................................................... 31
14.15 Sales Tax................................................................. 31
14.16 Severability.............................................................. 31
14.17 Counterparts.............................................................. 31
14.18 Third Party Rights........................................................ 31
1. DEFINITIONS..................................................................... 31
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT dated effective the 15th day of August,
1997, entered into by and between Outdoor Systems, Inc., a Delaware corporation
("Seller"), and The ▇▇▇▇▇ Corporation, a Louisiana corporation ("Buyer").
PRELIMINARY STATEMENTS
WHEREAS, Seller has contracted to purchase from Minnesota Mining and
Manufacturing Company ("3M") pursuant to that certain Agreement of Purchase and
Sale by and among Seller and 3M dated April 30, 1997 as amended from time to
time to its closing (the "3M Agreement") all of the issued and outstanding stock
of the National Advertising Company ("National" or the "Company");
WHEREAS, the Company is in the business of owning, constructing, posting
and maintaining off-premises advertising displays, consisting principally of
painted bulletins, poster panels and mall advertising displays of various sizes
in the United States (such U.S. business, the "Outdoor Advertising Business" or
the "Business");
WHEREAS, Seller has agreed, subject to closing the 3M Agreement, to cause
the Company to immediately sell to Buyer certain assets, including all of those
existing outdoor advertising structures owned by National and listed on Schedule
1.1(i) hereto(the "Structures"). Such Structures shall be sold and conveyed with
all related rights and liabilities, on an "as is" and "whereas" basis without
any representations, warranties, or indemnity, except as explicitly set forth
herein; and
WHEREAS, to induce the Seller to cause the Company to sell on the
financial terms and price contained in this Agreement, Buyer agrees to assume
and indemnify the Company and Seller from certain obligations and liabilities
related to the Structures and the Company, all as more fully described herein;
WHEREAS, Subject to the specific warranties, representations, covenants
and agreements set forth herein, it is the general intent of the parties to this
Agreement that the sale between the Company and Buyer effect a pro-rata split of
the benefits and burdens of the Buyer under the 3M Agreement, based upon the net
revenues for the year ended December 31, 1996;
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements, and upon the terms and subject to the
conditions hereinafter set forth, the parties do hereby agree as follows.
1. PROPERTY TO BE SOLD.
1.1 Purchase and Sale. On the Closing Date (as defined in Section 2.1), on
the terms and subject to the conditions set forth in this Agreement, Seller
shall cause National to sell to Buyer, and Buyer shall purchase from National
the Structures and all tangible property and intangible property related to the
Structures owned by National at the closing of the 3M Agreement (the "3M
Closing") together with certain other assets described below, including
specifically:
(i) the Structures listed on Schedule 1.1(i) hereto;
(ii) the land and buildings listed on Schedule 1.1(ii) (the
"Buildings");
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(iii) the parcels of land and the easements listed on Schedule
1.1(iii) (the "Owned Sites");
(iv) all leases upon which the existing Structures are exclusively
built or located (the "Leases");
(v) all contracts for sales of outdoor advertising space and service
with regard to the Structures ("Contracts");
(vi) all permits and tags issued by state, county and city
governmental authorities authorizing the outdoor advertising operation conducted
with regard to the Structures (the "Permits");
(vii) all other assets owned by National that are exclusively
related to the operation of the Structures, including without limitation any
contracts or agreements to use the Structures for wireless communication
purposes (the "Other Assets");
(viii) all accounts receivable of National to the extent relating to
the Structures or Contracts or the related Outdoor Advertising Business (the
"Accounts Receivable");
(ix) all personal property, including without limitation, furniture
and fixtures, machinery and equipment, supplies and inventory, located in or on
the Buildings (the "Contents");
(x) the vehicles listed on schedule 1.1(x) (the "Vehicles");
(xi) all assignable non-competition agreements held by National to
the extent they are applicable to the Property (the "Non-Competition
Agreements"); and
(xii) a portion (calculated on the Buyer's Percentage, as such term
is defined Section 2.2) of all of the property of any nature or type owned by
National and located in or associated exclusively with National's Bedford Park,
IL office, whether or not a part of National's Outdoor Advertising Business,
including without limitation all elements of working capital such as cash and
securities; trademarks and patents and unrelated businesses (such as Tradewinds
and Healthport) (the assets described in this Subsection (xii are referred to
herein as the "Apportioned Assets").
Hereinafter, the Structures, Buildings, Owned Sites, Vehicles, Contents,
tangible Other Assets and tangible Apportioned Assets are referred to as the
"Tangible Property", and the easements, Leases, Contracts, Permits, Accounts
Receivable, the Non-Competition Agreements, intangible Other Assets and
intangible Apportioned Assets, are referred to as the "Intangible Assets."
Collectively the Tangible Property and Intangible Assets are sometimes referred
to hereinafter as the "Property." The parties acknowledge and agree that nothing
in this Agreement shall be deemed to give Buyer any right or interest in the
capital stock of National.
1.2 Liabilities Assumed. Buyer, National, and Seller shall share
Liabilities as follows:
(a)(i) "Liabilities" shall mean any and all debts,
liabilities, obligations, absolute or contingent, matured or
unmatured, liquidated or unliquidated, accrued or unaccrued, known
or unknown, whenever arising, including without limitation those
debts, liabilities and obligations arising under any law, rule,
regulation, Action, threatened Action, order or consent decree of
any court, any governmental or other
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regulatory or administrative agency or commission or any award of
any arbitration tribunal, and those arising under any contract,
guarantee, commitment or undertaking for which (i) National is
liable or (ii) Seller is liable, with or without indemnification
from 3M under the 3M Agreement.
(ii) "Action" shall mean any action, suit, arbitration, inquiry,
proceeding, or investigation by or before any court, any governmental or
other regulatory or administrative agency, body or commission or any
arbitration tribunal.
(iii) "Litigation" shall have the meaning as given in Section 4.6(b)
hereof.
(b) Seller and National shall retain and agree to discharge and
perform all Liabilities that relate exclusively to the outdoor advertising
assets of National other than those that relate exclusively to the
Property or the Apportioned Assets (the "National Outdoor Assets"),
whether such Liabilities arise or are attributable to events occurring
before, on or after the Closing Date.
(c) Buyer shall assume and agrees to discharge all Liabilities that
relate exclusively to the Property other than the Apportioned Assets,
whether they arise or are attributable to the events occurring before, on,
or after the Closing Date. Notwithstanding the foregoing, to the extent
that Seller has knowledge of any Litigation, Buyer shall assume and become
liable for: (i) Litigation listed on Schedule 4.6 (i) through (iv) hereto
and (ii) Litigation as of the date hereof exclusively related to the
Property other than the Apportioned Assets that is not listed on Schedule
4.6 (i) through (iv) and of which Buyer has knowledge that such Litigation
is exclusively related to the Property other than the Apportioned Assets.
(d) Liabilities that relate exclusively to the Apportioned Assets
shall be referred to as "Shared Liabilities" or "Shared Liability".
(i) To the extent such any Shared Liability is not specifically
allocated among the parties elsewhere in this Agreement, the Buyer's share
shall be equal to the Buyer's Percentage (as determined in Section 2.2)
and Buyer shall assume and agree to discharge such portion of the Shared
Liability and National and Seller shall be liable for the balance.
(ii) Notwithstanding the foregoing, to the extent that Seller has
knowledge of any Litigation relating to the Apportioned Assets, such
Litigation shall be considered a Shared Liability and Buyer shall assume
and become liable for (i) Litigation related to the Apportioned Assets
listed on Schedule 4.6 (i) through (iv) hereto and (ii) Litigation as of
the date hereof exclusively related to the Apportioned Assets as of the
date hereof that is not listed on Schedule 4.6 (i) through (iv) and of
which Buyer has knowledge that such Litigation is exclusively related to
the Apportioned Assets.
(iii) For those Liabilities arising after the Closing, the Buyer,
Seller and National shall each be primarily and solely liable for and
indemnify the others from any such Liability is caused or is proximately
caused by them. To the extent the Liability is caused or proximately
caused by more than one of them, the causing parties shall share the
Liability in proportion to their culpabilities and each shall jointly and
severally indemnify the non-causing party for any losses incurred with
respect to such Liability. If the Liability is not caused by any of the
parties to this Agreement, the Buyer's share of such Liability shall be
equal to the
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Buyer's Percentage. National and Seller shall be liable for the balance.
The provisions of this subparagraph shall apply to all Apportioned Assets
only while it is an Apportioned Asset.
(iv) Notwithstanding anything to the contrary herein, Buyer and
Seller specifically agree that the amount of Buyer's share of the Shared
Liabilities arising from events occurring on or before the Closing that
(A) are unknown by Buyer as of the date hereof or (B) have not been
disclosed to Buyer as of the date hereof less Buyer's share of the net
fair market value of marketable and book value of nonmarketable
Apportioned Assets, shall in no event exceed One Million and No/100
($1,000,000.00) Dollars.
(v) The parties acknowledge that various claims and administrative
matters may arise from time to time in respect of Shared Liabilities and
that it would be in the best interest of the parties hereto to designate
responsibility for managing and administering any particular Shared
Liability to one party, which party shall be the party whose portion of
the Shared Liability is expected to be the greater. All out-of-pocket
costs and expenses (including, without limitation, reasonable attorneys'
fees and all expenses whatsoever reasonably incurred) incurred by or on
behalf of the party with such management and administrative responsibility
shall be shared among the parties in the same proportions in which the
Shared Liability is shared.
(vi) The parties hereto shall be entitled to share in any rights and
assets (including, without limitation, recoveries, claims, rights of
subrogation and proceeds of asset sales) that relate to the Shared
Liabilities in the same proportion as the designated responsibility of the
parties with respect to the Shared Liabilities.
(e) Buyer shall pay to Seller at the Closing the amounts shown on
Schedule 1.2(f). Buyer shall also pay the Buyer's Percentage of the
accrued payroll to the Closing Date for the Extra Employees (as such term
is defined in the 3M Agreement) employed at 3M's Bedford Park Ill. office,
plus the accrued payroll to the Closing Date for the 3M employees hired by
Buyer. At Closing, Buyer shall pay Seller an estimate of such accrued
payroll and such amounts shall be adjusted and adjustments paid as soon as
practicable thereafter. To the extent that Seller receives reimbursement
from 3M of those certain payments pursuant to Section 9.02(c) of the 3M
Agreement, Seller shall promptly remit such amounts to Buyer.
(f) The Liabilities and the Shared Liabilities to be assumed by
Buyer pursuant to this Section and Sections 11.1 and 11.2 shall be
referred to herein as the "Assumed Liabilities."
(g) Buyer and Seller shall sign an assumption agreement included
within the ▇▇▇▇ of Sale, Assignment and Assumption to be executed pursuant
to Article 3 hereof.
2. CLOSING AND PAYMENT OF THE PURCHASE PRICE
2.1 Closing / Closing Date. On the Closing Date, on the terms and
conditions set forth herein, Seller shall cause National to sell and Buyer shall
purchase the Property. The "Closing" is the date on which, the place where, and
the manner in which, the acquisition documents transferring ownership of the
Property are executed by the parties and the Purchase Price (as defined below)
paid, and it will be held at the same location as the closing of the 3M
Agreement immediately following the closing of such Agreement, unless extended
by mutual agreement of the parties or as set forth below
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(the Closing Date"). Should the pre-transaction waiting period pursuant to the
HSR Act (as defined hereinafter) not have expired or been early terminated prior
to the Closing date as defined immediately above, either party by written notice
to the other may extend the Closing Date to a date not later than five (5)
business days after the expiration or early termination of the HSR waiting
period, but in no event later than October 31, 1997 (the "Termination Date").
The conveyance of the Tangible Assets and the assignment of the Intangible
Assets shall be effective as of the close of business on the Closing Date. Time
is of the essence in this transaction.
2.2 Purchase Price and Payment. (a) The aggregate purchase price to be
paid by Buyer for the Property shall be the sum of (i) the dollar amount
produced by multiplying $1,050,000,000.00 by that percentage derived from
dividing the 1996 gross revenues less agency commissions attributable to the
Structures by $211,000,000 (the "Buyer's Percentage"), as adjusted pursuant to
Subsection (b) below (the "Cash Purchase Price") plus (ii) the dollar amount of
the Assumed Liabilities as of the Closing. The Cash Purchase Price and the
Assumed Liabilities, are collectively referred to herein as the "Purchase
Price"). Payment of the Cash Purchase Price due on the Closing Date plus an
agreed upon estimate of Assumed Liabilities to be paid by Seller to 3M as set
forth on a closing statement shall be in U.S. dollars and shall be made on the
Closing Date by wire transfer of immediately available funds to the account of
Seller at a bank specified by Seller.
