Exhibit 10.65
ASSET PURCHASE AGREEMENT
------------------------
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is made and entered into
this 21st day of June, 2001, by and between (i) U.S. BROADCASTING LIMITED
PARTNERSHIP, a State of Georgia limited partnership (hereinafter referred to as
"Seller"), and (ii) RADIO ONE, INC., a State of Delaware corporation
(hereinafter referred to as "Purchaser").
RECITALS:
---------
A. Seller is the licensee, owner and operator of radio broadcast station
WPEZ-FM, licensed to Macon, Georgia (the "Station"), pursuant to certain
licenses and authorizations and approvals granted to Seller by the Federal
Communications Commission (the "FCC").
B. The Station is presently licensed to Macon, Georgia. As described
herein, the city of license of the Station will be changed to Hampton, Georgia.
C. Subject to the consent of the FCC and the terms and conditions of this
Agreement, Purchaser desires to acquire all of Seller's right, title and
interest in certain assets used or useful in the operation of the Station, as
more specifically described herein, including the license and other
authorizations issued by the FCC for the operation of the Station (the "FCC
Authorizations").
NOW, THEREFORE, in consideration of the mutual promises and covenants
hereinafter contained, the parties, intending to be legally bound, hereby agree
as follows:
1. Definitions. Unless otherwise stated in this Agreement, the following
-----------
terms shall have the following meanings:
(a) Assets. "Assets" shall have the meaning assigned to such term in
------
Section 3 of the Agreement.
(b) Assignment Application. "Assignment Application" means the
----------------------
application(s) which the parties hereto will join in and file with the FCC
requesting its written consent to the assignment of the FCC Authorizations for
the Station from Seller to Purchaser as provided for in Section 10 of this
Agreement.
(c) Closing Date. "Closing Date" means, the tenth business day after
------------
the date upon which the FCC grant of the Assignment Application shall have
become a Final Order
- 1 -
referred to in Section 1(i), or such other date as the parties may agree upon in
writing. Notwithstanding the foregoing, the Closing Date shall not occur prior
to January 30, 2002. Purchaser shall also have the option to extend the Closing
Date for a period of up to six (6) months beyond the January 30, 2002 date,
provided Purchaser notifies Seller in writing of such intent at least fifteen
(15) days prior to January 30, 2002.
(d) Closing Place. "Closing Place" means such place as the parties
-------------
shall mutually agree.
(e) Construction Permit. "Construction Permit" shall have the meaning
-------------------
assigned to such term in Section 2 of the Agreement.
(f) FCC. "FCC" means the Federal Communications Commission.
---
(g) FCC License to Cover Construction. "FCC License to Cover" shall
---------------------------------
have the meaning assigned to such term in Section 19(j) of the Agreement.
(h) FCC Consent. "FCC Consent" means the action taken by the FCC or
-----------
its Mass Media Bureau granting the Assignment Application without any condition
which in the Purchaser's reasonable judgement is or would be materially adverse
to Purchaser, thereby granting consent by the FCC to the assignment of the FCC
Authorizations from Seller to Purchaser.
(i) Final Order. For purposes of this Agreement, the term "Final
-----------
Order" shall mean the FCC Consent, which FCC Consent shall not have been
reversed, stayed, enjoined, set aside, annulled or suspended; and with respect
to which action no timely request for stay, application for review, petition for
rehearing or reconsideration, appeal or request for writ of certiorari, or sua
---
sponte action of the FCC or its staff with comparable effect, shall be pending;
- ------
and as to which the time for filing of any such request, petition, appeal,
petition for writ of certiorari, and for the taking of any such sua sponte
--- ------
action by the FCC or its staff shall have expired or otherwise terminated. The
parties may agree to waive the requirement that consent shall have become a
Final Order.
(h) Station. "Station" means radio broadcast Station WPEZ-FM, Macon,
-------
Georgia.
2. Station. The Station is presently licensed to Macon, Georgia, where
-------
its transmitter and transmitting facilities are located. The Mass Media Bureau
of the FCC granted the petition of Seller to change the table of FM allotments
to add Channel 300C1 to Hampton, Georgia. Seller thereafter filed with the FCC
an Application for FM Broadcast Station Construction Permit (File No.
BPH-19990203ID), as amended (the "Construction Permit "), which was granted by
the FCC on January 4, 2001 (Public Notice Report No. 44897). Pursuant to the
Construction Permit, the Station shall be downgraded from Class C1 to Class C2,
the city of license shall be changed to Hampton, Georgia, and the transmitter
location and transmitting facilities shall be relocated to Fayette County,
Georgia.
- 2 -
3. Assets to be Conveyed. Subject to the terms and conditions hereof, on
---------------------
the Closing Date at the Closing Place, Seller shall sell, assign, convey,
transfer and deliver to Purchaser by delivery of bills of sale or other
documents of transfer (in a form reasonably satisfactory to Purchaser), and
Purchaser will acquire and purchase all of Seller's right, title and interest in
the following assets owned by Seller and used or held for use in connection with
the business and operations of the Station (the "Assets"):
(a) FCC Authorizations. The FCC Authorizations as listed in Schedule
------------------ --------
3(a) attached hereto, together with any renewals, extensions or modifications
- ----
therefor and additions thereto or applications filed between the date hereof and
the Closing Date.
(b) Files, Records, Documents and Logs. All files, records, documents
----------------------------------
and logs pertaining to the Station or its operation in the possession of Seller.
(c) Tower Lease Agreement. All of Seller's right, title and
interest under that certain Lease Agreement entered into by and between Seller
and American Tower Systems, L.P., a Delaware limited partnership (the "Lease
Agreement"), dated January 30, 2001, attached hereto as Schedule 3(b).
-------------
(d) Equipment. All of Seller's rights, title and interest in the
---------
equipment used in the construction of the facilities authorized by the
Construction Permit.
The Assets when transferred on the Closing Date shall be free and clear of any
and all liens, mortgages, deeds of trust, mortgage deeds, pledges, security
interests, charges, and encumbrances whatsoever.
4. Excluded Assets. Seller shall retain, and shall not sell or assign to
---------------
Purchaser any assets of Seller other than the Assets as set forth in Section 3
of this Agreement. Excluded assets shall include, among others, the Station's
call letters, programming, accounts receivable, cash on hand, deposits and
similar items.
5. Assumed Liabilities. Purchaser shall assume and perform all of the
-------------------
obligations of Seller under the Lease Agreement from and after the Closing Date.
Except as otherwise specifically provided herein, Purchaser shall not assume or
be liable for, and does not undertake to attempt to, assume or discharge: (i)
any liability or obligation of Seller arising out of or relating to any
contract, lease agreement, or instrument; (ii) any liability or obligation of
Seller arising out of or relating to any employee benefit plan otherwise
relating to employment; (iii) any liability or obligation of Seller arising out
of or relating to any litigation, proceeding or claim (whether or not such
litigation, proceeding or claim is pending, threatened or asserted before, on or
after the Closing Date); (iv) any other liabilities, obligations, debts or
commitments of Seller whatsoever, whether accrued now or hereafter, whether
fixed or contingent, whether known or unknown; or (v) any claims asserted
against the Station or any of the Station Assets relating to any event (whether
act or omission) prior to the Closing Date including, without limitation, the
payment of all taxes.
