EXHIBIT 10.45(b)
TIME BROKERAGE AGREEMENT
This Agreement is made this 6th day of May, 1999, by and between
Sinclair Telecable, Inc., an Indiana corporation, and Commonwealth Broadcasting,
L.L.C., a Virginia limited liability company (collectively "Licensee"),
licensees of Stations WCDX-FM, Mechanicsville, Virginia, WPLZ-FM, Petersburg,
Virginia, WGCV-AM, Petersburg, Virginia, and WJRV-FM, Richmond, Virginia,
respectively (the "Stations"), and Radio One, Inc., a Delaware corporation
("Timebroker").
1.0 Programming.
1.1 In consideration for the mutual obligations herein contained and
the payment by Timebroker to Licensee of the sums of money provided for herein,
Licensee agrees to sell and Timebroker agrees to buy, beginning June 1, 1999
(the "Commencement Date") and until the earlier of the termination, according to
its terms, of the Asset Purchase Agreement (the "Asset Purchase Agreement" dated
May 6th, 1999) or the Closing, as defined in the Asset Purchase Agreement
between the parties, or some earlier date on which this Agreement terminates,
those certain segments of air time (hereinafter referred to as "Sold Time") on
the Stations. Subject to the rules and policies of the Federal Communications
Commission ("FCC" or "Commission") and the limitations contained herein, Sold
Time shall consist of up to 168 hours per week of programming which shall be
provided to Licensee by Timebroker, including entertainment programs and
commercials when and as selected by Timebroker. Licensee, however, reserves for
use, at its option, one hour between 5:00 and 6:00 a.m. each Saturday and
Sunday.
1.2 Licensee may produce or present on the Stations public affairs or
other informational programming and such additional programming as it elects to
present during the preemptions provided for in paragraph 1.3 hereof. Licensee's
public affairs programs shall respond to the needs and interests of Richmond,
Mechanicsville, and Petersburg.
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1.3 Timebroker's programming shall consist primarily of music,
commercial announcements, news and informational programming. Timebroker shall
not alter the format of any of the stations without Licensee's prior consent.
Licensee may, from time to time, preempt portions of Sold Time to broadcast
emergency information or programs it deems would better serve the public
interest, and may refuse to broadcast any program and/or announcement of
Timebroker should Licensee deem such program and/or announcement to be contrary
to the public interest. However, such authority shall not be exercised in an
arbitrary manner or for the commercial advantage of Licensee. Timebroker shall
be notified, unless such advance notice is impossible or impractical, at least
one week in advance of any preemption of Timebroker's programming for the
purpose of broadcasting programs Licensee deems necessary to serve the public
interest. In the event of any such preemption, Timebroker shall receive a
pro-rated credit for the preempted time against the monthly payment required by
paragraph 3.0 and described in subparagraph (a) of Schedule 3.0 hereof.
1.4 Timebroker shall broadcast (a) an announcement in form satisfactory
to Licensee at the beginning of each hour to identify each respective Station's
call sign and city of license, (b) an announcement at the beginning of each
segment of Sold Time (i.e., at the beginning of each broadcast day) to indicate
that program time has been purchased by Timebroker, (c) sponsorship
identification announcements for all commercial matter included in Sold Time
that comply with Section 73.1212(a) of the FCC's rules and regulations, and (d)
any other announcement that may be required by law, regulation, or the Stations'
policy, as provided, in writing, to Timebroker.
2.0 Record Keeping.
2.1 Licensee shall promptly provide Timebroker with a copy of any
official correspondence it receives from the FCC or any other federal, state or
local governmental authority, which relates in any way to, or alleges a
violation by Licensee, of any law, rule, regulation, ordinance or any other
governmental requirement. Licensee also shall continue to be responsible for
maintenance of all FCC required logs and records for the Stations, including the
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public inspection file and quarterly lists of community problems and programs
broadcast in response thereto. In this regard, Timebroker shall, at its expense,
and under Licensee's supervision, compile and complete all such logs, records
and reports relating to the Stations' Sold Time as are customary in the
broadcast industry, and such logs, records and reports shall be the property of
Licensee, but shall be available at all times to Timebroker. Timebroker will,
forthwith upon receipt of same, furnish to Licensee all correspondence it
receives from the public regarding the Stations' operations or programming
during Sold Time.