(b) The Purchase Price may be further adjusted immediately prior to
Closing by agreement of the parties.
(c) The Purchase Price may be further adjusted subsequent to the Closing
pursuant to this Subsection:
(i) With 60 days of the Closing, Buyer shall notify Seller in
writing of any Structure or Structures listed on Schedule
1.1(i) which were not in existence as of the Closing (the
"Non-existent Structures"). If Buyer does not notify Seller of
any Non-existent Structures within such 60 days, then there
shall be no adjustment to the Purchase Price pursuant to this
Subsection.
(ii) Seller shall have 60 days in which to either accept Buyer's
listing of the Non-existent Structures or to reply to Buyer in
writing, listing those Non-existent Structures that it does
not agree were not in existence at the Closing. Upon replying
to Buyer as required in the previous sentence, Seller shall
immediately pay to Buyer in immediately available funds the
amount of the Purchase Price calculated in Subsection (a)
above attributable to the Structures that it agrees with Buyer
were Non-existent Structures at the Closing.
(iii) If Buyer does not reply within such 60 day time period,
Buyer's list of the Non-existent Structures shall be deemed
accepted by Seller and Seller shall immediately pay to Buyer
in immediately available funds the amount of the Purchase
Price calculated in Subsection (a) above attributable to the
Non-Existent Structures.
(iv) If Seller does not agree with Buyer's list of Non-existent
Structures and so notifies Buyer within the 60 day notice
period, Buyer and Seller shall resolve their differences
pursuant to the dispute resolution provisions contained in
Article 14 of this Agreement.
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(d) The Purchase Price may be further adjusted subsequent to the Closing
pursuant to this Subsection:
(i) With 60 days of the closing, Buyer shall notify Seller in
writing of any outdoor advertising structure or structures
listed on Schedule 2.2(d) which were in fact in existence as
of the Closing (the "Existing Structures"). If Buyer does not
notify Seller of any Existing Structures within such 60 days,
then there shall be no adjustment to the purchase price
pursuant to this Subsection.
(ii) Seller shall have 60 days in which to either accept Buyer's
listing of the Existing Structures or to reply to Buyer in
writing, listing those Existing Structures that it does not
agree were in existence at the Closing. Upon receipt of
Seller's notice, Buyer shall pay to Seller in immediately
available funds the amount of the purchase price calculated in
Subsection (a) above attributable to the Structures that it
agrees with Buyer were Existing Structures at the Closing and
Seller shall transfer title to the Existing Structures (which
shall be deemed Structure for all purposes hereunder) and
related Property.
(iii) If Seller does not reply within such 60 day time period,
Buyer's list of the Existing Structures shall be deemed
accepted by Seller and Buyer shall pay to Seller in
immediately available funds the amount of the Purchase Price
calculated in Subsection (a) above attributable to the
Existing Structures and Seller shall transfer title to the
Existing Structures, (which shall be deemed Structures for all
purposes hereunder) and related Property.
(iv) If Seller does not agree with Buyer's list of Existing
Structures and so notifies Buyer within the 60 day notice period, Buyer and
Seller shall resolve their differences pursuant to the dispute resolution
provisions contained in Article 14 of this Agreement.
2.3 Deposit. Buyer agrees that upon the execution of this Agreement Buyer
shall deposit the amount of Five Million and No/100 ($5,000,000.00 ) Dollars
(the "Deposit") with Seller, by wire transfer of immediately available funds to
a separate, interest bearing account of Seller at a bank designated by Seller at
an interest rate of not less than 5.25%. In the event that the Closing occurs,
the Deposit shall be applied to the Purchase Price. In the event that the
Closing does not occur, the Deposit (plus interest at such rate) shall be paid
pursuant to Section 12.3.
2.4 Allocation of Purchase Price. Buyer and Seller agree that they shall
agree subsequent to the Closing on how the Purchase Price shall be allocated for
state income, property and transfer tax and federal income tax purposes to the
components of the Property purchased and sold hereunder.
2.5 Execution and Delivery of Documents. At or prior to the Closing, the
parties shall execute and/or deliver, as appropriate, all instruments,
certificates and schedules required hereunder including but not limited to the
following:
(a) Seller. Seller shall execute and/or deliver (or cause National to
execute and deliver, as appropriate) the following documents and items:
(1) Bills of Sale for the Vehicles, as required under Article 3;
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(2) Quitclaim deeds and limited warranty deeds for the Buildings
and fee-owned parcels included in the Owned Sites as required
under Article 3;
(3) Assignments of Easements for each easement included in the
owned sites as required under Article 3;
(4) The master amendment referred to in Section 6.7(a) hereof;
(5) The master sublease referred to in Section 6.7(b) hereof;
(6) The Certificates of the Company and Seller, as defined in
Section 9.1;
(7) Certified copies of resolutions of the Boards of Directors of
Company and Seller authorizing this Agreement and the
transactions contemplated hereunder;
(8) Certificates of good standing of Company and Seller issued by
the Secretary of State's office of the state under which laws
Seller was organized;
(9) The FIRPTA Certificate (as defined pursuant to Section 6.1
hereof); and
(10) Opinion of Seller's counsel dated as of the date of Closing.
(b) Buyer. Buyer shall execute and/or deliver the following documents and
items:
(1) The Purchase Price;
(2) Certified resolutions of the Executive Committee of the Board
of Directors of Buyer authorizing this Agreement and the
transactions contemplated hereunder;
(3) The Certificate of the Buyer as defined in Section 10.1;
(4) A certificate of good standing of Buyer issued by the
Secretary of State's office of the state under which laws
Buyer was organized;
(5) Opinion of Buyer's counsel dated as of the date of Closing;
and
(6) the amount to be paid by Buyer pursuant to Section 7.3 for
replacement insurance.
(c) Seller and Buyer. Seller and Buyer shall also execute and/or deliver
the following item:
(1) a Closing statement in a form of acceptable to Buyer and
Seller;
(2) ▇▇▇▇ of Sale, Assignment and Assumption Agreement for the
Property other than the Buildings, Owned Sites and Vehicles as
required under Section 1.2 and Article 3; and
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(3) ▇▇▇▇ of Sale, Assignment and Assumption Agreement for the
Apportioned Assets as required under Section 1.2 and Article
3.
3. TRANSFER OF TITLE.
3.1 Personal Property. At the Closing, Seller shall cause National to and
Buyer shall execute a ▇▇▇▇ of Sale, Assignment and Assumption Agreement
transferring full ownership to all of the Property.
3.2 Real Property. (a) The Buildings and fee-owned parcels included in the
Owned Sites, including any improvements thereon, shall be transferred to Buyer's
designee, TLC Properties, Inc., by Company by means of a quitclaim or limited
warranty deed.
(b) The easements included within the Owned Sites shall be transferred to
Buyer's designee, TLC Properties, Inc., by means of an Assignment of Easement.
3.3 Vehicles. At the Closing, Seller shall cause National to and Buyer
shall execute a separate ▇▇▇▇ of Sale for each state in which any Vehicle is
titled, transferring full ownership to the Vehicles titled in such state to
Buyer.
3.4 Title. Anything in this Article 3 notwithstanding, neither Seller nor
National shall be obligated to transfer any better or clearer title than 3M
delivers or National has at the 3M Closing. Notwithstanding any warranties made
by National under the limited warranty deed with respect to the Texas real
property conveying real property to Buyer pursuant to this Agreement, Buyer (a)
hereby covenants and agrees to indemnify National and Seller for, and to hold
National and Seller harmless against, any and all claims, damages, losses, and
liabilities arising from any and all breaches or violation of such warranties
(collectively, "Title Losses") and (b) hereby, for itself and its successors and
assigns, releases and discharges Seller and National from any and all Title
Losses.
4. REPRESENTATIONS AND WARRANTIES OF SELLER.
As a material inducement to Buyer to execute this Agreement and to perform
or cause the same to be performed, Seller represents and warrant to Buyer that:
4.1 Existence. The Company and Seller are corporations duly organized,
validly existing and in good standing under the laws of Delaware and each has
all requisite corporate power and authority to carry on its business as it is
now being conducted. The Company and Seller are duly qualified to do business
and are in good standing as foreign corporations in all jurisdictions where the
nature of the property owned or leased by it, or the nature of the business
conducted by it, makes such qualification necessary and the absence of such
qualification would not have a material adverse effect on the Property,
business, assets, financial condition or results of operations of the Company or
Seller (a "Material Adverse Effect").
4.2 Authority; Agreement Will Not Cause Breach or Violation; Effect of
Agreement.
(a) Seller and National are corporations duly organized, validly existing
and in good standing under the laws of the State of Delaware and each has all
requisite corporate power and authority to execute, deliver and perform this
Agreement and the other documents to be executed at or prior to the Closing in
connection herewith (the "Ancillary Document(s)") and to consummate the
transactions contemplated hereby and thereby.
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(b) The execution, delivery and performance by Seller and National of this
Agreement and the Ancillary Documents and the consummation by Seller of the
transactions contemplated hereby and thereby have been duly authorized by all
necessary corporate action on the part of Seller, and will be prior to Closing,
by National.
(c) This Agreement has been, and the Ancillary Documents when executed and
delivered will be, duly and validly executed and delivered by National and/or
Seller; and this Agreement constitutes, and the Ancillary Documents when
executed and delivered will constitute, valid and binding obligations of
National or Seller enforceable against National or Seller in accordance with
their respective terms, except to the extent that such enforceability (i) may be
limited by bankruptcy, insolvency, reorganization, moratorium or other similar
laws relating to creditors' rights generally, and (ii) is subject to general
principles of equity .
(d) The execution, delivery and performance by National and/or Seller of
this Agreement and the Ancillary Documents and the consummation by National
and/or Seller of the transactions contemplated hereby and thereby will not, with
or without the giving of notice or the lapse of time, or both, (i) violate any
provision of law, rule or regulation to which Seller or the Company is subject,
(ii) violate any order, judgment or decree applicable to Seller or the Company,
or (iii) violate any provision of the certificate of incorporation or the
by-laws of Seller or the Company; except, in each case, for violations which
individually or in the aggregate would not materially hinder or impair the
consummation of the transactions contemplated hereby and thereby and would not
have a Material Adverse Effect.
4.3 Title to Assets. (a) The Company has or will have prior to Closing
good and marketable title to all of the Property free and clear of all
encumbrances, other than (i) as set forth in the Disclosure Schedule, (ii) for
liens for taxes not yet due and payable or due but not delinquent or being
contested in good faith by appropriate proceedings and (iii) encumbrances which
individually or in the aggregate do not have a Material Adverse Effect;
provided, however, that Seller does not represent or warrant hereby that the
lessors of any lease, license, easement or other agreement (for real property or
otherwise) to which the Company is a party have good and marketable title to the
property leased thereunder. To Seller's or 3M's knowledge, (i) there are no
mortgages or deeds of trust on any real property owned or leased by the Company
that is part of the Property, with respect to which 3M, the Seller or Company is
the mortgagor or the obligor and (ii) there are no liens or security interests
on the Property securing obligations of the Company, or guaranties by the
Company of obligations, for borrowed money or evidenced by notes, debentures or
other similar instruments. Seller has not heretofore obligated itself or the
Company to dispose of or assign any of the Property, except certain computer
equipment included in the Apportioned Assets which will be sold to 3M and with
respect to which Buyer shall receive Buyer's Percentage of the proceeds.
4.4 Financial Statements. Seller has delivered to Buyer audited balance
sheets of the Company as of December 31, 1996 and 1995 (the "Balance Sheet") and
audited statements of income and cash flows for each of the three years in the
period ended December 31, 1996, including footnotes thereto (collectively, the
"Financial Statements"), included in the Disclosure Schedule attached hereto and
made part hereof. The Financial Statements fairly present in all material
respects the financial position of the Company as of December 31, 1996 and 1995
and the results of operations and cash flows for each of the three years in the
period ended December 31, 1996, in conformity with generally accepted accounting
principles consistently applied except as disclosed in the notes thereto.
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14
4.5 Absence of Certain Changes or Events. Except as otherwise set forth in
the Disclosure Schedule or as otherwise contemplated by this Agreement, since
December 31, 1996, the Company or the Property has not (i) suffered any damage,
destruction or casualty loss to its physical properties which has a Material
Adverse Effect; (ii) incurred or discharged any obligation or liability or
entered into any other transaction except in the ordinary course of business and
except for obligations, liabilities and transactions that do not individually or
in the aggregate have a Material Adverse Effect; (iii) suffered any material
adverse change in its assets, business or financial condition; or (iv) increased
the rate or terms of compensation payable or to become payable by the Company to
its key employees or increased the rate or terms of any bonus, pension or other
employee benefit plan covering any of its key employees, except in each case
increases occurring in the ordinary course of business in accordance with its
customary practices (including normal periodic performance reviews and related
compensation and benefit increases) or as required by any pre-existing
Commitment (as defined in Section 4.9).