- 3 -
6. Earnest Money. Contemporaneously with the execution and delivery of
-------------
this Agreement, Purchaser shall deposit the sum of Two Million Seven Hundred
Fifty Thousand Dollars ($2,750,000.00) in an escrow account with Wilmington
Trust Company (the "Escrow Agent") to be maintained and administered in
accordance with the Escrow Agreement attached hereto as Exhibit A. All funds
---------
deposited with the Escrow Agent shall be held and disbursed in accordance with
the terms of the Escrow Agreement. At the Closing, the Escrow Deposit shall be
disbursed to Seller in partial payment of the Purchase Price (as defined below),
less any interest or other proceeds from the investment thereof, which shall be
disbursed to Purchaser.
7. Purchase Price.
--------------
(a) The aggregate purchase price for the Assets shall be Fifty Five
Million Dollars ($55,000,000.00) (the "Purchase Price"). On the Closing Date,
subject to the release of the Earnest Money to Seller, Purchaser shall pay to
Seller the sum of Fifty-Two Million Two Hundred Fifty Thousand Dollars
($52,250,000) in cash by bank wire of immediately available federal funds to
such bank as Seller shall designate for the account of Seller.
(b) Contingent Payment. In addition to the consideration referred to
------------------
in paragraph (a) of this Section, Purchaser shall pay to Seller by wire transfer
in cash the aggregate sum of Five Million Dollars ($5,000,000.00) within five
(5) calendar days after the FCC grant of any application which Purchaser may
file with the FCC to change the Station from a Class C2 broadcast station to a
Class C1 broadcast station becomes a Final Order, provided that such payment
shall only be due if the grant shall have become a Final Order within five (5)
years after the Closing Date. Purchaser shall have sole discretion to determine
if and when such application is filed, and/or to amend, supplement, dismiss or
withdraw such application; except that Purchaser may not dismiss or withdraw
such application within the last three (3) months of the stated five (5) year
period. Purchaser shall furnish a copy of any such application to Seller at such
time as it is filed with the FCC.
8. Purchase Price Allocation. The Purchase Price shall be allocated among
-------------------------
the Assets as mutually agreed among the parties, based upon an appraisal to be
prepared by Bond and Pecaro, no later than sixty (60) days after the Closing
Date. Seller and Purchaser shall use the mutually agreed upon appraisal
determined pursuant to this Section 8 for accounting purposes, including without
limitation, those matters subject to Section 1060 of the Internal Revenue Code
of 1986, as amended (the "Code"), provided, however, that if Purchaser and
Seller are unable to reasonably agree on such appraisal, neither party shall be
bound by such appraisal. The cost of such appraisal shall be paid by Purchaser.
9. Prorations. The Purchase Price shall be increased or decreased as
----------
required to effectuate the proration of expenses. All expenses arising from the
Lease Agreement, including rent, utilities and personal property; as well as
from the operation of the Station, including business and license fees, FCC
annual regulatory fees, utility charges, real and personal property taxes and
assessments levied against the Assets, property and equipment rentals,
applicable copyright or other fees, sales and service charges, taxes (except for
taxes arising from the transfer of the Assets under this Agreement), and similar
prepaid and deferred items shall be prorated
- 4 -
between Seller and Purchaser in accordance with generally accepted accounting
principles, the proration to be made and paid, insofar as feasible, on the
Closing Date, with a final settlement not later than sixty (60) days after the
Closing Date.
10. Assignment of FCC Authorizations. As set forth more particularly
--------------------------------
hereinafter, the Closing is conditioned upon and subject to the prior receipt of
the FCC Consent and it becoming a Final Order. The parties agree as follows:
(a) Purchaser Covenant. Within ten (10) days following the execution
------------------
of this Agreement, Purchaser will complete and deliver to Seller a fully
executed copy of a substantially complete application to the FCC requesting the
FCC's written consent to the assignment of the FCC Authorizations to a wholly
owned licensee subsidiary of Purchaser ("ROI Licensee Sub") and to the
consummation of the transactions contemplated by this Agreement together with a
check covering one-half of the FCC filing fee. Purchaser will diligently take,
or cooperate in the taking of, all steps that are necessary, proper or desirable
to expedite the preparation of such application and its prosecution to a
favorable conclusion. Purchaser will promptly provide Seller with copies of any
pleading, order or other document served on it relating to such application.
(b) Seller Covenant. As promptly as practicable after the execution
---------------
of this Agreement, and in no event later than fifteen (15) days thereafter,
Seller shall file an application (after receiving within ten (10) days of the
signing date of Purchaser's portion of such application) with the FCC requesting
the FCC's written consent to the assignment of the FCC Authorizations to ROI
Licensee Sub and to the consummation of the transactions contemplated by this
Agreement. Seller shall diligently take all steps that are necessary, proper or
desirable to expedite the preparation of such application and its prosecution to
a favorable conclusion. Seller shall promptly provide Purchaser with a copy of
any pleading, order or other document served on Seller relating to such
application. Seller shall furnish all information required by the FCC and shall
be represented at all meetings or hearings scheduled to consider such
application.
(c) Prosecution. Purchaser and Seller shall prosecute the Assignment
-----------
Application using due diligence and shall use their respective best efforts to
promptly obtain the requisite FCC Consent. Neither party shall directly or
indirectly impede or delay the granting of the FCC Consent. Purchaser and Seller
each agree to return to the FCC within a reasonable period of time after receipt
(but no later than ten (10) business days), any forms or other documents needing
execution and completion by either of them as well as any required amendments to
the Assignment Application. Purchaser and Seller shall provide the FCC with any
documents or material which it may request. Purchaser and Seller shall promptly
furnish each other with copies of any material received from or sent to the FCC
in connection with the Assignment Application. If the FCC Consent imposes any
condition on any party hereto, such party shall use reasonable efforts to comply
with such condition; provided, however, that no party shall be required to
comply with any condition which it determines in good faith would constitute a
material adverse change upon the Station. If reconsideration or judicial review
is sought with respect to the grant of the FCC Consent or the terms thereof, the
parties hereto shall cooperate in opposing such efforts for reconsideration or
judicial review unless the circumstances
- 5 -
warranted the filing by any of the parties hereto of such a request for
reconsideration or judicial review.
(d) Other Governmental Consents. Promptly following the execution of
---------------------------
this Agreement, the parties shall prepare and file with the appropriate
governmental authorities any other requests for approval or waiver that are
required from such governmental authorities in connection with the transactions
contemplated hereby and shall diligently and expeditiously prosecute, and shall
cooperate fully with each other in the prosecution of, such request for approval
or waiver and all proceedings necessary to secure such approvals and waivers.
11. Termination By Non-Action of FCC/Notice of Hearing. In addition to any
--------------------------------------------------
other rights of termination granted hereunder, this Agreement may be terminated
if the FCC Consent, pursuant to the grant of the Assignment Application shall
not have become a Final Order within fifteen (15) months from the date upon
which the Assignment Application is tendered for filing with the FCC. In such
event, either party, at its option, by written notice of termination to the
other party prior to the date when the FCC Consent (if any is granted) becomes a
Final Order, may terminate this Agreement without liability on the part of the
terminating party; provided, however, that the terminating party shall not be in
material default under the provisions of this Agreement, and provided further,
that any delay in any decision or determination by the FCC respecting the
Assignment Application shall not have been caused by any action or inaction of
the terminating party or contributed to by any failure on the part of such party
to furnish, file or make available information within its control or caused by
the willful furnishing by such party of incorrect, inaccurate or incomplete
information to the FCC.
12. Control of Station. Between the date of this Agreement and the Closing
------------------
Date, Purchaser shall not, directly or indirectly, control, supervise or direct
the operation of the Station. Such operations shall be the sole responsibility
of Seller and shall be in the complete discretion of Seller.
