ASSET PURCHASE AGREEMENT
by and between
FLAGSHIP BROADCASTING CORPORATION
and
TV ALABAMA, INC.
TABLE OF CONTENTS
Page
ARTICLE 1....................................................................2
DEFINITIONS AND REFERENCES...................................................2
ARTICLE 2....................................................................7
SALE AND PURCHASE OF ASSETS; PURCHASE PRICE; PAYMENT OF
PURCHASE PRICE; ASSUMPTION OF LIABILITIES...................................7
2.01 Asset Sale........................................................7
2.02 Purchase Price....................................................7
2.03 Payment of Purchase Price.........................................7
2.04 Assumption of Liabilities.........................................7
ARTICLE 3....................................................................8
REPRESENTATIONS AND WARRANTIES BY SELLER.....................................8
3.01 Organization and Standing.........................................8
3.02 Authorization.....................................................8
3.03 Litigation; Compliance with Law...................................9
3.04 Financial Statements and Condition; Liabilities...................9
3.05 Assets; Consents.................................................10
3.06 Condition of Tangible Assets.....................................11
3.07 Trademarks; Licenses.............................................11
3.08 Licenses.........................................................11
3.09 Reports and Records..............................................11
3.10 Contracts........................................................12
3.11 Conflicts........................................................12
3.12 Related Parties..................................................13
3.13 Taxes............................................................13
3.14 Employee Benefit Plans...........................................14
3.15 Environmental Matters............................................15
3.16 Labor Relations..................................................16
3.17 Broadcast of Programming.........................................17
3.18 Insurance........................................................17
3.19 Disclosure.......................................................17
ARTICLE 4...................................................................18
REPRESENTATIONS AND WARRANTIES BY BUYER.....................................18
4.01 Organization and Standing........................................18
4.02 Authorization....................................................18
4.03 Qualification as Licensee........................................18
ARTICLE 5...................................................................19
APPLICATION FOR COMMISSION CONSENT..........................................19
ARTICLE 6...................................................................19
HART-SCOTT-RODINO...........................................................19
ARTICLE 7...................................................................19
COVENANTS AND AGREEMENTS OF SELLER..........................................19
7.01 Negative Covenants...............................................19
7.02 Affirmative Covenants............................................21
7.03 Removal of Materials.............................................23
7.04 Confidentiality..................................................23
7.05 Employees........................................................23
ARTICLE 8...................................................................23
COVENANTS AND AGREEMENTS OF BUYER...........................................23
8.01 Confidentiality..................................................23
8.02 Corporate Action.................................................24
ARTICLE 9...................................................................24
CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE.........................24
9.01 Representations and Covenants....................................24
9.02 Consents.........................................................24
9.03 Delivery of Documents............................................24
9.04 FCC Order........................................................24
9.05 Title Insurance Commitment and Survey............................25
9.06 Legal Proceedings................................................25
9.07 Hart-Scott-Rodino................................................25
9.08 Absence of Material Change.......................................25
ARTICLE 10..................................................................25
CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE........................25
10.01 Representations and Covenants...................................25
10.02 Delivery of Documents...........................................26
10.03 FCC Order.......................................................26
10.04 Legal Proceedings...............................................26
10.05 Hart-Scott-Rodino...............................................26
ARTICLE 11..................................................................26
THE CLOSING.................................................................26
11.01 Closing.........................................................26
11.02 Delivery by Seller..............................................26
11.03 Delivery by Buyer...............................................28
ARTICLE 12..................................................................28
ALLOCATION OF PURCHASE PRICE AMONG ASSETS...................................28
ARTICLE 13..................................................................29
POSSESSION AND CONTROL......................................................29
ARTICLE 14..................................................................29
RISK OF LOSS................................................................29
ARTICLE 15..................................................................29
SURVIVAL; INDEMNIFICATION...................................................29
15.01 Survival of Seller's Representations............................29
15.02 Indemnification by Seller.......................................30
15.03 Survival of Buyer's Representations.............................30
15.04 Indemnification by Buyer........................................30
15.05 Conditions of Indemnification...................................31
ARTICLE 16..................................................................32
TERMINATION.................................................................32
ARTICLE 17..................................................................32
REMEDIES....................................................................32
17.01 Default by Buyer................................................32
17.02 Default by Seller...............................................32
17.03 Specific Performance............................................33
ARTICLE 18..................................................................33
GUARANTEE...................................................................33
ARTICLE 19..................................................................35
ADDITIONAL ACTIONS AND DOCUMENTS............................................35
ARTICLE 20..................................................................35
BROKERS.....................................................................35
ARTICLE 21..................................................................35
EXPENSES....................................................................35
ARTICLE 22..................................................................36
NOTICES.....................................................................36
ARTICLE 23..................................................................38
WAIVER......................................................................38
ARTICLE 24..................................................................38
BENEFIT AND ASSIGNMENT......................................................38
ARTICLE 25..................................................................39
REMEDIES CUMULATIVE.........................................................39
ARTICLE 26..................................................................39
ENTIRE AGREEMENT; AMENDMENT.................................................39
ARTICLE 27..................................................................39
SEVERABILITY................................................................39
ARTICLE 28..................................................................39
PRESS RELEASES..............................................................39
ARTICLE 29..................................................................40
HEADINGS....................................................................40
ARTICLE 30..................................................................40
GOVERNING LAW...............................................................40
ARTICLE 31..................................................................40
SIGNATURE IN COUNTERPARTS...................................................40
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is entered
into as of this 14th day of September, 1999 by and between FLAGSHIP BROADCASTING
CORPORATION, an Ohio corporation ("Seller"), and TV ALABAMA, INC., a Delaware
corporation, ("Buyer").
WHEREAS, Seller owns and operates Television Station WJSU-TV,
Channel 40, Anniston, Alabama, together with certain auxiliary facilities
(collectively, the "Station");
WHEREAS, RKZ Television, Inc. ("RKZ") and Allbritton
Communications Company ("ACC") are parties to that certain Option Agreement
dated as of December 21, 1995 whereby RKZ granted to ACC or its designated
affiliate the option to purchase the assets of the Station (the "Option
Agreement");
WHEREAS, pursuant to that certain Assignment and Assumption
Agreement dated as of February 1, 1996, ACC assigned to Allfinco, Inc., a
Delaware corporation ("Allfinco"), and Allfinco assigned to Buyer, all of ACC's
rights and obligations under the Option Agreement;
WHEREAS, pursuant to that certain Asset Purchase Agreement
dated as of July 7, 1997, RKZ assigned the Option Agreement to Seller which
assignment was consummated on October 2, 1997;
WHEREAS, Buyer exercised the Option pursuant to written notice
dated as of September 14, 1999; and
WHEREAS, Buyer agrees to purchase from Seller all the Assets
(as hereinafter defined), and Seller desires to sell all the Assets to Buyer,
all in accordance with and subject to the terms and conditions hereinafter set
forth.
NOW, THEREFORE, in consideration of the foregoing and of the
mutual covenants and agreements hereinafter set forth, and intending to be
legally bound, the parties hereto hereby agree as follows:
ARTICLE 1.
DEFINITIONS AND REFERENCES
As used herein, the following terms shall have the meanings
set forth below, unless the context otherwise requires:
"Accounts Receivable" means all accounts, notes or accounts
receivable with respect to the Station.
"Additional Agreements" shall have the meaning set forth in
Section 7.01(g).
"Applications" shall have the meaning set forth in Section 5.
"Assets" means the Station and all real, personal and mixed
assets, both tangible and intangible (including the business of the Station as a
"going concern"), wherever located, owned or held by Seller and which are used
or useful in the business and operation of the Station. Subject to the
provisions of Section 7, Assets shall include all such assets existing on the
date of this Agreement and all such assets acquired between that date and the
Closing Date, and shall include, without limitation, all of Seller's right,
title and interest in and to the following assets:
(a) that certain real property set forth and described in
Schedule 1(a).
(b) the leasehold interests in that certain real property
described in Schedule 1(b).
(c) all buildings, structures, fixtures, and other
improvements now or hereafter actually or
constructively attached to the Property, and all
modifications, additions, restorations, or replacements
of the whole or any part thereof, including, without
limitation, those described in Schedules 1(a) and 1(b)
(the "Improvements").
(d) as landlord (whether named as such therein or by
assignment or otherwise) in all leases and subleases,
if any, of the Property and the Improvements now
existing or at any time hereafter made, and any and all
amendments, modifications, supplements, renewals and
extensions thereof, together with all rents, royalties,
security deposits, revenues, issues, earnings, profits,
income and other benefits of the Property or the
Improvements now due or hereafter to become due with
respect to the Property or the Improvements or any part
thereof.
(e) in and to all streets, roads and public places, opened
or proposed, and all easements and rights of way,
public and private, rights and appurtenances, now or
hereafter used in connection with, or belonging,
incident or appertaining to, the Property or the
Improvements.
(f) all furniture, fixtures, furnishings, machinery,
equipment, inventory, supplies, antenna installations,
towers and other property, including, without
limitation, those described in Schedule 1(f).
(g) all of the Licenses (as hereinafter defined) for the
Station as more fully described in Schedule 1(g).
(h) all of the copyrights, trademarks and trade names
(including any and all applications, registrations,
extensions and renewals relating thereto), and all of
the rights associated therewith, including, without
limitation, those described in Schedule 1(h) and
Seller's rights to the call letters for the Station.
(i) all contracts, agreements, leases and other intangible
assets, including, without limitation, those trade-out
agreements and other contracts, agreements and leases
described in Schedule 1(i).
(j) all deposits and prepaid expenses, including, without
limitation, those described in Schedule 1(j).
(k) all automotive equipment and motor vehicles, including,
without limitation, those described in Schedule 1(k).
(l) all engineering, business and other books, papers,
files and records, but not the articles of
incorporation, by-laws, minute books, stock transfer
records, or other corporate records of Seller.
(m) all translators, earth stations, and other auxiliary
facilities, and all applications therefor.
"Assignment of Contracts" means that certain Assignment of
Contracts, dated as of the Closing Date and executed by Seller, substantially in
the form attached hereto as Exhibit D.
"Assignment of Leases" means that certain Assignment of
Leases, dated as of the Closing Date and executed by Seller, substantially in
the form attached hereto as Exhibit A.