4.6 Litigation; Compliance with Laws. To the knowledge of Seller as of the
date hereof, Schedule 4.6(i) to (iv) lists the Litigation matters related to the
Property. To the knowledge of Seller and 3M as of the date hereof, except for
matters (i) that have occurred in the ordinary course of the Outdoor Advertising
Business (including, but not limited to, local permitting issues), (ii) that do
not have a Material Adverse Effect, (iii) that are listed in the Disclosure
Schedule or (iv) that are described in Section 4.8:
(a) the Outdoor Advertising Business is not operating under or subject to,
or in default with respect to, any order, writ, injunction, judgment or decree
of any court or federal, state or local government);
(b) the Company has not received written notification of any action or
proceeding in any court or before any governmental authority ("Litigation")
pending or threatened by or against the Company which in any way affects the
Property; and
(c) (i) other than with respect to the Company's off-premises advertising
displays included in the Property, the Company is in compliance with applicable
laws, by-laws, regulations, orders or decrees, and the present uses by the
Company of the Property conveyed hereby do not violate or fail to comply with
any such laws, regulations, orders or decrees in any material respect and (ii)
with respect to the Company's off-premises advertising displays included in the
Property, the Company has not received written notification from any federal,
state, local or other governmental authority that (x) the Company is not in
compliance with applicable laws, regulations, orders or decrees, or (y) the
present uses by the Company of such off-premises advertising displays violate or
fail to comply with any such laws, regulations, orders or decrees in any
material respect.
4.7 Permits. To the knowledge of Seller and 3M, the Revised Disclosure
Schedule to the 3M Agreement lists all material licenses and permits paid by the
Company as of the date set forth on such listing in connection with the Outdoor
Advertising Business with respect to the Property and issued to the Company by
any federal or state governmental authority.
4.8 Environmental. (a) To the knowledge of Seller and/or 3M, no hazardous
substance (as defined under applicable federal, state, local or foreign law) has
been treated, stored, disposed of or discharged into the environment on or from
the premises of any real property owned by the Company or subject to any Lease
which is included in the Property which is required by law, rule or regulation
currently in effect to be remediated by or at the expense of Seller, 3M or the
Company,
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other than (i) as listed in the Disclosure Schedule or (ii) where the cost of
such remediation individually or in the aggregate would not have a Material
Adverse Effect.
(b) Buyer and Seller agree that the only representations and warranties of
Seller in this Agreement as to any Environmental Matters are those contained in
Section 4.6 and this Section 4.8, and that such representations and warranties
relate only to the present use of the property owned by the Company or subject
to any Lease which is included in the Property. As used herein, the term
"Environmental Matters" means any matter arising out of or relating to
environment, safety, health or sanitation or the production, storage, handling,
use, emission, release, discharge or disposal of any substance, product or waste
which is hazardous or toxic or which is regulated by municipal, state, federal,
foreign or other law.
4.9 Commitments. The Disclosure Schedule lists each written contract or
agreement and, to the knowledge of Seller and/or 3M, each oral agreement, to
which the Company is a party or by which the Company is bound and which is
material to the business or financial condition of the Company in connection
with the use or ownership of the Property (collectively, the "Commitments").
Except as set forth in the Disclosure Schedule, to Seller's knowledge, the
Company is not in default under any of the Commitments, which default has a
Material Adverse Effect.
4.10 Employee Benefit Plans. (a) The Disclosure Schedule lists all
material Company benefit plans and material benefit arrangements. True and
complete copies thereof, where in writing, have previously been or will be
delivered or made available to Buyer.
(b) Except as set forth in the Disclosure Schedule, the Company does not
have any obligation to contribute to a "multiemployer plan" as defined in
Section 3(37) of ERISA or a benefit plan subject to Title IV of ERISA with
respect to any employees of the Company.
4.11 Taxes. (a) Except as set forth in the Disclosure Schedule, all
federal, state, local and foreign tax returns and reports required to be filed
with respect to the Company have been filed in a timely manner (taking into
account all extensions of due dates) and all taxes shown as due thereon have
been paid, except where the failure to so file or pay, individually or in the
aggregate, does not have a Material Adverse Effect. Except as set forth in the
Disclosure Schedule, no deficiencies for any taxes in respect of the Company
have been asserted in writing against the Company which remain unpaid and which
individually or in the aggregate have a Material Adverse Effect.
(b) Neither Seller nor the Company is a "foreign person" within the
meaning of Section 1445(b)(2) of the Code.
4.12 Consents. To the knowledge of Seller, no consent, approval or
authorization of, or exemption by, or filing with, any governmental authority is
required to be obtained or made by Seller in connection with the execution,
delivery and performance by Seller of this Agreement and the Ancillary Documents
or the taking by Seller of any other action contemplated hereby or thereby,
other than (i) pursuant to the HSR Act, (ii) as listed in the Disclosure
Schedule or (iii) such consents, approvals, authorizations or exemptions which
individually or in the aggregate, if not made, obtained or granted, would not
have a Material Adverse Effect and would not materially affect the ability of
Seller to execute, deliver and perform this Agreement and the Ancillary
Documents or the transactions contemplated hereby or thereby.
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4.13 Fees. Neither Seller nor the Company has paid or become obligated to
pay any fee or commission to any broker, finder or intermediary in connection
with the transactions contemplated hereby.
5. REPRESENTATIONS AND WARRANTIES OF BUYER.
As a material inducement to Seller to execute this Agreement and to
perform or cause the same to be performed, Buyer represents and warrants to
Seller that:
5.1 Corporate Power and Authority; Effect of Agreement. (a) Buyer is a
corporation duly organized, validly existing and in good standing under the laws
of the jurisdiction of its incorporation and has all requisite corporate power
and authority to execute, deliver and perform this Agreement and the Ancillary
Documents and to consummate the transactions contemplated hereby and thereby.
(b) The execution, delivery and performance by Buyer of this Agreement and
the Ancillary Documents and the consummation by Buyer of the transactions
contemplated hereby and thereby have been duly authorized by all necessary
corporate action on the part of Buyer.
(c) This Agreement has been, and the Ancillary Documents when executed and
delivered will be, duly and validly executed and delivered by Buyer; and this
Agreement constitutes, and the Ancillary Documents when executed and delivered
will constitute, valid and binding obligations of Buyer enforceable against
Buyer in accordance with their respective terms, except to the extent that such
enforceability (i) may be limited by bankruptcy, insolvency, reorganization,
moratorium or other similar laws relating to creditors' rights generally, and
(ii) is subject to general principles of equity.
(d) The execution, delivery and performance by Buyer of this Agreement and
the Ancillary Documents and the consummation by Buyer of the transactions
contemplated hereby and thereby will not, with or without the giving of notice
or the lapse of time, or both, (i) violate any provision of law, rule or
regulation to which Buyer is subject, (ii) violate any order, judgment or decree
applicable to Buyer, or (iii) violate any provision of the Certificate of
Incorporation or the By-laws of Buyer; except, in each case, for violations
which individually or in the aggregate would not materially hinder or impair the
consummation of the transactions contemplated hereby and thereby.
5.2 Consents. Buyer must obtain the approval of the Majority Banks, as
such term is defined in that certain Credit Agreement between Buyer and The
Chase Manhattan Bank and other lenders dated December 18, 1996, of the
transactions contemplated by this Agreement. Except for the consent of the
Majority Banks, which has been obtained, no consent, approval, or authorization
of, or exemption by, or filing with, any governmental authority or any other
person is required to be obtained or made by Buyer in connection with the
execution, delivery and performance by Buyer of this Agreement, or the taking by
Buyer of any other action contemplated hereby (other than the filings required
pursuant to the HSR Act).
5.3 Litigation. There is no Litigation pending or, to Buyer's knowledge,
threatened (i) against Buyer or any of its affiliates with respect to which
there is a reasonable likelihood of a determination which would materially
affect the ability of Buyer to perform its obligations under this Agreement, or
(ii) which seeks to enjoin or obtain damages in respect of the consummation of
the transactions contemplated hereby. Neither Buyer nor any of its affiliates is
subject to any outstanding orders, rulings, judgments or decrees which would
materially affect the ability of Buyer to perform its obligations under this
Agreement.
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5.4 Availability of Funds. Buyer will have available on the Closing Date
sufficient funds to enable it to consummate the transactions contemplated by
this Agreement.
6. COVENANTS OF SELLER.
Seller covenants and agrees with Buyer that:
6.1 FIRPTA Certificate/Withholding. At the Closing, Seller shall cause
National to deliver to Buyer, a certificate made under penalty of perjury by
National, stating that National is not a non-resident alien, foreign
corporation, partnership, trust or estate as defined by Internal Revenue Code
("IRC") Section 1445 and the regulations promulgated thereunder (the "FIRPTA
Certificate").
6.2 Conduct of Business. (a) Except as may be otherwise contemplated by
this Agreement or required by any of the documents listed in the Disclosure
Schedule or except as Buyer may otherwise consent to in writing (which consent
shall not be unreasonably withheld), from the 3M Closing to the Closing under
this Agreement, Seller will (i) use its best efforts to cause the Company to (x)
in all material respects operate the Property only ln the ordinary course, (y)
use its reasonable efforts to keep available the services of its employees and
agents (as a group) that, immediately following the 3M Closing, are involved
with the Property, and (z) use its reasonable efforts to preserve its
relationship with its material lenders, suppliers, contractors, customers,
lessors, advertisers, licensors and licensees and others having material
business dealings with the Property such that the Property will not be
materially impaired and (ii) use its reasonable efforts to maintain in full
force and effect the Company's insurance plan that may be in existence
immediately following the 3M Closing which insures the Property.
(b) After the 3M Closing, Seller agrees that it will not cause Company to
encumber the Property in any manner nor alienate any part of the Property,
except in accordance with this Agreement.
6.3 Access. From the date hereof and prior to the Closing Date, Seller
shall use its best efforts to provide Buyer with such information as Buyer may
from time to time reasonably request and as Seller may have or have access to
obtain with respect to the Property and to the Company as it relates to the
Property and the transactions contemplated by this Agreement and the Ancillary
Documents, and shall provide Buyer and its- accountants, counsel, consultants
and other representatives reasonable access, during regular business hours and
upon reasonable notice, to the personnel, properties, books and records of the
Company as Buyer may from time to time reasonably request and as Seller may have
or have access to obtain; provided, however, that Seller shall not be obligated
to provide Buyer with any information which, in the sole discretion of Seller,
relates to trade secrets or the disclosure of which would violate any law, rule
or regulation or term of any commitment, or if the provision thereof would, in
the sole discretion of Seller, adversely affect the ability of Seller, the
Company or any of their affiliates to assert attorney-client, attorney work
product or other similar privilege. Any disclosure whatsoever during such
investigation by Buyer shall not constitute an enlargement of or additional
representations or warranties of Seller beyond those specifically set forth in
this Agreement. All such information and access shall be subject to the terms
and conditions of the Confidentiality Agreement by and between Buyer and Seller
dated July 22, 1997.
6.4 Further Assurances. At any time or from time to time after the
Closing, Seller shall and after the Closing shall cause Company to, at the
request of Buyer and at Buyer's expense, execute and deliver any further
instruments or documents and take all such further action as Buyer may
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reasonably request in order to evidence the consummation of and give effect to
the transactions contemplated hereby and by the Ancillary Documents.
6.5 Interim Statements. Prior to Closing, and in addition to the
information to be provided pursuant to Section 6.3 above, Seller agrees to
promptly provide to Buyer unaudited monthly net sales results of the Company
that relate to the Property and its related Outdoor Advertising Business with
respect to all periods after December 31, 1996 to the extent monthly net sales
information is received by Seller from 3M. Seller agrees that it shall use its
best efforts to obtain any and all such information from Company or 3M.
