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EXHIBIT 2.4
ASSET PURCHASE AGREEMENT
AMONG
MARANATHA BROADCASTING COMPANY, INC.,
CITADEL BROADCASTING COMPANY
AND
CITADEL LICENSE, INC.
WEST(AM)
JULY 15, 1997
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT ("AGREEMENT"), made as of the 15th day of
July, 1997, by and among MARANATHA BROADCASTING COMPANY, INC., a Pennsylvania
corporation ("PURCHASER"); CITADEL BROADCASTING COMPANY, a Nevada corporation
("CITADEL"); and CITADEL LICENSE, INC., a Nevada corporation ("LICENSE SUB").
RECITALS:
A. Citadel and License Sub own and operate, and License Sub is the
licensee of, radio station WEST(AM) licensed to Easton, Pennsylvania (the
"STATION").
B. Purchaser is the licensee of and owns and operates radio station
WFMZ(FM) licensed to Allentown, Pennsylvania (the "ALLENTOWN STATION").
C. Citadel and License Sub desire to sell to Purchaser, and Purchaser
desires to purchase from Citadel and License Sub, certain of the assets of the
Station, together with cash, in exchange for certain of the assets of the
Allentown Station, on the terms and subject to the conditions set forth in this
Agreement and in the Allentown Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and
sufficiency of which are hereby acknowledged, the parties agree as follows:
SECTION 1
DEFINITIONS
The following terms when used in this Agreement shall have the
meanings assigned to them below:
"ACCOUNTS RECEIVABLE" has the meaning specified in Section 8.3.
"ACCOUNTS RECEIVABLE LIST" has the meaning specified in Section 8.3.
"ACCRUED TAXES" has the meaning specified in Section 4.6.
"ACT" means the Communications Act of 1934, as amended.
"AFFILIATE" of any Person means any other Person (a) that directly or
indirectly controls, is controlled by, or is under direct or indirect common
control with, the first Person, or (b) any interests of which are owned, in
whole or in part, directly or indirectly, by the first Person. For purposes of
this definition, the term "control" (including the correlative meanings of the
terms "controls," "controlled by," and "under direct or indirect control
with"), as used with respect to any Person, shall mean the possession, directly
or indirectly, of the power to direct or cause the
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direction of the management policies of the Person, whether through the
ownership of voting securities or by contract or otherwise.
"ALLENTOWN AGREEMENT" means that certain Asset Purchase Agreement
dated as of the date hereof among Purchaser, Citadel and License Sub relating
to the sale by Citadel and License Sub of the Allentown Station.
"ALLENTOWN ASSUMED OBLIGATIONS" means the Assumed Obligations under,
and as defined in, the Allentown Agreement.
"ALLENTOWN PURCHASED ASSETS" means the Purchased Assets under, and as
defined in, the Allentown Agreement.
"ALLENTOWN STATION" has the meaning specified in the recitals to this
Agreement.
"ASSET SCHEDULE" has the meaning specified in Section 2.1(a).
"ASSIGNED CONTRACTS" has the meaning specified in Section 2.1(d).
"ASSUMED OBLIGATIONS" has the meaning specified in Section 2.3.
"BROKER" means Richard A. Foreman Associates Inc.
"BUSINESS" has the meaning specified in Section 4.1.
"CASH PURCHASE PRICE" has the meaning specified in the Allentown
Agreement.
"CITADEL'S DISCLOSURE SCHEDULE" has the meaning specified in
Section 4.3.
"CLOSING" means the consummation of the transactions contemplated in
this Agreement in accordance with the provisions of Section 10.
"CLOSING DATE" has the meaning specified in Section 10.1.
"CODE" means the Internal Revenue Code of 1986, as amended.
"CONTRACTS" has the meaning specified in Section 4.9.
"CPR RULES" means the Center for Public Resources Rules for
Nonadministered Arbitration of Business Disputes.
"DAMAGES" has the meaning specified in Section 13.1.
"EASTON ANTENNA LEASE" has the meaning specified in Section 9.8.
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"ENVIRONMENTAL CLAIMS" means and includes, without limitation: (a)
claims, demands, suits, causes of action for personal injury or lost use of
property, or consequential damages, to the extent any of the foregoing arise
directly or indirectly out of Environmental Conditions; (b) actual or
threatened damages to natural resources; (c) claims for the recovery of
response costs, or administrative or judicial orders directing the performance
of investigations, response or remedial actions under CERCLA, RCRA or other
Environmental Laws; (d) a requirement to implement "corrective action" pursuant
to any order or permit issued pursuant to RCRA; (e) claims for restitution,
contribution or equitable indemnity from third parties or any governmental
agency; (f) fines, penalties or Liens against property; (g) claims for
injunctive relief or other orders or notices of violation from Governmental
Authorities; and (h) with regard to any present or former employees, exposure
to or injury from Environmental Conditions.
"ENVIRONMENTAL CONDITIONS" means conditions of the environment,
including the ocean, natural resources (including flora and fauna), soil,
surface water, ground water, any present or potential drinking water supply,
subsurface strata or the ambient air, relating to or arising out of the use,
handling, storage, treatment, recycling, generation, transportation, release,
spilling, leaking, pumping, pouring, emptying, discharging, injecting,
escaping, leaching, disposal, dumping, or threatened release of Hazardous
Materials by Citadel. With respect to claims by employees, Environmental
Conditions also includes the exposure of Persons to Hazardous Materials within
work places on any real estate owned or occupied by Citadel.
"ENVIRONMENTAL LAWS" has the meaning specified in the definition of
Hazardous Materials.
"ENVIRONMENTAL NONCOMPLIANCE" means, but is not limited to: (a) the
release or threatened release as a result of the activities of Citadel of any
Hazardous Materials into the environment, any storm drain, sewer, septic system
or publicly owned treatment works, in violation of any effluent emission
limitations, standards or other criteria or guidelines established by any
federal, state or local law, regulation, rule, ordinance, plan or order; and
(b) any facility operations, procedures, designs, etc. which do not conform to
the statutory or regulatory requirements of the CAA, the CWA, the TSCA, the
RCRA or any other Environmental Laws intended to protect public health, welfare
and the environment.
"ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.
"EXCLUDED ASSETS" has the meaning specified in Section 2.2.
"FCC" means the Federal Communications Commission.
"FCC APPLICATION" has the meaning specified in Section 9.1(a).
"FCC APPROVAL" has the meaning specified in Section 9.1(a).
"FCC LICENSES" means the main station license for the Station,
together with each of the other consents, rights, licenses, permits and other
authorizations issued by the FCC and held by
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Citadel and/or License Sub in connection with, or pertaining to, the conduct of
the business and operation of the Station, together with any renewals and
extensions thereof and any applications therefor pending on the Closing Date,
and any and all applications made by Citadel and/or License Sub for such
consents, rights, licenses, permits and other authorizations.
"FINAL ORDER" means a written action or order issued by the FCC or its
staff setting forth the FCC Approval (or a denial thereof), (a) which action or
order has not been vacated, reversed, stayed, enjoined, set aside, annulled or
suspended, and (b) with respect to which action or order (i) no requests have
been filed and are pending for administrative or judicial review, rehearing,
reconsideration, appeal or stay, and the time period for filing any such
requests and for the FCC to set aside the action on its own motion under the
provisions of the Act or the rules, regulations and policies of the FCC has
expired, or (ii) in the event of review, reconsideration or appeal, the time
for further review, reconsideration or appeal has expired.
"GAAP" means generally accepted accounting principles in effect in the
United States of America from time to time applied on a consistent basis during
the periods involved.
"GOVERNMENTAL AUTHORITY" means any government, whether federal, state
or local, or any other political subdivision thereof, or any agency, tribunal
or instrumentality of any such governmental or political subdivision, or any
other Person exercising executive, legislative, judicial, regulatory or
administrative functions of or pertaining to government.
"HAZARDOUS MATERIALS" means hazardous wastes, hazardous substances,
hazardous constituents, toxic substances or related materials, whether solids,
liquids or gases including but not limited to substances defined as "PCBs,"
"hazardous wastes," "hazardous substances," "toxic substances," "pollutants,"
"contaminants," "radioactive materials," "petroleum," or other similar
designations in, or otherwise subject to regulation under, the Comprehensive
Environmental Response, Compensation and Liability Act of 1980, as amended by
the Superfund Amendments and Reauthorization Act of 1986 ("CERCLA"), 42 U.S.C.
Section 9601 ET SEQ.; the Toxic Substance Control Act ("TSCA"), 15 U.S.C.
Section 2601 ET SEQ.; the Resource Conservation and Recovery Act ("RCRA"), 42
U.S.C. Section 9601; the Clean Water Act ("CWA"), 33 U.S.C. Section 1251 ET
SEQ.; the Safe Drinking Water Act, 42 U.S.C.Section 300f ET SEQ.; the Clean Air
Act ("CAA"), 42 U.S.C. Section 7401 ET SEQ.; or any similar state law; and in
the plans, rules, regulations or ordinances adopted, or other criteria and
guidelines promulgated pursuant to the preceding laws or other similar laws,
regulations, rules or ordinances now in effect (collectively, the "ENVIRONMENTAL
LAWS"); and any other substances, constituents or wastes subject to
environmental regulations under any applicable federal, state or local law,
regulation or ordinance.
"HSR ACT" means the Hart-Scott-Rodino Antitrust Improvement Act of
1976, as amended from time to time.
"HSR FILING" has the meaning specified in Section 9.7.
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"INDEBTEDNESS FOR BORROWED MONEY" means (a) all indebtedness of
Citadel in respect of money borrowed (including, without limitation,
indebtedness which represents the unpaid amount of the purchase price of any
property), (b) all indebtedness of Citadel evidenced by a promissory note, bond
or similar written obligation to pay money, (c) all indebtedness guaranteed by
Citadel or for which Citadel is contingently liable, including, without
limitation, guaranties in the form of an agreement to repurchase or reimburse,
and any commitment by which any such Person assures a creditor against loss,
including contingent reimbursement obligations with respect to letters of
credit, and (d) all monetary obligations of Citadel under any lease or similar
arrangement, which obligations would be classified and accounted for as capital
obligations on a balance sheet of Citadel under GAAP.
"INDEMNITEE" has the meaning specified in Section 13.3.
"INDEMNITOR" has the meaning specified in Section 13.3.
"INTELLECTUAL PROPERTY" has the meaning specified in Section 2.1(e).
"LEASEHOLDS" has the meaning specified in Section 4.8.
"LIEN" means any mortgage, pledge, hypothecation, assignment,
encumbrance, claim, easement, transfer restriction, lien (statutory or
otherwise) or security interest of any kind or nature whatsoever.
"OBLIGATIONS" means, without duplication, all (a) Indebtedness for
Borrowed Money, (b) Accrued Taxes, accounts payable, accrued liabilities and
all other liabilities and obligations of the type normally required by GAAP to
be reflected on a balance sheet, (c) commitments by which Citadel assures a
creditor against loss, including the face amount of all letters of credit and,
without duplication, all drafts drawn thereunder, (d) obligations guaranteed in
any manner by Citadel, (e) obligations under capitalized leases in respect of
which obligations Citadel is liable, contingently or otherwise, as obligor,
guarantor or otherwise, or in respect of which obligations such Person assures
a creditor against loss, (f) obligations under acceptance facilities, (g)
obligations secured by a Lien on property of Citadel, (h) obligations under
interest rate or currency exchange or swap agreements, (i) unsatisfied
obligations for "withdrawal liability" to a "multiemployer plan" as such terms
are defined under ERISA, (j) indebtedness issued or obligation incurred in
substitution or exchange for any Obligations, (k) costs or expenses incurred by
Citadel of any nature, whether or not currently payable, and (l) other
liabilities or obligations of Citadel, in each of the foregoing instances
whether absolute or contingent, known or unknown, and whether or not normally
required by GAAP to be reflected on a balance sheet.
