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Exhibit 10.2
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT ("AGREEMENT"), dated as of May 8, 2000,
by and between NEW WORLD BROADCASTERS CORP., a Texas corporation ("SELLER"), and
SPANISH BROADCASTING SYSTEM, INC., a Delaware corporation ("PURCHASER").
W I T N E S S E T H:
WHEREAS, Seller desires to sell and assign to Purchaser, and Purchaser
desires to purchase and assume from Seller, Radio Station KTCY-FM (Pilot Point,
Texas) (the "STATION") and certain associated assets and liabilities, including
without limitation, certain contracts and leases and, subject to the approval of
the Federal Communications Commission (the "COMMISSION" or the "FCC"), to accept
assignment from Seller of certain licenses and other authorizations issued by
the Commission to Seller; and
WHEREAS, Seller is entering into a Stock Purchase Agreement, dated as
of the date hereof, with respect to the stock of 910 Broadcasting Corp. ("910"),
a Texas corporation and wholly-owned subsidiary of Seller (the "910 AGREEMENT"),
and Rodriguez Communications, Inc. ("RCI"), the stockholders of RCI and
Purchaser are entering into a Stock Purchase Agreement, dated as of the date
hereof (the "RCI AGREEMENT"), whereby Purchaser will acquire the outstanding
capital stock of RCI and the outstanding capital stock of 910; and
WHEREAS, PURCHASER has agreed to lend funds to Seller and RCI for RCI
to use to, among other things, consummate the purchase of certain radio stations
and for Seller to use to repay certain indebtedness and to operate and maintain
the Station and KXEB-AM; and
NOW, THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, the parties hereto agree as follows;
ARTICLE I
DEFINED TERMS
Section 1.01. CERTAIN DEFINED TERMS. As used in this Agreement, the
following terms shall have the following meanings:
"ACTION" shall mean any claim, action, suit, arbitration, inquiry,
proceeding or investigation by any Governmental Authority or other third party.
"AFFILIATES" of a party shall mean persons or entities that directly,
or indirectly through one or more intermediaries, control or are controlled by,
or are under common control with, such party.
"CODE" shall mean the United States Internal Revenue Code of 1986, as
amended.
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"ENCUMBRANCES" shall mean liens, charges, pledges, options, mortgages,
deeds of trust, security interests, claims, restrictions (whether on voting,
sale, transfer, disposition or otherwise), easements and other encumbrances of
every type and description, whether imposed by Law, agreement, understanding or
otherwise.
"ENVIRONMENTAL LAW" shall mean any law, ordinance, or regulation,
whether national, Federal, state, local or other, pertaining to the protection
of human health or the environment, including, without limitation, the
Comprehensive Environmental Response, Compensation and Liability Act, 42 U.S.C.
Sections 11001, et seq., and the Resource Conversation and Recovery Act, 42
U.S.C. Sections 6901, et seq.
"GOVERNMENTAL AUTHORITY" shall mean any United States federal, state or
local or any foreign government, governmental, regulatory or administrative
authority, agency or commission or any court, tribunal or arbitral body.
"GOVERNMENTAL ORDER" shall mean any claim, action, suit, arbitration,
order, writ, judgment, injunction, decree, stipulation, determination or award
entered into by or with any Governmental Authority.
"HAZARDOUS MATERIALS" shall mean any waste or substance that is listed,
defined, designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any
Environmental Law, including any admixture or solution thereof, and specifically
including petroleum and all derivatives thereof or synthetic substitutes
therefor and asbestos or asbestos-containing materials.
"IRS" shall mean the United States Internal Revenue Service.
"LAW" shall mean any federal, state, local or foreign statute, law,
ordinance, regulation, rule, code, Governmental Order, permit, franchise, grant,
authorization, easement, consent, certificate or requirement or rule of common
law of any Governmental Authority.
"LIABILITIES" shall mean any and all debts, liabilities and
obligations, whether accrued or fixed, absolute or contingent, matured or
unmatured, or determined or determinable, including, without limitation, those
arising under any Law (including, without limitation, any environmental law),
Action or Governmental Order and those arising under any contract agreement,
arrangement, commitment or undertaking.
"MATERIAL ADVERSE EFFECT" shall mean a single event, occurrence or fact
that (together with all other events, occurrences and facts that could
reasonably be expected to result in a loss) would have, or might reasonably be
expected to have, a material adverse effect on a Person's assets, business,
operations or financial condition, or that might reasonably be expected to
prevent such Person from consummating the transactions contemplated by this
Agreement.
"PERMITTED ENCUMBRANCES" shall mean any and all of the following
Encumbrances:
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(a) Liens for taxes and assessments which are not yet due and payable;
(b) Rights existing under applicable laws or operating agreements or
similar contracts to assert liens against the relevant assets or properties, but
not including liens and other rights which have actually been asserted, unless
the relevant Person disputes the validity of any such lien or the amount claimed
to be owed in connection therewith, or such lien or other right is not
enforceable against the interest of such Person;
(c) Any obligations or duties affecting any property to any
municipality or public authority with respect to any franchise, grant, license
or permit and all applicable laws, rules and orders of any Governmental
Authority;
(d) Any other Encumbrance that is not substantial in character, amount
or extent and does not materially detract from the value of the property subject
thereto;
(e) Any Encumbrance created by or in favor of Purchaser or any of its
Affiliates; and
(f) Such Encumbrances or impairments to the quality of title arising as
a result of the sale to Purchaser of the Assets pursuant to this Agreement.
"PERSON" shall mean any individual, corporation (including any
non-profit corporation), general or limited partnership, limited liability
company, joint venture, estate, trust, association, organization, labor union,
or other entity or Governmental Authority.
"SUBSIDIARY" shall mean any corporation or other Person of which
securities or other interests having the power to elect a majority of that
corporation's or other person's board of directors or similar governing body, or
otherwise having the power to direct the business and policies of that
corporation or other Person (other than securities or other interests having
such power only upon the happening of a contingency that has not occurred) are
held on the date in question by such Person or one or more of its Subsidiaries;
when used without reference to a particular Person, "Subsidiary" means a
Subsidiary on the date in question of Seller.
"TAX" shall mean any federal, state, local or foreign tax (including,
without limitation, any income tax, franchise tax, doing business tax, branch
profits tax, capital gains tax, value-added tax, ad valorem tax, excise tax,
transfer tax, employment tax, social security tax, sales tax, use tax, property
tax, or any other kind of tax or payment in lieu of tax no matter how
denominated), levy, assessment, tariff, duty (including any customs duty),
deficiency or other fee, and any related charge or amount (including any fine,
penalty, interest or addition to tax), imposed, assessed or collected by or
under the authority of any Governmental Authority or payable pursuant to any
tax-sharing agreement or any other contract relating to the sharing or payment
of any such tax, levy, assessment, tariff, duty, deficiency or fee.
"TAX RETURN" shall mean any return (including any information return),
report, statement, schedule, notice, form or other document or information filed
with or submitted to or required to be filed with or submitted to, any
Governmental Authority in connection with the
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determination, assessment, collection or payment of any Tax or in connection
with the administration, implementation or enforcement of or compliance with any
legal requirement relating to any Tax.
"TIME SALE AGREEMENTS" shall mean all agreements for the sale of
advertising time on the Station for cash in the ordinary course of business.
"TRADE AGREEMENTS" shall mean all agreements for the sale of
advertising time on the Station for non-cash consideration.
Section 1.02. OTHER DEFINED TERMS. The following terms shall have the
meanings defined for such terms in the Sections of this Agreement set forth
below:
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TERM SECTION
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Agreement Preamble
Allocation Section 2.05
Ancillary Documents Section 4.03
Assets Section 2.01
Assignment Application Section 2.04
Assumed Contracts Section 2.01
Assumed Liabilities Section 2.03
Basket Amount Section 7.04
Bridge Loan Agreement Section 3.02
Cash Amount Section 2.05
Cleanup Section 7.02
Closing Section 3.01
Closing Date Section 3.01
Commission Preamble
Communications Act Section 2.04
Excluded Assets Section 2.02
Excluded Liabilities Section 2.03
Excluded Tax Liabilities Section 2.03
FCC Preamble
FCC Licenses Section 2.01
FCC Orders Section 2.04
Final Orders Section 2.04
Governmental Licenses Section 2.01
HSR Act Section 2.04
Income Taxes Section 7.05
Intangible Property Section 2.01
Leases Section 2.01
Losses Section 7.02
910 Preamble
910 Agreement Preamble
Permits Section 2.01
Personnel Section 6.06
Proprietary Information Section 4.15
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Proprietary Rights Agreement Section 4.16
Purchase Price Section 2.05
Purchaser Preamble
Purchaser Common Stock Section 2.05
Purchaser Shares Section 2.05
Purchaser's Broker Section 5.05
RCI Preamble
RCI Agreement Preamble
Seller Preamble
Seller's Brokers Section 4.22
Securities Act Section 4.23
Station Preamble
Straddle Period Section 7.05
TBA Section 3.02
Tangible Personal Property Section 2.01
Transfer Taxes Section 6.03
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ARTICLE II
PURCHASE AND SALE
Section 2.01. PURCHASE AND SALE OF ASSETS. Upon the terms and subject
to the conditions set forth in this Agreement, at the Closing, Seller shall
sell, assign, transfer, convey and deliver to Purchaser, and Purchaser shall
purchase from Seller, the following assets (the "ASSETS"), free and clear of all
Encumbrances:
(a) the FCC licenses, permits and other authorizations, including any
temporary waiver or special temporary authorization, issued to or held by Seller
exclusively in connection with the conduct of the business and operation of the
Station, including any pending applications therefor, as set forth in SCHEDULE
2.01(A) (the "FCC LICENSES");
(b) subject to Permitted Encumbrances, all of Seller's right, title and
interest in and to all equipment, electrical devices, antennae, cables, tools,
hardware, office furniture and fixtures, office materials and supplies,
inventory, motor vehicles, spare parts and other tangible personal property of
every kind and description which are held for use principally or used in the
operation of the Station, including the items set forth on SCHEDULE 2.01(B),
except any retirements or dispositions thereof made between the date hereof and
the Closing in the ordinary course of business and consistent with past
practices of Seller (the "TANGIBLE PERSONAL PROPERTY");
(c) subject to Permitted Encumbrances, all of Seller's right and
interest in and to the leases identified in SCHEDULE 2.01(C) (the "LEASES") to
the extent such Leases are assignable;
(d) the Station' public inspection files, filings with the FCC related
to the Station, executed copies of all written Assumed Contracts, and such
technical information, engineering data, rights under manufacturers' warranties
as exist at Closing and relate to the assets of the Station being conveyed
hereunder;
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(e) subject to Permitted Encumbrances, the benefit and burden,
subsequent to the Closing Date, of all Time Sales Agreements and Trade
Agreements, and other contracts, agreements, and leases which are used in the
operation of the Station and listed on SCHEDULE 2.01(E), together with all
contracts, agreements, and leases made between the date hereof and Closing in
the ordinary course of business that are used in the operation of the Station
(the "ASSUMED CONTRACTS");
(f) subject to Permitted Encumbrances, all of Seller's right and
interest in and to the Station's call letters and the trademarks, trade names,
service marks, franchises, copyrights, computer software, programs and
programming material, jingles, slogans, logos, and other intangible property
which are used exclusively in the operation of the Station, including, without
limitation, those listed on SCHEDULE 2.01(F) (the "INTANGIBLE PROPERTY");
(g) the governmental licenses, permits and authorities, other than the
FCC Licenses, issued to or held by Seller exclusively in connection with the
conduct of the business and operation of the Station, including any pending
applications therefor as set forth in SCHEDULE 2.01(G) (the "PERMITS", and,
together with the FCC Licenses, the "GOVERNMENTAL LICENSES").
The Assets shall be delivered without any representation or warranty by
Seller except as expressly set forth in this Agreement, and Purchaser
acknowledges that it has not relied on or been induced to enter into this
Agreement by any representation or warranty other than those expressly set forth
in Article IV hereof.
Section 2.02. EXCLUDED ASSETS. The following property will not be
purchased by Purchaser and shall remain the property of Seller (collectively,
the "EXCLUDED ASSETS"):
(a) corporate minute books, stock books and income tax returns of
Seller;
(b) investments of Seller in subsidiaries, partnerships and other
entities, including 910;
(c) the assets of Seller not specifically described herein as part of
the Assets, including, without limitation, television station KTAQ (Greenville,
Texas) and assets used principally in the operation of such station, television
station K25FW (Corsicana, Texas) and assets used principally in the operation of
such station, the real estate owned by Seller and located in Midlothian, Texas,
the interest of Seller in Seller's radio and television stations other than
KTCY-FM; and
(d) the cash and cash equivalents of Seller as of the Closing Date.
Section 2.03. ASSUMPTION AND EXCLUSION OF LIABILITIES.
(a) On the terms and subject to the conditions of this Agreement, from
and after the Closing Date, Purchaser shall assume and shall pay, perform and
discharge when due only the following specified liabilities and obligations, and
no others (collectively, the "ASSUMED LIABILITIES"):
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(i) Liabilities arising from actions taken after the Closing
relating to the Assumed Contracts; and
(ii) Liabilities arising out of Purchaser's ownership after
the Closing Date of the Assets, to the extent such obligations were incurred
after the Closing.
(b) Subject to Section 6.03, Purchaser shall not assume any Liabilities
of Seller in respect of any Taxes arising from the use, ownership or operation
of the Station or the Assets up to, and including, the Closing Date or resulting
from the transactions contemplated by this Agreement (collectively, "EXCLUDED
TAX LIABILITIES").
(c) Except as specifically set forth in Section 2.03(a), Purchaser
shall not assume or be responsible for any Liabilities of Seller (such excluded
liabilities, being referred to herein collectively as the "EXCLUDED
LIABILITIES").
Section 2.04. ASSIGNMENT OF GOVERNMENTAL LICENSES.