6.6 Post-Closing Access to Books and Records. For a period of seven years
from the Closing Date:
(a) The Seller shall not dispose of or destroy any books and records,
including without limitation any employee records, relating to Property and its
related Outdoor Advertising Business for periods prior to the Closing that it
receives from 3M ("Books and Records") without first giving written notice to
Seller at least 30 days prior to the proposed date of such disposition or
destruction;
(b) Seller shall, upon prior written notice, allow Buyer and its agents
access to all Books and Records during normal working hours at Seller's
principal place of business or at any location where any Books and Records are
stored, and Buyer shall have the right, at its own expense, to make copies of
any Books and Records; provided, however, that any such access or copying shall
be had or done in such a manner so as not to interfere with the normal conduct
of Seller's business;
(c) Seller shall make available to Buyer upon written request (i) copies
of any Books and Records, (ii) Seller's personnel to assist Buyer in locating
and obtaining any Books and Records, and (iii) any of Seller's personnel whose
assistance or participation is reasonably required by Buyer or any of its
affiliates in anticipation of, or preparation for, existing or future
Litigation, tax returns or other matters in which Buyer or any of its affiliates
is involved. Buyer shall reimburse Seller for the reasonable out-of-pocket
expenses incurred by Seller in performing the covenants contained in this
Section 6.6(c); provided, however, that any such access or copying shall be had
or done in such manner so as not to interfere with the normal conduct of
Seller's business.
(d) The foregoing provisions of this Section 6.6 shall be in addition to
the obligations of Seller under Section 13.2(c)(ii).
6.7 Related Party Leases. (a) At or prior to the Closing, Seller and the
Company shall each execute and deliver a master amendment to all of outdoor
advertising site leases for those Structures that are located on CSX Railroad
rights-of-way and Burlington-Northern Railroad rights-of-way. Such master
amendment will extend the term of such Leases for a period ending on the fifth
anniversary of the Closing, with the rental fixed at the rent paid during the
prior lease year or as otherwise equitably determined by the parties.
(b) To the extent that any Structure is located upon a leasehold for which
the related lease also applies to a structure retained by National or owned by
Seller, Seller shall cause the Company to sublease to Buyer such portion of its
leasehold sufficient to operate such Structure under such terms and conditions
as are contained in the underlying lease with an equitable allocation of rents.
7. COVENANTS OF BUYER.
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7.1 Buyer's Knowledge of Business; Representations of Seller Modified by
Buyer's Knowledge. To the knowledge of Buyer, the representations and warranties
of Seller made in this Agreement or in any Ancillary Document entered into on or
prior to the date hereof are true and correct. Buyer hereby agrees that to the
extent any representation or warranty of Seller made herein or in any Ancillary
Document is, to the knowledge of Buyer acquired prior to the date hereof, untrue
or incorrect, (i) Buyer shall have no rights hereunder or thereunder by reason
of such untruth or inaccuracy, and (ii) any such representation or warranty by
Seller shall be deemed to be amended to the extent necessary to render it
consistent with such knowledge of Buyer. In addition, between the date hereof
and the Closing, Buyer may acquire additional knowledge concerning the matters
covered by the representations and warranties of Seller. Accordingly, Buyer
agrees (without prejudice to any rights which Buyer may have under Sections 9.1,
12.1 and 12.2) that, if the Closing occurs, then to the extent any
representation or warranty of Seller made herein or in any Ancillary Document
entered into at or prior to the Closing, to the knowledge of Buyer acquired from
and after the date hereof and prior to the Closing, is untrue or incorrect, (x)
Buyer shall have no rights hereunder or thereunder by reason of such untruth or
inaccuracy, and (y) any such representation or warranty by Seller shall be
deemed to be amended to the extent necessary to render it consistent with such
knowledge of Buyer.
7.2 Assumed Liabilities. Unless otherwise agreed to by the parties, Buyer
shall pay each Assumed Liability (or its portion thereof) assumed pursuant to
Section 1.2 hereof (or reimburse Seller therefor) on a date agreed upon by the
parties or on the later of the date on which such Assumed Liability is due or
within five days after Seller advises Buyer of the amount thereof; provided,
however, that Buyer may dispute any such Assumed Liability with the third party
to whom such Assumed Liability is owed, in good faith, by appropriate
proceedings after written notice to Seller of its intent to do so and receipt of
Seller's written consent thereto (which consent shall not be unreasonably
withheld and shall be deemed given if Seller does not object thereto in writing
within ten days after receipt of Buyer's written notice). The grant to Buyer of
such right to dispute shall not in any way affect the obligation of Buyer,
pursuant to Section 13.2(b) or otherwise, to indemnify Seller and its affiliates
against all liability, loss, damage, claim (including third party claims whether
or not meritorious), cost or expense (including without limitation, reasonable
attorney's fees and disbursements) (collectively "Losses") sustained or incurred
by any of them arising out of or relating to such Assumed Liability, including
by reason of Buyer's disputing such Assumed Liability.
7.3 Replacement Insurance. (a) Buyer shall pay at Closing an amount equal
to the Buyer's Percentage times the cost of the liability insurance policy
obtained by Seller pursuant to Section 5.03(c) of the 3M Agreement.
(b) Seller and/or Company shall insure that Buyer is an additional named
insured under any insurance policy for which Buyer pays or reimburses any party
any part of the premium for such policy pursuant to this Section.
(c) Buyer and Seller agree that any deductible and/or limit on coverage
under any insurance policy obtained pursuant to this Section shall be equitably
divided between Buyer and Seller.
(d) It is not the intent of the parties hereto that Buyer should pay a
portion of any insurance premium for any insurance policy covering any claim of
any nature or type against Company, and then be required to pay such claim in
full or in part without the benefit of the insurance for which Buyer paid a
portion of the policy premium. To the extent that the Buyer pays any portion of
any insurance premium for any insurance policy covering any liability, loss, or
expense of 3M, Company or Seller that Buyer has assumed pursuant to Section 1.2
or any other Section of this Agreement,
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Buyer shall not be required to pay to Seller any amounts for which coverage
under such insurance policy is available.
7.4 Performance Bonds. Buyer shall deliver to Seller or the appropriate
governmental authority, within 30 days of receipt of copies of the bonds to be
replaced, replacement (or, if the beneficiary thereof will not permit
replacement, back-up) performance bonds, payment bonds, bid bonds, letters of
credit, guarantees and similar instruments, in an aggregate principal amount and
with terms and from banks or other financial institutions or surety companies in
each case reasonably satisfactory to Seller, to replace (or, to the extent
required as described above, to collateralize) any performance bonds, payment
bonds, bid bonds, letters of credit, guarantees and similar instruments of
Seller or of any of its affiliates related to the Property and its related
Outdoor Advertising Business of which Seller fully advises Buyer of or of which
Buyer otherwise has knowledge of (in each case, or portions thereof) remaining
outstanding on the Closing Date with respect to which Seller or any of its
affiliates will have any liability after the Closing. Buyer shall indemnify and
hold Seller and Company harmless from any Losses as a result of 3M, Seller, or
Company having any performance bonds, payment bonds, bid bonds, letters of
credit, guarantees and similar instruments related to the Property outstanding
after Closing (without regard to any deductible amount hereunder).
7.5 Imprints. (a) No later than 180 days after the Closing Date, Buyer, at
its sole expense, shall remove from all advertising displays and vehicles
transferred hereby all imprints containing the Names (as defined in Section 8.2)
or Logos (as defined in Section 8.2); provided, however, that (i) Buyer shall
remove all such imprints within 120 days after the Closing Date with respect to
any such advertising displays containing tobacco advertising, and (ii) Buyer
shall not place any new tobacco advertising on any such advertising displays
without removing all such imprints from such displays.
(b) Buyer shall indemnify Seller and its affiliates and hold them harmless
from and against any and all Losses incurred or suffered by any of them arising
out of or resulting from the use of the Names or any similar name or any Logos
incorporating such Names or any similar Names by Buyer after the Closing,
whether or not such use is contemplated under this Section 7.5.
7.6 Consummation of Agreement. Buyer will take all corporate and other
action required of it to carry out the transactions contemplated by this
Agreement, and will not take any action that would have the effect of impeding
or preventing the consummation of the transactions contemplated by this
Agreement, to the end that the transactions contemplated by this Agreement shall
be fully carried out.
7.7 Further Assurances. At any time or from time to time after the
Closing, Buyer shall, at the request of Seller and at the expense of Seller,
execute, acknowledge and deliver any further assumption agreements, instruments
or documents and take all such further action as Seller may reasonably request
in order to evidence the consummation of and give effect to the transactions
contemplated hereby and by the Ancillary Documents, and the assumption by Buyer
of the Assumed Liabilities.
7.8 Books and Records; Personnel. To extent that Buyer takes possession of
any of the Books and Records of Company or Seller related to the Property, then
for a period of seven years:
(a) The Buyer shall not dispose of or destroy any such books and records,
including without limitation any employee records, relating to the Property and
its related Outdoor Advertising Business
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for periods prior to the Closing without first giving written notice to Seller
at least 30 days prior to the proposed date of such disposition or destruction;
(b) Buyer shall, upon prior written notice, allow Seller and its agents
access to all Books and Records during normal working hours at Buyer's principal
place of business or at any location where any Books and Records are stored, and
Seller shall have the right, at its own expense, to make copies of any Books and
Records; provided, however, that any such access or copying shall be had or done
in such a manner so as not to interfere with the normal conduct of Buyer's
business;
(c) Buyer shall make available to Seller upon written request (i) copies
of any Books and Records, (ii) Buyer's personnel to assist Seller in locating
and obtaining any Books and Records, and (iii) any of Buyer's personnel whose
assistance or participation is reasonably required by Seller or any of its
affiliates in anticipation of, or preparation for, existing or future
Litigation, tax returns or other matters in which Seller or any of its
affiliates is involved. Seller shall reimburse Buyer for the reasonable
out-of-pocket expenses incurred by Buyer in performing the covenants contained
in this Section 7.8(c); provided, however, that any such access or copying shall
be had or done in such manner so as not to interfere with the normal conduct of
Buyer's business.
(d) The foregoing provisions of this Section 7.8 shall be in addition to
the obligations of Buyer under Section 13.2(c)(ii). Notwithstanding anything to
the contrary herein, Seller shall not have any access to the individual Leases,
Permits or Contracts after Closing except as may be required of the Company or
the Seller by law.
8. ADDITIONAL COVENANTS.
8.1 Corporate Name. Buyer acknowledges that, as between Buyer and Seller,
neither Buyer nor Seller has any proprietary right to all names, marks, trade
names, trademarks, service names and service marks (collectively, "Names")
incorporating "Minnesota Mining and Manufacturing", "3M", "3M Media" and "3M
National" and to all corporate symbols or logos (collectively, "Logos")
incorporating "Minnesota Mining and Manufacturing", "3M", "3M Media" or "3M
National", all right to which and the goodwill represented thereby and
pertaining thereto are being retained by 3M. Buyer agrees that it will not use
the Names "Minnesota Mining and Manufacturing", "3M", "3M Media" or "3M
National" or any Logo incorporating such Names in connection with the sale of
any products or services or otherwise in the conduct of its business, except as
expressly permitted by 3M in writing.
8.2 Filings; Other Action. (a) Subject to the terms and conditions herein
provided, each party shall:
(i) Promptly make their respective filings and thereafter make any
other required submissions under the HSR Act with respect to the transactions
contemplated hereby;
(ii) Use their best efforts to cooperate with one another in (x)
determining which filings are required to be made prior to the consummation of
the transactions contemplated hereby, and which consents, approvals, permits or
authorizations are required to be obtained prior to the consummation of the
transactions contemplated hereby from governmental or regulatory authorities of
the United States, the several states and foreign jurisdictions in connection
with the execution and delivery of this Agreement and the consummation of the
transactions contemplated hereby and (y) timely making all such filings and
timely seeking all such consents, approvals, permits or authorizations;
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(iii) use their best efforts to take, or cause to be taken, all
other action and do, or cause to be done, all other things necessary, proper and
appropriate to consummate and effectuate the Closing Date for the transaction
contemplated hereby on or prior to the Termination Date, including, without
limitation, promptly responding to any request for additional information
pursuant to Section (e)(1) of the HSR Act ("Second Request"), and the resolution
of objections, if any, as may be asserted by any governmental authority with
respect to the transactions contemplated hereby under any antitrust or trade or
regulatory laws or regulations of any governmental authority (it being
understood and agreed that Buyer shall use all measures available to it to
consummate the transactions, except that notwithstanding anything to the
contrary herein, Buyer shall not be required to license or otherwise dispose of,
or hold separate or otherwise divest itself of, all or any portion of its
businesses or assets or any portion of the business or assets of any of its
subsidiaries or to lift or rescind or appeal any injunction or restraining order
or other order adversely affecting the ability of the parties to consummate the
transactions contemplated hereby and use their best efforts to defend any
litigation seeking to enjoin, prevent or delay the consummation of the
transactions contemplated hereby or seeking material damages, provided, that
Buyer shall not be required to divest itself of any of the property currently
owned by Buyer, its subsidiaries, or affiliates, in order to obtain any
governmental approval; and
(iv) Furnish to the other party, upon request, copies of all
correspondence, filings or communications between that party, or any of its
representatives, on the one hand, and any governmental agency or authority, on
the other hand, with respect to pre-notification obligations under any antitrust
law with respect to this Agreement; provided, however, that with respect to any
documents that one party reasonably believes should not be disclosed to the
other party, such party shall instead furnish those documents to counsel for the
other party pursuant to a mutually satisfactory confidentiality agreement.