"PERMITS" has the meaning specified in Section 4.17(b).
"PERSON" means an individual, corporation, partnership, joint venture,
joint stock seller, association, trust, business trust, unincorporated
organization, Governmental Authority, or any other entity of whatever nature.
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"PERSONAL PROPERTY" has the meaning specified in Section 2.1(a).
"PURCHASED ASSETS" has the meaning specified in Section 2.1.
"PURCHASE PRICE" has the meaning specified in Section 3.1.
"PURCHASER COLLECTION PERIOD" has the meaning specified in
Section 8.3.
"PURCHASER'S DISCLOSURE SCHEDULE" has the meaning specified in
Section 5.3.
"REAL PROPERTY" has the meaning specified in Section 2.1(b)
"REAL PROPERTY LEASES" has the meaning specified in Section 2.1(c).
"STATION" has the meaning specified in the recitals to this Agreement.
"STUDIO" has the meaning specified in Section 9.13.
"SUPPLEMENTAL FINANCIAL STATEMENTS" has the meaning specified in
Section 6.10
"TAXES" means all taxes, charges, fees, levies, or other assessments,
including income, gross receipts, excise, property, sales, transfer, license,
payroll, and franchise taxes, any taxes required by law to be withheld, and any
taxes payable as a result of the consummation of the transactions contemplated
by this Agreement, which taxes are imposed by any Governmental Authority; and
such term shall include any interest, penalties, or additions to tax
attributable to such assessments.
"TRADE AGREEMENTS" has the meaning specified in Section 6.9.
"TRADE IMBALANCE" has the meaning specified in Section 6.9.
"TRADE LIABILITIES" has the meaning specified in Section 6.9.
"TRADE RECEIVABLES" has the meaning specified in Section 6.9.
"TRADE SCHEDULE" has the meaning specified in Section 6.9.
SECTION 2
PURCHASE AND SALE OF ASSETS
2.1 PURCHASE AND SALE OF PURCHASED ASSETS. Subject to the terms and
conditions of this Agreement, and on the basis of the representations,
warranties, covenants and agreements contained in this Agreement, at the
Closing, Citadel (and, with respect to clause (f) below,
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License Sub) agrees to sell, assign and convey to Purchaser, and Purchaser
agrees to purchase, acquire and accept from Citadel (and, with respect to clause
(f) below, License Sub), all of the Purchased Assets. The "PURCHASED ASSETS"
consist of:
(a) All the tangible personal property, improvements and
fixtures described on SCHEDULE 2.1 to this Agreement (the "ASSET SCHEDULE")
(the "PERSONAL PROPERTY");
(b) All of the right, title and interest of Citadel in and to
the real property described on the ASSET SCHEDULE (the "REAL PROPERTY");
(c) The leasehold interests pursuant to the real property
leases described on the ASSET SCHEDULE (the "REAL PROPERTY LEASES");
(d) All of the right, title and interest of Citadel in and to
those contracts, leases, licenses, memberships, agencies, permits and
agreements, other than Real Property Leases, to which Citadel presently is a
party or an assignee of a party which are described on the ASSET SCHEDULE (the
"ASSIGNED CONTRACTS"), including the employment agreements listed on the ASSET
SCHEDULE;
(e) The call letters of the Station and all of the
copyrights, trademarks, trade names and other similar rights, including
applications and registrations therefor, used in connection with the past or
present operation of the Station in which Citadel has any right, title or
interest, including, without limitation, those items listed on the ASSET
SCHEDULE (collectively, the "INTELLECTUAL PROPERTY");
(f) The FCC Licenses, a complete list of which is
included on the ASSET SCHEDULE;
(g) Copies of all books, records and accounts relating to the
operation of the Station, subject to the right of Citadel to retain originals
thereof for Citadel's personal use and reference and to obtain access to such
books, records and accounts in accordance with the provisions of Section
2.2(a); and
(h) All other assets owned by Citadel as of the date of this
Agreement which are needed in the broadcast chain of the Station as of the date
of this Agreement (i.e., from studio to transmission).
2.2 EXCLUDED ASSETS. Notwithstanding anything to the contrary
contained in this Agreement, it is expressly understood and agreed that there
shall be excluded from the assets transferred or assigned to Purchaser with
respect to Station the following (collectively, the "EXCLUDED ASSETS"):
(a) Except to the extent included in Section 2.1(g), all of
Citadel's and License Sub's corporate books and records and other documents
relating to the internal corporate affairs
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of Citadel and License Sub, and all other corporate records or files of Citadel
and License Sub not relating to the business or operation of the Station;
(b) All cash, cash equivalents or similar type investments held by
Citadel and License Sub, such as certificates of deposit, treasury bills and
other marketable securities on hand as of the Closing;
(c) All accounts receivable existing as of Closing;
(d) Corporate assets and assets not used in connection with the
Station;
(e) Any and all claims of Citadel and License Sub with respect to
transactions occurring or arising prior to the Closing Date, including, without
limitation, claims for Tax refunds; and
(f) Those additional assets identified on SCHEDULE 2.2 as Excluded
Assets.
Notwithstanding the foregoing, any asset which is described above but which is
actually listed on the ASSET SCHEDULE shall be a Purchased Asset and not an
Excluded Asset.
2.3 OBLIGATIONS. Purchaser shall not assume, and shall purchase the
Purchased Assets free and clear of, any and all Obligations of Citadel and
License Sub, except that Purchaser shall assume those Obligations of Citadel
arising from and after the Closing Date (other than any liability or obligation
for breach or default which occurred prior to the Closing Date) pursuant to
each of (a) the Real Property Leases, (b) the Assigned Contracts, (c) those
items subject to proration pursuant to Section 9.2, (d) the Trade Liabilities
and (e) those additional items expressly set forth on SCHEDULE 2.3 to this
Agreement (collectively, the "ASSUMED OBLIGATIONS").
SECTION 3
PURCHASE PRICE
3.1 PURCHASE PRICE. The purchase price for the Purchased Assets shall
consist of the Allentown Purchased Assets, subject to the assumption by Citadel
of the Allentown Assumed Obligations and the payment by Citadel of the Cash
Purchase Price, as provided in the Allentown Agreement (the "PURCHASE PRICE").
3.2 ALLOCATION OF THE PURCHASE PRICE. Citadel, License Sub and
Purchaser shall report the transactions contemplated by this Agreement for
federal and state tax purposes in a manner consistent with the allocation of
the Purchase Price mutually agreed upon by Citadel, License Sub and Purchaser.
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SECTION 4
REPRESENTATIONS AND WARRANTIES OF CITADEL AND LICENSE SUB
In connection with the purchase and sale of the Purchased Assets under
this Agreement and in order to induce Purchaser to enter into and consummate
the transactions contemplated by this Agreement, Citadel and License Sub make
the following representations and warranties to Purchaser, as of the date of
this Agreement and as of the date of the Closing (except for representations
and warranties expressly and specifically relating to a time or times other
than the date hereof or thereof, which shall be made as of the specified time
or times):
4.1 ORGANIZATION AND QUALIFICATION. Each of Citadel and License Sub is
a corporation duly organized, validly existing and in good standing under the
laws of the State of Nevada, and has full corporate power and authority (a) to
own its assets and properties and to conduct the business relating to the
Station (the "BUSINESS") and (b) to enter into this Agreement and to consummate
the transactions contemplated hereby. Citadel has duly qualified to do business
as a foreign corporation and is in good standing under the laws of the
Commonwealth of Pennsylvania. Each of Citadel and License Sub has full power,
authority and legal right and all necessary approvals, permits, licenses and
authorizations to own its properties and to conduct the Business.
4.2 AUTHORITY. The execution and delivery of this Agreement by Citadel
and License Sub, the performance by Citadel and License Sub of their respective
covenants and agreements hereunder and the consummation by Citadel and License
Sub of the transactions contemplated hereby have been duly authorized by all
necessary action on the part of Citadel and License Sub. This Agreement
constitutes the valid and legally binding agreement of Citadel and License Sub,
enforceable against each of them in accordance with its terms.
4.3 NO LEGAL BAR; CONFLICTS. Neither the execution and delivery of
this Agreement, nor the consummation of the transactions contemplated hereby,
violates or will violate any provision of the Articles of Incorporation or
Bylaws of Citadel or License Sub, or any law, rule, regulation, writ, judgment,
injunction, decree, determination, award or other order of any Governmental
Authority, or violates or will violate, or conflicts with or will conflict with,
or will result in any breach of any of the terms of, or constitutes or will
constitute a default under or results in or will result in the termination of or
the creation or imposition of any Lien pursuant to, the terms of any contract,
commitment, agreement, understanding or arrangement of any kind to which Citadel
or License Sub is a party or by which Citadel, License Sub or any of the assets
of Citadel or License Sub is bound. Except for the FCC Approval, compliance with
the HSR Act and the consents disclosed in SCHEDULE 4.0 to this Agreement
("CITADEL'S DISCLOSURE SCHEDULE"), no consents, approvals or authorizations of,
or filings with, any Governmental Authority or any other Person are required in
connection with the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby.
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4.4 FINANCIAL STATEMENTS. Citadel has delivered to Purchaser, with
respect to the Station, the monthly unaudited balance sheets and income
statements for each month in 1996 and the first six months of 1997. Each of the
foregoing financial statements (including in all cases the notes thereto, if
any) (i) is accurate and complete in all material respects, (ii) is consistent
in all material respects with the books and records of Citadel relating to the
Station (which, in turn, are accurate and complete in all material respects)
and (iii) presents fairly in all material respects the financial condition and
results of operations of the Station in accordance with GAAP (subject in the
case of unaudited financial statements to the lack of footnote disclosure and
changes resulting from normal year-end audit adjustments), consistently
applied, as of the dates and for the periods set forth therein.
4.5 ABSENCE OF CERTAIN CHANGES. Between December 31, 1996 and the date
of this Agreement, except as disclosed in CITADEL'S DISCLOSURE SCHEDULE, there
has not been any (a) material adverse change in the condition of the Station,
financial or otherwise, or in the results of operations, assets, liabilities or
business of the Station; (b) damage or destruction, whether or not insured,
affecting the business operations of the Station; (c) labor dispute or
threatened labor dispute involving any of the employees of the Station; (d)
actual or threatened dispute pertaining to the Station with any material
provider of software, hardware or services; (e) material change in the
customary methods of operations of the Station; (f) except in the ordinary
course of business or to the extent not material to the Business or financial
condition of the Station, sale or transfer of any tangible or intangible asset
used or useful in the operation of the Station, mortgage, pledge or imposition
of any Lien on any such asset, lease of real property, machinery, equipment or
buildings with respect to the Station entered into or modification, amendment
or cancellation of any of its existing leases relating to the Station, or
cancellation of any debt or claim; or (g) liability or obligation (contingent
or otherwise) incurred under agreements or otherwise, except current
liabilities entered into or incurred in the ordinary course of business
consistent with past practices.