"Assignment of Licenses" means that certain Assignment of
Licenses, dated as of the Closing Date and executed by Seller, substantially in
the form attached hereto as Exhibit C.
"Assumption Agreement" means that certain Assumption Agreement
dated as of the Closing Date and executed by Buyer and Seller, substantially in
the form attached hereto as Exhibit G.
"Bill of Sale" means that certain Bill of Sale and Assignment
of Assets, dated as of the Closing Date and executed by Seller, substantially in
the form attached hereto as Exhibit B.
"Claims" shall have the meaning specified in Section 15.05.
"Closing" means the closing of the purchase, assignment and
sale of the Assets contemplated hereunder.
"Closing Date" means the time and date on which the Closing
takes place, as established by Section 11.01.
"Commission" means the Federal Communications Commission.
"Deed" means the general warranty deed of Seller,
substantially in the form attached hereto as Exhibit E.
"Encumbrances" mean any mortgages, pledges, liens, claims,
security interests, agreements, restrictions, defects in title, easements,
encumbrances, or charges.
"FCC Order" means an order or orders of the Commission, or of
the Chief, Mass Media Bureau, acting under delegated authority, consenting to
the assignment to Buyer of the Licenses for the Station, as proposed in the
Applications therefor, without conditions which are adverse to Buyer or which in
any way diminish the operating rights with respect to the Assets and the
Station, except any such conditions expressly accepted by Buyer in writing.
"Final Order" means the FCC Order(s) as to which the time for
filing a request for administrative or judicial review, or for instituting
administrative review sua sponte, shall have expired without any such filing
having been made or notice of such review having been issued; or, in the event
of such filing or review sua sponte, as to which such filing or review shall
have been disposed of favorably to the grant and the time for seeking further
relief with respect thereto shall have expired without any request for such
further relief having been filed.
"Indemnified Party" and "Indemnifying Party" shall have the
respective meanings specified in Section 15.05.
"Licenses" means all of the licenses and other authorizations
issued by the Commission for the operation of the Station, as set forth in
Schedule 1(g).
"Option" means the option to purchase the Station granted by
Seller to Buyer, pursuant to the exercise of which this Agreement has been
entered into.
"Option Consideration" means the amount of Ten Million Dollars
($10,000,000) which Buyer has paid Seller pursuant to the terms of the Option
Agreement and any portion of the Supplemental Amount, if any, previously paid by
Buyer to Seller.
"Property" means, collectively, that certain real property
described in Schedule 1(a) and the leasehold interests in that certain real
property described in Schedule 1(b).
"Purchase Price" means the amount of Twelve Million Dollars
($12,000,000) and up to an additional amount of Seven Million Dollars
($7,000,000) in the event that the Supplemental Amount has been paid by Buyer to
Seller as specified in Section 2.3 of the Option Agreement.
"Station Contracts" shall have the meaning set forth in
Section 3.10.
"Supplemental Amount" shall have the meaning set forth in the
Option Agreement.
"Survey" means the surveys for all parcels of real property
described on Schedule 1(a), each of which shall be prepared by a registered land
surveyor licensed in the State of Alabama (the "Surveyor"), certified by the
Surveyor to Buyer and Buyer's lender, and showing (a) the location of all lot
and street lines, (b) the location of encroachments, overhangs or projections by
buildings or improvements erected on adjacent lands or on such real property,
(c) means of ingress and egress to public roads, (d) the location of all utility
and other easements, rights of way, set-back lines and other matters of record
affecting such real property; (e) a description and the location of all existing
improvements (including parking areas), and (f) such other facts and information
as Buyer may require.
"TBA" means that certain Time Brokerage Agreement, dated as of
December 21, 1995, by and between Seller and Buyer.
"Title Insurance Commitment" means an irrevocable title
insurance commitment issued by a title insurance company acceptable to Buyer
with respect to the real property described in Schedule 1(a) for (i) a prepaid
owner's policy of title insurance (on ALTA Form B 1990 or form offering similar
coverage), showing fee simple title to the real property described in Schedule
1(a) in Buyer, with no exception as to survey matters, no standard pre-printed
exceptions, no creditors' rights exceptions, no exceptions for mechanics and
materialmen's liens, no gap exceptions, and affirmative coverage as Buyer may
reasonably request, and (ii) a prepaid full-coverage mortgagee policy of title
insurance (on the ALTA 1990 form or form offering similar coverage), naming
Buyer's lender as the insured party, with no exception as to survey matters, no
standard pre-printed exceptions, no creditors' rights exceptions, no exceptions
for mechanics and materialmen's liens, no gap exceptions, and affirmative
coverage as Buyer may reasonably request, insuring that the mortgage of Buyer's
lender constitutes a valid and recorded first lien on a good and marketable fee
simple interest in the real property described in Schedule 1(a). The dollar
amount of each policy shall be equal to the amount of consideration allocated to
the real property pursuant to Section 12.
All references to Sections, Exhibits and Schedules are to
Sections of and Exhibits and Schedules to this Agreement.
ARTICLE 2.
SALE AND PURCHASE OF ASSETS; PURCHASE PRICE; PAYMENT OF
PURCHASE PRICE; ASSUMPTION OF LIABILITIES
2.01 ASSET SALE.
On the basis of the representations, warranties and agreements
contained herein, and subject to the terms and conditions hereof, Seller agrees
to sell, assign, transfer, convey and deliver to Buyer, and Buyer agrees to
purchase from Seller, the Assets at the Closing.
2.02 PURCHASE PRICE.
For and in consideration of the conveyances and assignments
described herein and in addition to the assumption of liabilities as set forth
in Section 2.04, Buyer agrees to pay to Seller, and Seller agrees to accept from
Buyer, the Purchase Price (less the Option Consideration), subject to adjustment
for payment of expenses as provided for in Section 21. The Purchase Price shall
be payable as described in Section 2.03. The Purchase Price shall be allocated
among the Assets in accordance with Section 12.
2.03 PAYMENT OF PURCHASE PRICE.
On the Closing Date, the Buyer shall pay the adjusted Purchase
Price (as calculated in accordance with Section 2.02) to Seller by wire transfer
of immediately available funds.
2.04 ASSUMPTION OF LIABILITIES.
At the Closing, Buyer shall assume only the following
liabilities and obligations of Seller (the "Assumed Liabilities"): (a) the
liabilities and obligations of Seller to be performed after the Closing Date
under the contracts, agreements and leases set forth and described in Schedules
1(b) and 1(i) and (b) the liabilities and obligations of Seller to be performed
after the Closing Date under any contracts, agreements and leases which are
entered into after the date hereof (in compliance with Section 7) and which are
identified in the certificate referred to in Section 11.02(c). Buyer shall not
assume or be deemed to assume any debts, liabilities or obligations of Seller
except as specified in this Section 2.04. All such assumptions pursuant to this
Section 2.04 shall be subject to Buyer's confirmation with creditors of existing
unperformed obligations.
ARTICLE 3
REPRESENTATIONS AND WARRANTIES BY SELLER
Seller represents and warrants to Buyer as follows:
3.01 ORGANIZATION AND STANDING.
Seller is a corporation duly organized, validly existing and
in good standing under the laws of the State of Ohio and authorized to conduct
business in the State of Alabama. Neither the nature of the business conducted
by Seller, nor the character of the properties owned, leased or otherwise held
by Seller makes any such qualification necessary in any other state, country,
territory or jurisdiction. Seller has the full and unrestricted power and
authority, corporate and otherwise, to own, lease and operate the Assets, to
carry on its business as now conducted, and to enter into and perform the terms
of this Agreement, the agreements, and instruments referred to herein, and the
transactions contemplated hereby and thereby.
3.02 AUTHORIZATION.
The execution, delivery and performance of this Agreement and
of the agreements and instruments called for hereunder, and the consummation of
the transactions contemplated hereby and by such agreements and instruments have
been duly and validly authorized by all necessary actions of Seller (none of
which actions has been modified or rescinded and all of which actions are in
full force and effect). This Agreement constitutes, and upon execution and
delivery each other agreement and instrument will constitute, a valid and
binding agreement and obligation of Seller, enforceable in accordance with its
respective terms. Except as specified in Section 3.05, the execution, delivery
and performance by Seller of this Agreement and the agreements and instruments
called for hereunder will not require the consent, approval or authorization of
any person, entity or governmental authority.
3.03 LITIGATION; COMPLIANCE WITH LAW.
There is no action, suit, investigation, claim, arbitration or
litigation pending or, so far as Seller knows, threatened against or involving
either Seller, the Assets, the Station or the Station's business and operations,
at law or in equity, or before or by any court, arbitrator or governmental
authority, and neither Seller nor the Station is operating under or subject to
any order, judgment, decree or injunction of any court, arbitrator or
governmental authority, except for those listed in Schedule 3.03. Seller has
complied and is in compliance in all material respects with all laws,
ordinances, regulations, awards, orders, judgments, decrees and injunctions
applicable to Seller, to the Assets, to the Station and to its business and
operations, including all federal, state and local laws, ordinances, regulations
and orders pertaining to employment or labor, safety, health, environmental
protection, zoning and other matters. Seller has obtained all material permits,
licenses and approvals (none of which has been modified or rescinded and all of
which are in full force and effect) from all governmental authorities necessary
in order to conduct the operation of the Station as presently conducted and to
own, use and maintain the Assets.
3.04 FINANCIAL STATEMENTS AND CONDITION; LIABILITIES.
3.04(a) Seller has prepared and/or furnished to Buyer the
balance sheets of Seller as of the dates specified on Schedule 3.04(a), and the
statements of income, stockholders' equity and changes in financial position for
the periods specified on Schedule 3.04(a). All of the financial statements,
including, without limitation, the notes thereto, referred to in Schedule
3.04(a) or furnished to Buyer after the date hereof pursuant to this Agreement:
(i) are in accordance with the books and records of the Seller, (ii) are true,
correct and complete in all material respects and present fairly the financial
position of Seller as of the respective dates and the results of operations and
changes in cash flow for the respective periods indicated, and (iii) have been
prepared in accordance with generally accepted accounting principles applied on
a basis consistent with prior accounting periods. All deposits and prepaid
expenses, if any, included as assets of Seller represent bona fide deposits or
payments theretofore made by Seller, the benefit and advantage of which will be
obtained and enjoyed by Seller and, after the Closing Date, by Buyer.