(a) In order to consummate the transfer of the Assets, Purchaser and
Seller will file within 10 business days after the execution and delivery of
this Agreement assignments of license applications requesting FCC consent to the
assignment to Purchaser of all FCC Licenses relating to the operation of the
Station (the "ASSIGNMENT APPLICATION"). The parties agree to prosecute the
Assignment Application in good faith and with due diligence. Each party will be
solely responsible for the expenses incurred by it in the preparation, filing
and prosecution of the Assignment Application (it being agreed that each of
Seller and Purchaser will pay one-half of the FCC filing fee). As used herein,
the term "FCC ORDERS" shall mean that the FCC has granted or given its consent,
without any condition materially adverse to Purchaser, to the Assignment
Application; the term "FINAL ORDERS" shall mean that the FCC Orders shall have
become final that such FCC Orders are not reversed, stayed, enjoined or set
aside, and with respect to such FCC Orders, no timely request for stay,
reconsideration, review, rehearing or notice of appeal is pending, and as to
which FCC Orders the time set forth in the FCC rules or the Communications Act
of 1934, as amended (the "COMMUNICATIONS ACT"), for filing any such request,
petition or notice of appeal or for review by the FCC staff on its own motion
has expired.
(b) Purchaser and Seller shall make or cause to be made any and all
necessary filings under the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended (the "HSR ACT") with respect to the transactions contemplated
by this Agreement, the 910 Agreement and the RCI Agreement. Purchaser shall pay
any notification filing fee associated with the filing under the HSR Act.
Section 2.05. PURCHASE PRICE. The purchase price (the "PURCHASE PRICE")
for the Assets shall be (i) $7,000,000 to be paid in cash (the "CASH AMOUNT"),
and (ii) $33,500,000 to be paid in shares of the Series A Common Stock, $.0001
par value per share, of Purchaser ("PURCHASER COMMON STOCK"), with such number
of shares of Purchaser Common Stock (the "PURCHASER SHARES") to be equal to
$33,500,000 divided by the average last trade price per share of the Purchaser
Common Stock for the 30-day period ending on the day
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immediately preceding the Closing Date, as reported under Nasdaq National Market
Issues in The Wall Street Journal. Payment of the Purchase Price shall be made
first by reducing the amounts payable hereunder by any amounts owed at the
Closing by Seller or RCI to Purchaser (or its Affiliates), to the extent not
otherwise repaid or credited against the purchase price under the 910 Agreement
or the RCI Agreement, under the Bridge Loan Agreement. In addition, Purchaser
shall assume at Closing, and thereafter perform the Assumed Liabilities. The
aggregate amount of the Purchase Price and the Assumed Liabilities (that are
properly included in Purchaser's tax basis for the Assets) shall be allocated
among the Assets in the manner set forth on SCHEDULE 2.05 (the "ALLOCATION").
Seller and Purchaser shall file all information and Tax Returns (and any
amendments thereto) in a manner consistent with this Section 2.05 (including,
without limitation, IRS Form 8594 or any successor form). If, contrary to the
intent of the parties hereto as expressed in this Section 2.05, any taxing
authority makes or proposes an allocation different from the Allocation
determined under this Section 2.05, Seller and Purchaser shall cooperate with
each other in good faith to contest such taxing authority's allocation (or
proposed allocation), provided, however, that, after consultation with the party
adversely affected by such allocation (or proposed allocation), another party
hereto may file such protective claims or returns but only as may be reasonably
required to reserve a claim which may be barred by the statute of limitations.
ARTICLE III
CLOSING
Section 3.01. CLOSING. Subject to the terms of this Agreement, the sale
and purchase of the Assets and the assumption of the Assumed Liabilities
contemplated by this Agreement shall take place at a closing of the transactions
contemplated hereby (the "CLOSING") to be held at the offices of Thompson &
Knight L.L.P., in Dallas, Texas, at 10:00 a.m., local time, on the date which is
the later of (i) the fifth day after the issuance of the FCC Orders, (ii) the
date on which all closing conditions set forth in this Article III have been
satisfied or, to the extent permitted under applicable Law, waived, and (iii)
November 8, 2000, or at such other place or at such other time or on such other
date as Seller and Purchaser may mutually agree upon in writing (the day on
which the Closing takes place being the "CLOSING DATE").
Section 3.02. CONDITIONS TO THE CLOSING.
(a) The obligations of Seller and Purchaser hereunder shall be subject
to the satisfaction or written waiver on or prior to the Closing Date of the
following conditions:
(i) The waiting period (and any extension thereof), if any,
applicable to the transactions contemplated by this Agreement under the HSR Act,
shall have been terminated or shall have expired, and no restrictive order or
other requirements pursuant to the HSR Act shall have been placed on the
parties.
(ii) The FCC shall have approved the Assignment Application
(and such other applications as may be required by applicable law, rule or
regulation to permit the transfer to the Seller of the Assets to be filed with
respect to the transactions contemplated by this Agreement).
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(iii) No temporary restraining order, preliminary or permanent
injunction or other order issued by any court of competent jurisdiction or other
legal restraint or prohibition preventing the consummation of the transactions
contemplated hereby shall be in effect, nor shall any proceeding by or with any
Governmental Authority or third party seeking any of the foregoing be pending
(excluding, in each case, any such matter initiated by Seller, Purchaser or any
of their Affiliates). There shall not be any Action taken, or any Law enacted,
entered, enforced or deemed applicable to the transactions contemplated hereby,
which makes the consummation of such transactions illegal (excluding, in each
case, any such matter initiated by Seller, Purchaser or any of their
Affiliates).
(iv) Purchaser and Seller shall have entered into a time
brokerage agreement in substantially the form of EXHIBIT 3.02(A)(IV) with
respect to the Station concurrently with entering into this Agreement (the
"TBA").
(b) The obligations of Seller to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment on or prior
to the Closing Date of each of the following conditions:
(i) Purchaser shall have entered into a loan agreement with
Seller and RCI in substantially the same form as Exhibit 3.02(b)(i) (the "BRIDGE
LOAN AGREEMENT") and Purchaser shall have advanced all funds required to be
advanced as of the Closing Date under the Bridge Loan Agreement in accordance
with the terms thereof.
(ii) All the representations and warranties of Purchaser
contained in this Agreement, and in any agreement, instrument or document
delivered pursuant hereto or in connection herewith on or prior to the Closing
Date that are not qualified by materiality, Material Adverse Effect or a dollar
threshold shall be true and correct in all material respects, and all other
representations and warranties of Purchaser shall be true and correct, as of the
date made and (having been deemed to have been made again on and as of the
Closing Date) shall be true and correct in all material respects on and as of
the Closing Date, except to the extent that any such representation or warranty
is made as of a specified date, in which case such representation or warranty
shall have been true and correct as of such specified date.
(iii) Purchaser shall have performed and complied with in all
material respects all covenants and agreements required by this Agreement, and
any agreement, instrument or document delivered pursuant hereto or in connection
herewith on or prior to the Closing Date, to be performed or complied with by it
on or prior to the Closing Date.
(iv) Purchaser shall not be in default under the TBA, which
default has resulted in a Material Adverse Effect on the Station or the Seller.
(v) The closing of the transactions contemplated under the RCI
Agreement shall have occurred or shall occur concurrently with the Closing.
(c) The obligations of Purchaser to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment on or prior
to the Closing Date of each of the following conditions:
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(i) All the representations and warranties of Seller contained
in this Agreement, and in any agreement, instrument, or document delivered
pursuant hereto or in connection herewith on or prior to the Closing Date, that
are not qualified by materiality, Material Adverse Effect or a dollar threshold,
shall be true and correct in all material respects, and all other
representations and warranties of Seller shall be true and correct, as of the
date made and (having been deemed to have been made again on and as of the
Closing Date) shall be true and correct in all material respects on and as of
the Closing Date, except as affected by actions taken or omitted to be taken by
Purchaser pursuant to the TBA, and except to the extent that any such
representation or warranty is made as of a specified date, in which case such
representation or warranty shall have been true and correct as of such specified
date.
(ii) Seller shall have performed and complied with in all
material respects all covenants and agreements required by this Agreement, and
any agreement, instrument, or document delivered pursuant hereto or in
connection herewith on or prior to the Closing Date, to be performed or complied
with by it on or prior to the Closing Date.
(iii) Charles J. Brooks shall have entered into an employment
agreement with Purchaser substantially in the form of EXHIBIT 3.02(C)(III)
hereto.
(iv) Each of Marcos A. Rodriguez, James L. Anderson and James
A. Gammon shall have entered into Non-Competition Agreements with the Purchaser
substantially in the form of EXHIBIT 3.02(C)(IV) hereto.
(v) Seller and RCI shall have applied any amounts advanced
under the Bridge Loan Agreement in accordance with the terms thereof.
(vi) Seller shall have executed and a delivered Lock-Up Letter
in the form of EXHIBIT 3.02(C)(VI).
Section 3.03. CLOSING DELIVERIES BY SELLER. At the Closing, Seller
shall execute, acknowledge (where appropriate) and deliver, or cause to be
executed, acknowledged (where appropriate) and delivered, to Purchaser the
following:
(a) Such instruments, in form and substance reasonably satisfactory to
Purchaser, as may be reasonably requested by Purchaser to transfer the Assets to
Purchaser or evidence such transfer on the public records.
(b) A certificate, executed by an officer of Seller, dated as of the
Closing Date, certifying that (i) the representations and warranties of Seller
in this Agreement that are not qualified by materiality, Material Adverse Effect
or a dollar threshold are true and correct in all material respects, and all
other representations and warranties of Seller are true and correct, in each
case, as of the Closing Date, with the same effect as though made as of such
date (or, in the case of representations and warranties which address matters
only as of a particular date, as of such particular date), (ii) each covenant or
agreement of Seller in this Agreement to be complied with at or prior to Closing
shall have been complied with in all material respects and (iii) no Action
(excluding any such matter initiated by Purchaser or any of its Affiliates) is
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pending or, to Seller's knowledge, threatened before, and no injunction has been
issued by, any Governmental Authority seeking to enjoin or restrain or prohibit,
delay, or restrain the performance of or to obtain damages or other relief in
connection with this Agreement, or the consummation of the transactions
contemplated hereby.
(c) A certificate of Seller certifying that Seller is not a "foreign
person" within the meaning of Section 1445 of the Code in substantially the form
of EXHIBIT 3.03(C).
Section 3.04. CLOSING DELIVERIES BY PURCHASER. At the Closing,
Purchaser shall execute, acknowledge (where appropriate) and deliver, or cause
to be executed, acknowledged (where appropriate) and delivered, to Seller the
following:
(a) Such assumption agreements and similar instruments, in form and
substance reasonably satisfactory to Seller, relating to the assumption of the
Assumed Liabilities and the transfer of the Assets, as may reasonably be
requested by Seller.
(b) A certificate or certificates evidencing the Purchaser Shares, duly
issued and registered in the name of Seller.
(c) The Cash Amount, if any.
(d) a certificate, executed by the duly authorized officer of
Purchaser, dated as of the Closing Date, certifying that (i) the representations
and warranties of Purchaser in this Agreement not qualified by materiality,
Material Adverse Effect or a dollar threshold are true and correct in all
material respects, and all other representations and warranties of Purchaser are
true and correct, in each case, as of the Closing Date, with the same effect as
though made as of such date (or, in the case of representations and warranties
which address matters only as of a particular date, as of such particular date),
(ii) each covenant or agreement of Purchaser in this Agreement to be complied
with at or prior to Closing shall have been complied with in all material
respects and (iii) no Action (excluding any such matter initiated by Seller or
any of its Affiliates) is pending or, to Purchaser's knowledge, threatened
before, and no injunction has been issued by, any Governmental Authority seeking
to enjoin or restrain or prohibit, delay, or restrain the performance of or to
obtain damages or other relief in connection with this Agreement, or the
consummation of the transactions contemplated hereby.
ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Purchaser that:
Section 4.01. ORGANIZATION; GOOD STANDING. Seller is a corporation duly
formed and validly existing under the laws of Texas and has all requisite power
and authority to own and lease its properties and assets and to carry on its
business as currently conducted.
Section 4.02. QUALIFICATION. Seller is duly qualified or licensed to do
business as a foreign corporation or other entity in each of the jurisdictions
set forth opposite its name on SCHEDULE 4.02, and is in good standing in each of
such jurisdictions, which are all the
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jurisdictions in which such qualification or licensing is required for the
conduct of its business and the ownership and leasing of its properties and the
Assets, except jurisdictions in which the failure to be so qualified or licensed
would not, individually or in the aggregate, have a Material Adverse Effect on
the Seller.
Section 4.03. DUE AUTHORIZATION; EXECUTION AND DELIVERY. Subject to the
issuance of the Final Orders, and any required compliance with the HSR Act,
Seller has full corporate power and authority to enter into and perform this
Agreement and any documents or instruments to be entered into as contemplated or
required by this Agreement (collectively, the "ANCILLARY DOCUMENTS") and to
which Seller is a party, and to carry out the transactions contemplated hereby
and thereby. Prior to the Closing, Seller will have taken all requisite action
to approve the execution and delivery of this Agreement and the Ancillary
Documents to which it is a party and the transactions contemplated hereby and
thereby. This Agreement and each of the Ancillary Documents to which Seller is a
party constitute the legal, valid and binding obligation of Seller, enforceable
against it in accordance with its terms, except as may be limited by the
availability of equitable remedies or by applicable bankruptcy, insolvency,
reorganization, moratorium or other laws affecting creditors' rights generally
(whether such rights are considered at law or in equity).
Section 4.04. NONCONTRAVENTION. The execution, delivery and performance
by Seller of this Agreement and the Ancillary Documents to which it is a party,
and the consummation by it of the transactions contemplated hereby and thereby,
do not and will not (i) conflict with or result in a violation of any provision
of the charter or bylaws of Seller, (ii) conflict with or result in a violation
of any provision of, or constitute (with or without the giving of notice or the
passage of time or both) a default under, or give rise (with or without the
giving of notice or the passage of time or both) to any right of termination,
cancellation or acceleration under, or require any consent, approval,
authorization or waiver of, or notice to, any party to, any bond, debenture,
note, mortgage or indenture, or any material agreement, including but not
limited to the Assumed Contracts, or other material instrument or obligation to
which Seller is a party or by which Seller or any of the Assets may be bound, or
any FCC Licenses held by Seller, (iii) result in the creation or imposition of
any Encumbrance upon any of the Assets, except for Encumbrances in favor of
Purchaser, or (iv) assuming compliance with the matters referred to in Section
4.05, violate any material Law binding upon Seller, the Station or any of the
Assets, except for (A) such consents, approvals, authorizations and waivers that
have been obtained and are unconditional and in full force and effect and such
notices that have been duly given and (B) such consents, approvals,
authorizations, waivers and notices that are disclosed on SCHEDULE 4.04.