(b) Buyer agrees to use its best efforts to obtain all necessary
regulatory or judicial approvals, and to take such other actions as are
necessary, to consummate the transaction contemplated herein prior to the
expiration of any public notice and comment period that may be required in
connection with the approval of the Agreement.
8.3 Buyer Investigation; No Representations or Warranties; Exclusivity of
Remedies.
(a) Buyer may beginning on the date hereof and ending on the Closing Date
independently evaluate and conduct due diligence satisfactory to Buyer with
respect to the Property and its related Outdoor Advertising business (including,
but not limited to, the operations, facilities, contracts, customer files,
intellectual property, financial information and prospects of the Property).
Buyer may be represented by, and have the assistance of, representative, agents,
counsel, and other experts in the conduct of such due diligence.
(b) SECTION 8.3(a) ABOVE NOTWITHSTANDING, BUYER HEREBY ACKNOWLEDGES AT
CLOSING IT WILL HAVE INDEPENDENTLY EVALUATED AND CONDUCTED DUE DILIGENCE
SATISFACTORY TO BUYER WITH RESPECT TO THE ASSETS OF THE COMPANY AND THE OUTDOOR
ADVERTISING BUSINESS (INCLUDING, BUT NOT LIMITED TO, THE OPERATIONS, FACILITIES,
CONTRACTS, CUSTOMER FILES, INTELLECTUAL PROPERTY, FINANCIAL INFORMATION AND
PROSPECTS OF THE BUSINESS), AND HAS BEEN REPRESENTED BY, AND HAD THE ASSISTANCE
OF, COUNSEL IN THE CONDUCT OF SUCH DUE DILIGENCE, THE PREPARATION AND
NEGOTIATION OF THIS AGREEMENT AND THE ANCILLARY DOCUMENTS, AND THE CONSUMMATION
OF THE TRANSACTIONS CONTEMPLATED HEREBY.
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(c) SELLER HAS MADE AVAILABLE TO BUYER AND ITS REPRESENTATIVES CERTAIN
INFORMATION AND RECORDS RELATING TO THE PROPERTY AND ITS RELATED OUTDOOR
ADVERTISING BUSINESS. IT IS UNDERSTOOD AND AGREED BY THE PARTIES THAT NO
REPRESENTATION OR WARRANTY, EXPRESS OR IMPLIED, HAS BEEN MADE BY SELLER, COMPANY
OR THEIR AGENTS REGARDING THE ACCURACY OR COMPLETENESS OF ANY SUCH INFORMATION
OR RECORDS, EXCEPT AS EXPRESSLY SET FORTH IN THIS AGREEMENT OR ANY OF THE
ANCILLARY DOCUMENTS, AND THAT SELLER AND COMPANY WILL NOT HAVE OR BE SUBJECT TO
ANY LIABILITY TO BUYER OR ANY OTHER PERSON RESULTING FROM THE DISTRIBUTION TO
BUYER, OR BUYER'S USE, OF ANY SUCH INFORMATION OR RECORDS, EXCEPT AS EXPRESSLY
PROVIDED IN THIS AGREEMENT OR EXCEPT AS A RESULT OF FRAUD. FURTHERMORE, BUYER
AGREES THAT IT IS ACCEPTING BUSINESS BEING TRANSFERRED TO BUYER AT THE CLOSING
"AS IS, WHERE IS, WITH ALL FAULTS", WITH NO RESULTING RIGHT OF SET-OFF OR
REDUCTION IN THE TOTAL PURCHASE PRICE, AND THAT, EXCEPT AS EXPRESSLY SET FORTH
IN THIS AGREEMENT OR ANY OF THE ANCILLARY DOCUMENTS, SUCH TRANSFER IS BEING MADE
WITHOUT REPRESENTATION OR WARRANTY OF ANY KIND, EXPRESS OR IMPLIED, INCLUDING
ANY WARRANTY OF INCOME POTENTIAL, OPERATION EXPENSE, USE, MERCHANTABILITY OR
FITNESS FOR A PARTICULAR PURPOSE, OR QUALITY, WITH RESPECT TO ANY OF THE ASSETS
OR THE OUTDOOR ADVERTISING BUSINESS BEING SO TRANSFERRED, OR AS TO THE CONDITION
OR WORKMANSHIP THEREOF OR THE ABSENCE OF ANY DEFECTS THEREIN, WHETHER LATENT OR
PATENT, ALL OF WHICH REPRESENTATIONS AND WARRANTIES ARE HEREBY DISCLAIMED AND
RENOUNCED BY SELLER AND COMPANY. WITHOUT LIMITING THE GENERALITY OF THE
FOREGOING, EXCEPT AS EXPRESSLY SET FORTH IN SECTION 4.8 OF THIS AGREEMENT,
SELLER AND COMPANY MAKES NO REPRESENTATIONS OR WARRANTIES WHATSOEVER TO THE
BUYER REGARDING THE PRESENCE OR ABSENCE OF ANY HAZARDOUS SUBSTANCES, ASBESTOS
CONTAINING MATERIALS, UNDERGROUND STORAGE TANKS OR PCB'S IN, AT OR UNDER ANY OF
THE ASSETS OF THE COMPANY OR THE ACCURACY OR COMPLETENESS OF ANY STATEMENTS,
DOCUMENTS OR REPORTS REGARDING ENVIRONMENTAL MATTERS RECEIVED FROM SELLER, AND
BUYER ACKNOWLEDGES THAT IT HAS CONDUCTED SUCH INVESTIGATIONS AS IT HAS DEEMED
APPROPRIATE TO EVALUATE TO ITS SATISFACTION ITS RISKS FROM AN ENVIRONMENTAL
STANDPOINT.
(d) BUYER ACKNOWLEDGES AND AGREES THAT, EXCEPT AS OTHERWISE EXPRESSLY
PROVIDED IN THIS AGREEMENT, ITS SOLE AND EXCLUSIVE REMEDY WITH RESPECT TO ANY
AND ALL CLAIMS RELATING TO THE SUBJECT MATTER OF THIS AGREEMENT (INCLUDING
CLAIMS FOR BREACHES OF REPRESENTATIONS, WARRANTIES AND COVENANTS CONTAINED IN
THIS AGREEMENT) SHALL BE PURSUANT TO THE INDEMNIFICATION PROVISIONS SET FORTH IN
SECTION 13.2. IN FURTHERANCE OF THE FOREGOING BUYER HEREBY WAIVES, TO THE
FULLEST EXTENT PERMITTED UNDER APPLICABLE LAW, ANY AND ALL RIGHTS, CLAIMS AND
CAUSES FOR 13.2 THAT BUYER MAY HAVE AGAINST SELLER, COMPANY OR ANY OF THEIR
AFFILIATES UNDER OR BASED UPON ANY PRINCIPLE OF EQUITY OR ANY FEDERAL, STATE,
LOCAL OR FOREIGN STATUTE, LAW, ORDINANCE, RULE OR REGULATION (INCLUDING THOSE
RELATING TO HAZARDOUS SUBSTANCES, ASBESTOS CONTAINING MATERIALS, UNDERGROUND
STORAGE TANKS AND PCB'S, AND INCLUDING SPECIFICALLY ALL RIGHTS, IF ANY, THAT
BUYER MAY HAVE TO CONTRIBUTION FROM SELLER OR COMPANY UNDER THE COMPREHENSIVE
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24
ENVIRONMENTAL RESPONSE, COMPENSATION AND LIABILITY OF ACT OF 1980, AS AMENDED),
EXCEPT FOR SUCH CLAIMS ARISING OUT OF SELLER'S FRAUD, WILLFUL MISCONDUCT OR BAD
FAITH.
(e) WITHOUT LIMITING THE GENERALITY OF THE FOREGOING, NO CLAIMS RELATING
TO THE SUBJECT MATTER OF THIS AGREEMENT MAY BE BROUGHT BY BUYER AGAINST ANY
DIRECTOR, OFFICER OR EMPLOYEE OF SELLER OR THE COMPANY IN HIS OR HER INDIVIDUAL
CAPACITY.
8.4 Transition Matters. (a) Buyer and Seller confirm and agree that
certain services provided by 3M and its affiliates to the Company as of the date
hereof, including, but not limited to, certain services relating to human
resources/payroll, tax, travel reimbursement, insurance coverage, insurance
claims administration, legal, financial reporting, environmental, engineering
services, property accounting, information technologies (including computer
services and data processing) and employee information systems, shall be
terminated as of the Closing Date, subject to any transition agreement with
respect to one or more of such services as may be agreed between Seller and 3M
prior to Closing. Seller agrees that it shall enter into a transition agreement
with 3M pursuant to the 3M Agreement (the "Transition Agreement"). Such
Transition Agreement shall include, among other things, provisions requiring
that the accounting books and records remain in place and intact, and sufficient
Company accounting department employees remain employed, at the Company's
current home office located in ▇▇▇▇▇▇▇ ▇▇▇▇, ▇▇▇▇▇▇▇▇ for a period of time
reasonably sufficient for Buyer to obtain an audit prepared by its certified
public accountants of the prior results of the Outdoor Advertising Business
related to the Property acquired by Buyer hereunder. Seller agrees to provide to
Buyer the services it receives from 3M under the Transition Agreement as they
relate to the Property subject to all of the conditions and limitations
contained in the Transition Agreement. Buyer shall pay the Buyer's Percentage of
the charges by 3M to Seller under the Transition Agreement, except that Buyer
shall pay all of the charges of 3M specifically incurred (i) in relation to
Buyer's audit of the Property and (ii) any other services by 3M rendered
exclusively on Buyer's behalf that are not provided for in the Transition
Agreement.
(b) Seller and Buyer confirm and agree that to the extent Seller does not
receive same from 3M, no part of the following assets, which are used by or in
connection with the Outdoor Advertising Business will not be transferred to
Buyer: (i) the In-Store media program utilizing 3M(TM) FloorMinders(TM)
Graphics; (ii) the Travel Center Advertising business; (iii) all vehicles listed
in the Disclosure Schedule to the 3M Agreement; (iv) all cellular telephones
used in the Business; (v) all 3M, Company, or Seller company credit cards used
in the Business; (vi) the Westminster, Maryland plant, property and equipment;
(vii) the corporate facilities located a York, New York; (viii) the software and
hardware listed in the Disclosure Schedule to the 3M Agreement, including,
without limitation, the telecommunications system (including the Wide Area
Network); (ix) all cash of the Company; and (x) all attorneys' fees, costs,
proceeds and other funds awarded or paid to the Company, 3M or Seller in
connection with Impact Communications of Central Florida, Inc. and ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇▇ v. National Advertising Company and POA Acquisition Corp., Case No. 95-
142-Civ-Orl-18, excluding any such attorneys' fees and costs that are
attributable to prosecution of any appeal of such action subsequent to the
Closing Date. Following the Closing and in furtherance of this Section 8.4,
Buyer shall take such action as Seller may reasonably request to transfer to
Seller or Company any of such excluded assets and will indemnify and hold Seller
and Company harmless from any and all losses incurred by Seller in connection
with the use by Buyer following the Closing of any such excluded assets not so
transferred, including, but not limited to, the use of cellular telephones and
3M, Company, or Seller company credit cards.
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9. CONDITIONS PRECEDENT TO BUYER'S OBLIGATIONS.
The obligation of Buyer to purchase the Property shall be subject to the
satisfaction (or waiver) on or prior to the Closing Date of all of the following
conditions:
9.1 Representations, Warranties, Covenants of Seller. (a) Seller shall
have complied in all material respects with its agreements and covenants
contained herein to be performed on or prior to the Closing Date, and the
representations and warranties of Seller contained herein shall be true in all
material respects on and as of the Closing Date with the same effect as though
made on and as of the Closing Date (taking into account all modifications to the
Disclosure Schedule as reflected in the revised disclosure schedule to be
delivered by Seller to Buyer at the Closing, which shall include any material
changes to information set forth in the Disclosure Schedule (the "Revised
Disclosure Schedule")), except (i) as otherwise contemplated hereby, and (ii) to
the extent that any such representations and warranties were made as of a
specified date and as to such representations and warranties the same shall
continue on the Closing Date to have been true in all material respects as of
the specified date.