3.04(b) Except as reflected in the balance sheets as of July
31, 1999, including the notes thereto, there exist no liabilities of Seller,
contingent or absolute, matured or unmatured, known or unknown. Since July 31,
1999, (i) Seller has not made any contract, agreement or commitment or incurred
any obligation or liability (contingent or otherwise), except in the ordinary
course of business and consistent with past business practices, (ii) there has
not been any discharge or satisfaction of any obligation or liability owed to
Seller, which is not in the ordinary course of business or which is inconsistent
with past business practices, or (iii) there has not occurred any loss or
material injury to the Assets as the result of any fire, accident, act of God or
the public enemy, or other casualty, or any adverse material change in the
Assets.
3.05 ASSETS; CONSENTS.
3.05(a) The Assets to be acquired at the Closing constitute
all of the real, personal, and mixed assets, both tangible and intangible, that
are used, held for use or necessary for the business and operations of the
Station as presently conducted.
3.05(b) Seller is the sole and exclusive legal and equitable
owner of all right, title and interest in and has good, marketable, and
insurable title to the Assets, free and clear of any Encumbrances, except for
and subject only to (i) liens for real estate taxes not yet due and payable,
(ii) existing easements of record on real property which do not materially
impair the use of such property for the purposes contemplated hereunder, and
(iii) those encumbrances set forth in Schedule 3.05(b), which shall be removed
prior to or contemporaneously with the Closing Date.
3.05(c) On the Closing Date, Buyer shall acquire good,
marketable and insurable title to, and all right, title and interest in, the
Assets, free and clear of all Encumbrances, except for and subject only to liens
for real estate taxes not yet due and payable and existing easements of record
on real property which do not materially impair the use of such property for the
purposes contemplated hereunder.
3.05(d) All of the Assets to be transferred hereunder are
transferable by Seller by Seller's sole act and deed, and no consent on the part
of any other person is necessary to validate the transfer to Buyer, except (i)
the Licenses described in Schedule 1(g) are not assignable without the consent
of the Commission as provided by law and (ii) certain of the agreements
described in Schedules 1(b) and 1(i), as specified in Schedule 3.05(d), may be
assigned only with the consent of third parties.
3.05(e) The Property and all of the Improvements have direct
and unobstructed access to all public utilities necessary for the uses to which
the Property and all of the Improvements are presently devoted by Seller and to
a public street. No portion of the Property or any Improvement is the subject
of, or affected by, any condemnation or eminent domain proceedings currently
instituted or pending, and so far as Seller knows, no such proceedings are
threatened. The Property and the Improvements are not subject to any covenant or
other restriction preventing or limiting Seller's right to convey Seller's
right, title and interest in the Property and the Improvements or to use the
Property and the Improvements for the various purposes for which the Property
and the Improvements are being used.
3.06 CONDITION OF TANGIBLE ASSETS.
All tangible Assets are in good operating condition and
repair, and are suitable, adequate and fit for the uses for which they are
intended or are being used; and the present use of such Assets do not violate in
any material respect any applicable licenses, statutes, or building, fire,
zoning, health and safety or any other laws or regulations. Without limiting the
foregoing, such tangible assets and operations thereof do not result in exposure
of workers or the general public to levels of radio frequency radiation in
excess of the "Radio Frequency Protection Guides" recommended in "American
National Standard Safety Levels With Respect to Human Exposure to Radio
Frequency Electromagnetic Fields, 300 KHz to 100 GHz," issued by the American
National Standards Institute and which the Commission has incorporated in its
rules and regulations.
3.07 TRADEMARKS; LICENSES.
Schedule 1(h) contains a true and complete listing of all
franchises, licenses, trademarks, trade names, copyrights and applications
therefor owned or licensed by or registered in the name of Seller and used or
held for use in the business and operations of the Station, other than the
Licenses, all of which are transferable to Buyer by the sole act and deed of
Seller; and no consent on the part of any other person is necessary to validate
the transfer to Buyer. Seller pays no royalty to anyone under any of the
foregoing. Seller owns or possesses all rights to use all franchises, licenses,
service marks, trademarks, trade names, copyrights, patents and applications
therefor necessary to the conduct of the business of the Station. Seller does
not have any knowledge nor has Seller received any notice to the effect that any
service rendered by Seller relating to the business of the Station may infringe
on any trademark, service mark, trade name, copyright, patent, trade secret or
legally protectable right of another.
3.08 LICENSES.
The Licenses for the Station are valid through April 1, 2005
and there are no orders, complaints, proceedings or investigations, pending or,
so far as Seller knows, threatened, which would affect the validity of the
Licenses.
3.09 REPORTS AND RECORDS.
During the current term of the Licenses, all returns, reports
and statements relating to the Station currently required to be filed by Seller
with the Commission or any other governmental instrumentality have been filed
and complied with and are true, correct and complete in all material respects.
All such reports, returns and statements shall continue to be filed on a current
basis until the Closing Date, and will be true, correct, and complete in all
material respects. During the current term of the Licenses, all documents
required by the Commission's rules to be placed in the Station's public files
have been placed and are being held in such files. During the current term of
the Licenses, all logs and business records of every type and nature relating to
the business and operations of the Station, including but not limited to
political and public record files, program, operating and maintenance logs,
equipment performance measurements, policies or evidence of insurance, licenses,
payroll, social security and withholding tax returns, operator agreements and
other records pertaining to the business and operations of the Station have been
maintained in all material respects in accordance with good business practices
and the rules of the Commission and are, to the extent required, at the Station.
3.10 CONTRACTS.
The contracts, agreements and leases set forth and described
in Schedules 1(b), and 1(i) are all of the contracts, agreements, leases and
commitments (both written and oral) relating to the Assets, to the Station or to
the business and operations thereof, other than (i) contracts for the sale of
advertising for cash, which are not for a term longer than thirty (30) days, and
(ii) contracts or commitments which do not require payments of more than $5,000
each or $20,000 in the aggregate. Seller has delivered to Buyer prior to the
execution of this Agreement true and complete copies or descriptions of all
contracts, agreements, leases and commitments (and all amendments and
modifications thereto) relating to the Assets, the Station or to the business
and operations thereof (collectively, the "Station Contracts"). The unperformed
obligations ascertainable from the terms on the face of the Station Contracts
are the existing unperformed obligations thereunder. Each Station Contract is in
full force and effect, and constitutes a valid and binding obligation of, and is
legally enforceable in accordance with its terms against, the parties thereto.
The parties thereto have complied with all of the material provisions of the
Station Contracts and are not in default thereunder, and there has not occurred
any event which (whether with or without notice, lapse of time, or the happening
or occurrence of any other event) would constitute such a default. There has not
been (i) any failure of any party to any Station Contract to comply with all
material provisions thereof, (ii) any default by any party thereunder, (iii) any
threatened cancellation thereof, (iv) any outstanding dispute thereunder, or (v)
any basis for any claim of breach or default thereunder.
3.11 CONFLICTS.
Except as set forth in Schedule 3.11, the execution and
delivery of this Agreement and the agreements and instruments called for
hereunder, the fulfillment of and the compliance with the respective terms and
provisions of each, and the consummation of the transactions described in each,
do not and will not conflict with or violate any law, ordinance, regulation,
order, award, judgment, injunction or decree applicable to Seller, to the Assets
or to the Station, or conflict with or result in a breach of or constitute a
default under any of the terms, conditions or provisions of Seller's articles of
incorporation or bylaws, or any contract, agreement, lease, commitment, or
understanding to which Seller is a party or by which Seller is bound or to which
any of the Assets or the Station is subject, or result in the acceleration of
any indebtedness or in the creation of any Encumbrance upon the Assets.
3.12 RELATED PARTIES.
Neither Seller nor any shareholder, officer or director of
Seller has any interest whatsoever in any corporation, firm, partnership or
other business enterprise which has had any business transactions with Seller
relating to the Assets or the Station, and no shareholder of Seller has entered
into any transaction with Seller relating to the Assets or the Station, except
for those set forth in Schedule 3.12.
3.13 TAXES.
The Seller has timely filed with all appropriate governmental
agencies all federal, state, commonwealth, local, and other tax or information
returns and tax reports (including, but not limited to, all income tax,
unemployment compensation, social security, payroll, sales and use, profit,
excise, privilege, occupation, property, ad valorem, franchise, license, school
and any other tax under the laws of the United States or of any state or any
commonwealth or any municipal entity or of any political subdivision with valid
taxing authority) due for all periods ended on or before the date hereof. Seller
has paid in full all federal, state, commonwealth, foreign, local and other
governmental taxes, estimated taxes, interest, penalties, assessments and
deficiencies (collectively, "Taxes") which have become due pursuant to such
returns or without returns or pursuant to any assessments received by Seller.
Such returns and forms are true, correct and complete in all material respects,
and Seller has no liability for any Taxes in excess of the Taxes shown on such
returns. Seller is not a party to any pending action or proceeding, and, to
Seller's knowledge, there is no action or proceeding threatened by any
government or authority against Seller for assessment or collection of any
Taxes, and no unresolved claim for assessment or collection of any Taxes has
been asserted against Seller.
3.14 EMPLOYEE BENEFIT PLANS.
3.14(a) Except as described in Schedule 3.14(a), neither
Seller nor any Affiliates (as defined below) have at any time established,
sponsored, maintained, or made any contributions to, or been parties to any
contract or other arrangement or been subject to any statute or rule requiring
them to establish, maintain, sponsor, or make any contribution to, (1) any
"employee pension benefit plan" (as defined in Section 3(2) of the Employee
Retirement Income Security Act of 1974, as amended, and regulations thereunder
("ERISA")) ("Pension Plan"); (ii) any "employee welfare benefit plan" (as
defined in Section 3(1) of ERISA) ("Welfare Plan"); or (iii) any deferred
compensation, bonus, stock option, stock purchase, or other employee benefit
plan, agreement, commitment, or arrangement ("Other Plan"). Seller and the
Affiliates have no obligations or liabilities (whether accrued, absolute,
contingent, or unliquidated, whether or not known, and whether due or to become
due) with respect to any "employee benefit plan" (as defined in Section 3(3) of
ERISA) or Other Plan that is not listed in Schedule 3.14(a). For purposes of
this Section 3.14, the term "Affiliate" shall include all persons under common
control with Seller within the meaning of Sections 4001(a)(14) or (b)(1) of
ERISA or any regulations promulgated thereunder, or Sections 414(b), (c), (m) or
(o) of the Internal Revenue Code of 1986, as amended (the "Code").