2.2 Upon the request of Licensee, Timebroker shall provide for
Licensee's approval a schedule describing the play lists and a day part
breakdown of the programming matter to be transmitted by Timebroker for
broadcast on each of the Stations during the week (Sunday-Saturday) following
such request, and Licensee will notify Timebroker by 5:00 p.m. on the Friday
preceding the week for which the schedule has been provided of any objection
Licensee has to Timebroker's planned programming, based upon Licensee's
obligation to provide programming consistent with the FCC's Rules. Timebroker
shall conform or alter its programming schedule to meet any such objections.
Also, for any particular broadcast day, Timebroker shall provide Licensee,
within two (2) days following Licensee's request, program and traffic logs
setting forth, respectively, all of the programming and commercial matter that
was transmitted by Timebroker for broadcast on the Stations. Such logs shall
include notations that identify the subjects known to have been addressed in any
public affairs and talk shows, public service announcements or other programs
addressing local needs and interests, and shall identify the sponsor, the time
and the duration of each commercial announcement. Timebroker shall also provide
in a timely manner, upon Licensee's advance request, air checks of the Stations'
operations.
3.0 Payments. Commencing on June 1, 1999, and on the first day of each
month thereafter during the term of this Agreement, Timebroker shall pay a time
brokerage fee to Licensee in the amount and in the manner set forth in Schedule
3.0 attached hereto. In addition, Timebroker shall make payments to Licensee to
cover expenses itemized in Section 4.0 and
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Schedule 3.0 prior to their due dates, which shall be specified in writing by
Licensee and accompanied by documentation of the expense at least fifteen (15)
days in advance of the due date. Licensee shall provide documentation of the
expenses and monthly statements to Timebroker demonstrating that Licensee has
paid said expenses . In the event Licensee fails to pay any expense, Timebroker
may terminate this Agreement or pay the expense itself, at its option. If
Timebroker elects the latter option and pays the expense, Licensee shall
promptly repay Timebroker, or Timebroker may take a credit toward the Purchase
Price at Closing on the Asset Purchase Agreement. Should Timebroker fail or
refuse at any time to timely make the time brokerage fee required under this
paragraph, then upon five (5) days' written notice and opportunity to cure, to
Timebroker, Licensee may declare this Agreement null and void such that all of
Timebroker's rights hereunder shall be deemed forfeited and canceled for all
purposes. The same shall apply, but on ten (10) days' notice and opportunity to
cure, to the expense payments required hereunder. In either event, if Licensee
exercises its right to declare this Agreement null and void, Timebroker shall
(a) vacate the premises of the Stations and remove all of its equipment, papers
and materials within thirty (30) days after the date of notice of such
termination, and (b) be liable for a material breach of the Asset Purchase
Agreement. Should closing on the Asset Purchase Agreement occur during a month
for which payments in this Section 3 have been made, such payments shall be
prorated.
4.0 Expenses.
4.1 Timebroker shall be permitted access to and use of Licensee's
studio and program production facilities at no additional cost. However,
Licensee shall be responsible in the amounts and manner described in Schedule
3.0 for the payment of all fees and expenses relating to the basic operations of
the Stations or necessary for Licensee to fulfill its FCC obligations,
including, but not limited to: salaries, benefits and taxes relating to the
employment of Licensee's managerial and clerical employees, electricity,
property taxes, rents, and equipment repairs and maintenance.
