UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. 1)*
Earle I. Mack
_________________________________________
(Name of Issuer)
Class A Common Stock, $.01 par value per share
______________________________________________
(Title of Class of Securities)
089098107
______________
(CUSIP Number)
James H. Schropp, Esq.
Fried, Frank, Harris Shriver & Jacobson
1001 Pennsylvania Avenue, Suite 800
Washington, DC 20004-2505
(202) 639-7110
___________________________________________________________
(Name, Address and Telephone Number of Person Authorized to
Receive Notices and Communications)
November 18, 1999
_______________________________________________________
(Date of Event which Requires Filing of this Statement)
If the filing person has previously filed a statement on Schedule
13G to report the acquisition that is the subject of this
Schedule 13D, and is filing this schedule because of 240.13d-
1(e), 240.13d-1(f) or 240.13d-1(g), check the following box [ ].
Note: Schedules filed in paper format shall include a signed
original and five copies of the schedule, including all exhibits.
See 240.13d-7 for other parties to whom copies are to be sent.
*The remainder of this cover page shall be filled out for a
reporting person's initial filing on this form with respect to
the subject class of securities, and for any subsequent amendment
containing information which would alter disclosures provided in
a prior cover page.
The information required on the remainder of this cover page
shall not be deemed to be "filed" for the purpose of Section 18
of the Securities Exchange Act of 1934 ("Act") or otherwise
subject to the liabilities of that section of the Act but shall
be subject to all other provisions of the Act (however, see the
Notes).
<PAGE>
Schedule 13D
CUSIP No. 089098107
1
NAMES OF REPORTING PERSONS
I.R.S. IDENTIFICATION NOS. OF ABOVE PERSONS (ENTITIES ONLY):
Earle I. Mack
2
CHECK THE APPROPRIATE BOX IF A MEMBER OF A GROUP
(SEE INSTRUCTIONS):
(a) [ ] (b) [ ]
3
SEC USE ONLY:
4
SOURCE OF FUNDS (SEE INSTRUCTIONS): PF
5
CHECK IF DISCLOSURE OF LEGAL PROCEEDINGS IS
REQUIRED PURSUANT TO ITEMS 2(d) OR 2(e): [ ]
6
CITIZENSHIP OR PLACE OF ORGANIZATION:
United States
NUMBER OF SHARES BENEFICIALLY OWNED BY EACH
REPORTING PERSON WITH:
7 SOLE VOTING POWER 507,900 shares of Class A Common
8 SHARED VOTING POWER
9 SOLE DISPOSITIVE POWER 507,900 shares of Class A Common
10 SHARED DISPOSITIVE POWER
11
AGGREGATE AMOUNT BENEFICIALLY OWNED BY EACH
REPORTING PERSON:
507,900 shares of Class A Common
12
CHECK IF THE AGGREGATE AMOUNT IN ROW (11) EXCLUDES
CERTAIN SHARES (SEE INSTRUCTIONS): [ ]
13
PERCENT OF CLASS REPRESENTED BY AMOUNT IN ROW (11):
8.2
14
TYPE OF REPORTING PERSON (SEE INSTRUCTIONS):
IN
<PAGE>
Item 5. Interest in Securities of the Issuer
Item 5(c). On November 18, 1999, Mr. Mack received 36,000
shares of Big City Radio Inc.'s ("BCR") Class A
Common Stock pursuant to the terms of the merger
agreement among Hispanic Internet Holdings, Inc.
("HIH") and BCR.
Item 5(e). As of November 18, 1999, Mr. Mack beneficially
owns 507,900 shares or 8.2 percent of the Class A
Common Stock of BCR.
Item 7. Material to Be Filed as Exhibits
Exhibit A Merger and Registration Rights Agreement , dated
as of November 1, 1999, among BCR and HIH.
<PAGE>
SIGNATURE
After reasonable inquiry and to the best of my knowledge and
belief, I certify that the information set forth in this
statement is true, complete and correct as of November 18, 1999.
Date: November 18, 1999 By: /s/ Earle I. Mack
___________________________
Name: Earle I. Mack
<PAGE>
INDEX TO EXHIBITS
Exhibit Exhibit Page
No.
A Merger and Registration Rights Agreement ,
dated as of November 1, 1999, among Big City 6
Radio, Inc. and Hispanic Internet Holdings,
Inc.