4.6 TAXES. Except as disclosed in CITADEL'S DISCLOSURE SCHEDULE,
Citadel has filed or caused to be filed on a timely basis all federal, state,
local and other tax returns, reports and declarations required to be filed by
it with respect to the Station and has paid all Taxes (including, but not
limited to, income, franchise, sales, use, unemployment, withholding, social
security and workers' compensation taxes and estimated income and franchise tax
payments, penalties and fines) reflected as due on such returns, reports or
declarations (whether or not shown on such returns, reports or declarations),
or pursuant to any assessment received by it in connection with such returns,
reports or declarations. All returns, reports and declarations filed by or on
behalf of Citadel relating to the Station are true, complete and correct in all
material respects. With respect to the Station, no deficiency in payment of any
Taxes for any period has been asserted by any taxing authority which remains
unsettled at the date hereof, no written inquiries have been received by Citadel
from any taxing authority with respect to possible claims for taxes or
assessments, and there is no basis for any additional claims or assessments for
Taxes.
Since December 31, 1996, Citadel has not incurred any liability for
Taxes which materially affect the operation of the Station other than in the
ordinary course of business. All
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Taxes attributable to the Station or its income, operations or properties
accruing up to and including the Closing (the "ACCRUED TAXES") have been or will
be paid when due regardless of whether such Taxes are due and payable as of the
Closing.
4.7 ASSET SCHEDULE. The ASSET SCHEDULE includes complete and accurate
(a) listings of all Real Property; (b) listings of all Personal Property; (c)
descriptions of all Real Property Leases and Assigned Contracts, none of which
requires any consent of third parties in connection with the transactions
contemplated hereby, except otherwise as indicated in CITADEL'S DISCLOSURE
SCHEDULE; (d) descriptions of all of the Intellectual Property; and (e)
listings of all of the FCC Licenses, all of the foregoing of which will, as of
the Closing, be owned and held by Citadel or License Sub as reflected in the
ASSET SCHEDULE.
4.8 TITLE TO AND CONDITION OF PROPERTY.
(a) TITLE. Citadel will as of the Closing have good, marketable and
exclusive title to and undisputed possession of all of the real, personal and
tangible property and improvements included in the Purchased Assets. Except as
set forth on CITADEL'S DISCLOSURE SCHEDULE, the Purchased Assets are now free
and clear of all Liens. The Purchased Assets will, as of the Closing, be free
and clear of all Liens.
(b) CONDITION. The Personal Property, prior to their removal (if
any) pursuant to Section 9.9, is structurally sound, in reasonably good
condition, ordinary wear and tear excepted, adequate and suitable for the
operation of the Station as it is currently being operated, and in proper
condition and repair so that the Station can operate according to its FCC
Licenses, the rules, regulations and policies of the FCC and in all other
respects in compliance with the Act and all other applicable federal and state
laws.
(c) INSURANCE. The Personal Property included among the Purchased
Assets is and will be insured through the Closing Date in amounts adequate to
replace or repair any casualty or other insurable loss to any of such property.
(d) SUFFICIENCY OF ASSETS. The Purchased Assets include all of the
assets, of a sufficient nature, condition and quantity, needed in the broadcast
chain of the Station (i.e., from studio to transmission). Citadel has not, since
December 31, 1996, removed any material item of Personal Property from the
Station other than removals in the ordinary course of business which were not
done in contemplation of the transactions contemplated hereby.
(e) REAL PROPERTY LEASES.
(i) The ASSET SCHEDULE contains accurate descriptions of the
Real Property Leases and the location of the real estate leased thereunder (the
"LEASEHOLDS") and the type of facility located on the Leaseholds. Citadel will
as of the Closing have a valid leasehold interest in its respective Leaseholds.
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(ii) None of the Leaseholds is subject to any covenant or
restriction preventing or limiting in any material respect the consummation of
the transactions contemplated hereby, except for any consent listed on CITADEL'S
DISCLOSURE SCHEDULE required of the landlords under the Real Property Leases.
Citadel's right, title and interest in and to the Leaseholds will at the Closing
be held by Citadel free and clear of all Liens.
(iii) The use for which the Leaseholds are zoned permits the
use thereof for the business of the Station consistent with past practices. The
use and occupancy of the Leaseholds by Citadel are in compliance in all material
respects with all regulations, codes, ordinances and statutes applicable to
Citadel and Citadel has not received any notice asserting any material violation
of sanitation laws and regulations, occupational safety and health regulations,
or electrical codes.
(iv) There are no facts relating to Citadel, and to the best
of the knowledge of Citadel, no facts relating to any other party, that would
prevent the Leaseholds from being occupied and used by Purchaser and/or any
assignee of Purchaser after the Closing Date in the same manner as immediately
prior to the Closing.
(v) There is not under any Real Property Lease any material
default by Citadel or any condition that with notice or the passage of time or
both would constitute such a default, and Citadel has not received any notice
asserting the existence of any such default or condition.
(vi) Each Real Property Lease is valid and binding and in full
force and effect as to Citadel, and to the best of the knowledge of Citadel, as
to each other party thereto, and except as disclosed on the ASSET SCHEDULE, has
not been amended or otherwise modified.
(vii) The Leaseholds constitute all of the real property in
which Citadel has a leasehold interest or other interest or right (whether as
lessor or lessee) and which is or will prior to the Closing be used solely in
the operation of the Station.
4.9 CONTRACTUAL AND OTHER OBLIGATIONS. Set forth in the ASSET SCHEDULE
is a description of all (a) Real Property Leases to which Citadel is a party;
(b) all contracts, agreements, licenses, leases, arrangements and other
documents used solely in connection with the present operation of the Station to
which Citadel is a party or by which Citadel or any of the assets of Citadel are
bound (including, in the case of loan agreements, a description of the amounts
of any outstanding borrowings thereunder and the collateral, if any, for such
borrowings); (c) uncompleted orders for the purchase by Citadel of materials,
supplies, equipment and services for the requirements of the Station existing as
of the date hereof and with respect to which the remaining obligation of Citadel
is in excess of $2,500; and (d) contingent contractual obligations and
liabilities of Citadel relating to the Station and known to Citadel existing as
of the date hereof (all of the foregoing, collectively, the "CONTRACTS"). Each
of the Contracts is designated in the ASSET SCHEDULE either as an Assigned
Contract, or as a Contract that will not be assigned to Purchaser. Neither
Citadel nor, to the best of the knowledge of Citadel, any other Person is in
material
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default in the performance of any covenant or condition under any Contract and
no claim of such a default has been made and no event has occurred which with
the giving of notice or the lapse of time would constitute such a default under
any covenant or condition under any Contract. Citadel is not a party to any
Contract which would terminate or be materially adversely affected by the
consummation of the transactions contemplated by this Agreement. Originals or
true, correct and complete copies of all of the Assigned Contracts have been
provided to Purchaser as of the date of this Agreement.
4.10 COMPENSATION. Set forth in CITADEL'S DISCLOSURE SCHEDULE is a
list of (a) all agreements between Citadel and its employees or other Persons
providing services for compensation with regard to the Station, whether
individually or collectively, and (b) all employees of Citadel or other Persons
providing services for Citadel with respect to the Station entitled to receive
annual compensation in excess of $5,000 and their respective positions, job
categories and salaries. The transactions contemplated by this Agreement will
not result in any liability for severance pay to any such employee or other
Person. Citadel has not informed any such employee that such employee will
receive any increase in compensation or benefits or any ownership interest in
Citadel or the Business. Except as disclosed in CITADEL'S DISCLOSURE SCHEDULE,
all of the employees of Citadel with respect to the Station are "at will"
employees and may be terminated by Citadel at any time, without liability or
obligation except the payment of normal compensation accrued up to the time of
termination of employment.
4.11 EMPLOYEE BENEFIT PLANS.
(a) Citadel does not maintain or sponsor, and is not required to
make contributions to, any pension, profit-sharing, savings, bonus, incentive or
deferred compensation, severance pay, medical, life insurance, welfare or other
employee benefit plan which affects the employees working at the Station, except
as set forth in CITADEL'S DISCLOSURE SCHEDULE. CITADEL'S DISCLOSURE SCHEDULE
fully discloses all of the plans, funds, policies, programs, arrangements or
understandings sponsored or maintained by Citadel pursuant to which any employee
of the Station (or any dependent or beneficiary of any such employee) might be
or become entitled to (1) retirement benefits; (2) severance or separation from
service benefits; (3) incentive, performance, stock, share appreciation or bonus
awards; (4) health care benefits; (5) disability income or wage continuation
benefits; (6) supplemental unemployment benefits; (7) life insurance, death or
survivor's benefits; (8) accrued sick pay or vacation pay; (9) any type of
benefit offered under any arrangement subject to characterization as an
"employee welfare benefit plan" within the meaning of section 3(3) of ERISA; or
(10) benefits of any other type offered through any arrangement that could be
characterized as providing for additional compensation or fringe benefits. As to
any such plan, fund, policy, program, arrangement or understanding, all of the
following are true: (A) all amounts due as contributions, insurance premiums and
benefits to the date hereof have been fully paid by Citadel; (B) all applicable
material requirements of law have been observed with respect to the operation
thereof, and all applicable reporting and disclosure requirements have been
timely satisfied; and (C) Citadel is not aware of any claim or demand by any
employee (or beneficiary or dependent of any employee) for benefits (other than
routine
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claims for benefits), or by any taxing authority for taxes or penalties which
has not been satisfied in full or which may be or become subject to litigation
or arbitration.
(b) Citadel has no obligation to provide health or other welfare
benefits to former, retired or terminated employees with respect to the Station,
except as specifically required under Section 4980B of the Code. Citadel has
substantially complied with any applicable notice and continuation requirements
of Section 4980B of the Code and the regulations thereunder.
4.12 LABOR RELATIONS. There have been no material violations of any
federal, state or local statutes, laws, ordinances, rules, regulations, orders
or directives with respect to the employment of individuals by, or the
employment practices or work conditions of, Citadel with respect to the
Station, or the terms and conditions of employment, wages (including overtime
compensation) and hours. The Station is not engaged in any unfair labor
practice or other unlawful employment practice and there are no charges of
unfair labor practices or other employee-related complaints pending or
threatened against the Station before the National Labor Relations Board, the
Equal Employment Opportunity Commission, the Occupational Safety and Health
Review Commission, the Department of Labor or any other Governmental Authority.
There is no strike, picketing, slowdown or work stoppage or organizational
attempt pending, threatened against or involving the Station. No issue with
respect to union representation is pending or threatened with respect to the
employees of the Station.
4.13 INCREASES IN COMPENSATION OR BENEFITS. Subsequent to December 31,
1996, there have been no increases in the compensation payable or to become
payable to any of the employees of Citadel who work solely at the Station, nor
has Citadel paid or provided for any awards, bonuses, stock options, loans,
profit-sharing, pension, retirement or welfare plans or similar or other
payments or arrangements for or on behalf of such employees in each case other
than (a) pursuant to currently existing plans or arrangements set forth in
CITADEL'S DISCLOSURE SCHEDULE or (b) as was required from time to time by
governmental legislation affecting wages. The vacation policy of Citadel with
respect to the Station is set forth in CITADEL'S DISCLOSURE SCHEDULE. No
employee of Citadel who works solely at the Station is entitled to vacation
time in excess of two weeks during the current calendar year and no such
employee has any accrued vacation time with respect to any period prior to the
current calendar year, except as set forth in CITADEL'S DISCLOSURE SCHEDULE.