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4.2 All equipment necessary for broadcasting by the Station shall be
maintained by Licensee, with Timebroker's assistance when requested, in a
condition consistent with good engineering practice and in compliance in all
material respects with the applicable rules, regulations and technical standards
of the FCC. All capital expenditures (defined as any equipment repair and
maintenance cost in excess of Two Thousand Dollars ($2,000))reasonably required
to maintain the technical quality of the Stations' signal shall be made in a
timely fashion by Timebroker after consultation with Licensee and made available
for use by Licensee at the Stations, provided that should the parties not close
under the Asset Purchase Agreement for any reason, then at Timebroker's option,
Timebroker will either continue to own the equipment and may remove it or
Licensee will purchase the equipment from Timebroker at cost. Should the parties
close, the cost of such capital expenditures will be borne by Timebroker, but a
credit against the purchase price for half the cost thereof will be provided at
Closing.
4.3 All expenses associated with the production and delivery of
Timebroker's programming, including the salaries and related compensation of
Timebroker's employees, and music license fees shall be the sole responsibility
of Timebroker.
5.0 Insurance. Timebroker will arrange to include Licensee as a
co-insured on Timebroker's policy for appropriate liability and fire and
extended coverage insurance in amounts reasonably required to protect the
parties hereto from losses from liability for personal injury as well as from
loss by theft, fire and other causes to the Stations' equipment.
6.0 "Payola" and "Plugola". Timebroker agrees that it will take steps
consistent with broadcast industry standards to assure that its employees will
not accept any consideration in money, goods, services or otherwise, directly or
indirectly (including to relatives) from any person or company for the playing
of records, the presentation of any programming or the broadcast of any
commercial announcement over the Stations without reporting the same to the
management of the Licensee and without such broadcast being announced as
sponsored. Timebroker understands that violation of this provision is "payola"
and constitutes a federal crime. It is further understood and agreed that no
commercial message ("plug") or undue
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reference shall be made in programming presented over the Stations to any
business venture, profit-making activity or other interest (other than
non-commercial announcements for bona fide charities, church activities or other
public service activities) in which Timebroker or anyone else are directly or
indirectly interested without the same having been approved by the management of
Licensee and said broadcast being announced as sponsored.
7.0 Political Broadcasts. Timebroker agrees that any spot or program
time sold to any candidates for political office or person(s) supporting a
candidate will be sold in strict accordance with FCC rules and regulations and
will be supported by documentation as required by the FCC. Such documentation
will be transmitted to Licensee in a timely manner for inclusion in the
Stations' "political file." Timebroker will coordinate the Timebroker's
political sales policies with Licensee prior to any pre-election period.
8.0 Compliance With Laws/Indemnification. Timebroker and Licensee shall
comply in all material respects with all state, local and federal laws, rules
and regulations, including the rules, regulations and policies of the FCC, as
well as with all other obligations on their part under this Agreement, and the
failure of either to do so shall constitute a breach of this Agreement, provided
that the non-breaching party shall provide thirty (30) days' notice and
opportunity to cure to the allegedly defaulting party (except that such thirty
day period shall not apply to defaults under Section 3.0.). In the event of such
breach, Timebroker or Licensee, as the case may be, hereby indemnifies, makes
whole and holds harmless the other party, its officers, directors, shareholders,
members and employees of and from any and all costs, liabilities, claims,
obligations and expenses, including reasonable attorneys fees, which the other
party may incur arising from such breach or default. Further, Timebroker and
Licensee hereby indemnify and hold each other harmless against all liability for
libel, slander, illegal competition or trade practices, infringement of trade
marks, trade names, or program titles, violation of rights of privacy, and
infringement of copyrights and property rights resulting from the broadcast of
programming furnished or broadcast by the other party. These mutual obligations
shall survive any termination of this Agreement and shall continue until the
expiration of all applicable
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statutes of limitation and the conclusion and payment of all judgments which may
be rendered in all litigation which may have been commenced prior to such
expiration. Breach of the obligations in this paragraph by either party shall
not constitute a breach of the Asset Purchase Agreement.