Exhibit A
MERGER AND REGISTRATION RIGHTS AGREEMENT
MERGER AND REGISTRATION RIGHTS AGREEMENT made as of the 1st
day of November 1999, by and among (i) HISPANIC INTERNET
HOLDINGS, INC., a Florida corporation ("HIH"), (ii) the
shareholders of HIH listed on Schedule I to this Agreement (the
"Shareholders"), (iii) BIG CITY RADIO INC, a Delaware corporation
("BCR"), and (iv) HIH ACQUISITION, INC., a Delaware corporation
and a wholly owned subsidiary of BCR ("Newco"). Capitalized terms
used herein and not otherwise defined shall have the meaning
ascribed to such terms in Article VII hereof.
WITNESSETH
WHEREAS, the Boards of Directors of HIH, BCR and Newco have
each approved the merger of Newco with and into HIH (the
"Merger"), upon the terms and subject to the conditions set forth
herein;
WHEREAS, each Shareholder owns, and will own immediately
prior to the Closing, that number of shares (the "Shares") of
common stock of HIH (the "HIH Common Stock") set forth opposite
his or her name on Schedule I.
WHEREAS, pursuant to the Merger, the Shareholders will
receive the Merger Consideration specified herein;
NOW, THEREFORE, in consideration of the foregoing premises
and the mutual agreements and covenants contained herein, and for
other good and valuable consideration, the receipt and adequacy
of which is hereby acknowledged, the parties hereby agree as
follows:
ARTICLE I
MERGER
1.1 The Merger: Surviving Corporation. Upon the terms and
subject to the conditions set forth herein, and in accordance
with the provisions of this Agreement and the Florida Business
Corporation Act (the "FBCA"), at the Effective Time, Newco shall
be merged with and into HIH, with Newco being the surviving
corporation (hereinafter sometimes called the "Surviving
Corporation").
1.2 Articles of Incorporation. The Articles of
Incorporation of Newco, as in effect at the Effective Time, shall
be the Articles of Incorporation of the Surviving Corporation
until thereafter amended as provided by law.
<PAGE>
1.3 Bylaws. The Bylaws of Newco, as in affect at the
Effective Time, shall be the Bylaws of the Surviving Corporation
until thereafter amended as provided by law.
1.4 Directors and Officers. The directors and officers of
Newco immediately prior to the Effective Time shall be the
directors and officers of the Surviving Corporation at the
Effective Time until thereafter changed in accordance with
applicable law and appropriate corporate actions.
1.5 Effective Time. The Merger shall become effective in
accordance with the terms of articles of merger (the "Delaware
Articles of Merger") in the form attached hereto as Exhibit "A"
to be filed with the Delaware Department of State pursuant to
Delaware law. The date and time when the Merger shall become
effective are herein referred to as the "Effective Time."
1.6 Effectuation of the Merger. The parties shall file the
Delaware Articles of Merger and take any and all other lawful
actions and do any and all other lawful things necessary to cause
the Merger to become effective.
1.7 Conversion of Common Stock: Merger Consideration. By
virtue of the Merger and without any action on the part of any
holder of capital stock of Newco or HIH:
(a) The Shares of HIH issued and outstanding
immediately prior to the Effective Time (except for Shares which
are held by HIH in its treasury) shall be converted at the
Effective Time into and represent the right to receive the Merger
Consideration (as defined below) in accordance with the terms
hereof.
(b) Each share of HIH common stock held in its
treasury immediately prior to the Effective Time shall be
canceled or retired and cease to exist at the Effective Time
without any conversion thereof.
(c) The term "Merger Consideration" shall mean (i) an
aggregate amount of 400,000 shares of Common Stock (the "Closing
Date Shares"), $.01 par value (the "BCR Common Stock") of BCR, to
be allocated among the Shareholders in accordance with such
Shareholder's Pro Rata Portion, and (ii) the Earnout specified in
Section 1.13 hereof (the "Earnout Shares" and collectively with
the Closing Date Shares, the "Merger Consideration Shares").