13. Hart-Scott-Rodino Act Filing. Seller and Purchaser agree to (a) file,
----------------------------
or cause to be filed, with the Federal Trade Commission ("FTC") and the United
States Department of Justice ("DOJ") all filings, if any, which are required in
connection with the transactions contemplated hereby under the Hart-Scott-Rodino
Antitrust Improvements Act of 1976 (the "HSR Act"), within six (6) business days
of the date of the Agreement; (b) cooperate with each other in connection with
all HSR Act filings, which cooperation may include furnishing the other with any
information or documents in such party's possession that may be reasonably
required in connection with such filings; (c) request early termination of the
waiting period; promptly file, after any request by the FTC or DOJ which relates
to the transactions contemplated hereunder; and (e) furnish each other with any
correspondence from or to, and notify each other of any other communications
with, the FTC or DOJ which relates to the transactions contemplated hereunder,
and to the extent practicable, to permit each other to participate in any
conferences with the FTC or DOJ.
14. Representations and Warranties of Seller. Seller hereby makes the
----------------------------------------
following representations and warranties to Purchaser, which representations and
warranties shall be true as of the date hereof and the Closing Date:
- 6 -
(a) Organization and Standing. Seller is a limited partnership duly
-------------------------
organized and in good standing under the laws of the State of Georgia. Seller
has full power and authority to enter into this Agreement and, subject to
receipt of the FCC Consent, to consummate the transactions contemplated herein,
including the authority to operate the Station. Magic Broadcasting II, Inc., a
Georgia corporation, is the sole general partner of Seller. Magic Broadcasting
II, Inc. is duly organized and in good standing as a corporation under the laws
of the State of Georgia and has full power and authority to enter into this
Agreement for and on behalf of the Seller as its General Partner.
(b) Authorization. All necessary partnership actions to duly approve
-------------
the execution, delivery and performance of this Agreement and the consummation
of the transactions contemplated herein have been taken by Seller, and subject
to the approval of the FCC, this Agreement constitutes a valid and binding
agreement of Seller, enforceable in accordance with its terms, except as such
enforceability may be limited by applicable bankruptcy, reorganization,
insolvency, moratorium or other similar laws affecting creditors' rights
generally or by principles governing the availability of equitable remedies.
(c) Construction Permit. The Construction Permit is valid and, the
-------------------
grant of the Construction Permit, as well as all rule making proceedings which
may or could have affected the Construction Permit have each become a Final
Order.
(d) FCC Authorizations. As of the date of this Agreement, Seller is
------------------
the holder of the FCC Authorizations with respect to the Station listed and
described on Schedule 3(a). Such FCC Authorizations constitutes all of the
-------------
licenses, permits and authorizations required under Communications Act of 1934,
as amended, and the current rules, regulations and policies of the FCC
(collectively, the "Communications Act") for, and/or used in the operation of,
the Station as now operated and will be operated following completion of the
Construction Permit. The FCC Authorizations are in full force and effect, have
not been revoked, suspended, canceled, rescinded or terminated and have not
expired. Except as listed and described on Schedule 3(a), there is not pending,
-------------
or to the knowledge of Seller threatened, any action by or before the FCC to
revoke, suspend, cancel, rescind or modify any of the FCC Authorizations (other
than proceedings of general applicability in the radio broadcast industry to
amend FCC rules of general applicability), and there is not now issued or
outstanding, or to the knowledge of Seller pending or threatened, by or before
the FCC, any order to show cause, notice of violation, notice of apparent
liability, or notice of forfeiture or complaint against Seller with respect to
the Station. The Station is now and will continue to be operating in compliance
with the FCC Authorizations, the Communications Act and the current rules and
regulations of the FCC and all relevant standards of good engineering practice.
The most recently granted license renewal application for the Station was timely
and duly filed by Seller, and to the Seller's knowledge, no facts exist which
could form a basis for the FCC designating any renewal application for hearing
or for denying it or for granting any renewal application for a term less than
the maximum statutory term permitted or for the imposition of any adverse
conditions on the grant of any of renewal applications.
- 7 -
(e) Real Property. With respect to the Lease Agreement, (i) the Lease
-------------
Agreement is in full force and effect, and is valid, binding and enforceable in
accordance with its terms, (ii) all accrued and currently payable rents and
other payments required by such Lease Agreement have been paid, (iii) the Seller
is not in default under the Lease Agreement and no notice of default or notice
of termination has been received by Seller, and (iv) Seller has not violated any
term or condition under the Lease. No third-party consent or approval is
required for the assignment of the Lease Agreement to Purchaser, or for the
consummation of the transactions contemplated herein. To the extent that any
third-party consent or approval is required, such consent or approval shall be
provided by Seller to Purchaser on or prior to the Closing Date.
(f) Litigation. No judgment is issued or outstanding against the
----------
Seller which affects the Assets or the Station. No litigation, action, special
assessment, charge, lien, suit, judgment, proceeding or investigation is now
pending or to Seller's knowledge, threatened, before any forum, court, or
governmental body, department or agency of any kind, including without
limitation the FCC, to which Seller or the Station is a party.
(g) Insolvency Proceedings. No insolvency proceedings of any
----------------------
character, including, without limitation, bankruptcy, receivership,
reorganization, composition or arrangement with creditors, voluntary or
involuntary, affecting Seller or the Assets are pending or threatened. Seller
has not made an assignment for the benefit of creditors or taken any action with
a view to, or that would constitute a valid basis for, the institution of any
such insolvency proceedings. After giving effect to the transactions
contemplated by this Agreement, Seller (i) will have sufficient capital to carry
on its business and transactions, and (ii) will be able to pay its debts as they
mature or become due.
(h) No Misleading Statements. No statement made by Seller to
------------------------
Purchaser and no information provided, or to be provided, by Seller to Purchaser
pursuant to this Agreement (including schedules and exhibits attached hereto)
contains or will contain any untrue statement of a material fact or omits or
will omit a material fact. Seller has made full disclosure to Purchaser of all
material facts pertaining to the operation of the Station.
(i) No Inconsistent Action. Seller shall not take any action
----------------------
materially inconsistent with its obligations under this Agreement or that would
hinder or delay the consummation of the transactions contemplated by this
Agreement.
(j) Taxes. Seller has filed all applicable federal, state, local and
-----
foreign tax returns required to be filed, in accordance with provisions of law
pertaining thereto, and has to the best of its knowledge, paid all taxes,
interest, penalties and assessments (including, without limitation, income,
withholding, excise, unemployment, Social Security, occupation, transfer,
franchise, property, sales and use taxes, import duties or charges, and all
penalties and interest in respect thereof) required to have been paid with
respect to or involving the Station or the Assets.
(k) Additional FCC Matters.
----------------------
- 8 -
(i) All reports and filings of a material nature required to be
filed with the FCC by Seller with respect to the Station (including, without
limitation, all required ownership reports have been timely filed. All such
reports and filings are accurate and complete in all material respects. Seller
maintains a public file for the Station as required by FCC rules. With respect
to FCC licenses, permits and authorizations, Seller is operating only those
facilities for which an appropriate FCC Authorization has been obtained and is
in effect, and Seller is meeting the conditions of each such FCC Authorization.
(ii) Seller is aware of no facts indicating that Seller is not in
compliance with all requirements of the FCC, the Communications Act, or any
other applicable federal, state and local statutes, regulations and ordinances
with respect to the Station. Seller is aware of no facts and Seller has received
no notice or communication, formal or informal, indicating that the FCC is
considering revoking, suspending, canceling, rescinding or terminating any of
the FCC Authorizations.