9.0 Control of Station. Anything to the contrary in this Agreement
notwithstanding, Licensee shall retain ultimate control of all aspects of the
Stations' operations and Timebroker shall in no way represent itself or hold
itself out as the Stations' licensee. Licensee shall employ a station manager
whose principal workplace during regular business hours, five (5) days per week,
shall be the Stations' studios. Licensee shall employ at least one additional
person who shall be present at the Stations' studios at least during those
regular business hours when Licensee's manager must be elsewhere, or shall share
such an employee with the Timebroker. The parties shall jointly determine who
this shared employee will be and what his or her salary will be.
10.0 Employees. As of May 31, 1999, Licensee will dismiss all employees
of the Stations except for the Licensee's station manager. Timebroker may, prior
to the Commencement Date, extend offers of employment to any of the Stations'
dismissed employees. Licensee shall be responsible, consistent with state law
and internal station policy, for payment of all salary and other benefits,
whether monetary or otherwise (including, without limitation, accrued vacation
time), to which such dismissed employees of the Stations are entitled for all
periods up to and including May 31, 1999, and shall indemnify and hold
Timebroker harmless therefor.
11.0 Cure of FCC-Related Deficiencies. It is the intention of the
parties that this Agreement comply in all material respects with the rules and
policies of the FCC concerning agreements of this nature. In the event that
there is any complaint, inquiry, investigation, or proceeding at the FCC
concerning this Agreement and the relationship between the parties, the parties
shall cooperate fully and share equally the costs in responding to such matter.
The parties also agree to modify this Agreement in any reasonable manner
required to maintain compliance
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with FCC rules and policies, preserving to the maximum extent possible the basic
business terms and conditions contained herein. Should such modification prove
impossible, this Agreement may be terminated by either party.
12.0 Term
12.1 The term of this Agreement shall be from June 1, 1999, until the
earlier of (a) Closing under the Asset Purchase Agreement, (b) termination of
the Asset Purchase Agreement, (c) termination of this Agreement pursuant to
paragraph 3.0 (d) termination of this Agreement pursuant to paragraph 12.2
hereof, or (e) termination of this Agreement pursuant to paragraph 11 hereof.
12.2 In the event of a material default in performing the respective
duties and obligations as set forth in this Agreement (with the exception of
Timebroker's payment requirements as described in paragraphs 3 and 4), the
non-defaulting party may terminate this Agreement without penalty, provided that
such default shall not have been cured by the defaulting party within thirty
(30) days after written notice thereof.
12.3 In the event of termination of this Agreement, it is understood
that Timebroker reserves the right to ownership of logos and positioning
statements which it develops during the term of this Agreement, and Licensee may
not make use of any such materials without the consent of Timebroker.
12.4 In the event of Licensee's termination of this Agreement due to
Timebroker's default, all agreements or contracts for advertising during Sold
Time then in existence shall belong to and be the property of Licensee, except
that Licensee shall have the option whether to assume contracts with terms
longer than ten (10) weeks. Licensee shall (a) have the duty to perform all such
assumed agreements or contracts, and (b) be entitled to collect and receive the
money thereafter derived therefrom; and Timebroker will forthwith assign same to
Licensee and turn over to Licensee all books and records relating to the sale of
advertising for broadcast exclusively over the Stations. Timebroker shall, at
such time, pay over to Licensee any money or other consideration it shall have
received as "pre-payment" for such advertising which
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Licensee may thereafter undertake to broadcast over the Stations. Licensee
indemnifies and holds Timebroker harmless against any nonperformance of any
assumed agreement or contract. All uncollected revenue for advertising broadcast
during Sold Time prior to such termination shall belong to, be the property of
and be for the benefit of Timebroker.
13.0 Proration. Licensee shall be responsible for all expenses arising
out of the business of the Stations until 11:59 p.m. on May 31, 1999.
Thereafter, expenses arising out of the business of the Stations shall be
treated as outlined above in paragraph 3.0 and Schedule 3.0. All overlapping
expenses shall be prorated or reimbursed, as the case may be, as of 11:59 p.m.
on May 31, 1999.