3.14(b) Each plan or arrangement listed in Schedule 3.14(a)
(and any related trust or insurance contract pursuant to which benefits under
such plans or arrangements are funded or paid) has been administered in all
respects in full compliance with its terms and in both form and operation is in
compliance with applicable provisions of ERISA, the Code, the Consolidated
Omnibus Budget Reconciliation Act of 1986 and regulations thereunder, and other
applicable law. Each Pension Plan listed in Schedule 3.14(a) has been determined
by the Internal Revenue Service to be qualified under Section 401(a) and, if
applicable, Section 401(k) of the Code, and nothing has occurred or been omitted
since the date of the last such determination that resulted or could result in
the revocation of such determination. Seller and the Affiliates have made all
required contributions or payments to or under each plan or arrangement listed
in Schedule 3.14(a) on a timely basis and have made adequate provision for
reserves to meet contributions and payments under such plans or arrangements
that have not been made because they are not yet due.
3.14(c) The consummation of this Agreement (and the employment
by Buyer of former employees of Seller or any employees of an Affiliate) will
not result in any carryover liability to Buyer for taxes, penalties, interest or
any other claims resulting from any employee benefit plan (as defined in Section
3(3) of ERISA) or Other Plan. In addition, Seller and each Affiliate make the
following representations (i) as to all of their Pension Plans: (A) neither
Seller nor any Affiliate has become liable to the PBGC under ERISA under which a
lien could attach to the assets of Seller or an Affiliate; (B) Seller and each
Affiliate has not ceased operations at a facility so as to become subject to the
provisions of Section 4062(e) of ERISA; and (C) Seller and each Affiliate has
not made a complete or partial withdrawal from a multiemployer plan (as defined
in Section 3(37) of ERISA) so as to incur withdrawal liability as defined in
Section 4201 of ERISA, and (ii) all group health plans maintained by the Seller
and each Affiliate have been operated in compliance with Section 4980B(f) of the
Code.
3.14(d) The parties agree that Buyer does not and will not
assume the sponsorship of, or the responsibility for contributions to, or any
liability in connection with, any Pension Plan, any Welfare Plan, or Other Plan
maintained by Seller or an Affiliate for its employees, former employees,
retirees, their beneficiaries or any other person. In addition and not as a
limitation of the foregoing covenant, the parties agree that Seller and such
Affiliate shall be liable for any continuation coverage (including any
penalties, excise taxes or interest resulting from the failure to provide
continuation coverage) required by Section 4980B of the Code due to qualifying
events which occur on or before Closing Date.
3.15 ENVIRONMENTAL MATTERS.
3.15(a) For purposes of this section, "Hazardous Materials"
means any wastes, substances, or materials, whether solids, liquids or gases,
that are deemed hazardous, toxic, pollutants, or contaminants, including but not
limited to substances defined as "hazardous wastes," "hazardous substances,"
"toxic substances," "radioactive materials," or other similar designations in,
or otherwise subject to regulation under, the Comprehensive Environmental
Response, Compensation and Liability Act of 1980, ("CERCLA") as amended by the
Superfund Amendments and Reauthorization Act of 1986 ("SARA"), 42 U.S.C. ss.
9601 et seq.; the Toxic Substance Control Act ("TSCA"), 15 U.S.C. ss. 2601 et
seq.; the Hazardous Materials Transportation Act, 49 U.S.C. ss. 1802 et seq.;
the Resource Conservation and Recovery Act ("RCRA"), 42 U.S.C. ss. 9601 et seq.;
the Clean Water Act ("CWA"), 33 U.S.C. ss. 1251 et seq.; the Safe Drinking Water
Act, 42 U.S.C. ss. 300f et seq.; the Clean Air Act ("CAA"), 42 U.S.C. ss. 7401
et seq.; or other applicable federal, state, or local laws, including any plans,
rules, regulations, orders, or ordinances adopted, or other criteria and
guidelines promulgated pursuant to the preceding laws or other similar laws,
regulations, rules, orders, or ordinances now or hereafter in effect relating to
the protection of human health and the environment (collectively "Environmental
Laws"). "Hazardous Materials" includes but is not limited to polychlorinated
biphenyls (PCBs), asbestos and lead-based paints.
3.15(b)Seller's Environmental Representations and Warranties.
Seller hereby represents and warrants that except as set forth on
Schedule 3.15(b):
(i) There are no pending or, to Seller's
knowledge threatened, actions, suits, claims, legal proceedings or any other
proceedings based on Hazardous Materials or the Environmental Laws at the
Property, or any part thereof, or otherwise arising from Seller's activities
at the Property involving Hazardous Materials;
(ii) To Seller's knowledge, there are no
conditions, facilities, procedures or any other facts
or circumstances which could give rise to claims, expenses, losses, liabilities,
or governmental action against Buyer in connection with any Hazardous Materials
present at or disposed of from the Property, including without limitation the
following conditions arising out of, resulting from, or attributable to, the
assets, business, or operations of Seller at the Property: (A) the presence of
any Hazardous Materials on the Property or the release or threatened release of
any Hazardous Materials into the environment from the Property; (B) the off-site
disposal of Hazardous Materials originating on or from the Property or the
business or operations of Seller; (C) the release or threatened release of any
Hazardous Materials into any storm drain, sewer, septic system or publicly owned
treatment works; (D) any noncompliance with federal, state or local requirements
governing occupational safety and health, or presence or release in the air and
water supply systems of the Property of any substances that pose a hazard to
human health or an impediment to working conditions; or (E) any facility
operations, procedures or designs, which do not conform to the statutory or
regulatory requirements of any Environmental Laws.
(iii) To Seller's knowledge, neither
polychlorinated biphenyls nor asbestos-containing materials are present on or in
the Property.
(iv) The Property contains no underground
storage tanks, or underground piping associated with tanks, used currently or,
to Seller's knowledge, in the past for the management of Hazardous Materials.
3.16 LABOR RELATIONS.
There are no strikes, work stoppages, grievance proceedings,
union organization efforts, or other controversies pending or threatened between
Seller and any of its employees or agents or any union or collective bargaining
unit. Seller has complied and is in compliance in all material respects with all
laws and regulations relating to the employment of labor, including without
limitation provisions relating to wages, hours, collective bargaining,
occupational safety and health, equal employment opportunity, and the
withholding of income taxes and social security contributions. Except as set
forth in Schedule 3.16 hereto, there are no collective bargaining agreements or
employment agreements between Seller and any of its employees. The consummation
of the transactions contemplated hereby will not cause Buyer to incur or suffer
any liability relating to, or obligation to pay, severance, termination, or
other payments to any person or entity. Except as set forth in Schedule 3.16
hereto, no employee of Seller has any contractual right to continued employment
by Seller following consummation of the transactions contemplated by this
Agreement. Seller has previously delivered to Buyer an accurate and complete
list, a date no more than fourteen (14) days prior to the date of this
Agreement, of all employees of Seller and the rate of compensation (including
salary, bonuses and commissions) of each such employee.
3.17 BROADCAST OF PROGRAMMING
The motion pictures, feature films, and syndicated programs
for which Seller has obtained broadcast rights have been scheduled and broadcast
in the ordinary course of business, consistent with Seller's past business
practices and with customary practices in the television broadcast industry.
3.18 INSURANCE.
Schedule 3.18 contains a list and brief description of all
policies of title, property, fire, casualty, liability, life, workmen's
compensation, business interruption and other forms of insurance of any kind
relating to the Assets or the business and operations of the Station and owned
or held by Seller. All such policies: (i) are in full force and effect; (ii) are
sufficient for compliance in all material respects by Seller with all
requirements of law and of all agreements to which Seller is a party; (iii) are
valid, outstanding, and enforceable policies; and (iv) insure against risks of
the kind customarily insured against and in amounts customarily carried by
corporations similarly situated and provide adequate insurance coverage for the
Assets and the Station (including the business and operations thereof).
3.19 DISCLOSURE.
All facts of material importance to the Assets, to the Station
and to the business of Seller have been fully and truthfully disclosed to Buyer
in this Agreement. No representation or warranty by Seller and no document,
statement, certificate, schedule or exhibit to be furnished or delivered to
Buyer pursuant to or in connection with this Agreement contains or will contain
any material untrue or misleading statement of fact or omits or will omit any
fact necessary to make the statements contained herein or therein not materially
misleading.
ARTICLE 4.
REPRESENTATIONS AND WARRANTIES BY BUYER
Buyer represents, warrants and covenants to Seller as follows:
4.01 ORGANIZATION AND STANDING.
Buyer is a corporation duly organized, validly existing and in
good standing under the laws of the State of Delaware and by the Closing Date
will be duly qualified to do business as a foreign corporation in Alabama. Buyer
has the full and unrestricted power and authority, corporate and otherwise, to
enter into and perform the terms of this Agreement, the agreements and
instruments referred to herein, and the transactions contemplated hereby and
thereby.
4.02 AUTHORIZATION.
The execution, delivery and performance of this Agreement and
of the agreements and instruments called for hereunder, and the consummation of
the transactions contemplated hereby and thereby, have been duly and validly
authorized by all necessary actions of Buyer (none of which actions has been
modified or rescinded and all of which actions are in full force and effect).
This Agreement constitutes, and upon execution and delivery each other agreement
and instrument will constitute, a valid and binding agreement and obligation of
Buyer, enforceable in accordance with its respective terms. Except for the
consent of the Commission to the assignment to Buyer of the Licenses described
in Schedule 1(g), the pre-merger notification clearance required under the
Hart-Scott-Rodino Antitrust Improvements Act of 1976, as amended, and any
consents which may be required from certain lenders of Buyer as described in
Schedule 4.02, the execution, delivery and performance by Buyer of this
Agreement and the agreements and instruments called for hereunder will not
require the consent, approval or authorization of any person, entity or
governmental authority.