(iii) The operation of the Station does not cause or 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" (ANSI/IEEE C95.1-1992),
issued by the American National Standards Institute, and renewal of the FCC
Authorizations would not constitute a "major action" within the meaning of
Section 1.1301, et seq., of the FCC's rules.
------
(l) Compliance with Law. The Station, the Assets and Seller with
-------------------
respect to the Station and the Assets, are in material compliance with all
material requirements of law, federal, state and local, and all material
requirements of all governmental bodies or agencies having jurisdiction over any
of them, the operation of the Station, the use of its Assets, and the Lease
Agreement. Without limiting the foregoing, Seller has paid all monies and
obtained all licenses, permits, certificates and authorizations needed or
required for the operation of the Station. Seller has filed all reports and
other documents required to be filed with any federal, state, local or foreign
government or subdivision or agency thereof with respect to the Station, that if
not properly filed, would adversely affect Purchaser after the Closing Date.
Seller has not received any notice, not heretofore complied with, from any
federal, state or municipal authority or any insurance or inspection body that
the Station fails to comply with any applicable law, ordinance, regulation,
building or zoning law, or requirement of any public authority or body.
(m) No Violation. Except with regard to the loan agreement and
------------
related loan documents to which Seller is a party with BB&T Bank, its senior
lender, none of (i) the execution, delivery and performance of this Agreement by
Seller or its General Partner, (ii) the consummation of the transaction
contemplated hereby, nor (iii) Seller's compliance with the terms and conditions
hereof will, with or without the giving of notice or the lapse of time or both,
conflict with, breach the terms and conditions of, constitute a default under,
or violate Seller's Limited Partnership Agreement or the Articles of
Incorporation or By-Laws of the General Partner of the Seller, any judgment,
decree, order, agreement, lease or other instrument to which
- 9 -
Seller is a party or by which Seller is legally bound, or any law, rule or
regulation applicable to Seller or the operation of the Station.
(n) Feasibility of Tower. Seller represents that the tower to which
--------------------
the Lease Agreement refers will permit construction of the facilities pursuant
to the requirements of the Construction Permit and the terms of the Lease
Agreement.
15. Covenants of Seller. Between the date hereof and the Closing Date,
-------------------
Seller agrees as follows:
(a) Construction Permit. Seller shall not amend, supplement or take
-------------------
any action which would adversely change the Construction Permit, without the
Purchaser's prior written approval.
(b) Construction of Station. The parties agree that the Seller shall
-----------------------
undertake to complete construction of the facilities authorized in the
Construction Permit, and shall use its reasonable best efforts to ensure that
construction shall be completed within sixty (60) days from the execution of
this Agreement (but no later than September 30, 2001). Seller further agrees to
permit Purchaser, and its representatives and agents, access to the facilities
being constructed pursuant to the Construction Permit. Seller and Purchaser
shall consult with each other regarding the contractor that will perform the
construction, the equipment to be used to construct the facilities authorized in
the Construction Permit, and a proposed budget. Purchaser will not take, or fail
to take, any action which would delay completion of the facilities. All costs
associated with the completion of construction of the facilities pursuant to the
Construction Permit will be paid by Seller. Upon Closing, Purchaser will
reimburse the Seller for such costs reasonably incurred and documented with
invoices by Seller. Reimbursement for such costs shall be made as an adjustment
to the Purchase Price at Closing. During the construction of the facilities
authorized by the Construction Permit, the Seller and the Purchaser shall
consult with each other and reach mutual agreement on what costs are reasonable
before Seller incurs such costs. On the Closing Date, the Seller shall transfer
to Purchaser all rights, title and interest in the equipment used to construct
the facilities, pursuant to a Bill of Sale reasonably acceptable to Purchaser.
(c) License to Cover Construction Permit. Seller shall promptly,
------------------------------------
following completion of construction pursuant to the Construction Permit, file
with the FCC a License to Cover the Construction Permit. Seller shall further
diligently prosecute such License to Cover application at the FCC.
(d) Maintenance of Books and Records. Seller shall provide access to
--------------------------------
the books, accounts and records of the Station upon Purchaser's reasonable
requests.
(e) Operation of the Business. Seller shall operate the Station in
-------------------------
accordance with the terms of the FCC Authorizations and in compliance with all
applicable laws, rules and regulations and all applicable FCC rules and
regulations. Seller shall maintain the FCC Authorizations in full force and
effect and shall timely file and prosecute any necessary applications
- 10 -
for renewal of the FCC Authorizations. Seller will deliver to Purchaser, within
ten (10) days after filing, copies of any reports, applications or responses to
the FCC related to the Station which are filed during the date hereof to
Closing.
(f) Representations and Warranties. Seller shall give detailed
------------------------------
written notice to Purchaser promptly upon learning of the occurrence of any
event that would cause or constitute a breach, or that would have caused a
breach had such event occurred or been known to Seller prior to the date hereof,
of any of Seller's representations or warranties contained in this Agreement.
(g) Notice of Proceedings. Seller will promptly notify Purchaser in
---------------------
writing upon: (i) becoming aware of any order or decree or any complaint praying
for an order or decree restraining or enjoining the consummation of this
Agreement; or (ii) receiving any notice from any governmental department, court,
agency or commission of its intention to (A) institute an investigation into, or
institute a suit or proceeding to restrain or enjoin, the consummation of this
Agreement, or (B) nullify or render ineffective this Agreement if consummated.
(h) Confidentiality. Any and all non-public information, disclosures,
---------------
knowledge or facts regarding Purchaser or its business or properties to which
Seller is exposed as a result of the negotiation, preparation or performance of
this Agreement shall be confidential and shall not be divulged, disclosed or
communicated to any other person, firm, corporation or entity, except for
Seller's employees, attorneys, accountants, investment bankers, investors and
lenders, and their respective attorneys, on a need-to-know basis.
(i) Employee Matters. With respect to Seller's employees, Purchaser
----------------
assumes no obligation to continue the employment, or assume any compensation
arrangements or liabilities of Seller (including, without limitation, any
salary, bonuses, fringe benefits, insurance plans, or pension or retirement
benefits under any compensation or retirement plan maintained by Seller).
(j) Estoppel Certificates; Liens. Seller, at Seller's expense, will
----------------------------
obtain and deliver to Purchaser (i) a written Estoppel Certificate duly executed
by the lessor of the Lease Agreement described on Schedule 3(b), in form and
-------------
substance satisfactory to Purchaser, and (ii) all UCC, judgment and state and
federal tax lien search reports (showing searches in the name of Seller and the
call letters of the Station), necessary to assure that no liens are filed or
recorded against the Station or the Assets in the public records of the State of
Georgia, or Fayette or Bibb counties, or any other jurisdiction where the Assets
are located (the "Lien Search Reports"), other than those liens which will be
paid at Closing. The Estoppel Certificate shall be dated within fifteen (15)
days of the Closing Date. The Lien Search Reports shall be delivered within
fifteen (15) days prior to the Closing Date.
(k) Negative Covenants. Seller shall not, without the prior written
------------------
consent of Purchaser:
(i) Renegotiate, renew, modify, amend, terminate, or otherwise
permit the Lease Agreement to lapse.
- 11 -
(ii) Amend, modify, supplement or take any action which would
adversely change the Construction Permit; and further agrees to defend an appeal
or any other adverse action initiated against the Construction Permit.
(ii) Create, assume or permit to exist (subsequent to closing)
any mortgage, mortgage deed, pledge, security interest, charge, claim or
encumbrance of any kind with respect to the Assets.