14.0 Inspection of Books and Records. To the extent the FCC or any
third party is entitled by law or contract to review any of Timebroker's books
and records relating to the Stations' operation during Sold Time, including
financial books and records, whether pursuant to contracts entered into by
Licensee or otherwise, e.g., with ASCAP, BMI, or SESAC, Timebroker will, upon
reasonable notice, make such books and records available for such third party's
inspection and, to the extent required or made necessary by law or contractual
obligations of Licensee, for inspection by Licensee. In addition, upon request
by Licensee, Timebroker will forthwith supply Licensee with all information, and
all books and records necessary for verification thereof, which will enable
Licensee to prepare, file or maintain the records and reports required by the
FCC, ASCAP, BMI, SESAC and like entities.
15.0 No Carry-Over Agreements Without Consent. Timebroker shall seek
consent from Licensee to make agreements which shall require use of time on the
Stations subsequent to the expiration or termination of this Agreement which
exceed six (6) months in duration, and shall in no other way obligate Licensee
without Licensee's written consent.
16.0 Accounts Receivable. After the Commencement Date both parties
shall be responsible for collection of their own Accounts Receivable that are
outstanding and unpaid , except for those Accounts Receivable which Licensee has
instituted litigation to collect or
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referred to a collection agency as of the date of this Agreement and which are
identified in Schedule 16.0. All payments received by Timebroker or Licensee
from any person who makes a payment with respect to any Accounts Receivable for
the other party shall be promptly paid over to the other party, attempting
wherever possible to do so within fifteen (15) days of receipt thereof. Licensee
shall continue timely to pay commissions on the same percentage basis as prior
to the Commencement Date to employees, agencies and representatives on these
Accounts Receivable on the 15th and last day of each month, and to make
reasonable efforts in the ordinary course of business to collect the Accounts
Receivable. The parties will make every effort to cooperate with each other to
ensure that both are paid monies owed them promptly, but without undue
disruption to the parties' accounting systems or Timebroker's relationships with
customers.
17.0 Force Majeure Event. If either Timebroker or Licensee is prevented
from performing its obligations hereunder by a Force Majeure event (i.e., fires,
acts of God, orders of civil or military authorities or other contingencies
beyond the reasonable control of the parties), and such a situation cannot be
corrected within a period of thirty (30) days, this Agreement shall, at the
option of either of the parties hereto, terminate and, except as otherwise
provided herein, the parties' obligations accruing beyond that time shall be
terminated; and neither shall be liable to the other for a breach caused
thereby. Neither Timebroker nor Licensee shall be required to correct problems
caused by a Force Majeure event which eliminates its ability to carry out this
Agreement.
18.0 Waiver of Breach. A waiver by either Timebroker or Licensee of a
breach of any provision of this Agreement shall not be deemed to constitute a
waiver of any preceding or subsequent breach of the same provision or any other
provision.
19.0 Entire Agreement. This writing constitutes the entire agreement
between Timebroker and Licensee pertaining to time brokerage, all prior
understandings being merged herein. This Agreement may not be changed, modified,
renewed, extended or discharged, except as specifically provided herein or by an
agreement in writing signed by the parties hereto. It is recognized that the
obligations of Licensee and Timebroker hereunder are subject to applicable
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federal, state and local law, rules and regulations, including, but not limited
to, the Communications Act of 1934, as amended, and the rules and regulations of
the FCC.
20.0 Notices. All notices called for herein shall be in writing and
shall either be delivered by hand delivery, evidenced by written receipt; by
Federal Express, or other similar courier service or telecopier and evidenced by
written receipt; all of which shall be addressed as follows:
IF TO LICENSEE:
Mr. Robert Sinclair
Sinclair Telecable, Inc.
500 Dominion Tower
999 Waterside Drive
Norfolk, Virginia 23510
Fax: (757) 640-8552
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WITH A COPY TO:
Mr. J. David Sinclair
6158 Yellow Birch Court
Plainfield, IN 46168
Fax: (317) 838-7225
and
Howard M. Weiss, Esq.