1.8 Payment of the Merger Consideration. BCR shall
deliver, or cause to be delivered, the Merger Consideration
Shares to the Shareholders as follows: (i) the Closing Date
Shares shall be delivered to the Shareholders, in accordance with
their Pro Rata Portion, on the Closing Date, and (ii) the Earnout
Shares shall be delivered to the shareholder in accordance with
their Pro Rata Portion, within five business days of reaching the
goals set forth in Section 1.13 hereof.
<PAGE>
1.9 No Other Rights. Upon consummation of the Merger,
until surrendered to the Surviving Corporation, each certificate
for Shares which immediately prior to the Effective Time
represented outstanding Shares shall represent solely the right
to receive the Merger Consideration relating thereto at and after
the Effective Time.
1.10 Newco Common Stock. Each share of common stock, $.01
par value per share, of Newco issued and outstanding immediately
prior to the Effective Time shall, by virtue of the Merger and
without any action on the part of the holder thereof, be
converted at the Effective Time into one fully paid and non-
assessable share of common stock, par value $.01 per share, of
the Surviving Corporation.
1.11 Further Assurances. If at any time after the Effective
Time the Surviving Corporation shall consider or be advised that
any further documents, instruments or assurances in law or any
other acts are necessary, desirable or proper to carry out the
intent and accomplish the purposes of this Agreement, BCR agrees
that the Surviving Corporation and its proper officers and
directors will execute and deliver all documents, instruments and
assurances in law and do all acts reasonably necessary, desirable
or proper to carry out the intent and accomplish the purposes of
this Agreement, and that the proper officers and directors of the
Surviving Corporation are fully authorized in the name of the
Surviving Corporation or otherwise to take any and all such
action.
1.12 The Closing. The consummation of the transaction
contemplated by this Agreement (the "Closing") shall take place
at a location and date to be mutually agreed to by the parties
("Closing Date").
1.13 Earn Out. The Shareholders shall be entitled to
payment of additional consideration (the "Earnout") as follows,
based upon achievement of the Earnout Milestones (as defined
below):
(a) (i) an aggregate amount of 120,000 shares of BCR Common
Stock if Gross Revenues (as defined in (b) below of HIH
for the 2000 calendar year equal or exceed $1,800,000
(the "Y2000 Milestone"), (ii) an additional aggregate
amount of 120,000 shares of BCR Common Stock if Gross
Revenues of HIH for the 2001 calendar year equal or
exceed $4,500,000 (the "Y2001 Milestone"), (iii) an
additional aggregate amount of 120,000 shares of BCR
Common Stock if Gross Revenues of HIH for the 2002
calendar year equal or exceed $8,500,000 (the "Y2002
Milestone"), (iv) an additional aggregate amount of
120,000 shares of BCR Common Stock if Gross Revenues of
HIH for the 2003 calendar year equal or exceed
$11,500,000 (the "Y2003 Milestone"), and (v) an
additional aggregate amount of 120,000 shares of BCR
Common Stock if Gross Revenues of BCR
<PAGE>
Common Stock if Gross Revenues of HIH for the 2004
calendar year equal or exceed $15,000,000 (the "Y2004
Milestone") (such additional shares issued upon payment
of the Earnout are referred to as the "Earnout Shares"
and the Y2000 Milestone, the Y2001 Milestone, the Y2002
Milestone, the Y2003 Milestone and the Y2004 Milestone
shall be each be an "Earnout Milestone" and shall be
collectively referred to as the "Earnout Milestones").
The Earnout Shares shall be issued to the Shareholders
in accordance with their Pro Rata Portion and if the
Earnout Milestone for a calendar year during the 2000
to 2004 calendar years is met during such calendar
year. If in any given calendar year, Gross Revenues
are at least equal to the Earnout Milestones for the
first subsequent calendar year, then the Earnout
Milestones for the first such subsequent calendar year
will be equal to the average of the original Earnout
Milestones for the first such subsequent calendar year
and the year immediately proceeding the first such
subsequent calendar year. If in any given calendar
year, the Gross Revenues are at least equal to the
Earnout Milestones for the second, third, fourth or
fifth subsequent calendar year and if in the first such
subsequent year the Gross Revenues are at least equal
to the Earnout Milestones for the second, third, fourth
or fifth years, then the Earnout Shares associated with
the Earnout Milestone attained in these two consecutive
years shall be awarded at the close of such subsequent
calendar year. For example, if Gross Revenues for the
2000 calendar year equal $6,000,000, the Shareholder
shall be granted 120,000 shares. The additional 120,000
shares will be granted if and only if the revenues at
the end of calendar Y2001 are at least equal to the
average of Y2000's and Y2001's Earnout Milestones. If,
for example, Gross Revenues for calendar Y2000 equal
$10,000,000, the Shareholder shall be granted 120,000
shares. At the end of the calendar year 2001, 120,000
shares will be granted if the revenues at the end of
calendar Y2001 are at least equal to the average of the
Y2000's and Y2001's Earnout Milestones and an
additional 120,000 shares will be granted if revenues
at the end of calendar Y2001 are at least equal to
Y2002's Earnout Milestone.