(l) Local Marketing Agreement: Seller and Purchaser shall enter into
-------------------------
a Local Marketing Agreement (in the form attached hereto as Exhibit B)
simultaneously with the execution of this Agreement, which shall commence as
specified in the Local Marketing Agreement.
16. Representations and Warranties of Purchaser. Purchaser represents and
-------------------------------------------
warrants to Seller as follows:
(a) Organization and Standing. Purchaser is a corporation duly
-------------------------
organized, validly existing and in good standing under the laws of the State of
Delaware and is, or will be, authorized to conduct business as a foreign
corporation under the laws of the State of Georgia, subject to all relevant
governmental approvals. Purchaser has full power and authority to enter into
this Agreement, and, subject to receipt of the FCC Consent, to consummate the
transactions contemplated herein. Purchaser owns, either directly or indirectly,
all of the issued and outstanding shares of ROI Licensee Sub and has the
authority to cause ROI Licensee Sub to purchase the FCC Authorizations from
Seller at Closing. ROI Licensee Sub is a corporation duly organized, validly
existing and in good standing under the laws of the State of Delaware and is
authorized to conduct business as a foreign corporation under the laws of the
State of Georgia, subject to all relevant governmental approvals.
(b) Authorization. All necessary actions to duly approve the
-------------
execution, delivery and performance of this Agreement and the consummation of
the transactions contemplated herein have been taken by Purchaser, and subject
to the approval of the FCC and the DOJ, this Agreement constitutes a valid and
binding agreement of Purchaser enforceable in accordance with its terms, except
as such enforceability may be limited by applicable bankruptcy, reorganization,
insolvency, moratorium or other similar laws affecting creditors' rights
generally or by principles governing the availability of equitable remedies.
(c) Absence of Restrictions. Except for the FCC Consent, Purchaser
-----------------------
is, and pending closing will be, legally, technically, financially and otherwise
qualified under the Communications Act and all rules, regulations and policies
of the FCC to acquire the Assets and operate the Station. Purchaser is not aware
of any facts or proceedings which would disqualify Purchaser under the
Communications Act from acquiring the Assets or operating the Station or which
would cause the FCC not to approve the assignment of the FCC Authorizations to
Purchaser. Purchaser has no knowledge of any fact or circumstances relating to
Purchaser or any of Purchaser's affiliates that would reasonably be expected to
(a) cause the filing of any objection to the Assignment Application, or (b) lead
to a delay in the processing by the FCC of the
- 12 -
Assignment Application. As of the Closing Date, Purchaser shall have adequate
financial resources available to consummate the transactions contemplated by
this Agreement.
(d) Litigation. There is no litigation or other judicial or
----------
administrative proceedings pending or, to the knowledge; of Purchaser
threatened, which might interfere with Purchaser's power, authority or ability
to enter into this Agreement and to carry out the transactions contemplated
herein. Purchaser does not know of any basis for such proceedings.
(e) Assumption of Lease Agreement. Purchaser shall, effective as of
------------------------------
the Closing Date, assume and comply with all the obligations of the Lease
Agreement in accordance with the terms thereof.
(f) Control of Station. Purchaser shall not exercise control over the
------------------
Station until after the Closing Date.
(g) No Inconsistent Action. Purchaser shall not take any action
-----------------------
materially inconsistent with its obligations under this Agreement or that would
hinder or delay the consummation of the transactions contemplated by this
Agreement.
(h) No Violation. None of (i) the execution, delivery and performance
------------
of this Agreement by Purchaser, (ii) the consummation of the transaction
contemplated hereby, nor (iii) Purchaser's compliance with the terms and
conditions hereof will, with or without the giving of notice or the lapse of
time or both, conflict with, breach the terms and conditions of, constitute a
default under, or violate Purchaser's Articles of Incorporation or By-Laws, any
judgment, decree, order, lease or other such instrument to which Purchaser is a
party or by which Purchaser is legally bound, or any law, rule or regulation
applicable to Purchaser or the operation of the Station.
17. Covenants of Purchaser. Between the date hereof and the Closing Date,
----------------------
Purchaser agrees as follows:
(a) Representations and Warranties. Purchaser shall give detailed
------------------------------
written notice to Seller promptly upon learning of the occurrence of any event
that would cause or constitute a breach or would have caused a breach had such
event occurred or been known to Purchaser prior to the date hereof, of any of
the representations and warranties of Purchaser contained in this Agreement.
(b) Application for FCC Consent. Purchaser will diligently take, or
---------------------------
cooperate in the taking of, all steps that are necessary, proper or desirable to
expedite the prosecution of the Application to a favorable conclusion. Purchaser
will promptly provide Seller with copies of any pleading, order or other
document served on it relating to the Assignment Application. In the event that
Closing occurs prior to a Final Order, then Purchaser's obligations under this
Section 17(b) shall survive the Closing.
- 13 -
(c) Consummation of Agreement. Subject to the provisions of Section
-------------------------
31, Purchaser (i) shall use all reasonable efforts to fulfill the conditions in
Section 19, and to cause the transactions contemplated by this Agreement to be
fully carried out, and (ii) shall not take any action that would make the
consummation of this Agreement contrary to the Communications Act or the rules,
regulations or policies of the FCC.
(d) Notice of Proceedings. Purchaser will promptly notify Seller in
---------------------
writing upon: (i) becoming aware of any order or decree or any complaint praying
for an order or decree restraining or enjoining the consummation of this
Agreement or the transactions contemplated herein; or (ii) receiving any notice
from any governmental department, court, agency or commission of its intention
(A) to institute an investigation into, or institute a suit or proceeding to
restrain or enjoin, the consummation of this Agreement or such transactions, or
(B) to nullify or render ineffective this Agreement or such transactions if
consummated.
(e) Confidentiality. Any and all information, disclosures, knowledge
---------------
or facts regarding Seller, the Station and their operation and properties
derived from or resulting from Seller's acts or conduct (including, without
limitation, acts or conduct of Seller's officers, employees, accountants,
counsel, agents, consultants or representatives, or any of them) under the
provisions of Section 15(e) shall be confidential and shall not be divulged,
disclosed or communicated to any other person, firm, corporation or entity,
except for Purchaser's attorneys, accountants, investment bankers, investors and
lenders, and their respective attorneys for the purpose of consummating the
transactions contemplated herein.
18. Conditions Precedent to the Obligations of Seller. The obligation of
-------------------------------------------------
Seller to perform, fulfill or carry out its agreements, undertakings and
obligations herein made or herein agreed to be performed, fulfilled or carried
out on the Closing Date is and shall be subject to the fulfillment of or
compliance with, on or prior to the Closing Date, each of the following
conditions precedent, any of which may be waived in writing by Seller:
(a) Payments. The Purchase Price which is due and payable by
--------
Purchaser on the Closing Date, shall have been paid in accordance with the terms
of this Agreement.
(b) Representations, Warranties and Covenants
-----------------------------------------
(i) Each of the representations and warranties of Purchaser
contained in this Agreement shall have been true and correct in all material
respects as of the date when made, and shall be deemed to be made again on and
as of the Closing Date and shall be true and correct in all material respects;
and
(ii) Purchaser shall have performed and complied in all material
respects with each and every covenant and agreement required by this Agreement
to be performed or complied with by it prior to or on the Closing Date.
(c) Proceedings. Purchaser shall not be subject to any restraining
-----------
order or injunction restraining or prohibiting the consummation of the
transactions contemplated hereby;
- 14 -
provided, however, that in the event that such a restraining order or injunction
is in effect at the time a closing would otherwise occur by the terms of this
Agreement, neither party shall have the right to terminate this Agreement until
the earlier to occur of (i) One Hundred Eighty (180) days following the date
hereof, or (ii) Forty Five (45) days following the initial entry of such
temporary restraining order or injunction.