4.14 INSURANCE. Citadel maintains insurance policies covering all
of the Station's properties and assets and the various occurrences which may
arise in connection with the operation of the Station, each of which policies is
summarized in CITADEL'S DISCLOSURE SCHEDULE. Such policies are in full force and
effect and all installments of premiums due thereon have been paid in full.
Citadel has complied with the provisions of such policies. There are no notices
of any pending or threatened termination or premium increases with respect to
any of such policies. There has been no casualty loss or occurrence which may
give rise to any claim of any kind not covered by insurance and Citadel is not
aware of any casualty occurrence which may give rise to any claim of any kind
not covered by insurance. No third party has filed any claim against Citadel
with respect to the Station for personal injury or property damage of a kind for
which
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liability insurance is generally available which is not fully insured,
subject only to the standard deductible.
4.15 LITIGATION; DISPUTES. There are no claims, disputes, actions,
suits, investigations or proceedings pending or threatened against or affecting
the Station, and, to the best of the knowledge of Citadel, there is no basis
for any such claim, dispute, action, suit, investigation or proceeding. Citadel
has no knowledge of any default under any such action, suit or proceeding.
Citadel is not in default in respect of any judgment, order, writ, injunction
or decree of any Governmental Authority with respect to the operation of the
Station.
4.16 ENVIRONMENTAL.
(a) Prior to the execution of this Agreement, Citadel has provided
to Purchaser a true and correct copy of all environmental site assessments,
studies, reports and communications relating to the Purchased Assets.
(b) Except as disclosed on CITADEL'S DISCLOSURE SCHEDULE, (i)
there are no conditions, facilities, procedures or any other facts or
circumstances that constitute Environmental Noncompliance on any of the
Leaseholds and (ii) there is not constructed, placed, deposited, stored,
disposed of, nor located on any of the Leaseholds any asbestos in any form that
has released or, unless disturbed, threatens to release airborne asbestos fibers
in excess of applicable local, state and federal standards.
(c) Except as disclosed on CITADEL'S DISCLOSURE SCHEDULE, no
structure, improvements, equipment, fixtures, activities or facilities located
on the Leaseholds uses Hazardous Materials except those used in the ordinary
course of the Business and in compliance with applicable Environmental Laws.
(d) Except as specifically described on CITADEL'S DISCLOSURE
SCHEDULE, there have been no releases or threatened releases of Hazardous
Materials into the environment, or which otherwise contribute to Environmental
Conditions arising solely from the activities of the Station, or to the best of
the knowledge of Citadel arising from any other activities, except to the extent
that such releases or threatened releases do not constitute a condition of
Environmental Noncompliance relating to the Leaseholds.
(e) Except as disclosed on CITADEL'S DISCLOSURE SCHEDULE, there
are no underground storage tanks, or underground piping associated with tanks,
used for the management of Hazardous Materials at the Leaseholds and there are
no abandoned underground storage tanks at the Leaseholds which have not been
either abandoned in place or removed pursuant to a permit issued by a
Governmental Authority.
(f) Citadel is not subject to any Environmental Claims against
Citadel with respect to the Station, no Environmental Claims with respect to the
Station have been threatened,
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nor, to the best of the knowledge of Citadel, is there any basis for any such
Environmental Claims with respect to the Station.
4.17 PERMITS, COMPLIANCE WITH APPLICABLE LAW.
(a) GENERAL. Neither Citadel nor License Sub is in default under
any, and each has complied with all, statutes, ordinances, regulations, orders,
judgments and decrees of any Governmental Authority applicable to it or to the
Business or the assets and properties of the Station as to which a default or
failure to comply might result in any material adverse change in the condition,
financial or otherwise, assets or properties of the Station or the Business.
Citadel has no knowledge of any basis for assertion of any violation of the
foregoing or for any claim for compensation or damages or otherwise arising out
of any violation of the foregoing. Citadel has not received any notification of
any asserted present or past failure to comply with any of the foregoing which
has not been satisfactorily responded to in the time period required thereunder.
(b) PERMITS. Set forth in CITADEL'S DISCLOSURE SCHEDULE are
complete and accurate lists of all FCC Licenses applicable to the Station, and
all other permits, licenses, approvals, franchises, notices and authorizations
issued by any Governmental Authorities (collectively, the "PERMITS"), held by
Citadel and/or License Sub and applicable to the Station. The Station is
operating in accordance with the Act and its FCC Licenses and is in compliance
with the Act and the rules, regulations and policies of the FCC. The Permits set
forth in CITADEL'S DISCLOSURE SCHEDULE are all of the Permits required for the
conduct of the Business. All of the Permits set forth in CITADEL'S DISCLOSURE
SCHEDULE are in full force and effect, and neither Citadel nor License Sub has
engaged in any activity which would cause or permit revocation or suspension of
any such Permit, and no action or proceeding looking to or contemplating the
revocation or suspension of any such Permit is pending or threatened. There are
no existing defaults or events of default or events or state of facts which with
notice or lapse of time or both would constitute a default by Citadel or License
Sub under any such Permit. There is no default or claimed or purported or
alleged default or state of facts which with notice or lapse of time or both
would constitute a default on the part of any party in the performance of any
obligation to be performed or paid by any party under any Permit set forth in
CITADEL'S DISCLOSURE SCHEDULE. Except for (1) the FCC Approval, (2) compliance
with the HSR Act and (3) as set forth in CITADEL'S DISCLOSURE SCHEDULE, the
consummation of the transactions contemplated hereby will in no way affect the
continuation, validity or effectiveness of the Permits set forth in CITADEL'S
DISCLOSURE SCHEDULE, or require the consent of any Person. Except as set forth
in CITADEL'S DISCLOSURE SCHEDULE, neither Citadel nor License Sub is required to
be licensed by, and neither is subject to the regulation of, any Governmental
Authority by reason of the Business.
4.18 INTELLECTUAL PROPERTY. The use of the Intellectual Property in
connection with the operation of the Station and in a manner consistent with
past practices does not infringe upon the proprietary rights of any other
Person. Purchaser will, upon consummation of the transactions contemplated by
this Agreement, possess adequate rights, licenses and other authority to use
the Intellectual Property used by the Station in the operation of the Station
following the Closing in the manner now operated, without infringement or
unlawful or improper use of any of the
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Intellectual Property. No director, officer or employee of Citadel or License
Sub has any interest in any of the Intellectual Property, all of which will, as
of the Closing, be free and clear of all Liens. Citadel has no knowledge of any
infringement by any Person upon the rights of Citadel or License Sub with
respect to the Intellectual Property. Neither Citadel nor License Sub has
granted any outstanding licenses or other rights to any of the call letters,
copyrights, trademarks, trade names or other similar rights with regard to any
of the Intellectual Property.
4.19 BOOKS AND RECORDS. The books of account of Citadel relating to
the Station fairly and accurately reflect its income, expenses, assets and
liabilities and have been maintained in accordance with good business
practices. All of such books and records, to the extent included within the
Purchased Assets, will be located on the date of the Closing on the business
premises of the Station.
4.20 ACTS TO BE PERFORMED. Citadel and License Sub shall perform each
of the covenants, acts and undertakings of Citadel and License Sub to be
performed on or before the Closing Date pursuant to the terms of this
Agreement.
4.21 RELATED PARTY OBLIGATIONS. Except as set forth on the ASSET
SCHEDULE, no officer, director, shareholder or Affiliate of Citadel, or any
individual related by blood or marriage to any such Person, or any entity in
which any such Person or individual owns any beneficial interest, is a party to
any agreement, contract, commitment, promissory note, loan, any other actual or
proposed transaction with Citadel, or has any material interest in any material
property used by Citadel, which is material to the operation of the Station.
4.22 DISCLOSURE. To the best of Citadel's knowledge, no representation
or warranty made under this Section 4 and none of the information furnished by
Citadel or License Sub set forth in this Agreement or in the schedules or
exhibits to this Agreement contains any untrue statement of a material fact or
omits to state a material fact necessary to make the statements in this
Agreement or in the schedules or exhibits to this Agreement not misleading.
SECTION 5
REPRESENTATIONS AND WARRANTIES OF PURCHASER
In connection with the purchase and sale of the Purchased Assets under
this Agreement and in order to induce Citadel and License Sub to enter into and
consummate the transactions contemplated by this Agreement, Purchaser makes the
following representations and warranties to Citadel and License Sub, as of the
date of this Agreement and as of the date of the Closing (except for
representations and warranties expressly and specifically relating to a time or
times other than the date hereof or thereof, which shall be made as of the
specified time or times):
5.1 ORGANIZATION AND QUALIFICATION. Purchaser is a corporation duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Pennsylvania, and has full corporate power and authority (a) to
own its assets and properties and to conduct its business and
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(b) to enter into this Agreement and consummate the transactions contemplated
hereby. Purchaser has full power, authority and legal right and all necessary
approvals, permits, licenses and authorizations to own its properties and to
conduct its business.
5.2 AUTHORITY. The execution and delivery of this Agreement by
Purchaser, the performance by Purchaser of its covenants and agreements
hereunder and the consummation by Purchaser of the transactions contemplated
hereby have been duly authorized by all necessary corporate action. This
Agreement constitutes a valid and legally binding agreement of Purchaser,
enforceable against Purchaser in accordance with its terms.
5.3 NO LEGAL BAR: CONFLICTS. Neither the execution and delivery of
this Agreement, nor the consummation of the transactions contemplated hereby,
violates or will violate any provision of the Articles of Incorporation or
Bylaws of Purchaser, or any law, rule, regulation, writ, judgment, injunction,
decree, determination, award or other order of any Governmental Authority, or
violates or will violate, or conflicts with or will conflict with, or will
result in any breach of any of the terms of, or constitutes or will constitute
a default under or results in or will result in the termination of or the
creation or imposition of any Lien pursuant to the terms of, any contract,
commitment, agreement, understanding or arrangement of any kind to which
Purchaser is a party or by which Purchaser or any of the assets of Purchaser is
bound. Except for the FCC Approval, compliance with the HSR Act and the
consents disclosed in SCHEDULE 5.0 ("PURCHASER'S DISCLOSURE SCHEDULE"), no
consents, approvals or authorizations of, or filings with, any Governmental
Authority or any other Person are required on the part of Purchaser in
connection with the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby.
5.4 ACTS TO BE PERFORMED. Purchaser shall perform each of the
covenants, acts and undertakings of Purchaser to be performed on or before the
Closing Date pursuant to the terms of this Agreement.
5.5 LITIGATION. There is no litigation, proceeding or investigation
pending or, to the best of Purchaser's knowledge, threatened against or
affecting Purchaser that is reasonably likely to prevent or hinder the
consummation of the transactions contemplated by this Agreement.
5.6 DISCLOSURE. To the best of Purchaser's knowledge, no
representation or warranty made under this Section 5 and none of the
information furnished by Purchaser set forth in this Agreement or in the
schedules or exhibits to this Agreement contains any untrue statement of a
material fact or omits to state a material fact necessary to make the
statements in this Agreement or in the schedules or exhibits to this Agreement
not misleading.
