TELEVISION STATION LEASE AGREEMENT
This agreement made on July 21, 2003 between Cherie Erwin, Lessor, and
OBN Holdings, Incorporated, Lessee.
Recitals
Lessor is the owner of licenses, permits, intellectual property rights
(copyrights and trademarks,) equipment, parts, materials, comprising a
television broadcasting station ("KSSY Television") business known as KSSY
television, located at 1235 Sage Street, Arroyo Grande, California 93420,
and at 2130 Hwy 101, Arroyo Grande, CA 93420. Lessor desires to lease the
business to Lessee, and Lessee desires to lease the business from Lessor.
The business and assets of the business are hereafter collectively referred
to as " the Business Assets."
Therefore, Lessee and Lessor agree as follows:
ARTICLE I. LEASE
Section 1.01. Lessor shall lease to Lessee, and Lessee shall lease from
Lessor, on the terms and conditions and in the manner set forth in Article
II of this Agreement, the following personal property assets of the business
(hereafter called "the Business Assets"):
(a) All the furniture, equipment, and other tangible assets;
(b) All the licenses, trade, goodwill, intellectual property rights of
any kind or type; and
(c) All the unliquidated assets belonging to or upon which Lessor has
a claim of right or entitlement, including accounts receivables and
any causes of actions against any third parties.
Section 1.02. The lease for the Business Assets shall be a total of fifty
thousand dollars ($50,000) per year for a period of three (3) years.
Section 1.03. The annual lease amount shall be made in equal monthly
payments on the first of each month.
Section 1.04. At the end of the lease period, or once Lessor receives
a total of one hundred fifty thousand dollars ($150,000), whichever is sooner,
Lessor shall immediately, irrevocably and in perpetuity transfer to Lessee
ninety-five percent (95%) of all rights, title and interest in and to the
Business Assets. Transfer shall include, but not be limited to the Federal
Communications Commission (FCC) license currently owned by Lessor. If,
for any reason, transfer of the license to Lessee, or any entity designated
by Lessee, is not approved by the FCC, Lessor shall continue to lease the
Business Assets to Lessee for an additional ninety-nine (99) years at a
lease amount of one dollar ($1.00) per year.
Section 1.05. During the time in which lease is in force, Lessor may
not sell, pledge, hypoticate, or in any other way encumber the Business
Assets.
Section 1.06. Should Lessor elect to dispose of Lessor's five percent
(5%) interest in the Business Assets once Lessee has acquired ninety-five
percent (95%) interest, Lessor must sell to Lessee, and Lessee must purchase
the five percent (5%) at the prevailing market value as determined by a
professional broadcast station appraiser who shall be agreed on by both
parties.
Television Station Lease Agreement Page 1 of 4 Lessee Initials:______
Lessor Initials:______
Warranties by Lessor
Section 1.07. Lessor hereby warrants and represents to Lessee that:
(a) Lessor is the sole owner of the business, and no other person has
any claim, right, title to, or interest in, the Business Assets.
(b) Lessor has no undischarged obligations, financial or otherwise,
affecting the Business Assets being leased pursuant to this Agreement,
other than obligations arising in the usual and regular course of
business listed in the attached document marked "Exhibit A."
(c) Lessor has paid, or shall pay, all taxes owed by Lessor on account
of the business up to, and including July 31, 2003.
(d) The books of account for the business constitute a complete record
of the financial affairs of the business and accurately set forth
all liabilities, assets, and other matters regarding the financial
condition of the business. Lessee acknowledges that _________
inspected the books of account within the last 15 days from the date
of this agreement.
(e) To the best of Lessor's knowledge, the lease and subsequent transfer
of title will not conflict with or violate any agreement or law to
which Lessor or the business is subject, and there are no pending
or threatened lawsuits, other judicial proceedings, or administrative
proceedings involving Lessor or the Business Assets.
(f) Lessor warrants that Lessor has no employees and has no amounts due
to the Employment Development Department.