(d) FCC Authorization. The assignment of all of the FCC
-----------------
Authorizations to Purchaser shall have been initially approved by the FCC
without any conditions materially adverse to Seller.
(e) Hart-Scott-Rodino Act. If applicable, the waiting period under
----------------------
the Hart-Scott-Rodino Act shall have expired or been terminated.
19. Conditions Precedent to Obligations of Purchaser. The obligation of
------------------------------------------------
Purchaser to perform, fulfill or carry out its agreements, undertakings and
obligations herein made or herein agreed to be performed, fulfilled or carried
out on the Closing Date is and shall be subject to fulfillment of or compliance
with, on or prior to the Closing Date, each of the following conditions
precedent, any of which may be waived in writing by Purchaser:
(a) Representations, Warranties and Covenants
-----------------------------------------
(i) Each of the representations and warranties of Seller
contained in this Agreement shall have been true and correct in all material
respects as of the date when made, and shall be deemed to be made again on and
as of the Closing Date and shall then be true and correct in all material
respects; and
(ii) Seller shall have performed and complied with each and every
covenant and agreement required by this Agreement to be performed or complied
with by it prior to or on the Closing Date.
(b) Proceedings. Seller shall not be subject to any restraining order
-----------
or injunction restraining or prohibiting the consummation of the transactions
contemplated hereby; provided, however, that in the event that such a
restraining order or injunction is in effect at the time a closing would
otherwise occur by the terms of this Agreement, neither party shall have the
right to terminate this Agreement until the earlier to occur of (i) one hundred
eighty (180) days following the date hereof, or (ii) forty-five (45) days
following the initial entry of such temporary restraining order or injunction.
(c) Construction Permit. As of the Closing Date, no proceeding shall
-------------------
be pending which seeks, or the effect of which reasonably could be, to revoke,
cancel, fail to renew, suspend or modify adversely the Construction Permit and
the Construction Permit shall have become a Final Order.
- 15 -
(d) Tower. Authorization for and construction of the Tower that is
-----
the subject of the Lease Agreement is final and complete, and as currently
constructed will permit the facilities authorized in the Construction Permit to
be constructed in accordance with the Construction Permit.
(e) FCC Authorization. The assignment of all of the FCC
-----------------
Authorizations to Purchaser shall have become Final Order as referred to in
Section 1(i), without any conditions materially adverse to Purchaser. The
Station shall be operating in material compliance with the rules and regulations
of the FCC.
(f) Liens Released. All UCC Lien Search Reports have been delivered
--------------
by Seller to Purchaser, and all security interests pertaining to the Assets
shall be released of record and there shall be no liens in respect of the
Assets.
(g) Lease Agreement; Estoppel Certificate. Seller shall have executed
-------------------------------------
the Lease Agreement prior to the Closing Date; and the lessor under the Lease
Agreement shall have duly executed an Estoppel Certificate as of the Closing
Date, and if necessary, given its written consent to the assignment of the Lease
Agreement to Purchaser.
(h) Hart-Scott-Rodino Act. If applicable, the waiting period under
---------------------
the Hart-Scott-Rodino Act shall have expired or been terminated.
(i) Completion of Facilities Authorized in Construction Permit.
----------------------------------------------------------
Seller shall have completed construction of the facilities authorized in the
Construction Permit.
(j) FCC License to Cover Construction Permit. Seller shall have filed
----------------------------------------
with the FCC an application for a License to Cover the Construction Permit.
20. Indemnification by Seller. Notwithstanding the Closing, and regardless
-------------------------
of any investigation made at any time by or on behalf of Purchaser or any
information Purchaser may have, Seller hereby agrees to indemnify and hold
Purchaser harmless against and with respect to, and shall reimburse Purchaser
for:
(a) Any and all losses, liabilities, or damages resulting from any
untrue representation, breach of warranty, or nonfulfillment of any covenant or
agreement by Seller contained in this Agreement or in any certificate, document,
or instrument delivered to Purchaser under this Agreement.
(b) Any and all obligations of Seller not assumed by Purchaser
pursuant to this Agreement.
(c) Any and all losses, liabilities, or damages resulting from
Seller's operation or ownership of the Station prior to the Closing Date,
including any liabilities arising under the FCC Authorizations which relate to
events occurring prior to the Closing Date.
- 16 -
(d) Any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs, and expenses, including reasonable legal fees and
expenses, incident to any of the foregoing or incurred in investigating or
attempting to avoid the same or to oppose the imposition thereof, or in
enforcing this indemnity.
21. Notice of Indemnity Claim to Seller. Purchaser agrees to give written
-----------------------------------
notice to Seller within ten (10) days of the occurrence of any event, or of its
discovery of any facts, which entitle or may entitle Purchaser to
indemnification hereunder. Any failure to furnish such notice shall not prevent
the Purchaser from seeking and obtaining indemnification hereunder if such
failure to furnish notice does not prejudice Seller's rights hereunder. With
respect to threatened or asserted claims of third parties, Seller shall promptly
defend such claim by counsel of its own choosing. Seller shall not settle any
claim without Purchaser's approval, unless such settlement is a cash settlement
paid by Seller and there is a full release of Purchaser.
22. Defense or Settlement of Indemnity Claim by Seller. If Seller, within
--------------------------------------------------
fifteen (15) days after notice of a claim, fails to notify Purchaser of its
intent to defend such claim, Purchaser shall be entitled to undertake the
defense, compromise or settlement of such claim at the expense of and for the
account and risk of Seller under this indemnity Purchaser shall make a good
faith attempt to seek indemnification from any third parties, including
insurers, who may be liable upon any claims made against Purchaser and for which
Seller would be liable under this Section.
23. Indemnification by Purchaser. Notwithstanding the Closing, and
----------------------------
regardless of any investigation made at any time by or on behalf of Seller or
any information Seller may have, Purchaser hereby agrees to indemnify and hold
Seller harmless against and with respect to, and shall reimburse Seller for:
(a) Any and all losses, liabilities, or damages resulting from any
untrue representation, breach of warranty, or nonfulfillment of any covenant or
agreement by Purchaser contained in this Agreement or in any certificate,
document, or instrument delivered to Seller under this Agreement.
(b) Any and all obligations of Seller assumed by Purchaser pursuant
to this Agreement.
(c) Any and all losses, liabilities, or damages resulting from the
operation or ownership of the Station on and after the Closing Date.
(d) Any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs and expenses, including reasonable legal fees and
expenses, incident to any of the foregoing or incurred in investigating or
attempting to avoid the same or to oppose the imposition thereof, or in
enforcing this indemnity.
24. Notice of Indemnity Claim to Purchaser. Seller agrees to give written
--------------------------------------
notice to Purchaser within ten (10) days of the occurrence of any event, or of
its discovery of any facts, which entitle or may entitle Seller to
indemnification hereunder. Any failure to furnish such
- 17 -
notice shall not prevent the Seller from seeking and obtaining indemnification
hereunder if such failure to furnish notice does not prejudice Purchaser's
rights hereunder. With respect to threatened or asserted claims of third
parties, Purchaser shall promptly defend such claim by counsel of its own
choosing.