(b) At the Closing Date, there shall have been no changes in the Property
or the related Outdoor Advertising Business, other than changes that do not
individually or in the aggregate have a Material Adverse Effect, excluding,
without limitation, changes that are otherwise contemplated hereby (including,
without limitation, changes under Section 6.2).
(c) At the Closing Date, Buyer shall have received a certificate of
Seller, dated as of the Closing Date and signed by an officer of Seller,
certifying as to the fulfillment of the conditions set forth in this Section 9.1
(the "Certificate of Seller").
9.2 No Prohibition. No statute, rule or regulation or order of any court
or administrative agency shall be in effect which prohibits Buyer from
consummating the transactions contemplated hereby.
9.3 Consents. The applicable waiting period under the HSR Act shall have
expired or been terminated and all other consents, approvals, authorizations,
exemptions and waivers from governmental agencies that shall be required in
order to enable Buyer to consummate the transactions contemplated hereby and by
the Ancillary Documents shall have been obtained (except for such consents,
approvals, authorizations, exemptions and waivers, the absence of which would
not prohibit consummation of such transactions or render such consummation
illegal).
9.4 Non-Foreign Status Statements. Seller shall have delivered statements,
as contemplated under Section 1.1445-2(b)(2) of the Treasury Regulations, to the
effect that neither Seller nor the Company is a foreign person within the
meaning of the Code and applicable Treasury Regulations.
9.5 Lease Amendments and Sub-Leases. The master lease amendment referred
to in Section 6.7(a) and the master sub-lease referred to in Section 6.7(b)
shall have been fully executed by the parties thereto.
10. CONDITIONS PRECEDENT TO SELLER'S OBLIGATIONS.
The obligation of Seller to sell the Property shall be subject to the
satisfaction (or waiver) on or prior to the Closing Date of all of the following
conditions:
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10.1 3M Agreement Closed. The 3M Agreement shall have been closed, and the
transactions contemplated thereunder consummated.
10.2 Representations, Warranties, Covenants of Buyer. Buyer shall have
complied in all material respects with its agreements and covenants contained
herein to be performed on or prior to the Closing Date, and the representations
and warranties of Buyer contained herein shall be true in all material respects
on and as of the Closing Date with the same effect as though made on and as of
the Closing Date, except (i) as otherwise contemplated hereby, and (ii) to the
extent that any such representations and warranties were made as of a specified
date and as to such representations and warranties the same shall continue on
the Closing Date to have been true in all material respects as of the specified
date. Seller shall have received a certificate of Buyer, dated as of the Closing
Date and signed by an officer of Buyer, certifying as to the fulfillment of the
condition set forth in this Section 10.1 (the "Certificate of Buyer").
10.3 No Prohibition. No statute, rule or regulation or order of any court
or administrative agency shall be in effect which prohibits Seller from
consummating the transactions contemplated hereby.
10.4 Performance Bonds; Insurance. Buyer shall have delivered to the
applicable authority or the Seller as applicable the performance bonds, payment
bonds, bid bonds, letters of credit, guarantees and/or other instruments
referred to in Section 7.4, or otherwise complied with Section 7.4. Buyer shall
have paid its portion of the premiums for any insurance policies, as required
pursuant to Section 7.3.
10.5 Governmental Consents. The applicable waiting period under the HSR
Act shall have expired or been terminated and all other consents, approvals,
authorizations, exemptions and waivers from governmental agencies that shall be
required in order to enable Seller to consummate the transactions contemplated
hereby and by the Ancillary Documents shall have been obtained (except for such
consents, approvals, authorizations, exemptions and waivers, the absence of
which would not prohibit consummation of such transactions or render such
consummation illegal).
11. EMPLOYMENT AND EMPLOYEE BENEFIT ARRANGEMENTS.
11.1 Obligations to Employees. (a) Seller and 3M have made agreements
regarding employees of the Company that are contained in Article 9 of the 3M
Agreement. To the extent applicable to this Agreement, these provisions are
incorporated herein by reference. Buyer agrees to assume and perform all such
obligations made by Seller in Article 9 of the 3M Agreement (excluding
(P)9.02(a) and (P)(P)9.03(a) and (b)) as they relate to any employees of Company
hired by Buyer, unless waived by the employee.
(b) Buyer expressly acknowledges assuming Seller's and Company's
obligations under Section 9.05 of the 3M Agreement with respect to the employees
of the Company employed by Buyer and nothing contained in this Section 11 shall
limit Buyer's continuing obligations to make certain severance payments or to
provide health benefits to such employees in accordance with such provision,
unless waived by such National Employees.
11.2 Union Employees.
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(a) Buyer agrees to hire those union employees of the Company listed on
Schedule 11.2(a) and to assume Seller's obligations with respect to such union
employees under the 3M Agreement including those set forth in (P)9.09 of the 3M
Agreement.
(b) To the extent related to the union employees listed on Schedule
11.2(a), Buyer assumes the obligations of the Company to make contributions, at
substantially the same level for the operations in question, to each
multiemployer plan for which the Company has the obligation to make
contributions pursuant to the collective bargaining agreements described in
Schedule 11.2(b) and agrees to provide each such multiemployer plan with a bond
or escrow for a five-year period commencing with the first plan year beginning
after the Closing Date of a type and in an amount required by Section 4204
(a)(1)(B) of ERISA; provided further, however, that if the Buyer withdraws, or
partially withdraws, from any such multiemployer plan with respect to the
operation in question during the five-year period for which the bond is to be
provided, then the Seller and the Company shall be secondarily liable for any
such withdrawal liability that the Seller and the Company would have had to such
multiemployer plan with respect to the operations as a result of the sale of the
Property if the liability of the Buyer with respect to such multiemployer plan
is not paid. Notwithstanding the foregoing, the Seller and Company shall
cooperate with the Buyer if the Buyer elects to apply to the Pension Benefit
Guaranty Corporation ("PBGC") for a variance of the "bond or escrow" requirement
under PBGC Regulation Section 4204.11.
11.3 Hiring of Employees. Buyer and Seller agree that Buyer shall have
first chance to make offers of employment to employees of the Company related to
the operations of the Property. Should Buyer make an offer in accordance with
the requirements of this Agreement any such employee, Seller agrees that is
shall not hire such employee for a period of two years from the date of Closing.
12. TERMINATION OF AGREEMENT.
12.1 Termination. This Agreement may be terminated at any time prior to
the Closing:
(c) by the mutual written consent of Buyer and Seller;
(d) in writing by Buyer or Seller, if the Closing shall not have occurred
on or before the Termination Date, provided, however, that the right to
terminate this Agreement pursuant to this Section 12.1(b) shall not be available
to a party if such party's failure to perform or observe in any material respect
any of its covenants or agreements contained in this Agreement shall have been
the cause of, or resulted in, the failure of the consummation of the
transactions contemplated hereby to occur on or before such date; or
(e) in writing by either Buyer or Seller, if there shall have been a
material breach by the other party of any of its representations, warranties,
covenants or agreements contained herein and such breach results in a failure to
satisfy a condition to the terminating party's obligation to consummate the
transactions provided herein which cannot be cured or is not cured prior to the
Closing Date.
12.2 Effect on Obligations. Termination of this Agreement pursuant to this
Article 12 shall terminate all obligations of the parties hereunder, except for
the obligations under Sections 14.1, 14.2, 14.8, 14.9, and 14.11; provided,
however, that termination by Buyer or Seller pursuant to clauses (b) or (c) of
Section 12.1 shall not relieve the defaulting or breaching party from any
liability to the other party hereto.
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12.3 Termination Fee. In the event that Closing does not occur on or
before Termination Date and Seller has the unilateral right to terminate this
Agreement pursuant to Section 12.1(c), then Buyer agrees to pay Seller,
immediately upon Seller's demand, the sum of $5,000,000.00 (five million and
no/100 dollars) as liquidated damages, in which case Buyer and Seller agree that
payment of such fee shall relieve Buyer from any and all further liability for
its breach hereunder. Notwithstanding anything to the contrary herein, upon
payment of the liquidated damages provided for herein, Buyer shall not have any
further liability or obligation to Seller or Company relating to or arising from
its failure to close or its breach of any provision of this Agreement. The
Deposit shall be applied against any amounts payable to Seller under this
Section 12.3. In addition, if the Deposit is paid to Seller under this Section
12.3, any interest earned on the Deposit (as contemplated by the terms of
Section 2.3) shall also be paid to Seller.
13. INDEMNIFICATION.
13.1 Survival. (f) The representations and warranties made in this
Agreement or in any agreement, certificate (including the Certificate of Seller
and the Certificate of Buyer) or other Ancillary Document shall survive the
Closing Date until the first anniversary thereof and shall thereupon expire
together with any right to indemnification for breach thereof (except to the
extent a written notice asserting a claim for breach of any such representation
or warranty, describing the nature of the breach in reasonable detail, shall
have been given prior to such date to the party which made such representation
or warranty, in which case such representation and warranty shall survive, to
the extent of such claim only, until such claim is resolved, whether or not the
amount of the damages or expenses resulting from such breach has been finally
determined at the time the notice is given, if, but only if, (i) in the case of
any claim made by Buyer by reason of a third-party claim, the written notice is
accompanied by a copy of the written notice of the third-party claimant or (ii)
in the case of any claim made by Buyer other than by reason of a third-party
claim, some damages or expense shall have been incurred in good faith at or
prior to the date of such notice; and provided that any notice asserting a claim
for breach of any of the representations and warranties contained in Sections
4.6 and 4.8 (or in the Certificate of Seller insofar as it pertains to Sections
4.6 and 4.8) as to Environmental Matters (an "Environmental Breach") shall not
be effective notice unless accompanied by (x) written notice from the applicable
regulatory authority, or, if there has been a claim made against Buyer by a
third party, the written notice of the third-party claimant, alleging the
existence of the conditions as to which an Environmental Breach is claimed or
(y) a written report from an environmental consulting firm reasonably acceptable
to Seller, the fees and expenses of which firm shall be borne solely by Buyer,
confirming in reasonable detail, the existence of the conditions as to which an
Environmental Breach is claimed). The covenants and agreements contained herein
to be performed or complied with prior to the Closing (and the provisions of the
Certificate of Seller and the Certificate of Buyer pertaining thereto) shall
expire at the Closing. The covenants and agreements contained herein to be
performed or complied with at or after the closing (other than the covenant and
agreement to indemnify against breaches of representations and warranties, which
shall expire as set forth in the first sentence of this Section 13.1, but
including the indemnification obligations contained in Sections 7.2, 7.4, 7.5,
8.1, 8.4(c) and 14.15) shall survive the Closing until the expiration of the
applicable statute of limitations. Accordingly, Buyer agrees (without prejudice
to any rights which Buyer may have under Sections 9.1, 12.1 and 12.2) that, if
the Closing occurs, then to the extent any representation or warranty of Seller
made herein or in any Ancillary Document entered into at or prior to the
Closing, to the knowledge of Buyer acquired from and after the date hereof and
prior to the Closing, is untrue or incorrect, (x) Buyer shall have no rights
hereunder by reason of such untruth or inaccuracy, and (y) any such
representation or warranty by Seller shall be deemed to be amended to the extent
necessary to render it consistent with such knowledge of Buyer.
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13.2 Indemnification. (g) If the Closing shall occur, Seller shall
indemnify Buyer and its affiliates and hold each of them harmless from and
against all Losses which are incurred or suffered by any of them (i) by reason
of the breach of any of the representations or warranties made by Seller herein
or in any Ancillary Document or (ii) by reason of the failure by Seller to
perform or comply with any of the covenants or agreements contained herein or in
any Ancillary Document to be performed or complied with by Seller at or after
the Closing. Any recovery by Buyer and its affiliates for indemnification
pursuant to a breach shall be limited as follows: (l) Buyer and its affiliates
shall not be entitled to any recovery unless a claim for indemnification is made
in accordance with Section 13.1 and paragraph (c)(i) of this Section 13.2 and
within the time period of survival set forth in Section 13.1; (2) Buyer and its
affiliates shall not be entitled to recover any amount for indemnification
claims under clause (i) of this Section 13.2(a) unless and until the amount
which Buyer and its affiliates are entitled to recover in respect of such claims
exceeds, in the aggregate, the dollar amount equal to the Buyer's Percentage
times $10,000,000.00 (the "Deductible"), in which event (subject to clause (3)
below) the entire amount which Buyer and its affiliates are entitled to recover
in respect of such claims less the Deductible shall be payable; and (3) the
maximum amount recoverable by Buyer and its affiliates for indemnification
claims under clause (i) of this Section 13.2(a) shall in the aggregate be equal
to the dollar amount equal to the Buyer's Percentage times $50,000,000.00.