4.03 QUALIFICATION AS LICENSEE.
Except for possible contour overlap with television station
WCFT-TV, Tuscaloosa, Alabama, Buyer knows of no reason why it should not be
found by the Commission to be qualified under the Communications Act of 1934, as
amended, and the Commission's rules and regulations to become the licensee of
the Station.
ARTICLE 5.
APPLICATION FOR COMMISSION CONSENT
As promptly as practicable and no later than ten (10) business
days following the execution of this Agreement, Seller and Buyer shall take all
steps reasonably necessary to file and shall participate in the filing of
applications with the Commission (the "Applications") requesting its written
consent to the assignment of the Licenses for the Station (and any extensions
and renewals thereof) from Seller to Buyer. Seller and Buyer will diligently
take all necessary and proper steps, provide any additional information
reasonably requested, and otherwise use their best efforts in order to obtain
promptly the requested consent and approval of the Applications by the
Commission; provided that neither of the parties hereto shall have any
obligation to take any unreasonable steps to satisfy complainants, if any, or to
participate in any evidentiary hearing (other than a hearing at which only oral
argument is to be presented).
ARTICLE 6.
HART-SCOTT-RODINO
As promptly as practicable and no later than thirty (30) days
following the execution of this Agreement, Seller and Buyer shall complete any
filing that may be required pursuant to the Hart-Scott-Rodino Antitrust
Improvements Act of 1976, as amended, or shall mutually agree that no such
filing is required. Seller and Buyer shall diligently take all necessary and
proper steps and provide any additional information reasonably requested in
order to comply with the requirements of such Act.
ARTICLE 7.
COVENANTS AND AGREEMENTS OF SELLER
Seller covenants and agrees with Buyer as follows:
7.01 NEGATIVE COVENANTS.
Pending and prior to the Closing, Seller will not, without the
prior written approval of Buyer, do or agree to do any of the following:
7.01(a) Dispositions; Mergers. Sell, assign, lease or
otherwise transfer or dispose of any of the Assets or merge or consolidate with
or into any other entity or enter into any negotiations or agreements relating
thereto; provided, however, Seller may sell, assign, lease or otherwise transfer
or dispose of any asset described in Schedule 1(f) if such asset is expended in
the ordinary course of business, consistent with Seller's past business
practices and with customary practices in the television broadcast industry, and
property or equipment of like kind and equivalent value is substituted therefor.
7.01(b) Accounting Principles and Practices. Change or modify
any of Seller's accounting principles or practices or any method of applying
such principles or practices.
7.01(c) Trade-Outs. Enter into any trade-out agreement, or
similar contract, commitment or understanding to provide broadcast time, except
those which are in the ordinary course of business and consistent with Seller's
past business practices and the TBA and which can be and are performed
completely prior to the Closing Date.
7.01(d) Broadcast Time Agreements. Enter into any broadcast
time sales agreement, contract, commitment or understanding except those that
are in the ordinary course of business and consistent with customary practices
in the television broadcast industry and the TBA.
7.01(e) Local Marketing Arrangements. Except for the TAB,
acquire or enter into any local marketing arrangements, time brokerage
agreements or other similar contracts.
7.01(f) Program Contracts. Acquire or enter into any new
program contracts or renew, extend, amend, alter, modify or otherwise change any
existing program contract, except that Seller may enter into new program
contracts, consistent with the terms of the TBA, which have a term of less than
six months.
7.01(g) Additional Agreements. Materially modify or amend any
of the agreements listed in Schedule 3.05(d) which are marked by an asterisk or
enter into any other agreements, contracts, leases, commitments, understandings,
or licenses (collectively, "Additional Agreements") or incur any obligation or
liability (contingent or absolute); provided, however, that Seller may enter
into trade-out agreements, broadcast time agreements and program contracts
consistent with this Section 7.01 and the terms of the TBA; and that any
Additional Agreements are entered into in the ordinary course of business
consistent with Seller's past business practices and customary practices in the
television broadcast industry, so long as such Additional Agreements do not
involve payments or obligations in excess of One Million Dollars ($1,000,000)
for all such Additional Agreements in the aggregate.
7.01(h) Breaches; Employment Contracts. Do or omit to do any
act (or permit such action or omission) which will cause a material breach of
any Station Contract; enter into or become subject to any employment, labor or
union contract, any professional service contract not terminable at will, or any
bonus, pension, insurance, profit sharing, deferred compensation, severance pay,
retirement, hospitalization, employee benefit, or other similar plan; increase
the compensation payable or to become payable to any employee; or pay or arrange
to pay any bonus payment to any employee.
7.01(i) Actions Affecting Licenses or Contracts. Take any
action which under existing law may reasonably be expected to have a material
adverse effect on the validity or enforceability of or rights under the Licenses
or any material lease or contract.
7.01(j) Programming. Program or broadcast any motion picture,
feature film or syndicated program, except in the ordinary course of business,
within the terms of the TBA and consistent with Seller's past business
practices.
7.01(k) Accounts. Accelerate the collection of or sell or
assign any accounts receivable, or decelerate the payment of accounts payable,
except in order to conform with Seller's past business practices and the terms
of the TBA.
7.02 AFFIRMATIVE COVENANTS.
Pending and prior to the Closing Date, Seller will:
7.02(a) Preserve Existence. Preserve its corporate existence
and business organization intact, maintain its existing franchises and licenses,
use its reasonable best efforts to preserve for Buyer its relationships with
suppliers, customers, employees and others having business relations with
Seller, and keep all Assets in their present condition, ordinary wear and tear
excepted.
7.02(b) Normal Operations. Subject to the terms and conditions
of this Agreement (including, without limitation, Section 7.01) and the terms
and conditions of the TBA: (i) carry on the business and activities of the
Station, including without limitation, the sale of advertising time, entering
into trade or barter arrangements, entering into other agreements, leases,
commitments or understandings, or purchasing and scheduling of programming, in
the usual and ordinary course of business consistent with Seller's past business
practices and with customary practices in the television broadcast industry;
(ii) pay or otherwise satisfy all obligations (cash and barter) of the Station
as they come due and payable; (iii) maintain all of its properties in customary
repair, order and condition; and (iv) maintain its books of account, records,
and files in substantially the same manner as heretofore.
7.02(c) Maintain Licenses. Maintain the validity of the
Licenses, and comply in all material respects with all rules and regulations of
the Commission.
7.02(d) Payables. Pay all of its obligations, including,
without limitation, obligations under the Station Contracts and under any such
contracts that shall be entered into between the date hereof and the Closing
pursuant to Section 7.01, as and when they become due and payable.
7.02(e) Corporate Action. Take all corporate action under the
law of the State of Ohio are necessary to effectuate the transactions
contemplated by this Agreement and by the agreements and instruments called for
hereunder.
7.02(f) Transfer Tax; Bulk Sales. Take all necessary action to
provide for the payment of all applicable state sales, transfer or use taxes,
and to comply with all applicable bulk transfer and similar laws, in connection
with the transactions contemplated by this Agreement and the agreements and
instruments called for hereunder.
7.02(g) Access. Give to Buyer and Buyer's authorized
representatives full and complete access upon reasonable notice during normal
business hours to Seller's properties, books, records, contracts, commitments,
facilities, premises, and equipment and to Seller's officers and employees.
7.02(h) Other Information. Provide to Buyer all such other
information and copies of documents concerning Seller, the operation of the
Station, the Assets, and Seller's customers and suppliers as Buyer may request.
7.02(i) Insurance. Maintain in full force and effect all of
its existing casualty, liability, and other insurance through the day following
the Closing Date in amounts not less than those in effect on the date hereof.
7.02(j) Financial Statements. Provide Buyer with unaudited
statements of assets and liabilities and statements of revenues and expenses
reflecting the results of the business and operations of the Station for the
preceding twelve (12) months, within thirty (30) days of the end of the fiscal
year. All of the foregoing financial statements shall comply with the
requirements concerning financial statements set forth in Section 3.04.
7.02(k) Interruption in Broadcast Operations. Promptly notify
Buyer in writing if any Station ceases to broadcast at its authorized power for
more than 48 consecutive hours.
7.02(l) Consents. Obtain third party consents to assign to
Buyer those agreements on Schedule 3.05(d) which are marked with an asterisk and
use its best efforts to obtain third party consents for assignment of all other
agreements listed on Schedule 3.05(d).
7.03 REMOVAL OF MATERIALS.
Any building materials or other items located in or around the
Property which qualify as Hazardous Wastes or Toxic Substances shall immediately
be removed from the Property at Seller's cost and expense.
7.04 CONFIDENTIALITY.
Seller will use its best efforts to maintain strict
confidentiality with respect to all documents and information furnished to
Seller by or on behalf of Buyer; provided, however, that Seller shall have no
such obligations with respect to confidential information that (i) is a matter
of public knowledge or (ii) has been or is hereafter publicly disclosed other
than by or through Seller. In the event this Agreement is terminated, Seller
will return to Buyer all documents, drafts, work papers, and other material
prepared or furnished by Buyer relating to the transactions contemplated
hereunder, whether obtained before or after the execution of this Agreement.
7.05 EMPLOYEES.
For a period commencing upon the execution of this Agreement
and ending twelve (12) months following the Closing Date, Seller and its
affiliates will not offer employment elsewhere than at the Station to any
employee of Seller currently employed at the Station without the prior written
approval of Buyer.
ARTICLE 8.
COVENANTS AND AGREEMENTS OF BUYER
Buyer covenants and agrees with Seller as follows:
8.01 CONFIDENTIALITY.
Buyer will maintain strict confidentiality with respect to all
documents and information furnished to Buyer by or on behalf of Seller;
provided, however, that Buyer shall have no such obligations with respect to
confidential information that (i) is a matter of public knowledge or (ii) has
been or is hereafter publicly disclosed other than by or through Buyer. In the
event this Agreement is terminated, Buyer will return to Seller all copies in
its possession of documents, drafts, work papers, and other material prepared or
furnished by Seller relating to the transactions contemplated hereunder, whether
obtained before or after the execution of this Agreement and the agreements and
instruments called for hereunder.
8.02 CORPORATE ACTION.
Prior to the Closing, Buyer shall take all corporate action
under the law of the State of Delaware necessary to effectuate the transactions
contemplated by this Agreement and by the agreements and instruments called for
hereunder.
ARTICLE 9.
CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
The obligations of Buyer to purchase the Assets and to proceed
with the Closing are subject to the satisfaction (or waiver by Buyer) at or
prior to the Closing of each of the following conditions:
9.01 REPRESENTATIONS AND COVENANTS.
The representations and warranties of Seller made herein or in
any agreement, instrument or document called for hereunder shall have been true
and correct when made and shall be true and correct on the Closing Date as
though such representations and warranties were made on and as of the Closing
Date, and Seller shall have performed and complied with all covenants and
agreements required by this Agreement to be performed or complied with by Seller
prior to the Closing Date.
9.02 CONSENTS.
Seller shall have obtained prior to the Closing Date all
consents necessary to effect valid assignments to Buyer of those contracts on
Schedule 3.05(d) which are marked with an asterisk and all other consents
necessary to consummate the transactions contemplated hereby (except for the FCC
Order which shall be governed by Section 9.04).
9.03 DELIVERY OF DOCUMENTS.
Seller shall have delivered to Buyer all agreements,
instruments and documents required to be delivered by Seller to Buyer pursuant
to Section 11.02.
9.04 FCC ORDER.
The FCC Order shall have become a Final Order with respect to
the Station.
9.05 TITLE INSURANCE COMMITMENT AND SURVEY.
Buyer shall have received the Title Insurance Commitment and
Survey referred to in Section 1 for the real property described in Schedule
1(a), in form and substance satisfactory to Buyer.
9.06 LEGAL PROCEEDINGS.
No action or proceeding by or before any governmental
authority shall have been instituted or threatened (and not subsequently
dismissed, settled or otherwise terminated) which might restrain, prohibit or
invalidate the transactions contemplated by this Agreement (other than an action
or proceeding instituted or threatened by Buyer).
9.07 HART-SCOTT-RODINO.
All applicable waiting periods under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, shall have expired.
9.08 ABSENCE OF MATERIAL CHANGE.
Neither the Station nor the Assets shall have suffered a
material adverse change since the date hereof, and there shall have been no
changes since the date hereof in the business, operations, prospects, condition
(financial or otherwise), properties, assets or liabilities of Seller, of the
Station or of the Assets (regardless of whether or not such events or changes
are consistent with the representations and warranties given herein by Seller),
except changes contemplated by this Agreement and changes in the ordinary course
of business which are not (either individually or in the aggregate) materially
adverse.
ARTICLE 10.
CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE.
The obligation of Seller to sell, transfer, convey and deliver
the Assets and to proceed with the Closing are subject to the satisfaction (or
waiver by Seller) at or prior to the Closing of each of the following
conditions:
10.01 REPRESENTATIONS AND COVENANTS.
The representations and warranties of Buyer made in this
Agreement or in any agreement, instrument or document called for hereunder shall
have been true and correct when made and shall be true and correct on the
Closing Date as though such representations and warranties were made on and as
of the Closing Date, and Buyer shall have performed and complied with all
covenants and agreements required to be performed or complied with by Buyer
prior to the Closing Date.
10.02 DELIVERY OF DOCUMENTS.
Buyer shall have delivered to Seller the Purchase Price and
all agreements, instruments and documents required to be delivered by Buyer to
Seller pursuant to Section 11.03.
10.03 FCC ORDER.
The FCC Order shall have been issued with respect to the
Station.
10.04 LEGAL PROCEEDINGS.
No action or proceeding by or before any governmental
authority shall have been instituted or threatened (and not subsequently
dismissed, settled, or otherwise terminated) that might restrain, prohibit or
invalidate the transactions contemplated by this Agreement, other than an action
or proceeding instituted or threatened by Seller.
10.05 HART-SCOTT-RODINO.
All applicable waiting periods under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976, as amended, shall have expired.
ARTICLE 11.
THE CLOSING
11.01 CLOSING.
Unless otherwise agreed by the parties hereto, the Closing
hereunder shall be held on a date specified by Buyer within ten (10) days
following the date that the FCC Order becomes a Final Order. The Closing shall
be held at 10:00 A.M. local time at the offices of Hogan & Hartson in
Washington, D.C. or at such other time and place as the parties may agree.
11.02 DELIVERY BY SELLER.
At or before the Closing, Seller shall deliver to Buyer the
following:
11.02(a) Agreements and Instruments. The following bills of
sale, statements, assignments and other instruments of transfer, dated as of the
Closing Date, in form sufficient to transfer and convey to Buyer title (of the
quality provided for in this Agreement) to the Assets:
(i) the Assignment of Leases;
(ii) the Bill of Sale;
(iii) the Assignment of Licenses;
(iv) the Assignment of Contracts;
(v) the Deed; and
(vi) such other instruments or documents as Buyer or
Buyer's senior lender may reasonably request.
11.02(b) Consents. Copies of all consents necessary to effect
valid assignments to Buyer of all of the agreements listed on Schedule 3.05(d)
which are marked with an asterisk and any other consents Seller has been able to
obtain.
11.02(c) Certificate Concerning Interim Agreements.
A certificate of Seller describing all broadcast time sales agreements made,
all trade-out agreements entered into, and all other contracts, agreements
and leases entered into by Seller between the date hereof and the Closing Date,
and certifying that such agreements, contracts and leases were entered into in
accordance with Section 7.01.
11.02(d) Corporate Resolutions. Copies of the
resolutions of directors and shareholders of Seller, certified as being correct
and complete and then in full force and effect, authorizing the execution,
delivery and performance of this Agreement and the agreements and instruments
called for hereunder, and the consummation of the transactions contemplated
hereby and by such agreements and instruments.
11.02(e) Officers' Certificate. A certificate of
Seller signed by the President and the Secretary of Seller certifying that the
representations and warranties of Seller made herein were true and correct in
all material respects as of the date of this Agreement and are true and
correct in all material respects as of the Closing Date, and that
Seller has performed and complied with all covenants and agreements required to
be performed or complied with by Seller on or prior to the Closing Date.
11.02(f) Opinion of Counsel. An opinion of counsel
for Seller, dated the Closing Date, addressed to Buyer and to Buyer's lender,
substantially in the form attached hereto as Exhibit F.
11.02(g) Seller's IRS Form 8594. Internal Revenue
Service Form 8594 completed by Seller in connection with the acquisition of
the Assets by Buyer.
11.03 DELIVERY BY BUYER.
At or before the Closing, Buyer shall deliver to Seller the
following:
11.03(a) Purchase Price.
(i) The Purchase Price in the amount and manner set
forth in Section 2.
11.03(b) Assumption Agreement. The Assumption Agreement.
11.03(c) Corporate Resolutions. Copies of the resolutions of
the directors of Buyer, certified as being correct and complete and then in full
force and effect, authorizing the execution, delivery and performance of this
Agreement and the agreements and instruments called for hereunder, and the
consummation of the transactions contemplated by this Agreement and by such
agreements and instruments.
11.03(d) Officers' Certificate. A certificate of Buyer signed
by the President and the Secretary of Buyer certifying that the representations
and warranties of Buyer made herein were true and correct in all material
respects as of the date of this Agreement and are true and correct in all
material respects as of the Closing Date, and that Buyer has performed and
complied with all covenants and agreements required to be performed or complied
with by Buyer prior to the Closing Date.
11.03(e) Buyer's IRS Form 8594. Internal Revenue Service
Form 8594 completed by Buyer in connection with the acquisition of the Assets
by Buyer.
ARTICLE 12.
ALLOCATION OF PURCHASE PRICE AMONG ASSETS
Seller and Buyer each represent, warrant, covenant, and agree
with each other that the Purchase Price shall be allocated among the Assets, as
set forth in an appraisal of the tangible assets to be performed prior to the
Closing (at Buyer's sole expense) by Bond & Pecaro, for purposes of all federal,
state and other income tax returns filed by it or other tax payments made by it.
Notwithstanding any other provision of this Agreement, the provisions of this
Section 12 shall survive the Closing Date without limitation.
ARTICLE 13.
POSSESSION AND CONTROL
Between the date hereof and the Closing Date, Buyer shall not
directly or indirectly control, supervise or direct, or attempt to control,
supervise or direct, the business and operations of the Station, and such
operation, including complete control and supervision of all programs, shall be
the sole responsibility of Seller; provided, however, Buyer shall be entitled to
inspect the Assets as provided in Section 7.02(h) so that an uninterrupted and
efficient transfer of ownership may be effected. On and after the Closing Date,
Seller shall have no control over, or right to intervene or participate in, the
business and operations of the Station.
ARTICLE 14.
RISK OF LOSS
The risk of loss or damage by fire or other casualty or cause
to the Assets until the Closing Date shall be upon Seller. In the event of such
loss or damage prior to the Closing Date, Seller shall promptly restore, replace
or repair the damaged Assets to their previous condition at Seller's sole cost
and expense. In the event such loss or damage shall not be restored, replaced,
or repaired as of the Closing Date, Buyer shall, at its option, either (a)
proceed with the Closing and receive all insurance proceeds to which Seller
would be entitled as a result of such loss or damage (provided, however, if such
proceeds do not equal the loss, Seller shall pay the deficiency to Buyer), or
(b) defer the Closing Date until such restorations, replacements or repairs are
made (provided that no such deferral shall affect the right of Buyer to
terminate this Agreement pursuant to the provisions of Section 16).
ARTICLE 15.
SURVIVAL; INDEMNIFICATION
15.01 SURVIVAL OF SELLER'S REPRESENTATIONS.
Except as otherwise specified, the representations and
warranties made by Seller in this Agreement or pursuant hereto shall survive the
Closing Date for a period of two (2) years, provided that Sections 3.13 and 3.15
shall survive the Closing Date for a period equal to the applicable statute of
limitations and Section 3.05(b) shall survive without limitation as to time, and
the representations and warranties made by Seller shall also survive and shall
be unaffected by (and shall not be deemed waived by) any investigation, audit,
appraisal, or inspection at any time made by or on behalf of Buyer.