Section 4.05. GOVERNMENTAL APPROVALS. No material approval,
authorization, consent, order or other action of, or filing with, any
Governmental Authority is required in connection with the execution and delivery
by Seller of this Agreement or the consummation of the transactions contemplated
hereby, other than those of the FCC or those under the HSR Act, and other than
(i) filings with or approvals by other Governmental Authorities to occur in the
ordinary course following the consummation of the transactions contemplated by
this Agreement, and (ii) filings, with, or approvals of, Governmental
Authorities which may be necessary due to the status of Purchaser or any
Affiliate of Purchaser. Each of the filings and approvals included in clauses
(i) and (ii) above is described on SCHEDULE 4.05.
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Section 4.06. TITLE TO ASSETS. As of the Closing Date, Seller will have
good and marketable title to all of the Assets it owns, and valid leasehold
rights to all of the Assets its leases, free and clear of all Encumbrances other
than Permitted Encumbrances.
Section 4.07. CONDITION OF ASSETS. As of the Closing Date, the
buildings, plants, structures and equipment, if any, of Seller which are
included in the Assets will be (i) in reasonably good operating condition,
ordinary wear and tear excepted, and will have been maintained by Seller in
accordance with standard industry practice, (ii) suitable for the purposes used
and (iii) adequate and sufficient for the normal operation of the Station, as
presently conducted.
Section 4.08. FCC LICENSES.
(a) SCHEDULE 2.01(A) accurately identifies each of the FCC Licenses
(including each of the applications therefor) as to the licensee, city of
license, and call sign (or, with respect to applications therefor, the file
number assigned by the Commission to such application). Seller has delivered to
Purchaser copies of each of the FCC Licenses (including any and all amendments
and other modifications thereto and all applications for additional such
licenses). The FCC Licenses identified on SCHEDULE 2.01(A) comprise all of the
licenses, permits and other authorizations required from the Commission for the
normal and lawful broadcast operations of the Station in the manner now
conducted.
(b) No action or proceeding is pending or threatened before the
Commission or other Governmental Authority for the cancellation or material
adverse modification of the FCC Licenses. The Public Files which are required by
the Commission to be maintained by the licensee of the Station are current and
contain all information required to be included therein. Seller is current with
all reports, filings and other matters that it is required to file with the
Commission and is not delinquent in the payment of any fees and charges due to
the Commission. The material required by 47 C.F.R. Section 73.3526 to be kept in
the public inspection file of the Station is in such file.
(c) As of the Closing Date, Seller shall be the authorized legal holder
of each of the FCC Licenses. The FCC Licenses are in full force and effect and
no action or proceeding is pending or threatened before the Commission for the
cancellation of the FCC Licenses. Each of the Station, its physical facilities,
electrical and mechanical systems and transmitting and studio equipment are
being operated in material compliance with the terms of each FCC License and are
in substantial and material compliance with the rules and regulations of the
Commission.
(d) SCHEDULE 2.01(G) accurately identifies each of the Permits held by
Seller. The Permits identified on SCHEDULE 2.01(G) comprise all of the licenses,
permits and other authorizations required for the normal and lawful operations
of the Station in the manner now conducted, except for the FCC Licenses.
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Section 4.09. LITIGATION. There are no Governmental Orders and no
Actions pending or, to Seller's knowledge, threatened against or affecting the
Assets or which challenges the validity or propriety of any of the transactions
contemplated by this Agreement.
Section 4.10. ABSENCE OF CERTAIN CHANGES. Except as disclosed on
SCHEDULE 4.10, since March 31, 2000 (i) there has not been any event or
condition that might reasonably be expected to result in a Material Adverse
Effect on Seller or the Assets or any material portion thereof; (ii) Seller has
not, in respect of the Station, incurred any material liability, engaged in any
material transaction or entered into any material agreement outside the ordinary
course of business consistent with past practice; (iii) Seller has not suffered
any material loss, damage, destruction or other casualty to any of the Assets
(whether or not covered by insurance); (iv) Seller has not, in respect of the
Station, taken any of the actions set forth in Section 6.01 or in Articles VI or
VII of the Bridge Loan Agreement, except as permitted thereunder; and (v) no
negative change with respect to the FCC Licenses (other than any such changes
which have resulted from Purchaser's actions or inactions pursuant to the TBA)
has occurred.
Section 4.11. TAX MATTERS. Except as disclosed on SCHEDULE 4.11, Seller
has (and as of the Closing Date will have) (i) duly filed all Tax Returns
required to be filed by or with respect to it with the IRS or other applicable
taxing authority (other than Tax Returns where the failure to file would not be,
in the aggregate, material), (ii) paid all Taxes due, or claimed by any taxing
authority to be due, from or with respect to it (other than Taxes where the
failure to pay would not be, in the aggregate, material), except Taxes that are
being contested in good faith and for which adequate reserves have been set
aside as disclosed on SCHEDULE 4.11, and (iii) made all material deposits
required with respect to Taxes. All Tax Returns referred to in the preceding
sentence were, and in the case of Tax Returns not yet filed, will be, true,
correct and complete in all material respects when filed. All material Taxes
that Seller is or was required to withhold or collect have been duly withheld or
collected, including, without limitation, all employment related Taxes and
withholdings, and, to the extent required, have been or will be timely paid to
the proper governmental body. To the knowledge of Seller, there has been no
issue raised or adjustment proposed (and none is pending) by the IRS or any
other taxing authority in connection with any Tax Returns relating to the
Assets, the Station or the Seller. No waiver or extension of any statute of
limitations as to any federal, state, local or foreign tax matter relating to
the Assets, the Station or the Seller has been given by or requested from
Seller. There are no tax liens upon any of the properties or assets of Seller,
including, without limitation, the Assets, other than liens for Taxes not yet
due and payable. None of the Assets (i) is "tax-exempt use property" within the
meaning of Section 168(h) of the Code, (ii) is subject to a tax benefit transfer
lease subject to the provision of former Section 168(f)(8) of the Internal
Revenue Code of 1954 or (iii) secures any debt the interest on which is exempt
from tax under Section 103 of the Code.
Section 4.12. COMPLIANCE WITH LAWS. Seller has complied with all
material Laws (including without limitation the rules, regulations and practices
of the Commission), and Seller has not received any written notice of any claim,
which has not been dismissed or otherwise disposed of, that Seller has not so
complied.
Section 4.13. LEASED PROPERTY. No material waiver, indulgence or
postponement of Seller's obligations under any of the Leases has been granted by
the lessor or of the lessor's
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obligations thereunder by Seller. Seller is not in breach of or in default in
any material respect under any of the Leases, and Seller has not received any
notice from, or given any notice to, any lessor indicating that Seller or such
lessor is in breach of or in default in any material respect under any of the
Leases. To the knowledge of Seller, none of the lessors under any of the Leases
is in breach thereof or in default thereunder. Seller has full right and power
to occupy or possess, as the case may be, all the property covered by each
Lease.
Seller has delivered to Purchaser true, correct and complete copies of
all the Leases. No security deposits are being held or are required to be held
under the Leases.
Section 4.14. CERTAIN PAYMENTS. Since the inception of Seller, none of
Seller or its Subsidiaries, or any director, officer, employee, or, to the
knowledge of Seller, any agent (or employee thereof) of Seller or any Subsidiary
or any other Person associated with or acting for or on behalf of Seller or any
Subsidiary, other than Purchaser or any Affiliate of Purchaser, has directly or
indirectly (a) made any illegal contribution, gift, bribe, rebate, payoff,
influence payment, kickback or other payment to any Person, private or public,
regardless of form, whether in money, property or services (i) to obtain
favorable treatment in securing business, (ii) to pay for favorable treatment
for business secured or (iii) to obtain special concessions or for special
concessions already obtained, for or in respect of Seller or any of its
Subsidiaries.
Section 4.15. PROPRIETARY INFORMATION AND OTHER RIGHTS. Seller has
title and ownership of all patents, patent applications, trademarks, service
marks, trade names, copyrights, trade secrets, information, proprietary rights,
domain names and processes (collectively, "PROPRIETARY INFORMATION") necessary
for its business as now conducted without any conflict with or infringement of
the rights of others. Seller is not aware of any particular intellectual
property that it believes is essential to its product or service development, to
which it cannot obtain sufficient rights on reasonable terms. There are no
outstanding options, licenses, or agreements of any kind relating to the
foregoing, nor is Seller bound by or a party to any options, licenses or
agreements of any kind with respect to the patents, patent applications,
trademarks, service marks, trade names, copyrights, trade secrets, licenses,
information, proprietary rights, domain names and processes of any other person
or entity. Seller has not violated and received any communications alleging that
Seller has violated or, by conducting its business as proposed, would violate
any of the patents, trademarks, service marks, trade names, copyrights or trade
proprietary rights of any other person or entity. To the knowledge of Seller,
none of its employees is obligated under any contract (including licenses,
covenants or commitments of any nature) or other agreement, or subject to any
judgment, decree or order of any court or administrative agency, that would
interfere with the use of his or her best efforts to promote the interests of
Seller or that would conflict with Seller's business as currently conducted.
Neither the execution nor delivery of this Agreement nor the carrying on of
Seller's business by the employees of Seller nor the conduct of Seller's
business as currently conducted, will, to Seller's knowledge, conflict with or
result in a breach of the terms, conditions or provisions of, or constitute a
default under, any contract, covenant or instrument under which any of such
employees is now obligated.
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Section 4.16. EMPLOYEES.
(a) SCHEDULE 4.16(A) contains a complete and accurate list of the
following information for each employee or director of Seller engaged in the
operation of the Station, including each employee on leave of absence or layoff
status; employer; name; job title; current compensation paid or payable and any
change in compensation since January 1, 2000; vacation accrued; and service
credited for purposes of vesting and eligibility to participate under any
Seller's insurance, medical, welfare, or vacation plan, other employee welfare
benefit plan, or any other employee benefit plan or any director plan.
(b) To Seller's knowledge, no employee or director of Seller engaged in
the operation of the Station is a party to, or is otherwise bound by, any
agreement or arrangement, including any confidentiality, noncompetition or
proprietary rights agreement, between such employee or director and any other
Person ("PROPRIETARY RIGHTS AGREEMENT") that in any way adversely affects (i)
the performance of his duties as an employee or director of Seller, or (ii) the
ability of Seller to conduct its business, including any Proprietary Rights
Agreement with Seller by any such employee or director. To Seller's knowledge,
no director, officer, or other key employee of Seller engaged in the operation
of the Station intends to terminate his employment with Seller.
Section 4.17. LABOR AGREEMENTS AND ACTIONS. Seller is not bound by or
subject to (and none of Seller's assets or properties is bound by or subject to)
any written or oral, express or implied, contract, commitment or arrangement
with any labor union, and no labor union has requested or, to the knowledge of
Seller, has sought to represent any of the employees, representatives or agents
of Seller. There is no strike or other labor dispute involving Seller pending,
or, to the knowledge of Seller, threatened, nor is Seller aware of any labor
organization activity involving employees of Seller.
Section 4.18. ENVIRONMENTAL. Seller has not received any written notice
of any investigation or inquiry by any Governmental Authority under any
Environmental Laws relating to the ownership or operation of the Assets. Seller
has not disposed of any Hazardous Material on any of the assets of Seller in
violation of Environmental Laws and, to Seller's knowledge, no condition exists
on any of the assets of Seller which would subject the assets of Seller to any
remedial obligations under any Environmental Laws.
Section 4.19. CERTAIN AGREEMENTS. Seller has delivered to Purchaser
accurate and complete copies of the Assumed Contracts. Each of such agreements
is a valid and binding agreement of Seller and (to the knowledge of Seller) the
other party or parties thereto, enforceable against Seller and (to the knowledge
of Seller) such other party or parties in accordance with its terms. Seller is
not in breach of or in default under, nor has any event occurred which (with or
without the giving of notice or the passage of time or both) would constitute a
default by Seller under, any provision of any of such agreements, and Seller has
not received any notice from, or given any notice to, any other party indicating
that Seller is in breach of or in default under any of such agreements. To the
knowledge of Seller, no other party to any of such agreements is in breach of or
in default under such agreements, nor has any assertion been made by Seller of
any such breach or default. Except as disclosed on SCHEDULE 4.19, each of such
agreements is freely and fully assignable to Purchaser without penalty or other
adverse consequence.
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Section 4.20. ERISA. Neither Seller nor any of its affiliates sponsor,
maintain, contribute to (other than indirectly through the Administaff Client
Service Agreement referred to below) or administer any employee benefit plan
within the meaning of Section 3(3) of ERISA, including a multiemployer plan
(within the meaning of Section 4001(a) of ERISA). All fees required to be paid
by Seller to Administaff Companies, Inc. pursuant to the Client Service
Agreement between the Company and Administaff Companies, Inc. are current as of
the date of this Agreement and will be current as of the Closing Date. For
purposes of this Section and Section 7.02(b) only, an "affiliate" of any person
means any other person which, together with such person, would be treated as a
single employer under Section 414 of the Code.
Section 4.21. INSURANCE. Seller maintains the policies of insurance
described on SCHEDULE 4.21. All such policies are in full force and effect and
all premiums have been paid in full to the extent payment was due.