SECTION 6
AFFIRMATIVE COVENANTS OF CITADEL AND LICENSE SUB
Citadel and License Sub covenant and agree with Purchaser to:
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6.1 COMPLIANCE WITH LAW. Comply with all applicable laws and
regulations required for the valid and effective consummation of the
transactions contemplated hereby.
6.2 PAYMENT OF OBLIGATIONS. Fully discharge all Obligations of Citadel
with respect to the Station, except the Assumed Obligations, on a timely basis.
6.3 ACCESS. Afford Purchaser and its authorized representatives, upon
reasonable notice to Citadel, reasonable access during normal business hours to
the Station and the Station's employees, and permit Purchaser and its
authorized representatives to examine all operations, equipment, properties and
other assets, logs, books, relevant records, contracts and documents of Citadel
and License Sub pertinent to the Station; provided, however, that in each
instance (a) mutually satisfactory arrangements shall be made in advance in
order to avoid interruption and to minimize interference with the normal
business and operations of the Station and (b) Purchaser shall comply with
Section 9.10.
6.4 PRESERVATION OF ORGANIZATION. Exercise all reasonable efforts to
preserve the business organization of the Station intact, and assist Purchaser,
as and when requested by Purchaser, to preserve the present relationships of
the Station with employees, suppliers, advertisers and customers and others
having business relationships with the Station; provided, however, that nothing
contained in this Agreement shall require Citadel or License Sub to expend
money in fulfillment of their obligations set forth in this Section 6.4 other
than those expenditures that Citadel or License Sub would have made in the
ordinary course of the business of the Station and consistent with past
practices.
6.5 BOOKS AND RECORDS. Maintain the books and records of Citadel
relating to the Station in accordance with good business practices, on a basis
consistent with past practices, and promptly make available to Purchaser the
books, records, tax returns, leases, contracts and other documents or agreements
material to the Station as Purchaser, its counsel, accountants or other
authorized representatives may from time to time reasonably request.
6.6 EMPLOYEES. Pay as and when the same shall become due and payable
any amounts owed by Citadel to Station employees who have performed services up
to the time of Closing, whether fixed or accrued, for wages, vacation pay, sick
pay, severance pay, employee benefits, damages and otherwise.
6.7 COMPLIANCE WITH FCC MATTERS. Comply with the FCC Licenses
applicable to the Station and with the provisions of the Act, the rules,
regulations and policies of the FCC, and with all other laws, ordinances,
regulations, rules and orders of any Governmental Authority applicable to the
Station.
6.8 TAXES. File all federal, state and municipal tax returns, reports
and declarations required to be filed by Citadel with respect to the Station
prior to the Closing, and satisfy all Taxes related thereto, and either pay in
full on or before the Closing or effect a proration pursuant to Section 9.2 for
all Accrued Taxes attributable to Citadel with respect to the Station,
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or its income, operations or properties, accruing through the Closing,
regardless of whether such Taxes otherwise would have been then due and payable.
6.9 TRADE-OUTS. Purchaser shall assume as of the Closing the Trade
Agreements existing as of the Closing and that have not yet been performed. To
the extent that the aggregate liability of the Station as of the Closing for
unperformed time under the Trade Agreements (the "TRADE LIABILITIES") exceeds
the value of the goods and services to be received by the Station or Purchaser
after the Closing under the Trade Agreements (the "TRADE RECEIVABLES"), the
Cash Purchase Price shall be increased by the amount by which the Trade
Liabilities exceeds the Trade Receivables (the "TRADE IMBALANCE"). Citadel
shall deliver to Purchaser at the Closing a schedule of Trade Liabilities and
Trade Receivables existing as of the Closing (the "TRADE SCHEDULE"). Citadel
shall exercise reasonable efforts to minimize the amount of additional Trade
Liabilities incurred after execution of this Agreement, and to prevent a Trade
Imbalance. For purposes hereof, the term "TRADE AGREEMENTS" means and includes
those agreements entered into by Citadel for the sale of advertising time on
the Station for consideration other than cash. For purposes hereof, the value
of Trade Receivables and the Trade Liabilities as of the Closing shall be the
fair market value thereof, as previously agreed to by Citadel and the
applicable vendor. Purchaser shall assume Citadel's remaining obligations under
such contracts.
6.10 SUPPLEMENTAL FINANCIAL STATEMENTS. Citadel shall provide
Purchaser with copies of the monthly unaudited income statements and balance
sheets applicable to the Station prepared by Citadel from the date hereof until
Closing in the ordinary course of business (collectively, the "SUPPLEMENTAL
FINANCIAL STATEMENTS"). Citadel shall provide such Supplemental Financial
Statements to Purchaser promptly upon such Supplemental Financial Statements
becoming available to Citadel. The Supplemental Financial Statements shall be
subject to the representations and warranties as set forth in Section 4.4.
6.11 CONSENTS. Exercise all reasonable efforts (not involving the
payment by Citadel or License Sub of any money to any party to any Assigned
Contract) to obtain, prior to the Closing the consent and approval of any third
parties whose consent or approval is necessary in connection with the
consummation of the transactions contemplated hereby, with respect to the
Assigned Contracts set forth on CITADEL'S DISCLOSURE SCHEDULE and requiring
such consent. If any such consent or approval is not obtained, Citadel will use
commercially reasonable efforts (not involving the payment of money to any
Person) to secure an arrangement satisfactory to Purchaser intended to provide
for Purchaser following the Closing the benefits under each Assigned Contract
for which such consent or approval is not obtained; provided, however, that
Purchaser shall have the right to terminate this Agreement or to seek damages
or other remedies from Citadel as a result of any failure by Citadel to obtain
any such consent or approval set forth on CITADEL'S DISCLOSURE SCHEDULE, if
alternative arrangements are not satisfactory to Purchaser. Citadel shall also
execute a consent in a form provided by Purchaser, allowing Purchaser to assign
all of its rights under this Agreement and any related documents to one or more
of Purchaser's lenders upon default by Purchaser under the relevant loan
documents.
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Nothing in this Agreement will constitute a transfer or an attempted
transfer of any Assigned Contract which by its terms or under applicable law or
governmental rules or regulations requires the consent or approval of a third
party (including, without limitation, a Governmental Authority) unless such
consent or approval is obtained.
6.12 FURTHER INFORMATION. Furnish to Purchaser prior to the Closing
such financial (including tax), legal and other information with respect to the
Station as Purchaser or its authorized representatives may from time to time
reasonably request.
6.13 NOTICE. Promptly notify Purchaser in writing upon the occurrence
or the nonoccurrence of any event which does then, or which upon the passing of
time or the giving of notice would, constitute a breach of or default under, or
render misleading or untrue in any material respect, any agreement, covenant,
representation or warranty of Citadel or License Sub set forth in this
Agreement.
SECTION 7
NEGATIVE COVENANTS OF CITADEL AND LICENSE SUB
From and after the date of this Agreement and until the Closing,
Citadel and License Sub shall not take, or cause to be taken, any of the
following actions without Purchaser's prior approval, which may not be
unreasonably withheld:
7.1 SALES, TRANSFERS AND LIENS. Make any sale, transfer, assignment,
conveyance, mortgage, hypothecation, encumbrance or other placement of any Lien
on any of the Purchased Assets, except in the ordinary course of business, which
do not materially interfere with the operations of the Station, and which in the
case of a sale, transfer or assignment, is replaced with an asset of equal or
greater value, and, in the case of a conveyance, mortgage, hypothecation,
encumbrance or other Lien, is released at or prior to the Closing.
7.2 ASSUMED OBLIGATIONS. Amend, terminate or renew any of the Assumed
Obligations (including any renewal or termination resulting from the failure to
provide, after the date of this Agreement, timely notice of nonrenewal or
termination as required by the terms of any of the Assumed Obligations).
7.3 BREACHES, DEFAULTS. Do any act or omit to do any act, or permit
any act or omission to occur, that will cause a breach of any contract,
commitment or obligation of it or them in any respect that would have a
material adverse effect on the Purchased Assets or the business operations of
the Station as presently conducted.
7.4 OBLIGATIONS. Incur any Obligations with respect to the Station
except in the ordinary course of business in a manner consistent with past
practices.
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7.5 SALARY INCREASES. Increase any salary, other payments,
disbursement or distributions in any manner or form to any employees of Citadel
at the Station except (A) in the ordinary course of business consistent with
past practices or (B) in accordance with the existing terms of contracts
entered into prior to the date of this Agreement.
7.6 NON-SOLICITATION. Directly or indirectly solicit or negotiate with
any Person (other than a party hereto) or accept any proposal to acquire the
Station in whole or in part.
SECTION 8
COVENANTS OF PURCHASER
Purchaser hereby covenants as follows:
8.1 COMPLIANCE WITH LAW. Purchaser shall comply with all applicable
laws and regulations required for the valid and effective consummation of the
transactions contemplated by this Agreement.
8.2 NOTICE. Purchaser shall promptly notify Citadel in writing upon
the occurrence or the non-occurrence of any event which does then, or which
upon the passing of time or the giving of notice would, constitute a breach of
or default under, or render misleading or untrue in any material respect, any
agreement, covenant, representation or warranty of Purchaser set forth in this
Agreement.
8.3 ACCOUNTS RECEIVABLE. Subject to Purchaser's receipt from Citadel
at the Closing of a list (the "ACCOUNTS RECEIVABLE LIST") of accounts
receivable of the Station existing as of the Closing, exclusive of Trade
Receivables, if any (the "ACCOUNTS RECEIVABLE"), for a period of 120 days
commencing with the Closing Date (the "PURCHASER COLLECTION PERIOD"), Purchaser,
as agent for Citadel, shall collect the Accounts Receivable in accordance with
Purchaser's normal collection processes and procedures. In no event shall
Purchaser be required to institute litigation or to retain third parties to
institute collection procedures with respect to the Accounts Receivable. All
remittances will be applied first to the oldest Accounts Receivable, unless the
client asserts that a dispute exists with respect to a particular account or the
client specifies the particular invoice to which the payment is to be applied,
in which case the remittances shall be applied to the specific account and
Purchaser shall promptly notify Citadel of any dispute. Remittances collected by
Purchaser on behalf of Citadel shall be remitted to Citadel without offset of
any kind within 10 days after the end of each calendar month during the
Purchaser Collection Period, and within five days after termination of the
Purchaser Collection Period. During the Purchaser Collection Period, at
Citadel's option, Citadel shall be permitted to collect the Accounts Receivable
that remain outstanding after 60 days, or are disputed in writing by the
relevant account debtor. Each remittance by Purchaser to Citadel shall be
accompanied by a written report from Purchaser setting forth the aggregate
amount of the Accounts Receivable and the aggregate amount of cash collections
of such Accounts Receivable during the period for which payment is made, along
with a breakdown by account debtor. At the end of the Purchaser
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Collection Period, Purchaser shall account for all collected Accounts Receivable
and provide Citadel with all documentation related to uncollected Accounts
Receivable, and Purchaser shall have no further responsibilities with respect to
any uncollected Accounts Receivables except to remit promptly to Citadel any
amounts subsequently received by Purchaser. Purchaser shall have no obligation
with respect to any Accounts Receivable it is unable to collect. After the end
of the Purchaser Collection Period, Citadel shall be entitled to collect any
Accounts Receivable that remain uncollected.