(h) If the Closing shall occur, Buyer shall indemnify Seller and its
affiliates and hold each of them harmless from and against all Losses which are
incurred or suffered by any of them (i) by reason of the breach by Buyer of any
of the representations or warranties made by Buyer herein or in any Ancillary
Document, (ii) by reason of the failure by Buyer to perform or comply with any
of the covenants or agreements contained herein or in any Ancillary Document to
be performed or complied with by Buyer at or after the Closing or (iii) by
reason of the ownership by Buyer or any of its affiliates of the Property or the
conduct by Buyer or any of its affiliates of its business after the Closing;
provided, however, that Seller and its affiliates shall not be entitled to any
recovery unless a claim for indemnification is made in accordance with paragraph
(c)(i) of this Section 13.2 and within the time period set forth in Section
13.1.
(i)(i) In the event that any party shall incur or suffer any Losses in
respect of which indemnification may be sought by such party pursuant to the
provisions of this Section 13.2, the party seeking to be indemnified hereunder
(the "Indemnitee") shall assert a claim for indemnification by written notice (a
"Notice") to the party from whom indemnification is sought (the "Indemnitor")
stating the nature and basis of such claim, and if such claim is with respect to
a third-party claim or a claim relating to an Environmental Matter, accompanied
by the documentation set forth in Section 13.1. In the case of Losses arising by
reason of any third-party claim, the Notice shall be given within 30 days of the
filing or other written assertion of any such claim against the Indemnitee, but
the failure of the Indemnitee to give the Notice within such time period shall
not relieve the Indemnitor of any liability that the Indemnitor may have to the
Indemnitee except to the extent that the Indemnitor is prejudiced thereby.
(ii) The Indemnitee shall provide to the Indemnitor on request all
information and documentation reasonably necessary to support and verify any
Losses which the Indemnitee believes gives rise to a claim for indemnification
hereunder and shall give the Indemnitor reasonable access to all books, records
and personnel in the possession or under the control of the Indemnitee which
would have bearing on such claim.
(iii) In the case of third-party claims for which indemnification is
sought, the Indemnitor shall have the option, and with respect to such claims
that represent or are in respect of
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any of the Liabilities ("Liabilities Claims") shall have the obligation, (x) to
conduct any proceedings or negotiations in connection therewith, (y) to take all
other steps to settle or defend any such claim (provided that the Indemnitor
shall not settle any such claim without the consent of the Indemnitee (which
consent shall not be unreasonably withheld)) and (z) to employ counsel to
contest any such claim or liability in the name of the Indemnitee or otherwise.
In any event, the Indemnitee shall be entitled to participate at its own expense
and by its own counsel in any proceedings relating to any third-party claim. The
Indemnitor shall, within 45 days of receipt of the Notice, notify the Indemnitee
of (or, in the case of a Liabilities Claim, confirm to the Indemnitee) its
intention to assume the defense of such claim. Until the Indemnitee has received
notice of the Indemnitor's election whether to (or, in the case of a Liabilities
Claim, the Indemnitor's confirmation of its intention to) defend any claim, the
Indemnitee shall take reasonable steps to defend (but may not settle) such
claim. Except for Liabilities Claims, as to which this sentence shall not be
applicable, if the Indemnitor shall decline to assume the defense of such claim,
or shall fail to notify the Indemnitee within 45 days after receipt of the
Notice of the Indemnitor's election to defend such claim, the Indemnitee shall
defend against such claim (provided that the Indemnitee shall not settle such
claim without the consent of the Indemnitor, which consent shall not be
unreasonably withheld). The expenses of all proceedings, contests or lawsuits in
respect of any such claims (other than those incurred by the Indemnitee which
are referred to in the second sentence of this subparagraph (iii)) shall be
borne by the Indemnitor but only if the Indemnitor is responsible pursuant
hereto to indemnify the Indemnitee in respect of the third-party claim and, if
applicable, only to the extent required by the second sentence of Section
13.2(a). Regardless of which party shall assume the defense of the claim, the
parties agree to cooperate fully with one another in connection therewith. In
the case of a claim for indemnification made under Sections 13.2(a)(i) or
13.2(b)(i), (a) if (and to the extent) the Indemnitor is responsible pursuant
hereto for indemnifying the Indemnitee in respect of the third-party claim, then
within ten days after the occurrence of a final non-appealable determination
with respect to such third-party claim, the Indemnitor shall pay the Indemnitee,
in immediately available funds, the amount of any Losses (or such portion
thereof as the Indemnitor shall be responsible for pursuant to the provisions
hereof, including, without limitation, the second sentence of Section 13.2(a)),
and (b) in the event that any Losses incurred by the Indemnitee do not involve
payment by the Indemnitee of a third-party claim, then, if (and to the extent)
the Indemnitor is responsible pursuant hereto for indemnifying the Indemnitee
against such Losses, the Indemnitor shall within ten days after agreement on the
amount of Losses or the occurrence of a final non-appealable determination of
such amount pay to the Indemnitee, in immediately available funds, the amount of
such Losses (or such portion thereof as the Indemnitor shall be responsible for
pursuant to the provisions hereof, including, without limitation, the second
sentence of Section 13.2(a)).
(d) The provisions of paragraph (c) of this Section 13.2 shall apply to
all claims for indemnification hereunder.
(e) The indemnification provided in this Section 13.2 shall be the sole
and exclusive remedy any representation or warranty made by Seller in this
Agreement or in any Ancillary Document. All amounts payable by one party in
indemnification of the other shall be considered an adjustment to the Purchase
Price.
(f) IN NO EVENT SHALL SELLER BE LIABLE FOR LOSS OF PROFITS OR
CONSEQUENTIAL DAMAGES BY REASON OF A BREACH OF ANY REPRESENTATION OR WARRANTY,
WHETHER ORAL OR WRITTEN, MADE BY SELLER IN THIS AGREEMENT, IN ANY ANCILLARY
DOCUMENT OR OTHERWISE.
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(g) Notwithstanding anything in this Agreement to the contrary, neither
Seller nor any of its affiliates shall be responsible for any liability or
obligation as a result of Buyer's failure to comply with applicable law after
the Closing even if the Outdoor Advertising Business acquired hereby is operated
after the Closing in the manner operated prior to Closing.
(h) Upon making any payment to an Indemnitee for any indemnification claim
pursuant to this Section 13.2, the Indemnitor shall be subrogated, to the extent
of such payment, to any rights which the Indemnitee may have against any other
parties with respect to the subject matter underlying such indemnification
claim.
(i) Buyer understands and agrees that the rights accorded it by clause (a)
of this Section 13.2 are its sole and exclusive remedy against Seller or any of
its affiliates with respect to any Environmental Matters whatsoever. Buyer (on
its own behalf and on behalf of its affiliates and the successors and assigns of
any of the foregoing) hereby waives any right to seek contribution or other
recovery from Seller or 3M or any of their affiliates that any of them may now
or in the future ever have under 42 U.S.C. Sections 9607 and 9613(f) of the
Comprehensive Environmental Response, Compensation, and Liability Act (42 U.S.C.
Section 601 et seq.), as amended ("CERCLA"), the Hazardous Material
Transportation Act (49 U.S.C. Section 1801 et seq.), the Clean Water Act (33
U.S.C. Section 1251 et seq.), the Resource Conservation and Recovery Act (42
U.S.C.S.C. Section 7401 et seq.), the Emergency Planning and Community
Right-to-Know Act of 1986 (42 U.S.C. Sections 11001 et seq.), the Safe Drinking
Water Act (42 U.S.C. Sections 300f et seq.), the Toxic Substances Control Act,
as amended (15 U.S.C. Section 2601 et seq.), the Federal Insecticide, Fungicide,
and Rodenticide Act (7 U.S.C. Section 136 et seq.), the Occupational Safety and
Health Act (29 U.S.C. Section 651 et seq.) or any other federal, state, local or
foreign law relating to Environmental Matters, the rules and regulations
promulgated under any thereof, and any provisions of common law providing for
any remedy or right of recovery with respect to Environmental Matters, as these
laws, rules, regulations and provisions were in the past or are currently in
effect, or may in the future be enacted or be in effect (collectively,
"Environmental Laws"), with respect to the Liabilities. Buyer (on its own behalf
and on behalf of its affiliates and the successors and assigns of any of the
foregoing) hereby further unconditionally releases Seller and 3M and their
respective affiliates from any and all claims, demands, and causes of action
that any of them may now or in the future ever have against Seller or 3M or any
of their respective affiliates for recovery under CERCLA or under any other
Environmental Laws with respect to the Liabilities.
14. MISCELLANEOUS.
14.1 Dispute Resolution; Unaided Negotiations. To resolve any disputes
among the parties, Buyer or Seller must first provide written notice to the
other, specifying ln as much detail as possible the source or reason for the
dispute, the amount of claimed damages, if any, and the resolution proposed by
the notifying party. The receiving party shall respond in writing to any such
notice within seven business days after receipt. The responding party may
include in its reply a detailed description of any disputes it would like to
resolve and the proposed resolutions. The first notifying party shall respond
within seven business days. If the dispute is not then resolved, there shall
follow within seven business days of the last written response a meeting between
at least one representative of each party. Each party agrees to have present
such person or persons who are authorized to fully and finally resolve the
dispute. The purpose of this meeting shall be to discuss and negotiate in good
faith the complete resolution of any outstanding dispute. The date and time
shall be mutually agreed (within the stated period), and the location of the
meeting shall be chosen by the party responding to the first notice. Each party
shall bear its own costs (including travel expenses) incident to this
negotiation and meeting.
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14.2 Mediation; Litigation. Should the procedure outlined in Section 14.1
not bring about a resolution of the dispute, then within 30 days following the
meeting of principals, the party first sending the notice shall initiate a
voluntary, nonbinding mediation conducted by a mutually-agreed mediator. Should
the parties for any reason be unable or unwilling to agree upon a mediator, they
shall request J-A-M-S/Endispute in New York, NY, to appoint a capable mediator
for them in accordance with the commercial mediation rules of such organization.
The Parties shall bear equally all costs and expenses (including any attorneys'
fees) of this mediation and endeavor in good faith to resolve their differences.
While this mediation shall be nonbinding in all respects (i.e., any agreement
must be accepted by each party), each party agrees that:
(a) It shall appear when directed by the mediator, be fully prepared to
work towards a resolution of the dispute, and participate in good faith in the
mediation towards a resolution of all disputed issues or concerns;
(b) The duty to mediate in good faith under this Agreement shall be
specifically enforceable by the courts of Delaware; and
(c) Should a court in litigation stemming from the same general dispute or
disagreement among the parties determine that either did not participate in good
faith in the mediation process hereunder, then such party shall be liable for
the other party's attorneys' fees in the resulting litigation, up to $100,000.
(d) In the event that the parties are unable to resolve any outstanding
disagreement or dispute as provided above, then, as a last resort, either party
may commence Litigation; provided, however, that it must do so in the court
(state or federal, provided the court selected has subject matter jurisdiction)
as agreed pursuant to Section 14.14 hereof.
14.3 Interpretive Provisions. (a) Whenever used in this Agreement the term
"knowledge" shall mean actual knowledge without the need for independent
investigation of any officer or director of Seller or Buyer listed on Schedule
14.3 hereto. The burden of proving that a party or person had knowledge shall be
on the party asserting such knowledge. "Knowledge" as it relates to 3M shall
have the meaning assigned to such concept in the 3M Agreement.
(b) The inclusion of any item in this Agreement, the Disclosure Schedule
or the Revised Disclosure Schedule shall not be deemed an acknowledgment that
such item is material or would result in a Material Adverse Effect.
(c) Buyer and Seller confirm and agree that any judgment, order,
settlement, legislation or regulation which has the effect of restricting
tobacco advertising, in whole or in part, shall not be a "Material Adverse
Effect" for purposes of this Agreement.
(d) Buyer acknowledges receipt of copies of the 3M Agreement together with
its Disclosure Schedule and Revised Disclosure Schedule, and all matters
disclosed therein are deemed "known" by Buyer hereunder.