Section 4.22. BROKERAGE FEES. Neither Seller nor any of its Affiliates
has retained any financial advisor, broker, agent, or finder or paid or agreed
to pay any financial advisor, broker, agent, or finder on account of this
Agreement or any transaction contemplated hereby, other than Bluestone Capital
Partners, L.P. and Americom Radio Brokers, Inc. ("SELLERS' BROKERS"). Seller
shall pay all costs and expenses of Seller's Brokers in accordance with
agreements therewith and indemnify and hold harmless Purchaser from and against
any and all losses, claims, damages and liabilities (including legal and other
expenses reasonably incurred in connection with investigating or defending any
claims or actions) with respect to any finder's fee, brokerage commission or
similar payment in connection with any transaction contemplated hereby asserted
by any person on the basis of any act or statement made or alleged to have been
made by Seller or any of its Affiliates.
Section 4.23. INVESTMENT INTENT. Seller is acquiring the Purchaser
Shares for its own account for investment and not with a view to, or for sale or
other disposition in connection with, any distribution of all or any part
thereof. Seller understands that it must bear the economic risk of this
investment indefinitely unless it sells the Purchase Shares (i) in an offering
covered by a registration statement filed with the Securities and Exchange
Commission under the Securities Act of 1933, as amended (the "SECURITIES ACT"),
covering the Purchaser Shares or (ii) pursuant to an applicable exemption under
the Securities Act. In acquiring the Purchaser Shares, Seller is not offering or
selling, and will not offer or sell, for Purchaser in connection with any
distribution of the Purchaser Shares, and Seller does not have a participation
and will not participate in any such undertaking or in any underwriting of such
an undertaking except in compliance with applicable federal and state securities
laws.
Section 4.24. DISCLOSURE OF INFORMATION. Seller acknowledges that it or
its representatives have been furnished with substantially the same kind of
information regarding Purchaser and its business, assets, results of operation,
and financial condition as would be contained in a registration statement
prepared in connection with a public sale of the Purchaser Shares. Seller
further represents that it has had an opportunity to ask questions of and
receive answers from Purchaser regarding Purchaser and its business, assets,
results of operation and financial condition and the terms and conditions of the
issuance of the Purchaser Shares. The
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foregoing, however, shall not limit or modify the representations and warranties
of Purchaser in Article V, and shall not limit the disclosure requirements of
applicable federal and state securities laws.
Section 4.25. RESTRICTED SECURITIES. Seller understands that the
Purchaser Shares will not have been registered pursuant to the Securities Act or
any applicable state securities laws, that the Purchaser Shares will be
characterized as "restricted securities" under federal securities laws, and that
under such laws and applicable regulations the Purchaser Shares cannot be sold
or otherwise disposed of without registration under the Securities Act or an
exemption therefrom. In this connection, Seller represents that it is familiar
with Rule 144 promulgated under the Securities Act, as currently in effect, and
understands the resale limitations imposed thereby and by the Securities Act.
Stop transfer instructions may be issued to the transfer agent for securities of
Purchaser (or a notation may be made in the appropriate records of Purchaser) in
connection with the Purchaser Shares.
Section 4.26. LEGEND. It is agreed and understood by Seller that the
certificates representing the Purchaser Shares shall each conspicuously set
forth on the face or back thereof, in addition to any legends required by Law or
other agreement, a legend in substantially the following form:
THIS SECURITY HAS NOT BEEN REGISTERED UNDER THE SECURITIES ACT OF 1933,
AS AMENDED (THE "SECURITIES ACT"), AND, ACCORDINGLY, MAY NOT BE OFFERED
OR SOLD EXCEPT AS SET FORTH BELOW. BY ITS ACQUISITION HEREOF, THE
HOLDER (1) REPRESENTS THAT (A) IT IS A "QUALIFIED INSTITUTIONAL BUYER"
(AS DEFINED IN RULE 144A UNDER THE SECURITIES ACT) OR (B) IT IS AN
"ACCREDITED INVESTOR" (AS DEFINED IN RULE 501(a)(1), (2), (3) or (7)
UNDER THE SECURITIES ACT) (AN "ACCREDITED INVESTOR") OR (C) IT IS NOT A
U.S. PERSON AND IS ACQUIRING THIS SECURITY IN AN OFFSHORE TRANSACTION,
OR (D) HAS RECEIVED SUCH SHARES PURSUANT TO A VALID PRIVATE PLACEMENT
UNDER SECTION 4 OF THE SECURITIES ACT, (2) AGREES THAT IT WILL NOT
WITHIN TWO YEARS AFTER THE ORIGINAL ISSUANCE OF THIS SECURITY RESELL OR
OTHERWISE TRANSFER THIS SECURITY EXCEPT (A) TO THE ISSUER OR ANY
SUBSIDIARY THEREOF, (B) INSIDE THE UNITED STATES TO A QUALIFIED
INSTITUTIONAL BUYER IN COMPLIANCE WITH RULE 144A UNDER THE SECURITIES
ACT, (C) INSIDE THE UNITED STATES TO AN ACCREDITED INVESTOR THAT, PRIOR
TO SUCH TRANSFER, FURNISHES TO THE TRANSFER AGENT A SIGNED LETTER
CONTAINING CERTAIN REPRESENTATIONS AND AGREEMENTS (THE FORM OF WHICH
LETTER CAN BE OBTAINED FROM THE TRANSFER AGENT), (D) OUTSIDE THE UNITED
STATES TO PERSONS OTHER THAN U.S. PERSONS IN OFFSHORE TRANSACTIONS
MEETING THE REQUIREMENTS OF RULE 904 UNDER REGULATION S UNDER THE
SECURITIES ACT, (E) PURSUANT TO THE EXEMPTION FROM REGISTRATION
PROVIDED BY RULE 144 UNDER THE SECURITIES ACT (IF AVAILABLE), OR (F)
PURSUANT TO AN EFFECTIVE REGISTRATION STATEMENT UNDER THE SECURITIES
ACT AND (3) AGREES THAT IT WILL GIVE TO EACH PERSON TO WHOM THIS
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SECURITY IS TRANSFERRED A NOTICE SUBSTANTIALLY TO THE EFFECT OF THIS
LEGEND. AS USED HEREIN, THE TERMS "OFFSHORE TRANSACTION," "UNITED
STATES" AND "U.S. PERSON" HAVE THE RESPECTIVE MEANINGS GIVEN TO THEM BY
REGULATION S UNDER THE SECURITIES ACT.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF PURCHASER
Purchaser hereby represents and warrants to Seller as follows:
Section 5.01. ORGANIZATION AND GOOD STANDING. Purchaser is a
corporation duly organized, validly existing and in good standing under the laws
of the state of Delaware and has all requisite corporate power and authority to
own and lease its properties and carry on its business as currently conducted.
Section 5.02. DUE AUTHORIZATION; EXECUTION AND DELIVERY. Subject to the
issuance of the Final Orders and any required compliance with the HSR Act,
Purchaser has full power and authority to enter into this Agreement and the
Ancillary Documents to which it is a party and to carry out its obligations
hereunder. The execution and delivery by Purchaser of this Agreement and the
Ancillary Documents to which it is a party and the consummation by it of the
transactions contemplated hereby have been duly authorized by all necessary
corporate action on the part of Purchaser. This Agreement and the Ancillary
Documents to which Purchaser is a party have been duly executed and delivered by
Purchaser and constitute the legal, valid and binding obligations of Purchaser,
enforceable against it in accordance with their respective terms, except as may
be limited by applicable bankruptcy, insolvency, reorganization, moratorium or
other laws affecting creditors' rights generally or general equitable
principles. Neither the execution and delivery by Purchaser of this Agreement or
the Ancillary Documents to which it is a party, nor the consummation of the
transactions contemplated hereby and thereby will: (i) conflict with or result
in a breach of the organizational documents of Purchaser; (ii) subject to the
issuance of the Final Orders, violate any law, statute, rule or regulation or
any order, writ, injunction or decree of any court or governmental authority; or
(iii) violate or conflict with or constitute a default under (or give rise to
any right of termination, cancellation or acceleration under) any indenture,
mortgage, lease, contract or other instrument to which Purchaser or any of its
Affiliates is a party or by which it or any of its Affiliates is bound or
affected.
Section 5.03. GOVERNMENTAL CONSENTS. No consent, approval,
authorization, license, exemption of, filing or registration with any court,
governmental authority or administrative agency is required by Purchaser in
connection with the execution and delivery of this Agreement or the consummation
by it of any transaction contemplated hereby, other than the consent of the FCC
or under the HSR Act.
Section 5.04. LITIGATION. There is no order of any court, governmental
agency or authority and no action, suit, proceeding or investigation, judicial,
administrative or otherwise that is pending or, to Purchaser's knowledge,
threatened against or affecting Purchaser which challenges the validity or
propriety of any of the transactions contemplated by this Agreement.
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Section 5.05. BROKERAGE FEES. No broker, finder, financial advisor or
investment banker is entitled to any brokerage, finder's or other fee,
commission or expense reimbursement in connection with the transactions
contemplated by this Agreement as a result of any agreement or action of
Purchaser, other than Lehman Brothers, Inc. (the "PURCHASER'S BROKER").
Purchaser shall pay all costs and expenses of the Purchaser's Broker in
accordance with agreements therewith, and indemnify and hold harmless Seller and
its Affiliates from and against any and all losses, claims, damages and
liabilities (including legal and other expenses reasonably incurred in
connection with investigating or defending any claims or actions) with respect
to any finder's fee, brokerage commission or similar payment in connection with
any transaction contemplated hereby asserted by any person on the basis of any
act or statement made or alleged to have been made by Purchaser or any of its
Affiliates.
Section 5.06. QUALIFICATION. Purchaser is legally, financially and
otherwise qualified to be the licensee of, acquire, own and operate the Station
under the Communications Act and the rules, regulations and policies of the FCC.
There are no facts that would, under existing law and the existing rules,
regulations, policies and procedures of the FCC, disqualify Purchaser as an
assignee of the FCC Licenses or as the owner and operator of the Station. No
waiver of any FCC rule or policy is necessary for the FCC Consents to be
obtained. There is no action, suit or proceeding pending or, to the knowledge of
Purchaser, threatened against Purchaser which questions the legality or
propriety of the transactions contemplated by this Agreement or could materially
adversely affect Purchaser's ability to perform its obligations hereunder.
Purchaser has and will have available on the Closing Date sufficient funds to
enable it to consummate the transactions contemplated hereby.
Section 5.07. PURCHASER SHARES. The Purchaser Shares have been duly
authorized for issuance and, if and when delivered by Purchaser in accordance
with the provisions of this Agreement, will be validly issued fully paid and
nonassessable. The issuance of the Purchaser Shares pursuant to this Agreement
is not subject to any preemptive or similar rights.
ARTICLE VI
CERTAIN COVENANTS AND OTHER AGREEMENTS
Section 6.01. CONDUCT AND PRESERVATION OF BUSINESS.
(a) Except actions or inactions of Purchaser pursuant to the TBA, or as
expressly provided in this Agreement, during the period from the date hereof to
the Closing, Seller shall not, without the prior written consent of Purchaser:
(i) make any material change in the ongoing operations of the
Station;
(ii) incur, guarantee or assume any indebtedness for borrowed
money in respect of the Assets, other than indebtedness to Purchaser, or in
accordance with the Bridge Loan Agreement;
(iii) mortgage or pledge any of the Assets to any person other
than Purchaser, and other than in accordance with the Bridge Loan Agreement, or
create or suffer to exist any
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Encumbrance thereupon, other than the Permitted Encumbrances and Encumbrances in
favor of Purchaser, or in accordance with the Bridge Loan Agreement;
(iv) sell, lease, transfer or otherwise dispose of, directly
or indirectly, any material part of the Assets, other than in accordance with
the Bridge Loan Agreement;
(v) amend, modify or change any existing material lease,
contract, FCC License or agreement relating to the Assets;
(vi) permit any current insurance or reinsurance policies to
be canceled or terminated or any of the coverages thereunder to lapse if such
policy covers Assets, or insures risks, contingencies or liabilities of the
Station, unless simultaneously with such cancellation, termination or lapse,
replacement policies providing coverage equal to or greater than the coverage
canceled, terminated or lapsed are in full force and effect and written copies
thereof have been provided to Purchaser;
(vii) take any action which would or might make any of the
representations or warranties of Seller contained in this Agreement untrue or
inaccurate as of any time from the date of this Agreement to the Closing or
would or might result in any of the conditions set forth in this Agreement not
being satisfied;
(viii) allow any Assumed Contract to be terminated or to be
materially modified prior to the full term of the contract; or
(ix) authorize or propose, or agree in writing or otherwise to
take, any of the actions described in this Section.
Section 6.02. ACCESS TO RECORDS AND PROPERTIES. Subject to requirements
of confidentiality imposed by contract or by law, Seller will (a) make available
to Purchaser and its accountants, counsel and other representatives, access
during normal business hours to the properties, books and records of Seller, and
will allow Seller's officers and representatives to be available to Purchaser
for consultation, and (b) furnish Purchaser with copies of all such contracts,
books and records, and other existing documents and data relating to Seller, any
Subsidiary or the Assets as Purchaser may reasonably request, and (c) furnish
Purchaser with such additional financial, operating, and other data and
information relating to Seller, any Subsidiary or the Assets as Purchaser may
reasonably request.
Section 6.03. TAXES; OTHER CHARGES. All sales, use, value -added,
transfer, registration, stamp, deed and similar Taxes ("TRANSFER TAXES")
resulting from the consummation of the transactions contemplated hereby shall be
borne by Seller and Purchaser equally. The parties shall cooperate in obtaining
all exemptions from such Transfer Taxes. The party bearing responsibility under
applicable law shall file all necessary documentation with respect to, and make
all payments of, such Transfer Taxes on a timely basis, with the cooperation of
the other party.
Section 6.04. BEST EFFORTS. Seller and Purchaser shall take all
reasonable action necessary to consummate the transactions contemplated by this
Agreement and will use all
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necessary and reasonable means at its disposal to obtain all necessary consents
and approvals of other persons and Governmental Authorities required to enable
it to consummate the transactions contemplated by this Agreement, including the
consent of the FCC and any necessary filings and consents under the HSR Act.