25. Defense or Settlement of Indemnity Claim by Purchaser. If
Purchaser, within fifteen (15) days after notice of a claim, fails to notify
Seller of its intent to defend such claim, Seller shall be entitled to undertake
the defense, compromise or settlement of such claim at the expense of and for
the account and risk of Purchaser under this indemnity. Seller shall make a good
faith attempt to seek indemnification from any third parties, including
insurers, who may be liable upon any claims made against Seller and for which
Purchaser would be liable under this Section.
26. Indemnification Threshold. Notwithstanding the provisions of
Sections 20 and 23, neither party shall be required to indemnify the other party
under Sections 20 and 23 unless and until such time as the aggregate amount of
the claims against the indemnifying party, to which the other party (as a
claimant) is entitled to be indemnified, exceeds Five Thousand Dollars
($5,000.00). In such event, the full amount of the amount sought pursuant to the
indemnity, including the portion under $5,000, shall be included in the
indemnity and shall be recoverable.
27. Seller's Deliveries at Closing. On the Closing Date, Seller shall
------------------------------
execute and deliver or cause to be delivered to Purchaser, in form and substance
reasonably satisfactory to Purchaser:
(a) Assignments of FCC Authorizations. One or more assignments
---------------------------------
assigning to Purchaser the FCC Authorizations and all other licenses,
authorizations and permits obtained in connection with the operation of the
Station set forth in Schedule 3(a) attached hereto.
(b) Assignment of Lease. An assignment of the Lease Agreement to
-------------------
Purchaser.
(c) Files, Records, Documents and Logs. The files, records, documents
----------------------------------
and logs referred to in Section 3(b) hereof.
(d) Authorizing Resolutions. Copies of any and all resolutions of
-----------------------
Seller authorizing the execution and performance of this Agreement and the
consummation of the transactions described herein.
(e) Prorations under Lease. A complete and detailed preliminary list
----------------------
of all adjustments and prorations to be made pursuant to the provisions of
Section 9 hereof.
(f) Closing Documents. Those documents (including a Bill of Sale for
-----------------
the tangible Assets, an Estoppel Certificate and, if necessary, written consent
from lessor under the Lease Agreement), in form and substance satisfactory to
Purchaser, that are sufficient to sell,
- 18 -
convey, transfer and assign the FCC Authorizations and Assets to Purchaser free
and clear of any liens.
(g) Certified Officer's Certificate. A certificate, dated the Closing
-------------------------------
Date and duly executed by the President or Vice President of the General Partner
of Seller, authorized on behalf of Seller to give such certificate, to the
effect that conditions set forth in Section 19 have been satisfied.
(h) Miscellaneous. All other documents and instruments reasonably
-------------
requested by Purchaser and required to be provided to Purchaser pursuant to the
terms of this Agreement.
28. Purchaser's Deliveries at Closing. On the Closing Date, Purchaser
---------------------------------
shall execute and deliver or cause to be delivered to Seller, in form and
substance reasonably satisfactory to Seller:
(a) Purchase Price. The Purchase Price, as adjusted, payable on the
--------------
Closing Date as set forth in Section 7 hereof by wire transfer.
(c) Assumption Instrument: Lease. Such instruments as Seller may
----------------------------
reasonably require evidencing Purchaser's assumption and agreement to perform
all of the Seller's obligations under the Lease Agreement.
(d) Authorizing Resolutions. Copies of any and all resolutions of the
-----------------------
Board of Directors of Purchaser authorizing the execution and performance of
this Agreement and the consummation of the transactions described herein.
(e) Certified Officer's Certificate. A certificate, dated the Closing
-------------------------------
Date and duly executed by an officer of Purchaser, authorized on behalf of
Purchaser, to give such certificate, to the effect that conditions set forth in
Section 18(a) have been satisfied.
(f) Miscellaneous. All other documents and instruments reasonably
-------------
requested by Seller and required to be provided to Seller pursuant to the terms
of this Agreement.
29. Survival of Representations and Warranties. All representations,
------------------------------------------
warranties, covenants and agreements contained in this Agreement shall survive
the Closing Date for a period of one (1) year; provided; with the exception of
the representations, warranties, covenants and agreements contained in Sections
7(b) which shall survive the Closing for a period of five (5) years; and with
the exception of Section 14(d) which shall survive the closing indefinitely.
30. Fees and Expenses. Sales and transfer taxes, if any, upon the transfer
-----------------
of the Assets to Purchaser hereunder shall be paid by Seller. Seller and
Purchaser shall each pay one-half of the FCC filing fees. Purchaser shall pay
any filing fees required under the HSR Act. All other expenses incurred in
connection with the transactions contemplated herein shall be borne by the party
which incurs such expenses.
- 19 -
31. Termination. This Agreement may be terminated at any time on or prior
-----------
to the Closing Date:
(a) by the mutual written consent of Seller and Purchaser;
(b) by either Purchaser or Seller, if the party seeking to terminate
is not in material default or breach of this Agreement, upon written notice to
the other if (i) on or prior to the Closing Date, the other party defaults in
any material respect in the observance or in the due and timely performance of
any of its covenants and agreements contained herein and fails to cure such
default within fifteen (15) business days of the date written notice of breach
is received from the non-breaching party by the breaching party; or (ii) if
there shall be in effect any judgment, final decree or order that would prevent
or make unlawful the Closing;
(c) by either Purchaser or Seller in accordance with Section 11 of
this Agreement, unless the Closing has already occurred.
(d) by either Purchaser or Seller, if the FCC denies the Assignment
Application and/or the DOJ denies the approvals contemplated by this Agreement.
A termination pursuant to this Section shall not relieve either party of any
liability it otherwise has for a breach of this Agreement. So long as Purchaser
is not in breach of this Agreement, the Earnest Money shall be returned to
Purchaser if the Agreement is terminated.
32. Remedies.
--------
(a) Seller recognizes that, in the event Seller defaults in the
performance of its obligations under this Agreement, monetary damages alone will
not be adequate. Purchaser shall therefore be entitled in such event, either (i)
to bring suit at law or equity for money or other damages (including costs and
expenses incurred by Purchaser in the preparation and negotiation of this
Agreement and in contemplation of the Closing hereunder) or for indemnification
under Section 20 hereof; or (ii) to obtain specific performance of the terms of
this Agreement. In any action to enforce the provisions of this Agreement,
Purchaser shall have the right to obtain specific performance of the terms of
this Agreement without being required to prove actual damages, post bond or
furnish other security. In addition, Purchaser shall be entitled to obtain from
Seller court costs and reasonable attorney's fees incurred by it in enforcing
its rights hereunder.
(b) If the transactions contemplated by this Agreement are not
consummated as a result of Purchaser's wrongful failure to close hereunder,
Seller shall be entitled to payment of the Earnest Money, plus an additional
payment of Two Million Seven Hundred Fifty Thousand Dollars ($2,750,000), but
only if Purchaser has extended the Closing Date beyond January 30, 2002,
pursuant to Section 1(c) of this Agreement, and the Purchaser's wrongful conduct
occurs after January 30, 2002 ("Extension Payment"), as liquidated damages in
full settlement of any damages of any nature or kind that Seller may suffer or
allege to suffer as the
- 20 -
result thereof. It is understood and agreed that the amount of liquidated
damages represents Purchaser's and Seller's reasonable estimate of actual
damages and does not constitute a penalty. Recovery of liquidated damages under
this Section shall be the sole and exclusive remedy of Seller against Purchaser
for failure to consummate this Agreement and shall be applicable regardless of
the actual amount of damages sustained. In addition, Seller shall be entitled to
obtain from Purchaser court costs and reasonable attorney's fees incurred by it
in enforcing its rights hereunder. Seller shall not be required, as a condition
to obtaining liquidated damages, to have tendered the Assets but shall be
required to demonstrate that it is willing and able to do so and to perform its
other closing obligations in all material respects.