(e) Any of the foregoing provisions of this Agreement notwithstanding, the
Parties agree that the construction and enforcement of any and all of the
provisions of this Agreement shall be based on the following guidelines. Except
as otherwise specifically provided in this Agreement:
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(i) The Seller's obligation regarding the transfer of the Property is
strictly limited to delivering that which National has and can deliver as of the
Closing on an "as is" and "whereas" basis, no more and no less; and
(ii) Seller is not giving Buyer any greater, broader or more enforceable
representations, warranties, covenants or agreements than it receives from 3M
under the 3M Agreement other than for those provisions that relate only and
exclusively to Seller's knowledge, its corporate existence, authority and
ability to perform and as may be required for a sale of assets instead of stock
in the context of the 3M Agreement.
14.4 Entire Agreement. This Agreement and all Schedules and attachments
hereto constitute the sole understanding of the parties with respect to the
subject matter hereof. Matters disclosed by Seller to Buyer pursuant to any
Section of this Agreement shall be deemed to be disclosed with respect to all
Sections of this Agreement.
14.5 Successors and Assigns. The terms and conditions of this Agreement
shall inure to the benefit of and be binding upon the respective successors and
assigns of the parties hereto; provided, however, that this Agreement may not be
assigned by Buyer without the prior written consent of Seller, except that Buyer
may, at its election, assign this Agreement in full or in part to any direct or
indirect wholly owned subsidiary so long as (i) the representations and
warranties of Buyer made herein are equally true of such assignee, (ii) such
assignment does not have any adverse consequences to Seller or any of its
affiliates (including, without limitation, any adverse tax consequences or any
adverse effect on the ability of Buyer to consummate (or timely consummate) the
transactions contemplated hereby), and (iii) such assignee shall execute a
counterpart of this Agreement agreeing to be bound by the provisions hereof as
"Buyer", and agreeing to be jointly and severally liable with the assignor and
any other assignee for all of the obligations of the assignor hereunder, but no
such assignment of this Agreement or any of the rights or obligations hereunder
shall relieve Buyer of its obligations under this Agreement; and provided,
further, that Buyer may assign its rights but not its obligations under this
Agreement as collateral security under financing arrangements entered into by
Buyer for the purpose of obtaining the funds required for the Purchase Price.
14.6 Headings. The headings of the Articles, Sections and paragraphs of
this Agreement are inserted for convenience only and shall not be deemed to
constitute part of this Agreement or to affect the construction hereof.
14.7 Modification and Waiver. No amendment, modification or alteration of
the terms or provisions of this Agreement shall be binding unless the same shall
be in writing and duly executed by the parties hereto, except that any of the
terms or provisions of this Agreement may be waived in writing at any time by
the party which is entitled to the benefits of such waived terms or provisions.
No waiver of any of the provisions of this Agreement shall be deemed to or shall
constitute a waiver of any other provision hereof (whether or not similar). No
delay on the part of any party in exercising any right, power or privilege
hereunder shall operate as a waiver thereof.
14.8 Broker's Fees. Each of the parties hereto (i) represents and warrants
that it has not taken and will not take any action that would cause the other
party hereto to have any obligation or liability to any person for a finder's or
broker's fee, and (ii) agrees to indemnify the other party hereto for breach of
the foregoing representation and warranty, whether or not the Closing occurs.
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14.9 Expenses. Except as otherwise provided herein, Seller and Buyer shall
each pay all costs and expenses incurred by it or on its behalf in connection
with this Agreement and the transactions contemplated hereby, including, without
limiting the generality of the foregoing, fees and expenses of its own financial
consultants, accountants and counsel.
14.10 Notices. Any notice, request, instruction or other document to be
given hereunder by any party hereto to any other party shall be in writing and
shall be given (and will be deemed to have been duly given upon receipt) by
delivery in person, by electronic facsimile transmission, cable, telegram, telex
or other standard forms of written telecommunications, by overnight courier or
by registered or certified mail, postage prepaid if to Seller to:
Outdoor Systems, Inc.
▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇ and (▇▇▇) ▇▇▇-▇▇▇▇
with a copy to:
Powell, Goldstein, ▇▇▇▇▇▇▇ & ▇▇▇▇▇▇ LLP
16th Floor
▇▇▇ ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇▇
▇▇▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attention: ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇, Esq.
Telecopy: (▇▇▇) ▇▇▇-▇▇▇▇
if to Buyer to:
▇▇. ▇▇▇▇▇ ▇. ▇▇▇▇▇
The ▇▇▇▇▇ Corporation
▇▇▇▇ ▇▇▇▇▇▇ ▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇▇▇▇▇▇▇▇ ▇▇▇▇▇
Telephone: 504/▇▇▇-▇▇▇▇
Facsimile: 504/923-0658
with a copy to:
Kean, Miller, Hawthorne, ▇'▇▇▇▇▇▇,
▇▇▇▇▇▇▇ & ▇▇▇▇▇▇, L.L.P.
▇▇▇▇ ▇▇▇▇▇, ▇▇▇ ▇▇▇▇▇▇▇▇ ▇▇▇▇▇
▇▇▇▇▇ ▇▇▇▇▇, ▇▇ ▇▇▇▇▇
Attn: ▇▇▇ ▇. ▇▇▇▇▇▇, Esq.
Facsimile: 504/388-9133
or at such other address for a party as shall be specified by like notice.
14.11 Public Announcements. Neither Seller nor Buyer shall make any public
statements, including, without limitation, any press releases, with respect to
this Agreement and the transactions contemplated hereby without the prior
written consent of the other party (which consent shall not be
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35
unreasonably withheld or delayed) except as may be required by law. If a public
statement is required to be made by law, the parties shall consult with each
other in advance as to the contents and timing thereof.
14.12 Bulk Sales Law. Without admitting that the bulk sales law of any
state is applicable to the transactions contemplated by this Agreement, the
parties waive and agree not to comply with the bulk sales law of any state and
Seller shall indemnify and hold harmless Buyer, its stockholders, officer and
directors from and against any and all liabilities arising by reason of such
noncompliance in connection with the sale of the Property to Buyer.
14.13 Nonassignable Assets. "Nonassignable Asset" shall mean any asset
included in the Property whose sale, conveyance, transfer, assignment or
delivery is not permitted, or is not permitted without the consent of any other
person or party (including any governmental, regulatory or administrative
authority) other than consents, approvals, permits or authorizations
contemplated by Section 8.2. The Purchase Price shall not be subject to
adjustment or revision, and Buyer shall not be entitled to any repayment, refund
or other compensation, with respect to such Nonassignable Asset. The Seller
shall, to the maximum extent permitted by law or any terms or limitations
pertaining to such Nonassignable Asset, use its reasonable efforts to obtain for
the Buyer the benefits thereunder, and shall cooperate with Buyer in any
reasonable arrangement designed to provide such benefits to Buyer, including any
sublease or subcontract or similar arrangement; provided, however, that Seller
shall not be required to make any payments or incur any obligations in
connection with such arrangements.
14.14 Governing Law and Venue. Any dispute that relates to any specific
portion of the Property shall be resolved according to the law of the state in
which such specific property is located. In all other respects, this Agreement
is made in and shall be governed by and construed and enforced in accordance
with the laws of the State of Delaware. Venue shall be proper in the state where
the property is located concerning disputes that relate to any specific portion
of the Property. For all other matters, venue shall be proper in the State of
Delaware. Seller and Buyer hereby consent to the personal jurisdiction of such
courts for all matters relating to or arising from this Agreement.
14.15 Sales Tax. Any sales tax or transfer tax liability arising under the
laws of any state shall be borne by Buyer, which shall indemnify and hold
harmless Seller for any such sales tax or transfer tax liability which may
result from the transactions contemplated hereunder.
14.16 Severability. If any provision of this Agreement shall be held
invalid, illegal or unenforceable, the validity, legality or enforceability of
the other provisions hereof shall not be affected thereby, and there shall be
deemed substituted for the provision at issue a valid, legal and enforceable
provision as similar as possible to the provision at issue.
14.17 Counterparts. This Agreement may be executed in one or more
counterparts, each of which shall for all purposes be deemed to be an original
and all of which shall constitute the same instrument.
14.18 Third Party Rights. Nothing in this Agreement shall be deemed to
create any right on the part of any person or entity not a party to this
Agreement other than (i) any permitted assignees and (ii) with respect to
Article 11, any employee or union employee of the Company.
1. DEFINITIONS
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15.1 Defined Terms. The following terms are defined terms hereunder:
"3M" shall mean Minnesota Mining and Manufacturing Company.
"3M Closing" shall have the meaning given in Section 1.1.
"Accounts Receivable" shall have the meaning given in Section 1.1.
"Ancillary Document(s)" shall have the meaning given Section 4.2 (a).
"Balance Sheet" shall have the meaning given Section 4.4.
"Books and Records" shall have the meaning given Section 6.6 (a).
"Buyer" shall mean The ▇▇▇▇▇ Corporation, a Louisiana corporation .
"Buyer's Percentage" shall have the meaning given in Section 2.2 (a).
"Buildings" shall have the meaning given in Section 1.1.
"Business" shall have the meaning given in Section 8.4 (b).
"Certificate of Buyer" shall have the meaning given in Section 10.2
"Certificate of Seller" shall have the meaning given in Section 9.1(c).
"Closing" shall have the meaning given in Section 2.1.
"Closing Date" shall have the meaning given in Section 2.1.
"Commitments"shall have the meaning given in Section 4.9.
"Company" shall mean National Advertising Company.
"Contracts" shall have the meaning given in Section 1.1.
"Deductible" shall have the meaning given in Section 13.2 (a)
"Deposit" shall have the meaning given in Section 2.3.
"Environmental Breach" shall have the meaning given in Section 13.1 (a).
"Environmental Laws" shall have the meaning given in Section 13.2 (i).
"Environmental Matters" shall have the meaning given in Section 4.8 (b).
"Financial Statements" shall have the meaning given in Section 4.4.
"Indemnitee" shall have the meaning given in Section 13.2 (c)(i)
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37
"Indemnitor" shall have the meaning given in Section 13.2 (c)(i)
"Intangible Assets" shall have the meaning given in Section 1.1.
"Knowledge" shall have the meaning given in Section 14.3.
"▇▇▇▇▇ Market Areas" shall have the meaning given in Section 1.2 (e)(i)
"▇▇▇▇▇ Markets Employees" shall have the meaning given in Section 11.1
"Leases" shall have the meaning given in Section 1.1.
"Liabilities" shall have the meaning given in Section 1.2 (a).
"Liabilities Claims" shall have the meaning given in Section 13.2(c)(iii)
"Litigation" shall have the meaning given in Section 4.6 (b).
"Losses" shall have the meaning given in Section 7.2.
"Market Area Percentage" shall have the meaning given in Section 1.1.
"Material Adverse Effect" shall have the meaning given in Section 4.1.
"Names" shall have the meaning given in Section 8.2.
"National" shall mean National Advertising Company.
"Nonassignable Asset" shall have the meaning given in Section 14.13.
"Non-Competition Agreements" shall have the meaning given in Section 1.1.
"Notice" shall have the meaning given in Section 13.2 (c)(i)
"Other Assets" shall have the meaning given in Section 1.1.
"Owned Sites" shall have the meaning given in Section 1.1.
"Outdoor Advertising Business" shall have the meaning given in Section
8.4 (b).
"Permits" shall have the meaning given in Section 1.1.
"Property" shall have the meaning given in Section 1.1.
"Purchase Price" shall have the meaning given in Section 2.2 (a).
"Revised Disclosure Schedule" shall have the meaning given in Section 9.1
(a)
"Second Request" shall have the meaning given in Section 8.3 (a) (iii)
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38
"Seller" shall mean Outdoor Systems, Inc., a Delaware corporation
("Seller").
"Severance Pay" shall have the meaning given in Section 11.2.
"Shared Liabilities" or "Shared Liability"shall have the meaning given in
Section 1.2 (e).
"Tangible Property" shall have the meaning given in Section 1.1.
"Termination Date" shall have the meaning given in Section 2.1.
"Title Losses" shall have the meaning given in Section 3.5.
"Transition Agreement" shall have the meaning given in Section 8.4 (a).
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39
IN WITNESS WHEREOF, Buyer and Seller have executed this document,
effective the date first written above.
Seller:
WITNESSES: Outdoor Systems, Inc.
__________________________ By:_______________________________
__________________________
Buyer:
WITNESSES: THE ▇▇▇▇▇ CORPORATION
_________________________ By:__________________________________
▇▇▇▇▇ ▇. ▇▇▇▇▇, Vice President
and Chief Financial Officer
_________________________
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National Advertising Company hereby executes the foregoing Agreement as of
the 15th day of August, 1997 for purposes of acknowledging and assuming its
obligations under the Agreement.
NATIONAL ADVERTISING COMPANY
____________________________________
▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇
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