Except as otherwise provided herein, each of Seller and Purchaser acknowledges
and agrees that it shall pay all costs, fees and expenses incurred by it in
obtaining such necessary consents and approvals (it being understood that
Purchaser shall pay all filing fees in connection with notification filings
under the HSR Act). Each party shall promptly make all filings, applications,
statements and reports to all governmental agencies or entities which are
required to be made prior to the Closing Date by or on its behalf pursuant to
any statute, rule or regulation in connection with the transactions contemplated
by this Agreement, and copies of all such filings, applications, statements and
reports shall be provided to the other. If the FCC determines that the
transactions contemplated hereby or a portion thereof are inconsistent or
violative of FCC rules or regulations, the parties agree that they will, to the
extent practicable, negotiate in good faith to amend, modify or restructure the
transactions contemplated hereby so as to be consistent with FCC rules and
regulations.
Section 6.05. PUBLIC ANNOUNCEMENTS. Prior to the Closing Date, all
notices to third parties and other publicity relating to the transactions
contemplated by this Agreement shall be jointly planned by Seller and Purchaser;
it being understood by Seller that Purchaser is a public company subject to
disclosure requirements, and this covenant shall be subject to Purchaser's
requirements thereunder.
Section 6.06. EMPLOYMENT MATTERS. Set forth on SCHEDULE 4.16(A) is an
accurate and complete list of the names, positions and salaries of all personnel
of Seller (the "PERSONNEL") who work principally in connection with the Station
or the Assets. Two weeks prior to the Closing, Seller shall deliver to the
Purchaser a revised SCHEDULE 4.16(A) updating the information as to the
Personnel. Seller shall use its commercially reasonably efforts to maintain its
existing relationship with the Personnel, but shall not increase salary or
benefits or declare or pay bonuses without the prior written consent of
Purchaser. Purchaser shall review the schedule of Personnel and shall be given
an opportunity to interview all such members of Personnel. Purchaser may offer
employment to such employees as Purchaser shall determine in its sole
discretion. Seller shall use its best efforts to assist Purchaser in hiring such
members of Personnel who are made offers of employment by Purchaser. Purchaser
shall have no obligation to hire any employees or to maintain any level of
compensation or benefits or to provide any benefit plans, programs or
arrangements pursuant to this Agreement or in connection with the transactions
contemplated hereby.
Section 6.07. REGISTRATION RIGHTS. Upon Closing, Purchaser and Seller
shall enter into a registration rights agreement in substantially the same form
as the Form of Registration Rights Agreement attached hereto as EXHIBIT 6.07.
Section 6.08. COMPLIANCE WITH COVENANTS. Between the date hereof and
the Closing, Seller will comply in all material respects with all covenants set
forth in Articles VI and VII of the Bridge Loan Agreement and Purchaser shall
comply, and shall cause its Affiliates to comply, in all material respects with
all covenants of Purchaser and its Affiliates set forth in the Bridge Loan
Agreement and the TBA.
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Section 6.09. NOTIFICATION. Between the date hereof and the Closing,
Seller will promptly notify Purchaser in writing if Seller becomes aware of any
fact or condition that causes or constitutes a breach of any of Seller's
representations and warranties as of the date hereof, or if Seller becomes aware
of the occurrence after the date hereof of any fact or condition that would
(except as expressly contemplated by this Agreement) cause or constitute a
breach of any such representation or warranty had such representation or
warranty been made as of the time of occurrence or discovery of such fact or
condition. During the same period, Seller will promptly notify Purchaser of the
occurrence of any breach of any covenant of Seller in this Article VI or Article
VI or VII of the Bridge Loan Agreement or of the occurrence of any event that
may make the satisfaction of the conditions in Section 3 impossible or unlikely.
During the same period, Purchaser will promptly notify Seller of the occurrence
of any breach of any covenant of Purchaser in this Article VI or the TBA or of
the occurrence of any event that may make the satisfaction of the conditions in
Section 3 impossible or unlikely.
Section 6.10. NO NEGOTIATION. Until such time, if any, as this
Agreement is terminated pursuant to Article VIII, Seller will not directly or
indirectly solicit, initiate, or encourage any inquiries or proposals from,
discuss or negotiate with, or provide any non-public information to any person
(other than Purchaser) relating to any transaction involving the sale of the
Assets, or any of the capital stock of Seller, or any merger, consolidation,
business combination, or similar transaction involving Seller.
ARTICLE VII
INDEMNIFICATION
Section 7.01. SURVIVAL. All representations, warranties, covenants and
agreements made by any party to this Agreement or pursuant hereto shall be
deemed to be material and to have been relied upon by the parties hereto and
shall survive the Closing for twelve months after the Closing Date except for
(i) representations provided in Sections 4.01, 4.03, 4.04(i), 4.20 and 4.22,
which shall survive indefinitely, and (ii) representations provided in Section
4.11, which shall not survive the Closing.
Section 7.02. INDEMNIFICATION BY SELLER. Subject to the limitations set
forth in Sections 7.01 and 7.04, Seller shall indemnify and hold harmless
Purchaser and its officers, directors, employees, agents, permitted assigns,
Affiliates and successors thereof from, against, for and in respect of:
(a) any and all damages, losses, settlement payments, obligations,
liabilities, claims, actions or causes of action and encumbrances (collectively,
"LOSSES") suffered, sustained, incurred or required to be paid by Purchaser and
arising from the breach of any written representation, warranty, agreement or
covenant of Seller contained in this Agreement;
(b) all Excluded Liabilities, including but not limited to, the
Excluded Tax Liabilities, and all liabilities arising from or in connection with
the maintenance by Seller or any affiliate of Seller of any employee benefit
plan (as defined in Section 3(3) of ERISA);
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(c) all customary costs and expenses (including, without limitation,
customary attorneys' fees, interest and penalties) incurred by Purchaser in
connection with any action, suit, proceeding, demand, assessment or judgment
incident to any of the matters indemnified against in this Section 7.02; and
(d) any Losses arising from any cleanup or other remediation of or
arising from any cleanup, removal, containment or other remediation
(collectively, "CLEANUP") required by applicable law or regulation of, or any
other damage arising from, any Hazardous Substance, Cleanup or breach of
Environmental Law, but only to the extent that Seller has caused such Losses.
THE PROVISIONS OF THIS INDEMNITY SHALL NOT BE THE SOLE REMEDY IN THE
CASE OF INTENTIONAL MISREPRESENTATIONS, FRAUD, WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE.
Section 7.03. INDEMNIFICATION BY PURCHASER. Subject to the limitations
set forth in Sections 7.01 and 7.04, Purchaser shall indemnify and hold Seller
and the officers, directors, employees, trustees, agents, permitted assigns,
Affiliates and successors thereof harmless from, against, for and in respect of:
(a) any and all Losses suffered, sustained, incurred or required to be
paid by Seller and arising from the breach of any written representation,
warranty, agreement or covenant of Purchaser contained in this Agreement, or the
ownership and operation by Purchaser of the Assets after the Closing;
(b) any and all Assumed Liabilities arising from and after the Closing
Date; and
(c) all reasonable costs and expenses (including, without limitation,
attorneys' fees, interest and penalties) incurred by Seller in connection with
any action, suit, proceeding, demand, assessment or judgment incident to any of
the matters indemnified against in this Section 7.03.
THE PROVISIONS OF THIS INDEMNITY SHALL NOT BE THE SOLE REMEDY IN THE
CASE OF INTENTIONAL MISREPRESENTATIONS, FRAUD, WILLFUL MISCONDUCT OR GROSS
NEGLIGENCE.
Section 7.04. INDEMNIFICATION PROCEDURES. The obligations and
liabilities of each indemnifying party hereunder with respect to claims
resulting from the assertion of liability by the other party or indemnified
third parties shall be subject to the following terms and conditions:
(a) The indemnified party shall give prompt written notice (which in no
event shall exceed 30 days from the date on which the indemnified party first
became aware of such claim or assertion) to the indemnifying party of any claim
which might give rise to a claim by the indemnified party against the
indemnifying party based on the indemnity agreements contained in Article VII
hereof, stating the nature and basis of said claims and the amounts thereof, to
the extent known. The failure to so notify, or any delay in so notifying, the
indemnifying party will not relieve the indemnifying party of its obligations
under this Article VII, except solely to the extent that the indemnifying party
can demonstrate that such failure actually and materially
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prejudices the defense of the Action by the indemnifying party. Within 10 days
of delivery of such notice, the indemnifying party shall advise the indemnified
party (i) whether it disputes the claim for indemnification and (ii) whether the
indemnifying party desires at its sole cost and expense to defend such Action.
(b) In the event that the indemnifying party notifies the indemnified
party within the notice period specified in clause (a) of this Section 7.04 that
the indemnifying party does not dispute the indemnifying party's obligation to
indemnify hereunder and desires to defend the indemnified party against such
claim and, except as hereunder provided, the indemnifying party shall have the
right to defend by appropriate proceedings, which proceedings shall be promptly
settled or prosecuted by the indemnifying party to final conclusion; provided
that, unless the indemnified party otherwise agrees, the indemnifying party may
not compromise or settle any matter (in whole or in part) (i) without obtaining
a complete and unconditional release of the indemnified party, (ii) unless the
sole relief provided is monetary damages that are paid in full by the
indemnifying party, and (iii) unless there is no finding or admission of any
violation of law or any violation of the rights of any other Person and no
effect on any claims that may be made against the indemnified party. If the
indemnifying party elects not to defend the indemnified party against such
claim, whether by failure of the indemnifying party to give the indemnified
party timely notice as provided above or otherwise, then the indemnified party
may assume the defense thereof, shall have the right to undertake the defense
of, compromise or settle such proceedings and the indemnifying party shall, upon
request of the indemnified party, pay to such indemnified party, in accordance
with the terms of this Article VII, the amount of Losses resulting from such
proceeding; provided, however, that such proceeding shall not be compromised or
settled without the written consent of the indemnifying party, which consent
shall not be unreasonably withheld. Notwithstanding the foregoing, the
indemnifying party's right to object to any proposed compromise or settlement
shall be conditioned upon such indemnifying party acknowledging to the
indemnified party that such indemnifying party shall be solely responsible (as
between the indemnifying party and the indemnified party) for all liabilities
and obligations arising from the matter proposed to be compromised or settled.
If any Action, suit or proceeding is brought against the indemnified party with
respect to which the indemnifying party may have liability under the indemnity
agreements contained in Article VII hereof, the Action, suit or proceeding
shall, upon the written acknowledgment by the indemnifying party that it is
obligated to indemnify under such indemnity agreement, be defended (including
all proceedings on appeal or for review which counsel for the indemnified party
shall deem appropriate) by the indemnifying party. The indemnified party shall
have the right to employ its own counsel in any such case, but the fees and
expenses of such counsel shall be at the indemnified party's own expense unless
(i) the employment of such counsel and the payment of such fees and expenses
both shall have been specifically authorized in writing by the indemnifying
party in connection with the defense of such Action, suit or proceeding, or (ii)
counsel to such indemnified party shall have reasonably concluded and
specifically notified the indemnifying party that there may be specific defenses
available to it which are different from or additional to those available to the
indemnifying party or that such Action, suit or proceeding involves or could
have an effect upon matters beyond the scope of the indemnity agreements
contained in Article VII hereof, in any of which events the indemnifying party,
to the extent made necessary by such defenses, shall not have the right to
direct the defense of such Action, suit or proceeding on behalf of the
indemnified party. In the latter such case only that portion of such fees and
expenses of the indemnified
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party's separate counsel reasonably related to matters covered by the indemnity
agreements contained in Article VII hereof shall be borne by the indemnifying
party. The indemnified party shall be kept fully informed of such action, suit
or proceeding at all stages thereof whether or not it is represented by separate
counsel.
(c) The defending party shall make available to the non-defending party
and its attorneys and accountants all books and records of the non-defending
party relating to such proceedings or litigation and the parties hereto agree to
render to each other such assistance as they may reasonably require of each
other in order to ensure the proper and adequate defense of any such Action,
suit or proceeding.
(d) There shall be no indemnification recoverable against a party
otherwise obligated to provide indemnification therefor under this Article VII
(other than the payment of Taxes relating to the Straddle Period) until the
Losses by the party seeking such indemnification exceed $150,000 in the
aggregate (the "BASKET AMOUNT"), and once all such Losses exceed the Basket
Amount, such party shall only be obligated to the other party for Losses in
excess of the Basket Amount (other than the payment of Taxes relating to the
Straddle Period).
(e) Seller shall not be required to pay any amount in satisfaction of
the indemnification obligations of Seller pursuant to this Article VII in excess
of the Purchase Price received by Seller.
(f) A waiver of a condition to Closing hereunder shall not preclude the
waiving party from being indemnified hereunder.
Section 7.05. CERTAIN TAX MATTERS. For purposes of Section 2.03(b) and
7.02(b), Seller's allocable portion of Taxes with respect to a taxable period
which includes (but does not end on) the Closing Date (the "STRADDLE PERIOD")
shall be (x) in the case of any Taxes other than Taxes based upon or related to
income or receipts, an amount equal to the Tax for the entire period multiplied
by a fraction, the numerator of which is the number of days in the period for
which such Taxes are paid ending on the Closing Date and the denominator of
which is the number of days in the entire taxable period; and (y) in the case of
any Taxes based upon or related to income or receipts, the amount that would be
payable if the taxable period ended on the Closing Date. The party that has the
primary obligation to do so under applicable law shall file any Tax Return that
is required to be filed in respect of Taxes described in Section 7.02, and that
party shall pay the Taxes shown on such Tax Return and the other party shall
reimburse the filing party for its share of such Tax as determined under Section
7.02 by wire transfer of immediately available funds no later than ten days
after receipt of written notice that such Tax has been paid to the applicable
governmental body. For purposes of Taxes based upon or measured by net income
("INCOME TAXES"), Seller shall include the net income attributable to Seller,
the Station and the Assets in its income through the Closing Date and shall file
the appropriate Tax Returns. Subject to the provisions of Section 6.03, Seller
shall be responsible for the payment of all Taxes, including, without
limitation, Income Taxes imposed on Seller, if any, as a result of the transfer
of the Station and the Assets to Purchaser. Seller and Purchaser shall provide
each other with such cooperation and information as either of them reasonably
may request of the other with respect to Seller, the Station or the Assets in
filing any
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Tax Return, amended return or claim for refund, determining a liability for
Taxes or a right to refund of Taxes or in conducting any audit or other
proceeding in respect of Taxes with respect to Seller, the Station or the
Assets. Such cooperation and information shall include, without limitation,
providing copies of all relevant portions of Tax Returns with respect to Seller,
together with accompanying schedules and related work papers, documents relating
to rulings or other determinations by taxing authorities and records concerning
the ownership and tax basis of property, which either party may possess. Each
party shall make its employees available on a mutually convenient basis to
provide explanation of any documents or information provided hereunder. The
party requesting assistance hereunder shall reimburse the other for any
reasonable out-of-pocket costs incurred in providing any return, document or
other written information, and shall compensate the other for any reasonable
costs (excluding wages and salaries) of making employees available, upon receipt
of reasonable documentation of such costs. Each party shall retain all returns,
schedules and work papers and all material records or other documents relating
thereto, until the expiration of the statute of limitations (including
extensions) of the taxable years to which such returns and other documents
relate and, unless the relevant portions of such returns and other documents are
offered to the other party, until the final determination of any payments which
may be required in respect of such years under this Agreement. Any information
obtained under this Section 7.05 shall be kept confidential, except as may be
otherwise necessary in connection with the filing of any Tax Returns or claims
for refund or in conducting any audit or other proceeding and shall be used
solely for the purposes set forth in this Section 7.05.