SECTION 9
ADDITIONAL COVENANTS OF THE PARTIES
9.1 APPLICATION FOR TRANSFER OF CONTROL. As promptly as practicable
after the date of this Agreement, and in no event later than three business
days after the date of this Agreement, Purchaser, Citadel and License Sub shall
file an application (the "FCC APPLICATION") with the FCC to approve the
transfer of control of the Station from Citadel and License Sub to Purchaser
(the "FCC APPROVAL"). Purchaser shall have primary responsibility for filing
and prosecuting the FCC Application. The parties agree that they shall
prosecute the FCC Application (and shall cooperate with each other in the
timely prosecution thereof), in good faith and with due diligence, and within
the time allowed therefor by the rules and regulations of the FCC. Purchaser
and Citadel shall each take all necessary actions on its part to obtain the FCC
Approval. Purchaser shall advance the filing fee for the FCC Application, and
Citadel shall reimburse Purchaser for one-half of such filing fee at the
Closing. All other costs and expenses incurred by each party in connection with
the filing and prosecution of the FCC Application shall be paid by the party
incurring the cost or expense.
9.2 ADJUSTMENTS AT CLOSING. Without duplication, the following items
(in addition to similar items which are customarily prorated) shall be prorated
between Citadel and Purchaser through and including the Closing Date, and the
Cash Purchase Price appropriately increased or decreased as a result thereof:
(a) Amounts payable under the Real Property Leases and the
Assigned Contracts;
(b) Power, utility and telephone charges incurred in
connection with the Station;
(c) Accrued Taxes existing as of the Closing; and
(d) FCC and HSR filing fees, as provided in Sections 9.1 and
9.7, respectively.
Proration of real and personal property taxes shall be based upon the
most recent assessments available. Each of the parties shall duly cooperate
with the other in making the foregoing prorations, adjustments and payments.
If, for any reason beyond the reasonable control
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of the parties, information necessary to calculate the required prorations is
unavailable before the Closing Date, such item shall be prorated after the
Closing Date as soon as such information is available, and Purchaser and Citadel
shall cooperate with each other in regard thereto and shall pay, each to the
other, any amounts which may be owing as a result of such subsequent prorations.
If, at any time after the Closing Date, errors are discovered in any prorations
made pursuant to this Section 9.2, Purchaser and Citadel shall correct such
errors and pay, each to the other, any sums owing as a result of such
correction. All prorations to the extent feasible shall be made on the Closing
Date.
9.3 BROKERAGE. Purchaser, Citadel and License Sub represent and
warrant to each other that no Person (other than Broker) has provided services
as a broker, agent or finder in connection with the transactions contemplated
by this Agreement. Purchaser shall pay all fees, commissions, claims and
expenses of Broker in connection with the transactions contemplated hereby.
Purchaser, Citadel and License Sub shall each indemnify and hold harmless the
other for any and all claims or expenses, including attorneys' fees, asserted
by any Person purporting to act on behalf of the respective indemnitor as a
broker, agent or finder in connection with the transactions contemplated by
this Agreement.
9.4 RISK OF LOSS. If any loss or damage to any of the Purchased Assets
occurs prior to the Closing (i) which has a material adverse effect on the
Station and (ii) such loss or damage is not susceptible of repair, replacement
or restoration with sufficient, collectible insurance proceeds available for
such purposes or by Citadel at its sole cost and expense to substantially the
same condition as existed before such loss or damage, then the parties shall
adjust the Cash Purchase Price to reflect the diminution in value of the
Station attributable to the impairment of such assets.
9.5 ACTIONS WITH FCC. In the event any investigation, order to show
cause, notice of violation, notice of apparent liability or a forfeiture,
material complaint, petition to deny or informal objection is instituted or
filed against any party hereto (whether in connection with the proceedings to
approve the FCC Application or otherwise), such party shall promptly notify the
other party hereto in writing of such occurrence and shall thereafter
immediately take all reasonable measures to contest the same in good faith and
seek the removal or favorable resolution of such action, order, notice or
complaint.
9.6 COOPERATION. During the seven-year period immediately following
the Closing, Citadel shall cooperate with Purchaser in providing Purchaser all
information reasonably requested and permitting Purchaser access to all records
relating to the period of ownership of the Station by Citadel prior to the
Closing. The cost and expense in providing or permitting access to information
hereunder shall be borne by Purchaser. Purchaser, as a condition to being
provided with access to information hereunder, shall, at the request of
Citadel, execute a confidentiality agreement in form and substance acceptable
to Citadel in its reasonable discretion. Notwithstanding the foregoing, Citadel
may discard any such records during such seven-year period if (i) Citadel
notifies Purchaser of Citadel's intent to discard such records and
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(ii) Purchaser does not, within 10 days after receipt of such notice, retrieve
such records from Citadel's premises.
9.7 HSR FILING. As promptly as practicable after the date of this
Agreement, and in no event later than 10 days after the date of this Agreement,
the parties hereto shall complete and submit any filing that may be required
pursuant to the HSR Act (the "HSR FILING"). The parties hereto shall diligently
take, or fully cooperate in the taking of, all necessary and proper steps, and
provide any additional information reasonably requested, in order to comply
with the requirements of the HSR Act. The parties hereto shall use their best
efforts to resolve objections, if any, that may be asserted under the HSR Act
or any other antitrust law in connection with the transactions contemplated
hereby. Citadel shall advance the filing fee applicable to any HSR Filing, and
Purchaser shall reimburse Citadel for one-half of such filing fee at the
Closing. All other costs and expenses incurred by each party in connection with
the filing and prosecution of any HSR Filing shall be paid by the party
incurring the cost or expense.
9.8 EASTON ANTENNA LEASE. At the Closing, Purchaser, as lessor, and
Citadel, as lessee, shall enter into an antenna lease at the Station's current
tower site for Citadel's current WLEV(FM) "hop" at such site (the "ALLENTOWN
ANTENNA LEASE") containing the following terms: (a) the term shall be 50 years;
and (b) rent shall be $1 per year during the entire term. Purchaser and Citadel
shall negotiate in good faith the Easton Antenna Lease, which shall contain the
terms set forth in this Section 9.8, as well as such other customary and
appropriate terms and conditions.
9.9 REMOVAL OF PERSONAL PROPERTY. To the extent necessary or
appropriate, Purchaser shall be responsible for removing, at its expense, the
Personal Property from Citadel's premises within a reasonable time after the
Closing.
9.10 CONFIDENTIALITY. Purchaser shall maintain strict confidentiality
with respect to all documents and information furnished to Purchaser by or on
behalf of Citadel or License Sub. Notwithstanding the foregoing, nothing shall
be deemed to be confidential information that (a) is known to Purchaser at the
time of its disclosure to Purchaser; (b) becomes publicly known or available
other than through disclosure by Purchaser; (c) is received by Purchaser from a
third party not actually known by Purchaser to be bound by a confidentiality
agreement with or obligation to Citadel; or (d) is independently developed by
Purchaser as clearly evidenced by its records. Notwithstanding the foregoing
provisions of this Section, Purchaser may disclose such confidential
information (x) to the extent required or deemed advisable to comply with
applicable laws and regulations, (y) to its stockholders, officers, directors,
employees, representatives, financial advisors, attorneys, accountants and
agents with respect to the transactions contemplated hereby (so long as such
parties are informed of the confidentiality of such information), and (z) to
any governmental authority in connection with the transactions contemplated
hereby. In the event this Agreement is terminated, Purchaser will return to
Citadel all confidential information prepared or furnished by Citadel relating
to the transactions contemplated hereby, whether obtained before or after the
execution of this Agreement.
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9.11 PUBLIC ANNOUNCEMENTS. The parties hereto shall consult with each
other before making any further public statements with respect to this
Agreement or the transactions contemplated hereby and shall not issue any such
press release or make any such public statement without the prior written
consent of the other parties, which shall not be unreasonably withheld,
conditioned or delayed; provided, however, that a party may, without the prior
consultation with or written consent of the other parties, issue such press
release or make such public statement as may be required by applicable law if
it has used all reasonable efforts to consult with the other parties and to
obtain such parties' consents but has been unable to do so in a timely manner.
9.12 OPTION TO LEASE REAL PROPERTY. Purchaser may, at its cost and
expense, make or cause to be made such environmental assessment regarding the
Real Property as Purchaser deems appropriate. If such environmental assessment
(if any) uncovers any material environmental problem with respect to the Real
Property, Purchaser shall have the option (exercisable by providing written
notice to Citadel at least 30 days prior to the Closing) to lease the Real
Property from Citadel in lieu of taking title to the Real Property at the
Closing. If Purchaser exercises such option, Purchaser and Citadel shall
negotiate in good faith such lease, which shall be for a term of 29 years and
11 months, provide for rent of $1 per year during the entire term, and contain
such other customary and appropriate terms and conditions.
9.13 OPTION TO LEASE STUDIO SPACE. The studio currently used by the
Station (the "STUDIO") is owned by Citadel and not included in the Purchased
Assets. Purchaser shall have the option (exercisable by providing written notice
to Citadel at least 30 days prior to the Closing) to lease the Studio from
Citadel at the Closing. If Purchaser exercises such option, Purchaser and
Citadel shall negotiate in good faith such lease, which shall be for a term of
29 years and 11 months, provide for rent of $1 per year during the entire term,
and contain such other customary and appropriate terms and conditions.
SECTION 10
THE CLOSING
10.1 CLOSING DATE. The Closing shall occur on a date mutually selected
by Purchaser and Citadel which is within 10 business days following the later
of (a) the date on which the FCC Approval has become a Final Order or (b) the
date on which all applicable waiting periods under the HSR Act have expired or
been terminated. The Closing shall begin at 10:00 a.m., local time, on the date
of the Closing (the "CLOSING DATE") at the offices of Eckert Seamans Cherin &
Mellott, LLC, counsel for Citadel and License Sub, or at such other time and
place as the parties may agree in writing.
10.2 CLOSING DOCUMENTS. At the Closing:
(a) Citadel and License Sub shall deliver to Purchaser all
certificates, consents (including any third party consents required as to the
Assumed Obligations), estoppels and other documents (including bills of sale and
assignments) otherwise required to be delivered by Citadel
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and License Sub pursuant to this Agreement or as a condition precedent to
Purchaser's fulfillment of its obligations hereunder.
(b) Purchaser shall deliver to Citadel and License Sub all
certificates and other documents (including an assumption agreement relating to
the Assumed Obligations) required to be delivered by Purchaser to Citadel
and License Sub pursuant to this Agreement or as a condition precedent to
Citadel's and License Sub's fulfillment of their obligations under this
Agreement.
SECTION 11
CONDITIONS TO CITADEL'S AND LICENSE SUB'S OBLIGATION TO CLOSE
The obligation of Citadel and License Sub to consummate the
transactions contemplated by this Agreement at the Closing is subject to the
following conditions precedent, any or all of which may be waived by Citadel and
License Sub in their sole discretion (other than those set forth in Sections
11.7 and 11.8):
11.1 OPINION OF PURCHASER'S COUNSEL. Citadel and License Sub shall
have received an opinion of counsel for Purchaser, dated the date of the
Closing, in form and substance reasonably satisfactory to Citadel and License
Sub, to the effect that:
(a) Purchaser is a corporation duly organized, validly existing
and in good standing under the laws of the Commonwealth of Pennsylvania.