15.02 INDEMNIFICATION BY SELLER.
Subject to the conditions and provisions of Section 15.05,
Seller agrees to indemnify, defend and hold harmless Buyer, Buyer's employees,
managers and directors ("Buyer Indemnified Parties") from and against and in
respect of any and all demands, claims, complaints, actions or causes of action,
suits, proceedings, investigations, arbitrations, assessments, losses, damages,
liabilities, costs and expenses, including, but not limited to, interest,
penalties and attorneys' fees and disbursements, asserted against, imposed upon
or incurred by Buyer Indemnified Parties, directly or indirectly, by reason of
or resulting from (a) any liability, obligation, or claim against Seller
(whether absolute, accrued, contingent or otherwise and whether a contractual,
tax or any other type of liability or obligation or claim) not expressly assumed
by Buyer pursuant to Section 2.04, arising out of, relating to or resulting from
the business of Seller, or relating to or resulting from the Assets or the
business and operations of the Station during the period prior to the Closing
Date; (b) any misrepresentation or breach of the representations and warranties
of Seller contained in or made pursuant to this Agreement; or (c) any
noncompliance by Seller with any covenants, agreements or undertakings of Seller
contained in or made pursuant to this Agreement.
15.03 SURVIVAL OF BUYER'S REPRESENTATIONS.
The representations and warranties made by Buyer in this
Agreement or pursuant hereto shall survive the Closing Date for a period of two
(2) years, and shall also survive and shall be unaffected by (and shall not be
deemed waived by) any investigation, audit, appraisal or inspection at any time
made by or on behalf of Seller.
15.04 INDEMNIFICATION BY BUYER.
Subject to the conditions and provisions of Section 15.05,
Buyer hereby agrees to indemnify, defend and hold harmless Seller, Seller's
employees, managers and directors ("Seller Indemnified Parties") from and
against all demands, claims, actions or causes of action, assessments, losses,
damages, liabilities, costs and expenses, including, but not limited to,
interest, penalties and attorneys' fees and disbursements, asserted against,
imposed upon or incurred by Seller Indemnified Parties, directly or indirectly,
by reason of or resulting from (a) any liability, obligation, or claims against
Seller Indemnified Parties (whether absolute, accrued, contingent or otherwise
and whether contractual, tax or any other type of liability or obligation or
claim) expressly assumed by Buyer hereunder; (b) any misrepresentation or breach
of the representations and warranties of Buyer contained in or made pursuant to
this Agreement; or (c) any noncompliance by Buyer with any covenants, agreements
or undertakings of Buyer contained in or made pursuant to this Agreement.
15.05 CONDITIONS OF INDEMNIFICATION.
The obligations and liabilities of Seller and of Buyer
hereunder with respect to their respective indemnities pursuant to this Section
15, resulting from any claim or other assertion of liability by third parties
(hereinafter called collectively, "Claims"), shall be subject to the following
terms and conditions:
15.05(a) The party seeking indemnification (the "Indemnified
Party") must give the other party or parties, as the case may be (the
"Indemnifying Party"), notice of any such Claim promptly after the Indemnified
Party receives notice thereof.
15.05(b) The Indemnifying Party shall have the right to
undertake, by counsel or other representatives of its own choosing, the defense
of such claim.
15.05(c) In the event that the Indemnifying Party shall elect
not to undertake such defense, or within a reasonable time after notice of any
such Claim from the Indemnified Party shall fail to defend, the Indemnified
Party (upon further written notice to the Indemnifying Party) shall have the
right to undertake the defense, compromise or settlement of such Claim, by
counsel or other representatives of its own choosing, on behalf of and for the
account and risk of the Indemnifying Party (subject to the right of the
Indemnifying Party to assume defense of such Claim at any time prior to
settlement, compromise or final determination thereof).
15.05(d) Anything in this Section 15.05 to the contrary
notwithstanding, (i) if there is a reasonable probability that a Claim may
materially and adversely affect the Indemnified Party other than as a result of
money damages or other money payments, the Indemnified Party shall have the
right, at its own cost and expense, to participate in the defense, compromise or
settlement of the Claim, (ii) the Indemnifying Party shall not, without the
Indemnified Party's written consent, settle or compromise any Claim or consent
to entry of any judgment which does not include as an unconditional term thereof
the giving by the claimant or the plaintiff to the Indemnified Party of a
release from all liability in respect of such Claim, and (iii) in the event that
the Indemnifying Party undertakes defense of any Claim, the Indemnified Party,
by counsel or other representative of its own choosing and at its sole cost and
expense, shall have the right to consult with the Indemnifying Party and its
counsel or other representatives concerning such Claim and the Indemnifying
Party and the Indemnified Party and their respective counsel or other
representatives shall cooperate with respect to such Claim.
ARTICLE 16.
TERMINATION
If (i) an FCC Order has not become a Final Order and/or the
Closing has not occurred on or before the tenth anniversary of the date of the
Option Agreement, (ii) the Commission designates the Application contemplated by
Section 5 for an evidentiary hearing, or (iii) the Commission issues an order in
connection with such application with conditions which are adverse to Buyer or
which in any way diminish the operating rights with respect to the Assets and
the Station (except any such conditions expressly accepted by Buyer in writing),
then in any such event Buyer may, upon written notice to the Seller, terminate
this Agreement without any further obligation to the Seller hereunder, provided,
that such notice of termination is given prior to the date of the Closing or the
date on which such FCC Order shall have become a Final Order. If the Closing has
not occurred on or before the tenth anniversary of the date of the Option
Agreement, then in such event Seller may, upon written to the Buyer, terminate
this Agreement without any further obligation to the Buyer hereunder, provided,
that, such notice of termination is given prior to the date of the Closing and
the Seller is not in material default at such time. Upon termination of this
Agreement pursuant to this Section 16, this Agreement shall be deemed null,
void, and of no further force and effect (except for the provisions of Sections
7.04, 8.01, and 21, which shall survive such termination).
ARTICLE 17.
REMEDIES
17.01 DEFAULT BY BUYER.
If Buyer shall default in the performance of its obligations
under this Agreement in any material respect or if, as a result of Buyer's
action or failure to act, the conditions precedent to Seller's obligation to
close specified in Section 10 are not satisfied, and for such reason or reasons
this Agreement is not consummated, and provided that Seller shall not then be in
default in the performance of Seller's obligations hereunder, Seller shall be
entitled, by written notice to Buyer, to terminate this Agreement and to pursue
any other remedies Seller has at law or in equity or otherwise.
17.02 DEFAULT BY SELLER.
If Seller shall default in the performance of Seller's
obligations under this Agreement in any material respect, or if, as a result of
Seller's action or failure to act, the conditions precedent to Buyer's
obligation to close specified in Section 9 are not satisfied and for such reason
or reasons this Agreement is not consummated, or if Seller fails to operate the
Station at its authorized power for longer than 48 consecutive hours, and
provided that Buyer shall not then be in default in any material respect in the
performance of Buyer's obligations hereunder, Buyer shall be entitled, at
Buyer's sole option:
(i) To require Seller to consummate and specifically
perform the sale in accordance with the terms of this Agreement,
if necessary through injunction or other court order or process;
or
(ii) By written notice to Seller, to terminate this
Agreement and to pursue any other remedies Buyer has at law or
in equity or otherwise.
17.03 SPECIFIC PERFORMANCE.
Seller acknowledges that the Assets to be sold and delivered
to Buyer pursuant to this Agreement are unique and that Buyer has no adequate
remedy at law if Seller shall fail to perform any of their obligations
hereunder, and Seller therefore confirms and agrees that Buyer's right to
specific performance is essential to protect the rights and interests of Buyer.
Accordingly, in addition to any other remedies which Buyer may have hereunder or
at law or in equity or otherwise, Seller hereby agrees that Buyer shall have the
right to have all obligations, undertakings, agreements and other provisions of
this Agreement specifically performed by Seller and that Buyer shall have the
right to obtain an order or decree of such specific performance in any of the
courts of the United States or of any state or other political subdivision
thereof.
ARTICLE 18.
GUARANTEE
18.01 Osborn Communications Corp. ("Guarantor") hereby irrevocably and
unconditionally guarantees to Buyer the prompt and complete performance and
payment of each and every obligation of Seller to Buyer, direct or indirect, now
existing or hereafter arising under this Agreement, including the due and
punctual performance and observance by Seller of all of the terms and conditions
of this Agreement.
18.02 The obligations of Guarantor hereunder shall be absolute and
unconditional and shall continue in full force and effect until the performance
and payment of all of the obligations of Seller under this Agreement, and are in
no way conditioned upon any event or contingency, or upon any attempt to enforce
Seller's performance under this Agreement or any other right or remedy against
Seller or to collect from Seller through the commencement of legal proceedings
or otherwise.
18.03 The obligations of Guarantor hereunder shall not be affected,
reduced, impaired, modified, changed, released, limited or discharged in any
manner whatsoever by reason of any impairment, modification, change, release, or
limitation of the liability of Seller or its estate in bankruptcy, resulting
from the operation of any present or future provision of the bankruptcy laws or
other similar statute, or from the decision of any court.
18.04 Guarantor unconditionally waives diligence, presentment, protest,
notice of dishonor, demand, extension of time for payment, notice of nonpayment
at maturity, and indulgences and notices of every kind, and consents to any and
all changes in terms, covenants, and conditions hereof.
18.05 Guarantor agrees that the obligations of Guarantor hereunder are
irrevocable and are independent of the obligations of Seller under this
Agreement; that a separate action or actions may be brought and prosecuted
against Guarantor regardless of whether any action is brought against Seller or
whether Grantor is joined in any such action or actions.
18.06 Guarantor agrees that Guarantor shall not exercise any rights
that it may acquire by way of subrogation hereunder or otherwise until the
performance in full of all obligations guaranteed pursuant hereto.
18.07 Guarantor represents and warrants to Buyer that (a) it is a
corporation duly organized, validly existing, and in good standing under the
laws of the State of Delaware, (b) it has the full corporate power and corporate
authority to enter into this Agreement, and this Agreement has been duly
authorized, executed and delivered by Guarantor and is a legal, valid and
binding agreement and obligation of Guarantor enforceable against Guarantor in
accordance with its terms, except to the extent limited by applicable
bankruptcy, insolvency, moratorium and other similar laws of general application
relating to or affecting the enforcement of creditors' rights and general equity
principles, (c) neither the execution and delivery of this Agreement, the
consummation of any of the transactions contemplated herein, nor compliance with
the terms hereof, will conflict with or result in a breach of any provision of
any law or regulation applicable to Guarantor, or any indenture, contract or
other agreement to which Guarantor is a party or by which Guarantor is bound, or
any statute, rule, regulation, judgment, decree or order binding upon Guarantor,
and (d) Guarantor indirectly owns all of the issued and outstanding stock of
Seller.