ARTICLE VIII
TERMINATION
Section 8.01. TERMINATION. This Agreement may be terminated and the
transactions contemplated hereby abandoned at any time prior to the Closing in
the following manner:
(a) by mutual written consent of Seller and Purchaser; or
(b) by either Seller (following repayment of all amounts due to
Purchaser by any party under the Bridge Loan Agreement in accordance with the
terms thereof) or Purchaser if the Closing shall not have occurred on or before
June 1, 2001, unless such failure to close shall be due to a breach of this
Agreement by the party seeking to terminate this Agreement pursuant to this
clause (b); or
(c) by either Seller (following repayment of all amounts due to
Purchaser by any party under the Bridge Loan Agreement in accordance with the
terms thereof) or Purchaser if there shall be any Law that makes consummation of
the transactions contemplated hereby illegal or otherwise prohibited or a
Governmental Authority shall have issued an order, decree or ruling or taken any
other action permanently restraining, enjoining or otherwise prohibiting the
consummation of the transactions contemplated hereby, and such order, decree,
ruling or other action shall have become final and nonappealable; or
(d) by Seller (following repayment of all amounts due to Purchaser by
any party under the Bridge Loan Agreement in accordance with the terms thereof),
if (i) any of the material representations and warranties of Purchaser contained
in this Agreement shall not be
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true and correct in any material respect, when made or at any time prior to the
Closing as if made at and as of such time (except to the extent that any such
representation or warranty is made as of a specified date, in which case such
representation or warranty shall have been true and correct in all material
respects as of such specified date), in any respect which is material to
Purchaser or the ability of Purchaser to consummate the transactions
contemplated hereby, or (ii) Purchaser shall have failed to fulfill in any
material respect any of its material obligations under this Agreement, which
failure is material to the obligations of Purchaser under this Agreement, and,
in the case of each of clauses (i) and (ii), such misrepresentation, breach of
warranty, or failure (provided it can be cured) has not been cured within 30
days after written notice thereof from Seller to Purchaser; provided that
Purchaser shall have no opportunity to cure its failure to timely pay the
Purchase Price; or
(e) by Purchaser, if (i) any of the material representations and
warranties of Seller contained in this Agreement shall not be true and correct
in any material respect, when made or at any time prior to the Closing as if
made at and as of such time (except to the extent that any such representation
or warranty is made as of a specified date, in which case such representation or
warranty shall have been true and correct in all material respects as of such
specified date), in any respect which is material to Seller or the ability of
Seller to consummate the transactions contemplated hereby, or (ii) Seller shall
have failed to fulfill in any material respect any of its material obligations
under this Agreement, which failure is material to the obligations of Seller
under this Agreement, and, in the case of each of clauses (i) and (ii), such
misrepresentation, breach of warranty, or failure (provided it can be cured) has
not been cured within 30 days after written notice thereof from Purchaser to
Seller.
Section 8.02. CERTAIN REMEDIES NOT EXCLUSIVE. Except as specifically
set forth herein, the rights and remedies herein provided shall be cumulative
and not exclusive of any rights or remedies provided by law. The rights and
remedies of any party based upon, arising out of or otherwise in respect of any
inaccuracy in or breach of any representation, warranty, covenant or agreement
contained in this Agreement shall in no way be limited by the fact that the act,
omission, occurrence or other state of facts upon which any claim of any such
inaccuracy or breach is based may also be the subject matter of any other
representation, warranty, covenant or agreement contained in this Agreement (or
in any other agreement between the parties) as to which there is no inaccuracy
or breach.
Section 8.03. SPECIFIC PERFORMANCE. It is understood and agreed that
money damages would not be sufficient remedy for Seller's or Purchaser's failure
to perform under this Agreement, the Bridge Loan Agreement and the Ancillary
Documents, including Seller's failure to transfer, assign, convey, sell or
deliver the Assets to Purchaser and Purchaser's payment of the Purchase Price
and advancement of funds under the Bridge Loan Agreement in accordance with the
terms thereof, that Purchaser or Seller, as the case may be, would be
irreparably harmed by such a breach and that Purchaser and Seller shall be
entitled to specific performance and injunctive relief as remedies for any such
breach.
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ARTICLE IX
MISCELLANEOUS PROVISIONS
Section 9.01. EXPENSES. Except as otherwise expressly provided herein,
each party shall pay the fees and expenses incurred by it in connection with the
transactions contemplated by this Agreement. If any action is brought for breach
of this Agreement or to enforce any provision of this Agreement, the prevailing
party shall be entitled to recover court costs, arbitration expenses and
reasonable attorneys' fees.
Section 9.02. AMENDMENT. This Agreement may be amended at any time but
only by an instrument in writing signed by the parties hereto.
Section 9.03. NOTICES. All notices and other communications hereunder
shall be in writing and shall be deemed given if (i) mailed by certified mail,
return receipt requested, or delivered by nationally recognized "next-day"
delivery service, to the parties at the addresses set forth below (or at such
other address for a party as shall be specified by like notice), or (ii) sent by
facsimile to the number set forth below (or such other number for a party as
shall be specified by proper notice hereunder), or (iii) sent by email to the
email address set forth below (or such other email address for a party as shall
be specified by proper notice hereunder):
If to Purchaser, to: Spanish Broadcasting System, Inc.
3191 Coral Way
Miami, Florida 33145
Attention: Joseph A. Garcia
Facsimile: (305) 446-5148
Email: bgerdts@sbscorporate.com
with copies (which shall not constitute notice) to:
Kaye, Scholer, Fierman, Hays & Handler, LLP
901 Fifteenth Street, N.W.
Washington, D.C. 20005
Attention: Jason L. Shrinsky
Facsimile: 202-682-3580
Email:
If to Seller, to: New World Broadcasters Corp.
1333 Corporate Drive, Suite 350
Irving, Texas 75038
Attention: James L. Anderson
Facsimile: 972-550-5517
Email: jim@rodriguezcom.com
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with copies (which shall not constitute notice) to:
Thompson & Knight L.L.P.
1700 Pacific Ave., Suite 3300
Dallas, Texas 75201
Attention: David Emmons
Facsimile: 214 969-1751
Email: emmonsd@tklaw.com
Section 9.04. ASSIGNMENT. This Agreement shall be binding upon and
inure to the benefit of the parties hereto and their respective successors,
heirs and permitted assigns. This Agreement may not be assigned by either party
without the prior written consent of the other, except that Purchaser may assign
to any wholly owned subsidiary of Purchaser or to Purchaser's lender that will
lend to Purchaser the funds that Purchaser will in turn lend pursuant to the
Bridge Loan Agreement any of Purchaser's rights, interests or obligations
hereunder, upon notice to Seller; provided that no such assignment shall relieve
Purchaser of its obligations hereunder or delay Closing.
Section 9.05. COUNTERPARTS. This Agreement may be executed in any
number of counterparts, each of which shall be deemed an original, but all of
which together shall constitute one and the same instrument.
Section 9.06. HEADINGS. The headings of the Sections of this Agreement
are inserted for convenience only and shall not constitute a part hereof.
Section 9.07. ENTIRE AGREEMENT. This Agreement and the documents
referred to herein contain the entire understanding of the parties hereto in
respect of the subject matter contained herein. There are no restrictions,
promises, warranties, conveyances or undertakings other than those expressly set
forth herein. This Agreement supersedes any prior agreements and understandings
between the parties with respect to the subject matter.
Section 9.08. WAIVER. No attempted waiver of compliance with any
provision or condition hereof, or consent pursuant to this Agreement, will be
effective unless evidenced by an instrument in writing by the party against whom
the enforcement of any such waiver or consent is sought.
Section 9.09. GOVERNING LAW. THIS AGREEMENT SHALL BE GOVERNED BY AND
CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE STATE OF NEW YORK, WITHOUT REGARD
TO THE PRINCIPLES OF CONFLICTS OF LAWS THEREOF.
Section 9.10. SEVERABILITY. If any term or other provision of this
Agreement is held invalid, illegal or incapable of being enforced under any rule
or law, all other conditions and provisions of this Agreement shall nevertheless
remain in full force and effect so long as the economic or legal substance of
the transactions contemplated hereby is not affected in a materially adverse
manner with respect to either party. Upon such determination that any term or
other provision is invalid, illegal or incapable of being enforced, the parties
hereto shall
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negotiate in good faith to modify this Agreement so as to effect the original
intent of the parties as closely as possible in an acceptable manner to the end
that transactions contemplated hereby are fulfilled to the extent possible.
Section 9.11. INTENDED BENEFICIARIES. The rights and obligations
contained in this Agreement are hereby declared by the parties hereto to have
been provided expressly for the exclusive benefit of such entities as set forth
herein and shall not benefit, and do not benefit, any unrelated third parties.
Section 9.12. CONSENT TO JURISDICTION.
(a) The parties hereto hereby irrevocably submit to the jurisdiction of
the courts of the State of Delaware and the federal courts of the United States
of America located in Delaware, and appropriate appellate courts therefrom, over
any dispute arising out of or relating to this Agreement or any of the
transactions contemplated hereby and each party hereby irrevocably agrees that
all claims in respect of such dispute or proceeding may be heard and determined
in such courts. The parties hereby irrevocably waive, to the fullest extent
permitted by Law, any objection which they may now or hereafter have to the
laying of venue of any dispute arising out of or relating to this Agreement or
any of the transactions contemplated hereby brought in such court or any defense
of inconvenient forum for the maintenance of such dispute. Each of the parties
hereto agrees that a judgment in any such dispute may be enforced in other
jurisdictions by suit on the judgment or in any other manner provided by law.
This consent to jurisdiction is being given solely for purposes of this
Agreement and is not intended to, and shall not, confer consent to jurisdiction
with respect to any other dispute in which a party to this Agreement may become
involved.
(b) Each of the parties hereto hereby consents to process being served
by any party to this Agreement in any suit, action, or proceeding of the nature
specified in subsection (a) above by the mailing of a copy thereof in the manner
specified by the provisions of Section 9.03.
Section 9.13. MUTUAL CONTRIBUTION. The parties to this Agreement and
their counsel have mutually contributed to its drafting. Consequently, no
provision of this Agreement shall be construed against any party on the ground
that such party drafted the provision or caused it to be drafted or the
provision contains a covenant of such party.
Section 9.14. HSR ACT. Marcos A. Rodriguez represents and warrants
that, for the purposes of the HSR Act, he is the ultimate parent entity of
Seller and that he does not have total assets of more than $10 million as such
assets are calculated pursuant to regulations adopted under the HSR Act, and Mr.
Rodriguez agrees to indemnify and hold harmless Purchaser and its officers,
directors, employees, agents, permitted assigns, Affiliates and successors from,
against, for and in respect of any Losses arising from his failure to file under
and comply with the HSR Act with respect to the transactions contemplated
hereby.
[SIGNATURES APPEAR ON FOLLOWING PAGE]
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IN WITNESS WHEREOF, the parties hereto have each caused this Agreement
to be duly executed as of the date first above written by their respective
officers thereunto duly authorized.
"SELLER"
NEW WORLD BROADCASTERS CORP.
By: /s/ MARCOS A. RODRIGUEZ
---------------------------
Marcos A. Rodriguez,
Chairman of the Board and
Chief Executive Officer
"PURCHASER"
SPANISH BROADCASTING SYSTEM, INC.
By: /s/ RAUL ALARCON, JR.
-------------------------
Raul Alarcon, Jr.,
Chairman of the Board, Chief Executive
Officer and President
Marcos A. Rodriguez has executed this Agreement for the sole purpose of
making the representations, and warranties with respect to himself set forth in
Section 9.14 and for the purpose of making the agreements set forth in such
section.