(b) Purchaser has full power and authority to own its assets and
properties and to conduct its business and has all necessary approvals, permits,
licenses and authorizations to own its properties and to conduct its business in
the manner and in the locations presently owned and conducted.
(c) This Agreement, together with all other documents and
instruments required to be executed or delivered by Purchaser in connection with
the transactions contemplated by this Agreement, each has been duly authorized,
executed and delivered by Purchaser (to the extent it is a party thereto), and
constitutes a valid and legally binding obligation of Purchaser (to the extent
it is party thereto), enforceable against Purchaser in accordance with its
terms, except as such enforceability may be limited by bankruptcy, insolvency or
other laws affecting generally the enforceability of creditors' rights and by
limitations on the availability of equitable remedies.
(d) Neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, violates or will violate
any provision of the Articles of Incorporation or Bylaws of Purchaser or, to the
knowledge of such counsel, any law, rule, regulation, writ, judgment,
injunction, decree, determination, award or other order of any Governmental
Authority, or, to the knowledge of such counsel after due investigation,
violates or will violate or conflicts with or will conflict with or will result
in any breach of any
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of the terms of, or constitutes or will constitute a default under or results in
or will result in the termination of or the creation or imposition of any Lien
pursuant to the terms of any contract, commitment, agreement, understanding or
arrangement of any kind to which Purchaser is a party or by which Purchaser, or
any of the assets of Purchaser, is bound and which is known to Purchaser's
counsel, all as set forth on PURCHASER'S DISCLOSURE SCHEDULE.
Nothing contained in this Section 11.1 shall require an opinion of such counsel
with respect to FCC matters.
11.2 REPRESENTATIONS AND WARRANTIES. The representations and
warranties of Purchaser contained herein shall be true and correct in all
material respects at and as of the Closing with the same effect as though all
such representations and warranties were made at and as of the Closing (except
for representations and warranties expressly and specifically relating to a
time or times other than the Closing, which shall be true and correct in all
material respects at and as of the time or times specified except for such
inaccuracies as do not, individually or in the aggregate, have a material
effect on Purchaser's ability to consummate the transactions contemplated by
this Agreement) and Purchaser shall have delivered to Citadel a certificate to
that effect, dated the date of the Closing, signed by the President of
Purchaser.
11.3 NO LITIGATION. No injunction relating to any action, suit or
proceeding against Citadel or License Sub relating to the consummation of any
of the transactions contemplated by this Agreement or any action by any
Governmental Authority shall have been issued.
11.4 OTHER CERTIFICATES. Citadel shall have received certificate as to
the good standing of Purchaser as a corporation in the Commonwealth of
Pennsylvania as of a date not more than 20 days before the Closing, and such
other certificates, instruments and other documents, in form and substance
satisfactory to Citadel, as Citadel shall have reasonably requested in
connection with the transactions contemplated hereby.
11.5 CORPORATE ACTION. All corporate action necessary to authorize the
execution, delivery and performance by Purchaser of this Agreement and the
transactions contemplated hereby shall have been duly and validly taken by
Purchaser, and Purchaser shall have delivered to Citadel certified copies of
the resolutions of Purchaser's board of directors authorizing the execution and
performance of this Agreement and authorizing or ratifying the acts of its
officers and employees in carrying out the terms and provisions of this
Agreement.
11.6 ACTS TO BE PERFORMED. Each of the covenants, acts and
undertakings of Purchaser to be performed on or before the Closing Date
pursuant to the terms hereof shall have been duly performed.
11.7 FCC APPROVAL. The FCC Approval shall have been obtained.
11.8 HSR CLEARANCE. All applicable waiting periods under the HSR Act
shall have expired or been terminated.
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11.9 ALLENTOWN AGREEMENT. All of the conditions set forth in Section
11 of the Allentown Agreement shall have been satisfied or waived, and the
transactions contemplated by the Allentown Agreement shall be consummated
simultaneously with the Closing.
SECTION 12
CONDITIONS TO PURCHASER'S OBLIGATION TO CLOSE
The obligation of Purchaser to consummate the transactions
contemplated by this Agreement at the Closing is subject to the following
conditions precedent, any or all of which may be waived by Purchaser in its
sole discretion (other than those set forth in Sections 12.9 and 12.10):
12.1 OPINION OF CITADEL'S AND LICENSE SUB'S COUNSEL. Purchaser shall have
received an opinion of counsel for Citadel and License Sub, dated the date of
the Closing, in form and substance reasonably satisfactory to Purchaser, to the
effect that:
(a) Each of Citadel and License Sub is a corporation duly
organized, validly existing and in good standing under the laws of the State of
Nevada.
(b) Citadel is duly qualified and in good standing in the
Commonwealth of Pennsylvania.
(c) Each of Citadel and License Sub has full corporate power and
authority to own its assets and properties and to conduct the Business and has
all necessary approvals, permits, licenses and authorizations to own its
properties and to conduct the Business in the manner and in the locations
presently owned and conducted.
(d) This Agreement, together with all other documents and
instruments required to be executed or delivered by Citadel and License Sub in
connection with the transactions contemplated hereby, each has been duly
authorized, executed and delivered by Citadel and License Sub (to the extent a
party thereto), and constitutes a valid and legally binding obligation of
Citadel and License Sub (to the extent a party thereto), enforceable against
each of them in accordance with its terms, except as such enforceability may be
limited by bankruptcy, insolvency or other laws affecting generally the
enforceability of creditors' rights and by limitations on the availability of
equitable remedies.
(e) Neither the execution and delivery of this Agreement, nor the
consummation of the transactions contemplated hereby, violates or will violate
any provision of the Articles of Incorporation or Bylaws of Citadel or License
Sub or, to the knowledge of such counsel, any law, rule, regulation, writ,
judgment, injunction, decree, determination, award or other order of any
Governmental Authority, or, to the knowledge of such counsel after due
investigation, violates or will violate, or conflicts with or will conflict with
or will result in any breach of any of the terms of, or constitutes or will
constitute a default under, or results or will
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result in the termination of or the creation or imposition of any Lien pursuant
to, the terms of any contract, commitment, agreement, understanding or
arrangement of any kind to which Citadel or License Sub is a party or by which
Citadel, License Sub or any of the assets of Citadel or License Sub is bound and
which is known to such counsel, all as set forth on CITADEL'S DISCLOSURE
SCHEDULE. Except for (1) the FCC Approval, (2) compliance with the HSR Act and
(3) the consents disclosed on CITADEL'S DISCLOSURE SCHEDULE, no consents,
approvals or authorizations of, or filings with, any Governmental Authority or
any other Person are required on the part of Citadel or License Sub, in
connection with the execution and delivery of this Agreement and the
consummation of the transactions contemplated hereby.
(f) To the knowledge of such counsel, except as disclosed on
CITADEL'S DISCLOSURE SCHEDULE, there are no claims, disputes, actions, suits or
proceedings pending or threatened against Citadel or License Sub with respect to
the Station.
Nothing contained in this Section 12.1 shall require an opinion by such counsel
with respect to FCC matters.
12.2 REPRESENTATIONS, WARRANTIES AND COVENANTS. The representations
and warranties of Citadel and License Sub contained herein shall be true and
correct in all material respects at and as of the Closing (except for
representations and warranties expressly and specifically relating to a time or
times other than the Closing, which shall be true and correct in all material
respects at and as of the time or times specified except for such inaccuracies
as do not, individually or in the aggregate, have a material effect on the
Station or Citadel's or License Sub's ability to consummate the transactions
contemplated by this Agreement) with the same effect as though all such
representations and warranties were made at and as of the Closing, and Citadel
and License Sub shall have complied with all their covenants contained herein;
and Citadel and License Sub shall have delivered to Purchaser a certificate to
that effect, dated the date of the Closing, signed by the President of Citadel
and License Sub.
12.3 NO LITIGATION. No injunction relating to any action, suit or
proceeding against Purchaser, Citadel or License Sub relating to the
consummation of any of the transactions contemplated by this Agreement shall
have been issued.
12.4 OTHER CERTIFICATES. Purchaser shall have received certificates as
to the good standing of Citadel as a corporation in the States of Nevada and
Pennsylvania and of License Sub in the State of Nevada, each as of a date not
more than 20 days before the Closing, and such other certificates, instruments
and other documents customary for transactions of the nature provided for in
this Agreement, in form and substance reasonably satisfactory to Purchaser, as
Purchaser shall have reasonably requested in connection with the transactions
contemplated by this Agreement.
12.5 CORPORATE ACTION. All corporate action necessary to authorize the
execution, delivery and performance by Citadel and License Sub of this
Agreement and the transactions contemplated hereby shall have been duly and
validly taken by Citadel and License Sub, and Citadel and License Sub shall
have delivered to Purchaser certified copies of the resolutions of
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Citadel's and License Sub's board of directors authorizing the execution and
performance of this Agreement and authorizing or ratifying the acts of its
officers and employees in carrying out the terms and provisions of this
Agreement.
12.6 ACTS TO PERFORMED. Each of the covenants, acts and undertakings
of Citadel and License Sub to be performed on or before the Closing Date
pursuant to the terms hereof shall have been duly performed.
12.7 UCC SEARCHES. Citadel shall have delivered to Purchaser Uniform
Commercial Code judgment and lien searches from the appropriate county and
state agencies showing all Liens on the Purchased Assets, which searches shall
be conducted not more than 30 days prior to the Closing. Citadel may cause such
lien searches to be prepared by a third party, in which case Citadel shall not
be responsible for any inaccuracies in such lien searches unless Citadel has
actual knowledge of their inaccuracy. Notwithstanding the foregoing, Citadel
and License Sub shall remain responsible for satisfying any Lien on the
Purchased Assets even if such searches are inaccurate.
12.8 FILINGS, CONSENTS, APPROVALS AND ESTOPPEL CERTIFICATES. All
filings, consents, approvals and estoppel certificates required by or
reasonably requested by Purchaser pursuant to this Agreement, or necessary to
consummate the transactions contemplated by this Agreement, shall have been
obtained.
12.9 FCC APPROVAL. The FCC Approval shall have been obtained.
12.10 HSR CLEARANCE. All applicable waiting periods under the HSR Act
shall have expired or been terminated.
12.11 ALLENTOWN AGREEMENT. All of the conditions set forth in Section
12 of the Allentown Agreement shall have been satisfied or waived, and the
transactions contemplated by the Allentown Agreement shall be consummated
simultaneously with the Closing.
SECTION 13
INDEMNIFICATION
13.1 INDEMNIFICATION BY CITADEL AND LICENSE SUB. Subject to the
limitations and procedures set forth in this Section 13, Citadel and License
Sub shall indemnify and hold harmless Purchaser from and against any and all
Damages sustained or incurred by Purchaser, to the extent such Damages are
sustained or incurred by Purchaser by reason of the breach of any of the
obligations, covenants or provisions of, or the breach of any of the
representations or warranties made by, Citadel or License Sub in this
Agreement.