18.08 The provisions of this Section shall inure to the benefit of and
may be enforced by Buyer and its successors and assigns, and shall be binding
upon and enforceable against Guarantor and Guarantor's successors or assigns.
ARTICLE 19.
ADDITIONAL ACTIONS AND DOCUMENTS
Each of the parties hereto agrees that it will, at any time,
prior to, at or after the Closing Date, take or cause to be taken such further
actions, and execute, deliver and file or cause to be executed, delivered and
filed such further documents and instruments, and obtain such consents, as may
be necessary or reasonably requested in connection with the consummation of the
purchase and sale contemplated by this Agreement or in order to fully effectuate
the purposes, terms and conditions of this Agreement.
ARTICLE 20.
BROKERS
Except for Alex Brown & Co., Seller represents to Buyer that
Seller has not engaged, or incurred any unpaid liability (for any brokerage
fees, finders' fees, commissions or otherwise) to, any broker, finder or agent
in connection with the transactions contemplated by this Agreement; Buyer
represents to Seller that Buyer has not engaged, or incurred any unpaid
liability (for any brokerage fees, finders' fees, commissions or otherwise) to,
any broker, finder or agent in connection with the transactions contemplated by
this Agreement; and Seller agrees to indemnify Buyer, and Buyer agrees to
indemnify Seller, against any claims asserted against the other parties for any
such fees or commissions by any person purporting to act or to have acted for or
on behalf of the indemnifying party. Notwithstanding any other provision of this
Agreement, this representation and warranty shall survive the Closing Date
without limitation as to time.
ARTICLE 21.
EXPENSES
Each party hereto shall pay its own expenses incurred in
connection with this Agreement and in the preparation for and consummation of
the transactions provided for herein. Notwithstanding the foregoing, (a) Seller
and Buyer shall share equally in all sales, use, transfer, stamp, documentary,
and recording taxes and fees, all costs of conveyances, all notary fees, all
filing and application fees to any federal, state or local agency, all filing
fees to the Commission in connection with the Applications, all sales, stamp,
documentary, transfer, and recording taxes and fees applicable to the
transactions contemplated by this Agreement and the instruments and documents
called for hereunder, including, without limitation, any Alabama sales, use,
stamp, documentary, transfer or similar taxes imposed with respect to the sale
of any motor vehicle or with respect to the transfer of any real property, (b)
Buyer shall pay all fees and expenses of the appraiser referred to in Section 12
and the Title Insurance Commitment, and all filing fees in connection with any
filing under the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and (c) Seller shall pay all fees and expenses for the Survey.
ARTICLE 22.
NOTICES
All notices, demands, requests, or other communications which
may be or are required to be given or made by any party to any other party
pursuant to this Agreement shall be in writing and shall be hand delivered
(including delivery by overnight courier), mailed by first-class registered or
certified mail, return receipt requested, postage prepaid, delivered by
overnight air courier, or transmitted by telegram, telex or facsimile
transmission addressed as follows:
(i) If to Buyer:
TV Alabama, Inc.
c/o Allbritton Communications Company
808 17th Street, N.W.
Suite 300
Washington, D.C. 20006
Attn.: Jerald N. Fritz, Esq.
with a copy (which shall not constitute notice) to:
Hogan & Hartson
555 Thirteenth Street, N.W.
Washington, D.C. 20004
Attn.: Mace J. Rosenstein, Esq.
(ii) If to Seller:
Flagship Broadcasting Corporation
P.O. Box 90406
San Antonio, Texas 78209
Attn: Bridget Hubbard
with a copy (which shall not constitute notice) to:
Haley, Bader & Potts P.L.C.
4350 North Fairfax Drive
Suite 900
Arlington, VA 22203-1633
Attn: Theodore D. Kramer
or such other address as the addressee may indicate by written notice.
Each notice, demand, request, or communication which shall be
given or made in the manner described above shall be deemed sufficiently given
or made for all purposes at such time as it is delivered to the addressee (with
the return receipt, the delivery receipt, the affidavit of messenger or (with
respect to a telex or facsimile) the answer back being deemed conclusive but not
exclusive evidence of such delivery) or at such time as delivery is refused by
the addressee upon presentation.
ARTICLE 23.
WAIVER
No delay or failure on the part of any party hereto in
exercising any right, power or privilege under this Agreement or under any other
instrument or document given in connection with or pursuant to this Agreement
shall impair any such right, power or privilege or be construed as a waiver of
any default or any acquiescence therein. No single or partial exercise of any
such right, power or privilege shall preclude the further exercise of such
right, power or privilege, or the exercise of any other right, power or
privilege. No waiver shall be valid against any party hereto unless made in
writing and signed by the party against whom enforcement of such waiver is
sought and then only to the extent expressly specified therein.
ARTICLE 24.
BENEFIT AND ASSIGNMENT
Except as hereinafter specifically provided in this Section
24, no party hereto shall assign this Agreement, in whole or in part, whether by
operation of law or otherwise without the prior written consent of Seller (if
the assignor is Buyer) or Buyer (if the assignor is Seller), and any purported
assignment contrary to the terms hereof shall be null, void and of no force and
effect. In no event shall any assignment by Seller of its rights and obligations
under this Agreement, whether before or after the Closing, release Seller from
its liabilities hereunder. Notwithstanding the foregoing, Buyer or any permitted
assignee of Buyer may assign this Agreement and any and all rights hereunder, in
whole or in part, to any subsidiary of Buyer or to any entity in which the
controlling shareholders of Buyer maintain control. Subject to the foregoing,
this Agreement shall be binding upon and shall inure to the benefit of the
parties hereto and their respective successors and assigns. No person or entity
other than the parties hereto is or shall be entitled to bring any action to
enforce any provision of this Agreement against any of the parties hereto, and
the covenants and agreements set forth in this Agreement shall be solely for the
benefit of, and shall be enforceable only by, the parties hereto or their
respective successors and assigns as permitted hereunder.
ARTICLE 25.
REMEDIES CUMULATIVE
Except as specifically provided herein, the remedies provided
herein shall be cumulative and shall not preclude the assertion by Seller or by
Buyer of any other rights or the seeking of any other remedies against the
other.
ARTICLE 26.
ENTIRE AGREEMENT; AMENDMENT
This Agreement, together with all Exhibits and Schedules
hereto, constitutes the entire agreement among the parties pertaining to the
subject matter hereof and supersedes all prior agreements, understandings,
negotiations and discussions, whether oral or written, of the parties. No
supplement, modification or waiver of this Agreement shall be binding unless
executed in writing by the party to be bound thereby.
ARTICLE 27.
SEVERABILITY
If any part of any provision of this Agreement or any other
agreement, document or writing given pursuant to or in connection with this
Agreement shall be invalid or unenforceable under applicable law, such part
shall be ineffective to the extent of such invalidity or unenforceability only,
without in any way affecting the remaining parts of such provisions or the
remaining provisions hereof or of said agreement, document or writing.
ARTICLE 28.
PRESS RELEASES
All notices to third parties and other publicity relating to
the transactions contemplated by this Agreement shall be jointly planned,
coordinated and agreed to by Buyer and Seller. Prior to the Closing Date neither
of the parties hereto shall act unilaterally in this regard without the prior
written approval of the other, except as required by law and/or the rules and
regulations of the Commission.
ARTICLE 29.
HEADINGS
The headings of the sections and subsections contained in this
Agreement are inserted for convenience only and do not form a part or affect the
meaning, construction or scope thereof.
ARTICLE 30.
GOVERNING LAW
This Agreement, the rights and obligations of the parties
hereto, and any claims or disputes relating thereto, shall be governed by and
construed under and in accordance with the laws of the State of New York,
excluding the choice of law rules thereof.
ARTICLE 31.
SIGNATURE IN COUNTERPARTS
This Agreement may be executed in separate counterparts,
neither of which need contain the signatures of both parties, each of which
shall be deemed to be an original, and both of which taken together constitute
one and the same instrument. It shall not be necessary in making proof of this
Agreement to produce or account for more than the number of counterparts
containing the respective signatures of, or on behalf of, all of the parties
hereto.
IN WITNESS WHEREOF, each of the parties hereto has executed
this Asset Purchase Agreement, or has caused this Asset Purchase Agreement to be
duly executed and delivered in its name on its behalf, all as of the day and
year first above written.
SELLER
FLAGSHIP BROADCASTING CORPORATION
By: /s/ Bridget Hubbard
Bridget Hubbard
President
BUYER
TV ALABAMA, INC.
By: /s/ Robert L. Allbritton
Robert L. Allbritton
President
For purposes of Article 18 of
this Asset Purchase Agreement
OSBORN COMMUNICATIONS CORP.
By:
Frank D. Osborn
President
ACQUISITION OF WJSU-TV
LIST OF EXHIBITS
Exhibit A Assignment of Leases
Exhibit B Bill of Sale
Exhibit C Assignment of Licenses
Exhibit D Assignment of Contracts
Exhibit E Warranty Deed
Exhibit F Opinion of Seller's Counsel
Exhibit G Assumption Agreement
ACQUISITION OF WJSU-TV
LIST OF SCHEDULES
Schedule 1(a) Real Property
Schedule 1(b) Leasehold Interests
Schedule 1(f) Tangible Personal Property
Schedule 1(g) FCC Licenses
Schedule 1(h) Copyrights, Trademarks and Trade Names
Schedule 1(i) Trade-out Agreements and other Contracts, Agreements, and
Leases
Schedule 1(j) Deposits and Prepaid Expenses
Schedule 1(k) Motor Vehicles
Schedule 3.03 Litigation
Schedule 3.04(a) Financial Statements
Schedule 3.05(b) Encumbrances
Schedule 3.05(d) Consents Required to Transfer Assets
Schedule 3.11 Conflicts
Schedule 3.12 Transactions with Related Parties
Schedule 3.14(a) Employee Benefit Plans
Schedule 3.15(b) Environmental Matters
Schedule 3.16 Employment Agreements and Collective Bargaining Agreements
Schedule 3.18 Insurance
Schedule 4.02 Consents Required from Buyer's Lenders