/s/ MARCOS A. RODRIGUEZ
------------------------
Marcos A. Rodriguez
32
33
SCHEDULES 2.01(A)
FCC LICENSES
FCC FM Broadcasting License for KTCY-FM (Pilot Point, Texas)
34
SBS
INVENTORY LIST
LOBBY - RECEPTION AREA Computer - monitor, keyboard, mouse
Reception Meridian phone
3 - two drawer chests
Heater
Mail scale
Postage meter
8 - letter sized plastic trays
2 - waste baskets
La Mejor framed picture
2 - chairs
LOBBY II
Couch, love seat, chair set with two pillows
2 - marble end tables, 1 broken
2 - wooden tables
4 plants
Table lamp
Fire extinguisher
Wall mirror
2 - Marcos Rodriguez framed articles
LOBBY CUBE I
Computer - monitor, keyboard, mouse
Chair
Antique oak desk
Waste basket
Dry erase board
Meridian phone
LOBBY CUBE II
Meridian phone
CHUCK'S OFFICE
Desk & credenza
3 - shelves
Two shelf book shelf
Two drawer file cabinet
Printer
Meridian phone
Power shredder
2 - file trays
2 - file tracks
CHUCK'S CONFERENCE ROOM
Fax machine
Round conference table
4 - chairs
Meridian phone
2 - two-drawer lateral file cabinets
Plant
Waste basket
ROCIO'S OFFICE
Computer w/sound - monitor, keyboard, mouse
Meridian phone
HP Laser Jet 2D printer
2 - plants
2 - multiple file trays
Hole punch
Power Shredder
2 - chairs
Two drawer book shelf
Waste basket
TRAFFIC
Computer IBM w/sound - monitor, keyboard, mouse
Clone computer - monitor, keyboard, mouse
2 - Meridian phones
2 - chairs
Four-drawer legal sized filing cabinet
2 - Epson dot Matrix printers
2 - waste baskets
UPS Best - small
CARMEN'S OFFICE
4 - plants
Computer IBM w/sound - monitor, keyboard, mouse
3 - Chairs
Meridian phone
Waste basket
Six shelf book case
Epson LQ 570
3 - multi file trays
WAYNE'S OFFICE
Computer IBM w/sound - monitor, keyboard, mouse
Power shredder
APC UPS
Meridian phone
3 - chairs
Sharp adding machine
HP 5P Laser jet printer
14 - file trays
two drawer lateral filing cabinet
four drawer filing cabinet
Roll around file cabinet
Six shelf book shelf
Waste basket
RAUL'S OFFICE
Meridian phone
2
35
PAUL'S OFFICE
Clone Computer - monitor, keyboard, mouse
Meridian phone
2 - chairs
Waste basket
9 - file trays
2 - wire file trays
CONFERENCE ROOM
Conference table
11 - chairs
Large dry erase board
2 - trash cans
Meridian phone
Two drawer standard file cabinets
2 - large artificial plants
RCA home theater 30" w/remote
Panasonic VCR w/remote
3M 9100 projector
Real to Real stand
Framed picture
EQUIPMENT CLOSET
Radio Shack public address amp.
ESE digital timer
LEL digital timer
Radio Shack graphic equalizer
Telos 10 head
4 - spare modules for Autogram console
Autogram new knobs
4CX1500B tube
2 - on air light fixtures
Mackie 1402 audio mixer
Best UPS w/broken case
486 computer for remotes
Harrison console 12 channel w/power supply (scrap)
6 - floor Mic stands
Scotts Studios 8 channel routing switcher
Decoder TFT digital base band
Encoder TFT digital base band
Receiver TFT 8300 STL receiver
Telos 10 telephone interface
Dorrough DAP 310 audio processor
New - star guide satellite receiver
Tascam 112-cassette recorder
2 - Otari real to real CB 116 remote control head
Mari electronics STL transmitter diplexer HRC - 10A
7 - stereo head phones
Home made DC power supply
ACCOUNTING
3 - Meridian phones
Sharp GTL3 electronic calculator
Industrial stapler
3 - trash cans
2 - two drawer lateral files
Four drawer lateral file
2 - two drawer standard cabinets
Computer - monitor, keyboard, mouse
Sharp 1194 G Calculator
Xerox docuprint 12 laser printer
Okidata 320 Matrix printer
Preferred computers server
Scott Studio server
Raid 5-scuzzy array
APC UPS
Monitor & Keyboard
Balkin Omni view 6 port monitor, keyboard, mouse sharing switch
Lattis NET M-2800 12 port hub
Ethernet hub 16 port
2 - 3Com 24 port hubs
Hubbell 96 port patch panel Ethernet
Cork board
7' aluminum rack
Monitor shelf
2 - 3 wire dressing panels
15 port plug strip
2 - framed pictures
Dead clock
Wire file tray
Plastic file tray
Plastic file box
Metal key index
ANGELA'S OFFICE
Astro Flight digital charger for "Flash"
4 - 5 drawer plastic bin
Purple plastic bin
Six shelf metal shelf
4 - wall mount video tape shelf
1 - 3 shelf wire shelf
Computer desk
2 - chairs
2 - wooden desks
3 - two drawer file cabinets
Meridian phone
Clone Computer - monitor, keyboard, mouse
HP 672C color printer
2 - plastic file trays
Pin board
NOEMI
Dell computer with sound - monitor, keyboard, mouse
HP Scan Jet II CS flatbed
3
36
Meridian phone
Chair
Waste basket
HP Paint Jet XL 300 printer & stand
Sharp FO - 4500 fax
2 - two drawer standard cabinets
Plant
Picture
7 - trays
Sharp SF - 2030 copier
Large dry erase board 6'x4'
Small dry erase board 3'x2'
3 - trash cans
Fire extinguisher
Printer stand
4 - two drawer standard file cabinet
Ibico binder system
Wooden supply shelf
96 mailbox plot shelf
9 - plastic file trays
Four shelf book tray
30" x 2" pin board
3 - wall hanging plastic bins
Jet direct EX Plus 3
JUAN'S OFFICE
IBM 300GL Computer with stand - monitor, keyboard, mouse, sound
ABC UPS system
Meridian phone
3 - chairs
Power stereo
HP Laser 4L printer
Technique SL - P555 CD player
Panasonic double cassette dec. SG - HMO9A stereo amplifier
RCA antenna
Two Cerwin Vega speakers
2 - two-drawer lateral file cabinets
Four shelf book shelf
Picture frame
Waste basket
ED'S OFFICE
IBM 300 GL MKM w/sound - monitor, keyboard, mouse
APC UPS
Meridian phone
TX Inst. Calculator
HP Desk Jet 890C color printer
2 - pin boards 2' x 30"
2 - two-drawer lateral file cabinet
1500 watt heater
Desk
3 - chairs
7 - plastic trays
4 - disk indexes
Back pack external CD ROM
I Omega Zip 250 drive
Gold star monitor
ACER Speakers
3com office connect 8 port mini hub
8 port mini network hub
Dry erase board
MICHELLE
2 - two drawer cabinets
4 - wire file trays
Meridian phone
Chair - broken
Clone computer - monitor, keyboard, mouse
Waste basket
SCOTT
Meridian phone
Chair
Clone computer - monitor, keyboard, mouse
2 - two drawer cabinets
4 - plastic file trays
Broken monitor stand
Waste basket
DOLORES
Meridian phone
Clone computer - monitor, keyboard, mouse
Chair
Waste basket
EMPTY
2 - wire trays
Meridian phone
3 - plastic trays
JOE
Clone computer - monitor, keyboard, mouse
Waste basket
Meridian phone
4 - plastic file trays
Wire tray
Chair
PRINTER STATIONS
HP Laser 4 plus
Jet direct EX plus 3
Meridian phone
2 - chairs
2 - desks metal
HP 870 CSE color printer
4
37
Jet direct EX plus 3-printer server
Dell PC computer
JAKKI
Clone computer - monitor, keyboard, mouse
Waste basket
Meridian phone
4 - plastic file trays
Wire tray
JOSE SOLORZANO
Dell clone computer - monitor, keyboard, mouse
5 - plastic files
Chair
Meridian phone
Waste basket
4 - wire hanging files
3 - two doors metal cabinets
2 - Panasonic electric typewriters
2 - chairs
Meridian phone
5 - plastic trays
Chair
Clone computer - monitor, keyboard, mouse
2 - waste baskets
Meridian phone
5 - plastic trays
Chair
Clone computer - monitor, keyboard, mouse
2 - wastebaskets
Meridian phone
5 - plastic files
3 - metal files
2 - two drawer metal cabinets
Fire extinguisher
6 x 4 dry erase board
KXEB 910 MAIN STUDIO
2 - chairs
2 - lateral file cabinets
Harrison Air 7-90 11 channel audio console
Scott Studio system - SSPB & Raid skuzzy array, 2 keyboards & 2 monitors
Pin board large
Pin board small
Clock
Tascam Mark II recorder
Panasonic SU3800 DAT recorder
2 - Marantx PMD321 CD player
1 - Fostex powered speaker
Otari MX 50-50 Real to real recorder
3 - Symetri 528 E Mic Processors
1 - US Audio PHMAS Head phone system with 2 remote heads
2 - Henry matchbox interface device
Telos 10 digi telephone system w/head
Alesis RA-100 monitor amp
Radio systems, 8 port distribution amp.
Custom cabinet
End table
Fan
Radio Shack stereo amp
5 - plug strips
Henry engineering 8 channel stereo mixer
Home made switcher
Broadcast tools silent sensor
3 - Senheizer MD421 mics
3 EAC OC White Mic arms
2 - Alesis speakers & monitor "one"
2 - Omni mount speakers
5 - chairs
GENERAL ENGINEERING
Scott Studios clone PC - Winspot
2 - Tannoy monitor speakers
3 - 6' metal racks
6 - Rane Mojo MQ302 stereo graphic equalizers
Ramko Primus 16 port p-85/16m distribution amp
Moseley Associates SCG - 8 subchannel
Generator
Aphex Compeller/Aural Exciter
Aphex Compeller
Magnavox VHS - VCR
5 - spare Harrison Module
Fair Child 766H - dual trace oscilloscope
Potomac Instruments AT51 System AG51 audio generator and AA51 audio analyzer
3 - Electra voice RE - 20 mics
2 - Fostex 6301B powered speakers
2 - Meridian phones
2 - powered antennas (Radio Shack & TERK)
Panasonic tuner ST - K350
OC white Mic arm
5 - plug strips
KTCY
Optimod - FM 8200 Digital
Optimod 8100A snolog
Optimod 8100A/XT2
Dynalab FT101A Analog FM tuner
TFT 884 FM modulation & stereo monitor
TFT 845 FM SCA monitor
ATI - DA416 Distribution amplifier
Logitek ADA - 8 Distribution Amplifier
Logitek MON - 10 monitor switcher
Alesis RA - 100 Monitor amp
5
38
ESE ES-185AGPS Master Clock
Intraplex TI Interface
Telos Zephyr ISDN Kodak
Valley 440 audio processor
Logitek PRE-10
TFT, EAS 930 A receiver
2 - EAS 940A audio insertion modules
Best UPS 5,000 watts
4 - 16 terminal plug strips
Ty LINK ONS 1000 network server
Pipeline Ethernet router
Eventide 204 digital audio login system
KITCHEN
Goldstar Microwave
Microwave stand
Hotpoint (no frost) Refrigerator 17 cubic ft.
Dinette set
5 - Chairs
Small waste basket
Large waste basket
Artificial plant
Pin Board
Meridian phone
Four drawer legal sized cabinets
6 - 10X10 large tents
PROGRAMMING OFFICE
Three piece couch set (large couch & 2 recliners)
2 - end tables
Lamp
7 - chairs
2 - wood desks
Typing table
2 - PC clone computers (monitor, keyboard, mouse)
3 - wooden book shelves
2 - wooden cabinets 6' high
2 - two drawer filing cabinets
Lateral filing cabinet
HP Laser Jet printer 4L
HP Laser Jet printer 5L
Sharp fax machine
Dry erase board
2 - pin boards
"Flash" mascot
2 - waste baskets
5 - file trays
2 - coffee tables
CD wooden shelf
Wooden desk with matching credenza
2 - chairs
Power shredder
2 - Meridian phones
Clone computer (monitor, keyboard, mouse)
HP Laser Jet 2P printer
Two drawer metal file cabinet
24x36 pin board
24x36 dry erase board
UPS OPTI
Two drawer metal file cabinet
10 - file trays
2 - plants
Remote Equipment I = Road case, Furman p18 power conditioner & light
modules, Mackie 1402 console, technics FM tuner, 2 audio Technicia, ATW-10
mikes, 2 receivers Comrex Vector Codec, Mackie M1400I, 1000 watt power amp,
single line telephone, 4-SM48 Shure wired Mikes, 7" metal rack drawer, Radio
Shack powered antenna, 2 - Peavey SP2Q PA large speakers, 2 - Ramsa PA small
speakers, 4ft case with blower, 36" road case with PV 1000 watt amp included,
computer with monitor, keyboard and mouse, two speaker stands
Baloon display (KLTY logo)
Remote Kit II = Telos Zephyr ISDN codac, 18" case, Behringer
composer audio processor, US audio phmas head Meridian phone amp system with
four remote heads.