(g) Lessor warrants that Lessor does not collect sales tax, and has no
sales tax obligations to the Board of Equalization.
Delivery of Instruments
Section 1.08. At the time of transfer, as specified in Section 1.04,
Lessor shall deliver to Lessee:
(a) A bill of sale executed by Lessor, conveying to Lessee all the Business
Assets of the business described in Section 1.01 of this Agreement.
(b) Any other instruments required to transfer to Lessee the ownership
of any of the Business Assets described in Section 1.01 of this Agreement.
License Application by Lessee
Section 1.09. Lessee shall, at Lessee's own expense, apply for any
additional licenses or permits required, and thereafter take any other actions
required to obtain those licenses and permits.
ARTICLE II. MISCELLANEOUS
Section 2.01. During the term of this Lease, and after acquisition
of ninety-five percent (95%) interest, Lessee shall have sole administration
over Business Assets, which shall include, but not be limited to programming
aired on the television station, times in which programming is aired, licenses
and permits and location of broadcast facilities.
Section 2.02. If Lessor desires, Lessor shall be able to provide, at
Lessor sole expenses, no less than two (2) hours of programming per day
for the station to Lessor during any period in which Lessor has any ownership
in Business Assets. Lessee shall determine the time in which Lessor's
programming will be broadcasted.
Section 2.03. Should Lessee elect to make changes to the station that
Television Station Lease Agreement Page 2 of 4 Lessee Initials:_____
Lessor Initials:_____
requires the consent of the Federal Communications Commission, or other
governing body, Lessor shall approve and sign all of the documents required
to make changes.
Section 2.04. This Agreement constitutes the entire agreement between
Lessee and Lessor concerning their rights and obligations with respect to
the leasing of the Business Assets. Any agreements or representations
respecting the Business Assets's lease or its subsequent sale to Lessee
not expressly set forth in this Agreement shall have no effect, except for
a subsequent written modification signed by the party to be charged.
Section 2.05. This Agreement may be amended or modified at any time with
respect to any provision by a written instrument executed by Lessee and
Lessor.
Section 2.06. If Lessee or Lessor brings any legal action or seeks
arbitration regarding any provision of this agreement, the prevailing party
in the litigation or arbitration shall be entitled to recover reasonable
attorney's fees from the other party, in addition to any other relief that
may be granted.
Section 2.07. Any dispute arising under this Agreement shall be settled
by binding arbitration in accordance with the State of California, County
of San Luis Obispo, and judgment on the award rendered by the Arbitrator
may be entered in any court having jurisdiction.
Section 2.08. Any notices required or permitted to be given under this
Agreement shall be written, and may be given by personal delivery or by
registered or certified mail, first-class postage prepaid, return receipt
requested. Notice shall be deemed given upon actual receipt in the case
of personal delivery, or upon mailing. Mailed notices shall be addressed
as follows, but each party may change address by written notice in accordance
with this paragraph:
To Lessee: OBN Holdings, Incorporated, 8275 South Eastern Avenue, Las
Vegas, Nevada 89123.
To Lessor: Ms. Cherie Erwin, 1235 Sage Street, Arroyo Grande, California
93420.
Section 2.09. This Agreement shall be binding on and shall inure to the
benefit of the heirs, executors, administrators, successors, and assigns
of Lessee and Lessor.
Section 2.10. This Agreement shall be governed by and constructed in
accordance with the laws of the State of California.
Executed on _July 26, 2003, at Arroyo Grande, California.
LESSOR LESSEE
CHERIE ERWIN OBN HOLDINGS, INCORPORATED
/s/ Cherie Erwin /s/ Roger Neal Smith
__________________________________ __________________________________
Cherie Erwin Roger Neal Smith, Chief Executive Officer
Television Station Lease Agreement Page 3 of 4 Lessee Initials:_____
Lessor Initials:_____
Exhibit A - Outstanding Obligations
None
Television Station Lease Agreement Page 4 of 4 Lessee Initials:____
Lessor Initials:____