13.2 INDEMNIFICATION BY PURCHASER. Subject to the limitations and
procedures set forth in this Section 13, Purchaser shall indemnify and hold
harmless Citadel and License Sub from
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and against all losses, claims, demands, damages, liabilities, obligations,
costs and/or expenses, including, without limitation, reasonable fees and
disbursements of counsel (hereinafter referred to collectively as "DAMAGES"),
which are sustained or incurred by Citadel and License Sub, to the extent that
such Damages are sustained or incurred by reason of the breach of any of the
obligations, covenants or provisions of, or the breach of any of the
representations or warranties made by, Purchaser in this Agreement.
13.3 PROCEDURE FOR INDEMNIFICATION. In the event that any party to
this Agreement shall incur any Damages in respect of which indemnity may be
sought by such party pursuant to this Section 13 or any other provision of this
Agreement, the party indemnified hereunder (the "INDEMNITEE") shall notify the
party providing indemnification (the "INDEMNITOR") promptly. In the case of
third party claims, such notice shall in any event be given within 10 days of
the filing or assertion of any claim against the Indemnitee stating the nature
and basis of such claim; provided, however, that any delay or failure to notify
any Indemnitor of any claim shall not relieve it from any liability except to
the extent that the Indemnitor demonstrates that the defense of such action has
been materially prejudiced by such delay or failure to notify. In the case of
third party claims, the Indemnitor shall, within 10 days of receipt of notice
of such claim, notify the Indemnitee of its intention to assume the defense of
such claim. If the Indemnitor assumes the defense of the claim, the Indemnitor
shall have the right and obligation (a) to conduct any proceedings or
negotiations in connection therewith and necessary or appropriate to defend the
Indemnitee, (b) to take all other required steps or proceedings to settle or
defend any such claims, and (c) to employ counsel to contest any such claim or
liability in the name of the Indemnitee or otherwise. If the Indemnitor shall
not assume the defense of any such claim or litigation resulting therefrom, the
Indemnitee may defend against any such claim or litigation in such manner as it
may deem appropriate and the Indemnitee may settle such claim or litigation on
such terms as it may deem appropriate, and assert against the Indemnitor any
rights or claims to which the Indemnitee is entitled. Payment of Damages shall
be made within 10 days of a final determination of a claim.
A final determination of a disputed claim shall be (a) a judgment of
any court determining the validity of disputed claim, if no appeal is pending
from such judgment or if the time to appeal therefrom has elapsed, (b) an award
of any arbitration determining the validity of such disputed claim, if there is
not pending any motion to set aside such award or if the time within to move to
set such award aside has elapsed, (c) a written termination of the dispute with
respect to such claim signed by all of the parties thereto or their attorneys,
(d) a written acknowledgment of the Indemnitor that it no longer disputes the
validity of such claim, or (e) such other evidence of final determination of a
disputed claim as shall be acceptable to the parties.
SECTION 14
TERMINATION OF AGREEMENT: ADDITIONAL REMEDIES
14.1 MANNER. This Agreement and the transactions contemplated
hereby may be terminated prior to completion of the Closing:
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(a) by mutual written consent of Citadel, License Sub and
Purchaser;
(b) by either Citadel and License Sub, on the one hand, or
Purchaser, on the other, upon providing written notice to the other party at any
time after June 30, 1998 if the FCC Approval has not been granted by the FCC,
but only if the party providing such notice is not then in material breach of
this Agreement;
(c) by Purchaser, upon providing written notice to Citadel and
License Sub, if as of the time set for Closing any of the conditions in Section
12 of this Agreement (except Sections 12.9 and 12.10) has not been satisfied or
waived by Purchaser in writing, provided Purchaser is not then in material
breach of this Agreement;
(d) by Citadel and License Sub, upon providing written notice to
Purchaser, if as of the time set for Closing any of the conditions in Section 11
of this Agreement (except Sections 11.7 and 11.8) has not been satisfied or
waived by Citadel and License Sub in writing, provided Citadel and License Sub
are not then in material breach of this Agreement;
(e) by Citadel and License Sub, upon providing written notice to
Purchaser, if Purchaser fails to consummate the transactions contemplated
hereunder after all conditions in Section 12 of this Agreement have been
satisfied, provided Citadel and License Sub are not then in material breach of
this Agreement;
(f) by Purchaser, upon providing written notice to Citadel and
License Sub, if Citadel or License Sub fails to consummate the transactions
contemplated hereunder after all conditions in Section 11 of the Agreement have
been satisfied, provided Purchaser is not then in material breach of this
Agreement;
(g) subject to Section 9.1, by either party upon denial by the FCC
of the FCC Application; and
(h) by either party if any court of competent jurisdiction in the
United States or any other United States governmental body shall have issued an
order, decree or ruling or taken any other action restraining, enjoining or
otherwise prohibiting the transactions contemplated by this Agreement, and such
order, decree, ruling or other actions shall have become final and
non-appealable.
14.2 ADDITIONAL REMEDIES. The parties recognize and agree that
Purchaser has relied on this Agreement and expended considerable effort and
resources related to the transactions contemplated hereunder, that the rights
and benefits conferred upon Purchaser herein are unique, and that damages may
not be adequate to compensate Purchaser in the event Citadel and/or License Sub
improperly refuses to consummate the transactions contemplated hereunder. The
parties therefore agree that Purchaser shall be entitled, at its option and in
lieu of terminating this Agreement pursuant to Section 14.1, to have this
Agreement specifically enforced by a court of
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competent jurisdiction; provided, however, that Purchaser may not specifically
enforce this Agreement if it has previously terminated this Agreement.
SECTION 15
GENERAL
15.1 SURVIVAL OF REPRESENTATIONS AND WARRANTIES. Each representation
and warranty herein contained shall survive the Closing, notwithstanding any
investigation at any time made by or on behalf of any party to this Agreement.
15.2 GOVERNING LAW. This Agreement shall be governed by and construed
in accordance with the internal laws, and not the laws of conflicts, of the
Commonwealth of Pennsylvania.
15.3 NOTICES. Any notices or other communications required or
permitted under this Agreement shall be delivered personally or sent by
registered or certified mail, postage prepaid, delivered by overnight delivery
or sent by facsimile, addressed as follows:
To Citadel or: Citadel Broadcasting Company
License Sub 1015 Eastman Drive
Bigfork, Montana 59911
Attn: Lawrence R. Wilson
Fax: (406) 837-5373
With copy to: Citadel Broadcasting Company
140 South Ash Avenue
Tempe, Arizona 85281
Attn: Donna L. Heffner
Fax: (602) 731-5229
With a copy to: Eckert Seamans Cherin & Mellott, LLC
600 Grant Street
42nd Floor
Pittsburgh, Pennsylvania 15219
Attn: Bryan D. Rosenberger, Esq.
Fax: (412) 566-6099
To Purchaser: Maranatha Broadcasting Company, Inc.
East Rock Road
Allentown, PA 18103
Attn: Richard C. Dean
Fax: (610) 791-3000
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With a copy to: Malkames Law Offices
509 Linden Street
Allentown, PA 18101-1491
Attn: William G. Malkames, Esq.
Fax: (610) 821-5851
or such other addresses as shall be similarly furnished in writing by either
party. Such notices or communications shall be deemed to have been given as of
the date of personal delivery, or if mailed, the date the return receipt is
signed or the date on which delivery is refused, or if delivered by overnight
delivery or facsimile, on the date of receipt.
15.4 ENTIRE AGREEMENT. This instrument supersedes all prior
communications, understandings and agreements of or between the parties with
respect to the subject matter of this Agreement and, together with the
Allentown Agreement, contains the entire agreement among the parties with
respect to the transactions contemplated in this Agreement.
15.5 HEADINGS. The headings of this Agreement are inserted for
convenience only and shall not constitute a part of this Agreement.
15.6 SCHEDULES, EXHIBITS. All schedules and exhibits annexed to this
Agreement are hereby incorporated in this Agreement by this reference.
15.7 EXPENSES. Each party shall bear its own costs and expenses
incurred by it in connection with the transactions pursuant to this Agreement.
15.8 AMENDMENT. This Agreement may be amended, modified or superseded,
and any of the terms, covenants, representations, warranties or conditions
hereof may be waived, only by a written instrument executed on behalf of all of
the parties or, in the case of a waiver, by the party waiving compliance.
15.9 WAIVER. The failure of any party at any time or times to require
performance of any provision of this Agreement shall in no manner affect the
right to enforce that provision or any other provision of this Agreement at any
time thereafter.
15.10 ASSIGNMENT. Neither this Agreement nor any of the rights or
obligations under this Agreement may be assigned by Purchaser without the prior
written consent, in their sole discretion, of Citadel and License Sub, or by
Citadel or License Sub without the prior written consent, in its sole
discretion, of Purchaser. Subject to the foregoing, this Agreement shall be
binding upon and inure to the benefit of the parties hereto and their
respective successors and assigns, and no other person shall have any right,
benefit or obligation under this Agreement.
15.11 PRIOR CONTROL. Until the Closing, Citadel and License Sub shall
maintain control of the Station.
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15.12 ATTORNEYS' FEES. In the event of any action arising
out of this Agreement, the prevailing party shall be entitled to recover its
costs, expenses and reasonable attorney's fees incurred in connection with the
dispute from the other party.
15.13 COUNTERPARTS; FAX SIGNATURES. This Agreement may be executed in
one or more counterparts, each of which together shall constitute a single
instrument. Signatures on this Agreement transmitted by facsimile shall be
deemed to be original signatures for all purposes of this Agreement.
15.14 DISPUTE RESOLUTION. Except as provided below, any dispute
arising out of or relating to this Agreement or the breach, termination or
validity hereof shall be finally settled by arbitration conducted expeditiously
in accordance with the CPR Rules. The Center for Public Resources shall appoint
a neutral advisor from its National CPR Panel. The arbitration shall be
governed by the United States Arbitration Act, 9 U.S.C. Sections 1-16, and
judgment upon the award rendered by the arbitrators may be entered by any court
having jurisdiction thereof. The place of arbitration shall be Allentown,
Pennsylvania.
Such proceedings shall be administered by the neutral advisor in
accordance with the CPR Rules as he/she deems appropriate; provided, however,
such proceedings shall be guided by the following agreed upon procedures:
(a) mandatory exchange of all relevant documents, to be accomplished
within 45 days of the initiation of the procedure;
(b) no other discovery;
(c) hearings before the neutral advisor which shall consist of a
summary presentation by each side of not more than three hours; such hearings to
take place on one or two days at a maximum; and
(d) decision to be rendered not more than 10 days following such
hearing.
The provisions of this Section 15.14 shall not apply with regard to any
equitable remedies to which a party may be entitled under this Agreement.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the undersigned have executed this Agreement
effective as of the date above first written.
Maranatha Broadcasting Company, Inc.
By: /s/ Richard C. Dean
---------------------------------
Its: President
---------------------------------
Citadel Broadcasting Company
By: /s/ Lawrence R. Wilson
---------------------------------
Its: President
---------------------------------
Citadel License, Inc.
By: /s/ Lawrence R. Wilson
---------------------------------
Its: President
---------------------------------
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INDEX OF SCHEDULES
Schedule 2.1 - Asset Schedule
Schedule 2.2 - Excluded Assets
Schedule 2.3 - Assumed Obligations
Schedule 4.0 - Citadel's Disclosure Schedule
Schedule 5.0 - Purchaser's Disclosure Schedule
[Pursuant to Regulation S-K, Item 601(b)(2), Registrant agrees to furnish
supplementally a copy of these schedules to the Securities Exchange Commission
upon request.]