Expansion ladder
2 - Moseley STL transmitters PCC606C offline
TFT - EAS 911 EAS system offline
Orban 8100A processor stereo generator offline
Telos 10 telephone interface with head offline
4 - DOD direct boxes offline
Scientific Allanta SEDAT offline bad
WSC 400 watt audio amp offline bad
Panasonic DAT recorder SV - 3700 offline bad
Tecnics SL - P520 CD player
Yamaha SPX 1000 digital effects processor bad power supply
Panasonic SV2 - 3500 DAT recorder
Conex sub-audible tone sensor
Genter EFT 900A analog telephone interface
Meridian phone
ESE programmable digital timer
New Shop Vac with all accessories
Logitek PRE-10 switching unit
Audio-technica ATW-R10 with rock ears
Arriks pipe 500-C stereo audio console
JVC XLU251TV CD player
Macki 1202 audio console
Peavey Delta stereo effects processor
1995 Ford 350 Van
4 - plastic top folding tables
Two wheel dolly
6
39
PRODUCTION A
Orban Audicey 32 track digital editor with jazz backup
Mackie 32x8 channel audio console
Otari MX 55 Real and roll around cabinet MX5050
Scott studios PB production terminal with monitor keyboard & CPU
2 - wooden computer workstations
Meridian phone
Panasonic SV3800 DAT recorder
3M studio dispenser
Curtis Mathis 15" TV
Sanyo DA4 VCR
Eventide H3000B Ultra harmonizer
Wooden production table
OC White mike arm
Tascam CD-601 CD player
2 - AKGC414 EB Miks
Session 8 digital editor (computer audio interface w/keyboard, monitor & mouse)
session 8 disables
Crest Audio 1001A monitor amp
Digi Design 882 audio interface
2 port mike processor security case
7 - plug strips
Two bay audio patch rack
2 - Symetrix 528E Mike processor
Panasonic KX-e400 typewriter
2 - Alesis monitor one speakers
LEL1610 digital timer
2 - floor standing mike stands with booms
Best UPS
Waste basket
CD rack
Sound Ideas sound effect library
Ambiance sound effect library
Universal Studios sound effect library
Lucas Film Sound effect library
Hanna Barbera sound effect library
Warner Bros. Sound Effect library
Acoustic Magic library
First Com library
Total Access library
Underscore sound effect library
Novelty Comedy library
David Hoffner library
Digi Effects library
Sparkler sound effect library
6' table
KTCY MAIN STUDIO
Meridian phone
Metal CD rack
2 - waste baskets
Pin board
Table with stool
Custom studio furniture
Harrison air 790 20 channel console
Scotts Studio system 8 channel switcher SS & 2PB, modem, 2 monitors (one is a
touch screen 17")
Four port video DA & four port A10Cs-104 4 port
CD switcher
Task scan 112 R Mark II cassette recorder
Henry relay control
5 - RE27 mike electro voice
5 - OC White arms
Copy stand
Curtis Mathis Omni mount
2 - Alisis monitor one speaker
2 - Omni mounts
360 Systems Short Cut digital editor
Radio Shack powered speaker
Radio Shack unpowered speaker
Panasonic SV4100 DAT recorder
TFT EAS 911 system
2 - Denon DN-CN680 CD players
Lexicon PCM 70 digital effects processor
2 - Radio Shack telephone stobes
Commex Vector audio codec
IBM 300GL Computer (keyboard, mouse)
Viewsonic VPA 150 liquid crystal monitor
10 button key telephone
2 - Telos 100 digital telephone interface with IA2 digital interface
5 - symetrics 528E Mike processor
3 - US Audio Headphone heads
Crest Audio 1510A-monitor amp 1001A
Radio Shack 12-volt power supply
7 foot steel rack
Burk ARC-16 remote control studio unit
KTCY/KXEB
Potomic Instruments SU-16
Scott Studio rack drawer
PI SU-16 extension chassis
Telos Zepher ISDN Codec
Symethics 565E stereo processor
Broadcast tools 3X2 stereo switcher
7 - plug strips
Okidata 184 Dot Matrix printer
Stand
Pinboard
2 - chairs
Fire extinguisher
PRODUCTION B
Otari MX 50 4 channel Reel to Reel
2 - Elisis monitor one speakers
Symetrix Audio Processor XX208
7
40
Lexicon digital effects processor
Technics RS-TR575 stereo dual cassette deck
Scott Studios production PB with monitor, keyboard, mouse with voice trax
capability
Panasonic SU3800 DAT recorder
Mackie 24-8 24x8 audio console
OC white Mike arm
Clone computer running cool edit
Symetrics 528 E Mike processor
Alesis RA-100 monitor amp
Chair
Denon 951FA CD player - in shop for repairs
2 port security case
NEWS ROOM
Meridian phone
3 - chairs
2 - Alesis monitor one speaker with Omni mounts
Computer monitor wall mount
2 - Omni mount TV trays
Keyboard drawer
Studio custom furniture
Scotts Studio system = SS, PB, skuzzy array, 2 monitors, 2 keyboards
2 - Symetrics 528 E Mike processor in a metal security case
Gentner SPH-3 telephone interface
Crest Audio 1001A monitor amp
Radio Shack phone flasher
Panasonic SU3700 DAT recorder
Marantz PMD321 CD player
Macki 1402 audio console
2 - four drawer cabinets, one legal and one standard
Mike/intercom switching system
Metal CD rack
Globe
3 - file trays
Clone PC with monitor, keyboard, mouse
1500 watt heater
10 button telephone
Panasonic KX-P2180 Dot Matrix printer
Seven foot wooden book shelf
Wooden desk
Okidata OL810 Led page printer
2 - file trays
Waste Basket
Electric pencil sharpener
Sharp SF-8870 copier
First Aid Kit
KTCY TRANSMITTER
Dielectric A5000-201 Coax Switch
Altronic Research Dummy load
Bird Truline Watt meter with line section
Bird High Speed "watcher" line protection and power meter
Continental Electronics 816R-2C 215 Kw FM transmitter
Continental Electronics 815B Kw transmitter
Continental Electronics 802B FM Exiter
Marti ME-40 FM Exiter
TFT 844A Mod Mon.
Burk ARC-16 RMC w/2x panels
Crest Audio 1510A audio amp
Continental Electronics 802 Digital Exiter
Comrex Vector Copec
Intraplex T1 Interface
Orban 8100A with XT2 Chassis, analog stereo generator and processor
Orban 8000 analog stereo generator and processor
Tripp-lite UPS BC pro
3x Burk Line Voltage Sensor(s)
Eup - POS
Adtran TI CSU ALE
Current Technology SF
2x Eubank A/C's
EJP Modez POS Coax Switch control
8' Mark Products STL Dish
1910 Andrew 15/8" Heliax XMSN Line
ERI G-5 CPS 6 Bay Antenna
KXEB 910 TRANSMITTER
TFT 8300 STL xcutr
Collins 20 V-3 xcutr
Harris Gates Two xcutr
Intraplex
Onis 100 Tylink
Adtran
Burk ARC-1 with Panel
P1 AM-19 (204)
Belar Am Mod. Mon
Orban 9100-B
Realistic Stereo Amp
Realistic Minimus OS SPKR
Lasko Fan
Druacraft Heather
CRAFFT A/C
SSAC Monitor(s) (2x)
Hue & Phillips Flasher
Tripp-lite UPS
Gorman-Redlich CEB EBS
4' Anexter-Mark Dish
200' 1/8" Andrew Heliax Line
Homemade Phaser and Tuning Unit
2 - 280 ft. Andrews Towers
8
41
SCHEDULE 2.01(C)
REAL PROPERTY LEASES
Lease Agreement with Edge Broadcasting Corporation dated April 23, 1993
(assumed by Seller on October 11, 1995) for KTCY Transmitter. Lease
requires landlord's consent to assignment by tenant.
Lease Agreement with Rodriguez-Heftel-Texas dated November 29, 1994 for the
space located at 7700 Carpenter Freeway, Dallas, Texas.
42
SCHEDULE 2.01(E)
ASSUMED CONTRACTS
The Leases identified on Schedule 2.01(c).
Employment Agreement for Juan Montenegro with Seller and Administaff
Companies, Inc., as co-employers.
43
SCHEDULE 2.01(F)
INTANGIBLE PROPERTY
The following slogans are used by Seller (such slogans are not registered):
La Mejor 104.9 La Mejor en musica Mexicana
La Mejor 104.9 La madre de los corridos
44
SCHEDULE 2.01(G)
PERMITS
None
45
SCHEDULE 2.05
ALLOCATION OF PURCHASE PRICE
Tangible Assets $ 265,000
FCC Licenses and Misc. Intangibles $ 40,235,000
----------------
$ 40,500,000
================
46
SCHEDULE 4.02
QUALIFICATION
Seller is a Texas corporation and is not qualified to do business in any other
jurisdiction.
47
SCHEDULE 4.04
NONCONTRAVENTION
None
48
SCHEDULE 4.05
GOVERNMENTAL CONSENTS
None
49
SCHEDULE 4.10
ABSENCE OF CERTAIN CHANGES
None
50
SCHEDULE 4.11
TAX MATTERS
None
51
SCHEDULE 4.16(A)
EMPLOYEES
See Attached - (All employees are co-employed by Seller and Administaff
Companies, Inc.)
52
NEW WORLD BROADCASTERS, CORP.
EMPLOYEE ROSTER
AS OF MAY 1, 2000
COMPENSATION
LAST FIRST PER HR. SEMI-MO. DEPT. TITLE
------------ ------------ ------- ------- ------ -------
Aguilera C $4,166.67 Gen & Adm. Promotions Manager
Baez LA $10.00 Program Board Operator
Barbosa Z $1,250.00 K25FW Video Hostess
Bhatia P $10.00 Program Board Operator
Cardenas E $866.67 Program Producer
Chavez M $1,153.00 Sales Account Executive
Contreras JA $10.00 Program Board Operator
Danitz P $3,125.00 Sales L.S.M.
De La Cruz C $2,083.34 Program D J - Morning
De La Cruz R $10.00 Program Board Operator
De Leon 0 $10.00 Program D J - Mid-Morning
Fine K $2,291.67 Technical Chief Engineer
Flores R $10.00 Program Board Operator
Garcia J $1,000.00 Sales Account Executive
Gonzalez A $10.00 Program Board Operator
Guardiola R $1,400.00 Program D J - Afternoon
Guerrero M $10.00 Program Board Operator
Gutierrez E $975.00 Program DJ-Board Operator
Gutierrez G $991.67 Sales Traffic Assistant
Hernandez L $791.67 Gen. & Adm. Receptionist
Ibanez P $1,250.00 Program Production
Ibanez Y $884.62 Program Continuity
Jackson D $1,384.62 Sales Account Executive
Kennedy S $2,916.67 Sales Account Executive
Luna C $10.00 Program Board Operator
Martinez J $1,750.00 Sales Account Executive
Montenegro J $5,729.17 Gen. & Admin. Gen. Mgr.
Morales J $10.00 Program Board Operator
Nagengast K $2,500.00 Sales Account Executive
Navarrete A $5,000.00 Sales N T R - AE
Olsson W $2,083.33 Gen. & Adm. Bus. Mgr.
Ortega J $10.00 Program Board Operator
Palacio E $1,041.67 Sales Account Executive
Pena R $10.00 Program Board Operator
Pryor E $3,541.67 Technical Dir. of Eng.
Ramirez I $3,208.33 K25FW Prog. Director
Rodriguez M $10.00 Program Board Operator
Rodriguez J L $10.00 Program Board Operator
Rodriguez J 1,458.33 K25FW Creative Director
Santana M $1,083.34 Program D J - Evening
Solorzano J $1,458.34 Sales Account Executive
Valero M $2,083.34 Sales Traffic
Villarreal N $1,250.00 Sales Secretary
Wright J $1,750.00 Sales Account Executive
LENGTH OF
LAST COMPENSATION CHANGES EMPLOYMENT BENEFITS
------------ ----------------------- ---------- ---------
Aguilera Start Date 1/1/99 HMO
Baez Less than 12 months
Barbosa Less than 12 months HMO
Bhatia Less than 12 months
Cardenas Frm p/t $10.00 to f/t Less than 12 months HMO
$20,800.00
Chavez Less than 12 months
Contreras Less than 12 months
Danitz Less than 12 months PPO
De La Cruz Less than 12 months HMO
De La Cruz Less than 12 months
De Leon Less than 12 months
Fine Less than 12 months HMO
Flores Less than 12 months
Garcia Less than 12 months HMO
Gonzalez Less than 12 months
Guardiola Frm $1166.67 to $1400.00/pay Less than 12 months HMO
perd.
Guerrero Less than 12 months
Gutierrez Frm p/t $10.00 to f/t Less than 12 months HMO
$23,400.00
Gutierrez Less than 12 months HMO
Hernandez Less than 12 months HMO
Ibanez Frm p/t $10.00 to f/t Less than 12 months HMO
$30,000.00
Ibanez Frm $884.62 to 958.33/pay Less than 12 months HMO
perd.
Jackson Less than 12 months HMO
Kennedy Less than 12 months HMO FAMILY
Luna Less than 12 months
Martinez Less than 12 months HMO FAMILY
Montenegro Less than 12 months HMO
Morales Less than 12 months
Nagengast Less than 12 months HMO SPOUSE
Navarrete Less than 12 months HMO
Olsson Start Date HMO SPOUSE
10/1/95
Ortega Less than 12 months
Palacio Less than 12 months HMO
Pena Less than 12 months
Pryor Less than 12 months HMO FAMILY
Ramirez Less than 12 months HMO
Rodriguez Less than 12 months
Rodriguez Less than 12 months
Rodriguez Less than 12 months HMO
Santana Frm $916.67 to $1083.34/pay Less than 12 months HMO
perd.
Solorzano Less than 12 months HMO FAMILY
Valero Less than 12 months HMO CHILD
Villarreal Less than 12 months HMO
Wright Less than 12 months HMO
53
SCHEDULE 4.19
CERTAIN AGREEMENTS
None
54
SCHEDULE 4.21
INSURANCE
See Attached
55
02/11/00
Rodriguez Communications, Inc.
DESCRIPTION OF OPERATIONS
Radio & TV broadcasting
NARRATIVE OUTLINE
SCHEDULE OF NAMED INSUREDS:
1. Rodriguez Communications, LLC
2. Rodriguez Capital Holdings, Inc.
3. Agility, Inc. (part of trust that controls operations-personal estate
planning)
4. Legacy Maker, Inc. (dormant)
5. Marcos & Sonya Rodriguez, Jr., Individually
6. Marcos & Sonya Rodriguez, Jr. Ins. Trust
7. Marcos & Sonya Rodriguez Family Trust
8. Marcos & Sonya Rodriguez Children's Trust #1
9. Marcos & Sonya Rodriguez Children's Trust #2
10. Sonya Nance Trust
11. Marcos Rodriguez, Inc. DBA KDMM Radio 1150 AM (Highland Park, TX)
12. New World Broadcasters, Corp. (KTCY 104.9 FM; Channel 25 T.V.)
13. Rodriguez Foundation
14. Rodriguez Oil & Gas, Inc.
15. Turnkey Promotions, Inc. DBA International Interiors (now dormant-used to
buy furnishings for his home)
16. KZIP AM, Inc. - Amarillo, TX
17. Equity-Media.com, Inc. (investigative "think tank" ISP company)
18. PC Media, Inc. (dormant ISP Co.)
19. KeepConnected, Inc. (dormant ISP Co.)
20. 910 Broadcasting Corp. (KXEB - 910 AM)
SCHEDULE OF RISK LOCATIONS:
1. 7700 Carpenter Freeway, Dallas, TX 75247 $600,000 BPP
2. 1333 Corporate #350, Irving, TX 75038 $ 5,000 BPP
56
Burdensome and immaterial schedules omitted.
The omitted schedules are available from the Company upon request.