Fletcher, Heald & Hildreth
1300 North 17th Street
11th Floor
Arlington, Virginia 22209
Fax: (703) 812-0486
IF TO TIMEBROKER:
Mr. Alfred C. Liggins, President
Radio One, Inc.
5900 Princess Garden Parkway
8th Floor
Lanham, Maryland 20706
Fax: (301) 306-9426
WITH A COPY TO:
Linda J. Eckard, Esq.
Radio One, Inc.
5900 Princess Garden Parkway
Suite 800
Lanham, MD 20706
Fax: (301) 306-9638
21.0 Binding Agreement/Successors and Assigns. This Agreement shall be
binding upon and inure to the benefit of the parties and their respective
successors and assigns.
22.0 Corporate/LLC Authority/Construction. The undersigned signatories
to this
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Agreement personally represent and warrant that they have full authority to
execute this Agreement on behalf of the respective parties. This Agreement shall
be construed and enforced under the laws of the Commonwealth of Virginia, but
not its conflicts of law principles.
23.0 Certifications.
23.1 Licensee hereby certifies that for the term of this Agreement it
shall maintain ultimate control over the Stations' facilities, including control
over the Stations' finances, personnel and programming, and nothing herein shall
be interpreted as depriving Licensee of the power or right of such ultimate
control.
23.2 Timebroker hereby certifies that the arrangement contemplated by
this Agreement complies with the provisions of Sections 73.3555 of the FCC's
Rules.
24.0 WGCV
24.1 Upon written request by Timebroker, Licensee shall give the
requisite notice to Hoffman Communications terminating the Time Brokerage
Agreement relating to WGCV (the "Hoffman Agreement"). Until that termination,
this Agreement shall not apply to WGCV. Upon termination of the Hoffman
Agreement, all of the provisions hereof shall apply to that station. The parties
hereby agree to use their collective best efforts to estimate the cost of
integrating the operation of Station WGCV into the combined operations of the
Stations. Timebroker shall reimburse promptly said costs upon the receipt of
documentation from Licensee.
WHEREFORE, the parties intending to be fully bound by the
terms hereof have executed this Agreement as of the date first written above.
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SINCLAIR TELECABLE, INC.
d/b/a SINCLAIR COMMUNICATIONS
By:
----------------------------------------
Robert Sinclair, Vice President
COMMONWEALTH BROADCASTING, LLC
By:
----------------------------------------
Robert L. Sinclair, Member
LICENSEE (collectively)
RADIO ONE, INC.
By:
----------------------------------------
Alfred C. Liggins, President
TIMEBROKER
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Schedule 3.0
Compensation
Timebroker will pay Licensee monthly as follows:
(a) $233,000.00 (the time brokerage fee); plus
(b) An amount equal to Licensee's expenses to be paid during the
following month starting on the Commencement Date for the following:
(i) salaries, benefits and taxes relating to the
employment of Licensee's employees;
(ii) electric costs;
(iii) property taxes and rents;
(iv) equipment repairs and maintenance.
The expenses defined in (i) - (iv) above are estimated not to exceed
Forty Two Thousand and Five Hundred Dollars ($42,500) in any month ("Expense
Amount"). Licensee shall be required to submit to Timebroker on a quarterly
basis an accurate account of expenses detailed in (i) - (iv) above, supported by
appropriate documentation. In no event shall Timebroker be required to pay any
amount in excess of the actual expenses. Thus, in the event that total actual
expenses for any quarter are less than the expenses paid during that quarter,
the parties shall in good faith and supported by appropriate documentation make
adjustments thereto and any excess amount paid by Timebroker shall be remitted
by Licensee within fifteen (15) days of the close of the quarter.
Notwithstanding the foregoing, if such expenses in any month exceed the Expense
Amount, Timebroker and Licensee shall each pay one half of the cost in excess of
the Expense Amount.