(b) For purposes of this Agreement, "Gross Revenues of HIH"
mean actual cash revenues from whatever source derived, excluding
any barter revenue.
(c) BCR shall make available to the Shareholders all such
information and copies of documents and records necessary for
evaluating the achievement of the Earnout Milestones. If any
Shareholder disputes such determination, then such Shareholder
shall give written notification to BCR setting forth such
dispute. As promptly as reasonably possible after receipt of
such notice, representatives of BCR and such Shareholder(s) shall
meet to attempt to reconcile their differences. If the dispute
has not been resolved within fifteen (15) business days after
notice of dispute has been given, then within five (5) business
days thereafter any party may give notice to the other of its
desire to arbitrate such disputed items and, at the request of
the notifying party, such disputed items shall be submitted for
arbitration to an arbitrators mutually acceptable to the parties.
The costs of such arbitrators shall be borne by the
non-prevailing party. Any Earnout Shares not subject to dispute
shall be paid in accordance with this Section 1.13.
<PAGE>
(d) If a Sale or Spin-off of the Surviving Corporation
shall occur at any time prior to the fifth anniversary date of
this Agreement and the Shareholders shall have (i) complied with
the terms and conditions of this Agreement and (ii) the Sale
price or, in the case of a Spin-off, the Equity Value, of the
Surviving Corporation, shall be at least Ten Million Dollars
($10,000,000), the Earnout Milestones shall be deemed to have
been achieved, as of the date of such Sale, and the Shareholders
shall be issued the Earnout Shares in accordance with their Pro
Rata Portion. For purposes of this Agreement, "Sale" shall mean
acquisition by any person, group of affiliated persons or entity,
of (1) all of the stock of the Surviving Corporation, or BCR, as
the case may be or (2) all or substantially all of the assets of
the Surviving Corporation, or BCR, as the case may be. For
purposes of this Agreement "Spin-off" shall mean (x) the
distribution by BCR of 100% of its ownership interests in the
Surviving Corporation as a dividend to its existing shareholders
or (y) an initial public offering of all or part of BCR's
ownership interests in the Surviving Corporation. If a Sale of
BCR shall occur at any time prior to the fifth anniversary of
this Agreement and the Sale price shall be at least $4.00 per
share of Class A Common Stock, the Earnout Milestones shall be
deemed to have been achieved. as of the date of such Sale, and
the Shareholders shall be issued the Earnout Shares in accordance
with their Pro Rata Portion.
ARTICLE II
REPRESENTATIONS, WARRANTIES AND COVENANTS OF BCR
In order to induce each Shareholder to enter into this
Agreement, BCR represents and warrants to each Shareholder the
following as of the Closing Date.
2.1 Organization and Corporate Power. BCR is a corporation
duly organized and validly existing under the laws of the State
of Delaware. Newco is a corporation duly organized and validly
existing under the laws of the State of Delaware. Each of BCR
and Newco has all required corporate power and authority to own
its property and to carry on its businesses as presently
conducted. Each of BCR and Newco has all required corporate
power and authority to enter into and perform this Agreement, and
to carry out the transactions contemplated hereby, including,
without limitation, the issuance of the Merger Consideration
Shares.