33. Notices. All notices, requests, demands and other communications
-------
required or permitted under this Agreement shall be in writing (which shall
include notice by facsimile transmission) and shall be deemed to have been duly
made and received when personally served, or when delivered by Federal Express
or a similar overnight courier service, expenses prepaid, or, if sent by
facsimile communications equipment, delivered by such equipment, addressed as
set forth below:
(a) If to Seller, to:
Mr. Douglas M. Grimm
U.S. Broadcasting Limited Partnership
544 Mulberry Street, Suite 500
P.O. Box 900
Macon, GA 31202
Fax: (478) 745-2078
with a copy (which shall not constitute notice) to:
Michael J. Golub, Esq.
Bodzin & Golub, P.C.
1156 15th Street, NW, Suite 329
Washington, D.C. 20005
Fax: (202) 785-8882
(b) If to Purchaser, to:
Mr. Alfred Liggins
President and Chief Executive Officer
Radio One, Inc.
5900 Princess Garden Parkway
8th Floor
Lanham, MD 20706
Fax: (301) 306-9694
with a copy (which shall not constitute notice) to:
- 21 -
Linda J. Eckard Vilardo, Esq.
General Counsel
Radio One, Inc.
5900 Princess Garden Parkway
8th Floor
Lanham, MD 20706
Fax: (301) 306-9638
Either of the parties may from time to time designate a substitute address in a
writing delivered to the other party.
34. Brokerage. The parties acknowledge that the Seller has engaged a
---------
broker to facilitate this transaction on the Seller's part. The parties agree
that any brokerage commission or finder's fee charged by said broker, in
connection with the transaction contemplated by this Agreement, shall be the
sole responsibility of the Seller.
35. Rescission of Agreement. If the Closing occurs prior to a Final Order,
-----------------------
and prior to becoming a Final Order the FCC Consent is reversed or otherwise set
aside, and there is a Final Order of the FCC (or court of competent
jurisdiction) requiring the re-assignment of the FCC Authorizations to Seller,
then Seller and Purchaser agree that the purchase and sale of the Station Assets
shall be rescinded. In such event, Purchaser shall reconvey to Seller the
Station Assets, and Seller shall repay to Purchaser the Purchase Price (limited
in all events to the value of such Purchase Price at the time of the Closing)
and reassume the Seller's contracts assigned and assumed by Purchaser at
Closing. Any such rescission shall be consummated on a mutually agreeable date
within thirty (30) calendar days of such Final Order (or, if earlier, within the
time required by such order). In connection therewith, Purchaser and Seller
shall each execute such documents (including execution by Purchaser of
instruments of conveyance of the Station Assets to Seller and execution by
Seller of instruments of assumption of the Seller contracts assigned and assumed
at Closing) and make such payments (including repayment by Seller to Purchaser
of the Purchase Price, which shall be limited to the value of such Purchase
Price at the time of the Closing) as are necessary to give effect to such
rescission. Seller's and Purchaser's obligations under this Section 35 shall
survive the Closing.
36. Successors and Assigns. Except as otherwise expressly provided herein,
----------------------
this Agreement shall be binding upon and inure to the benefit of the parties
hereto, and their respective representatives, successors and assigns. Neither
may assign any of its rights or delegate any of its duties hereunder without the
prior written consent of the other party, and any such attempted assignment or
delegation without such consent shall be void; provided, however, that Purchaser
may assign its rights and obligations hereunder to one or more wholly-owned
subsidiaries of Purchaser, in whole or in part without Seller's consent so long
as Purchaser notifies Seller in writing within five (5) business days of such
assignment, and assignee assumes all obligations of Purchaser hereunder.
- 22 -
37. Further Assurances. The parties agree to execute and deliver to the
------------------
other such other documents or instruments as may be reasonable and necessary in
furtherance of the performance of the terms, covenants and conditions of this
Agreement.
38. Exhibits. All Exhibits and Schedules attached to this Agreement shall
--------
be deemed part of this Agreement and incorporated herein, where applicable, as
if fully set forth herein.
39. Counterparts. This Agreement may be executed in any number of
------------
counterparts, each of which shall be deemed to be an original as against any
party whose signature appears thereon, and all of which shall together
constitute one and the same instrument. This Agreement shall become binding when
one or more counterparts hereof, individually or taken together, shall bear the
signatures of all of the parties reflected hereon as the signatories.
40. Headings. The headings of the Sections of this Agreement are inserted
--------
as a matter of convenience and for reference purposes only and in no respect
define, limit or describe the scope of this Agreement or the intent of any
Section hereof.
41. Entire Agreement. This Agreement and all exhibits attached hereto and
----------------
all agreements to be delivered by the parties pursuant hereto, represent the
entire understanding and agreement between the parties hereto with respect to
the subject matter hereof, supersedes all prior negotiations between such
parties, and can be amended, supplemented or changed only by an agreement in
writing which makes specific reference to this Agreement or the agreement or
instrument delivered pursuant hereto, as the case may be, and which is signed by
the party against whom enforcement of any such amendment, supplement or
modification is sought.
42. Confidentiality and Press Releases.
----------------------------------
(a) The parties acknowledge they have agreed to hold in strict
confidence all documents and information concerning each other and their
business and properties (except that the parties may disclose such documents and
information to any governmental authority reviewing the transaction contemplated
hereby), and if the transaction contemplated hereby is not consummated, such
confidence shall be maintained, and all such documents and information (in
written form) shall immediately thereafter be returned to the party originally
furnishing the same and the party returning such information shall not retain
copies thereof.
(b) The parties hereto shall reasonably cooperate in the issuance of
any press release or any other public announcement or other communication with
any news media concerning this Agreement or the transactions contemplated
hereby; provided, however, that nothing contained herein shall prevent any party
from promptly making all filings with governmental authorities as may, in its
judgment, be required or advisable in connection with the execution and delivery
of this Agreement or the consummation of the transactions contemplated hereby,
in which case the other parties shall be first notified in writing.
43. Severability. If any provision of this Agreement or the application
------------
thereof to any person or circumstances shall be invalid or unenforceable to any
extent, the remainder of this
- 23 -
Agreement and the application of such provision to other persons or
circumstances shall not be affected thereby and shall be enforced to the
greatest extent permitted by law.
44. Governing Law. This Agreement and all questions relating to its
-------------
validity, interpretation, performance and enforcement shall be governed and
construed in accordance with the laws of the State of Georgia without giving
effect to principles of conflicts of law.
[SIGNATURE PAGES TO ASSET PURCHASE AGREEMENT TO FOLLOW]
- 24 -
IN WITNESS WHEREOF, the parties hereto have hereunto set their respective
hands and seals as of the day and year first above written.
SELLER
U.S. BROADCASTING LIMITED PARTNERSHIP
By: /s/ Magic Broadcasting II, Inc., its General Partner
----------------------------------------------------
Name: Donald G. McCoy
Title: President
PURCHASER
RADIO ONE, INC.
By: /s/ SCOTT R. ROYSTER
--------------------------------
Name: Scott R. Royster
Title: Executive Vice President, Chief Financial Officer
- 25 -
List of Schedules and Exhibits
LIST OF SCHEDULES
- -----------------
Schedule 3(a) : FCC Authorizations
Schedule 3(b) : Tower Lease Agreement
LIST OF EXHIBITS
- ----------------
Exhibit A : Escrow Agreement
Exhibit B : Local Marketing Agreement
- 26 -