2.2 Authorization and Non-Contravention. This Agreement is
a valid and binding obligation of BCR and Newco, enforceable
against BCR and Newco in accordance with its terms, except as
such enforceability may be limited by bankruptcy laws and general
principles of equity. The execution, delivery and performance of
this Agreement and the issuance of the Merger Consideration
Shares, have been duly authorized by all necessary corporate
action of BCR and Newco. The execution, delivery and performance
of this Agreement and the consummation of the transactions
contemplated hereby will not (i) violate or conflict with BCR's
or Newco's charter or bylaws, (ii) conflict with or constitute a
breach of any material agreement to which BCR or Newco or any of
its subsidiaries are a party, except where such breach would not
have a Material Adverse Effect, or (iii) violate any applicable
law, rule, regulation, judgment order, writ or decree to which
BCR or Newco is subject, except for such violations that would
not have a Material Adverse effect.
<PAGE>
2.3 Capitalization. As of the Closing, and prior to giving
effect to the transactions contemplated hereby, the authorized
and issued capital stock of BCR is as set forth in Schedule 2.3
attached hereto.
2.4 Reports and Financial Statements. The historical
financial statements included in the Incorporated Documents
present fairly in all material respects the financial position of
BCR and its consolidated subsidiaries at the dates indicated and
the statement of operations, stockholders' equity and cash flows
of BCR and its consolidated subsidiaries for the periods
specified were prepared in conformity with GAAP applied on a
consistent basis throughout the periods presented except as
disclosed therein. Since the date of the most recent financial
statements included in the Incorporated Documents, there has been
no Material Adverse Change.
2.5 Incorporated Documents. The Incorporated Documents
comply in all material respects with the requirements of the
Exchange Act and as of their respective dates, did not include an
untrue statement of a material fact or omit to state a material
fact required to be stated therein or necessary to make the
statements therein, in the light of the circumstances under which
they were made, not misleading.
2.6 Regulatory Matters. Except to the extent as would not
have a Material Adverse Effect, BCR is in compliance with (i) the
communications Act of 1934, as amended by the Telecommunications
Act of 1996 (the "Communications Act") and with all applicable
rules, regulations and policies of the Federal Communications
Commission (the "FCC"), and (ii) all state and local laws
relating to telecommunications.
ARTICLE III
REPRESENTATIONS, WARRANTIES AND COVENANTS OF HIH
In order to induce BCR and Newco to enter into this
Agreement, HIH represents and warrants to BCR the following as of
the Closing Date.
3.1 Organization and Corporate Power. HIH is a corporation
duly organized and validly existing under the laws of the State
of Florida. HIH has all required corporate power and authority
to own its property and to carry on its businesses as presently
conducted. HIH has all required corporate power and authority to
enter into and perform this Agreement, and to carry out the
transactions contemplated hereby.
<PAGE>
3.2 Authorization and Non-Contravention. This Agreement is
a valid and binding obligation of HIH, enforceable against HIH in
accordance with its terms, except as such enforceability may be
limited by bankruptcy laws and general principles of equity. The
execution, delivery and performance of this Agreement have been
duly authorized by all necessary corporate action of HIH. The
execution, delivery and performance of this Agreement and the
consummation of the transactions contemplated hereby will not (1)
violate or conflict with HIH's charter or bylaws, (ii) conflict
with or constitute a breach of any material agreement to which
HIH or any of its subsidiaries are a part except when such breach
would not have a Material Adverse Effect, or (iii) violate any
applicable law, rule, regulation, judgment order, writ or decree
to which HIH is subject, except for such violations that would
not have a Material Adverse Effect.
3.3 Capitalization. The Shareholders are the record owners
of all of the issued and outstanding shares of HIH Common Stock.
All of such shares of HIH Common Stock are duly authorized,
validly issued, fully paid and nonassessable and were not issued
in violation of (i) any preemptive or other rights of any person
to acquire securities of HIH, or (ii) any applicable federal or
state securities laws, and the rules and regulations promulgated
thereunder. There are no outstanding subscriptions, options,
convertible securities rights (preemptive or other), warrant,
calls or agreements relating to any shares of capital stock of
HIH.
3.4 Ownership of Website. HIH owns and has the right to
use the website, "todoahora.com" free and clear of all liens and
encumbrances and has filed an application for service mark
registration in the United States Patent and Trademark Office,
copy of which is attached hereto as Exhibit "B".
3.5 Options or Other Rights. There is no outstanding
right, subscription, warrant, call, unsatisfied preemptive right,
option or other agreement of any kind to purchase or otherwise to
receive from the Company, or any Stockholder any of the
outstanding, authorized by unissued, unauthorized or treasury
shares of the capital stock or any other security of the Company
or, and there is no outstanding security of any kind convertible
into any such capital stock.
3.6 Charter Documents and Corporate Records. The
Stockholders have heretofore caused to be delivered to BCR true
and complete copies of the Articles of Incorporation and By-laws,
or comparable instruments, of the Company as in effect on the
date hereof and has made available for inspection the true and
complete minute books of the Company.
3.7 Compliance with Laws. The Company is not in violation
of any applicable order, judgment, injunction, award, decree or
writ (collectively, "Orders"), or any applicable law, statute,
code, ordinance, regulation or other requirement (collectively,
"Laws"), of any government or political subdivision thereof,
whether federal, state, local or foreign, or any
<PAGE>
agency or instrumentality of any such government or political
subdivision, any court or arbitrator (collectively, "Governmental
Bodies") the enforcement of which would have a Material Adverse
Effect on the condition of the Company as a whole, and the
Company has not received notice that any such violation is being
or may be alleged.
3.8 Permits. The Company has all licenses, permits, orders
or approvals to and have made all required registrations with,
any Governmental Body that are material to the current conduct of
the business of, or the current use of any of the Properties of,
the Company (collectively, "Permits"). All Permits are listed on
Schedule 3.4 and are in full force and effect; no material
violations are or have been recorded in respect of any Permit;
and no proceeding is pending or, to the Knowledge of the Company,
threatened to revoke or limit any Permit. No action by the
Stockholders, the Company or BCR is required in order that all
Permits will remain in full force and effect following the
consummation of the transactions provided for herein.
3.9 No Breach. The execution, delivery and performance of
this Agreement by the Stockholders and the consummation of the
transactions contemplated hereby, including but not limited to,
the merger (the "Contemplated Transactions") will not (i) violate
any provision of the Articles of Incorporation or By-laws of the
Company; (ii) require the Stockholders or the Company or to
obtain any consent approval or action of or make any filing with
or give any notice to, any Governmental Body or any other Person;
(iii) violate, conflict with or result in the breach of any of
the terms or result in a material modification of the effect or
otherwise cause the termination of or give any other contracting
party the right to terminate, or constitute (or with notice or
lapse of time or both constitute) a default under, any contract,
agreement, indenture, note, bond, loan, instrument, lease,
conditional sale contract, mortgage, license, franchise,
commitment or other binding arrangement (collectively, the
"Contracts") to which the Company is a party or by or to which it
or any of its Properties may be bound or subject, or result in
the creation of any Lien upon the Properties of the Company
pursuant to the terms of any such Contract; (iv) if the Required
Consents are obtained, violate any Order of any Governmental Body
against, or binding upon, the Company or upon its securities,
Properties or business; (v) if the Required Consents are
obtained, violate any Law of any Governmental Body; or (vi) if
the Required Consents are obtained, violate or result in the
revocation or suspension of any Permit.
3.10 Claims and Proceedings. There are no outstanding
Orders of any Governmental Body against or involving the Company.
There are no actions, suits, claims or legal, administrative or
administrative proceedings or investigations (collectively,
"Claims") (whether or not the defense thereof or liabilities in
respect thereof are covered by insurance) pending, or to the
Knowledge of the Company, threatened, against or involving the
Company or any of its Properties and to the Knowledge of the
Company, or any of the Stockholders, there is no fact, event or
circumstance that may give rise to any Claim.
3.11 Contracts. (a) Schedule 3.11 sets forth all of the
following Contracts to which the Company is a party or by or to
which it or its Properties may be bound or subject:
<PAGE>
(i) Contracts with any current or former officer, director,
shareholder, employee, consultant, agent or other representative
or with an entity in which any of the going is a controlling
Person; (ii) Contracts with any labor union or association
representing any employee or former employee; (iii) Contracts for
the sale of any Properties other than in the ordinary course of
business or for the grant to any Person of any option or
preferential rights to purchase any Properties; (iv) partnership
or, joint venture agreements or Contracts; (v) Contracts under
which the Company agrees to indemnify any party or to share tax
liability of any party; (vi) material Contracts which cannot be
canceled without liability, premium or penalty only on 90 days'
or more notice; (vii) Contracts containing covenants of the
Company not to compete in any line of business or with any Person
in any geographical area or covenants of any other Person not to
compete with the Company in any line of business or in any
geographical area; (viii) Contracts relating to the acquisition
by the Company of any operating business or the capital stock of
any other Person; (ix) Contracts relating to the borrowing of
money; (x) Contracts containing obligations or liabilities of any
kind to holders of the capital stock of the Company as such
(including, without limitation, an obligation to register any of
such securities under any federal or state securities laws); (xi)
Contracts pursuant to which the Company may hold or use any
interest owned or claimed by the Company in or to any material
Property; (xii) management Contracts and other similar agreements
with any Person; (xiii) any other Contracts pursuant to the terms
of which there is either a current or future obligation or right
of the Company to make payments in excess of $10,000 or receive
payments in excess of $25,000;
(b) There have been delivered to BCR true and complete
copies of all of the Contracts set forth on Schedule 3.11 or on
any other Schedule. All of the Contracts are valid and binding
upon the Company in accordance with their terms. The Company is
not in default in any material respect under any of such
Contracts, nor does any condition exist that with notice or lapse
of time or both would constitute such a material default
thereunder. To the Knowledge of the Company, no other party to
any such Contract is in default thereunder in any material
respect nor does any condition exist that with notice or lapse of
time or both would constitute such a material default thereunder.
3.12 Intellectual Property. Schedule 3.14 sets forth a list
of the Company's registered patents, registered trademarks,
domain names, registered service marks, registered trade names,
registered copyrights and franchises, all applications for any of
the foregoing and all permits, grants and licenses or other
rights running to the Company relating to any of the foregoing
that are material to the business of the Company. The Company
owns, or is licensed or otherwise has the right to use, all
registered patents, registered trademarks, domain names,
registered service marks, registered trade names, registered
copyrights and franchises set forth on Schedule 3.14, and (ii)
the Company's rights in the property set forth on such list are
free and clear of any Lien or other encumbrances and the Company
has not received written notice of any adversely-held patent,
invention, trademark, service mark or trade name of any other
person, or notice of any charge or claim of any person relating
to such intellectual property or any process or confidential
information of the Company and to the Company's Knowledge there
is no basis for any such charge or claim.
<PAGE>
3.13 Title to Properties. Except as set forth in the
Schedules hereto, the Company own outright and have good and
marketable title to all of their Properties, including, without
limitation, all of the assets reflected on the Balance Sheet or
currently used in the operation of their businesses, in each case
free and clear of any Lien.
3.14 Officers, Directors and Key Employees. Schedule 3.16
sets forth (i) the name and the 1999 total compensation of each
officer and director of the Company, (ii) the name and total
compensation of each other employee, consultant, agent or other
representative of the Company (iii) any accrual for, or any
commitment or agreement by the Company to pay, such increases,
bonuses or pay.
3.15 Potential Conflicts of Interest. No executive officer
or director of the Company, no Stockholder, no relative or spouse
(or relative of such spouse) of any such officer, director or a
Stockholder and no entity controlled by one or more of the
foregoing:
(i) owns, directly or indirectly, any interest in
(excepting less than 1% stock holdings for investment purposes in
securities of publicly held and traded companies), or is an
officer, director, employee or consultant of, any Person which
is, or is engaged in business as, a competitor or customer of the
Company;
(ii) owns, directly or indirectly, in whole
or in part, any Property that the Company uses in the conduct of
its business; or
(iii) has any cause of action or other claim
whatsoever against, or owes any amount to, the Company, except
for claims in the ordinary course of business such as for accrued
vacation pay, accrued benefits under employee benefit plans, and
similar matters and agreements existing on the date hereof.
3.16 Projections. The projections relating to operations of
the Company through the fiscal year ending 2005 (the
"Projections"), heretofore delivered by the Company to BCR, have
been prepared in good faith on a reasonable basis. The
assumptions on which the Projections are based are stated in
Schedule 3.17 and are consistent with past practices of the
Company and with historical conditions applicable to the business
of the Company. Nothing has come to the attention of the
Company, or any of the Stockholders to indicate that the
Projections or the assumptions upon which they arc based are not
reasonable.
3.17 Full Disclosure. All documents, Contracts,
instruments, certificates, statements, schedules (including
Schedules to this Agreement), exhibits (including Exhibits to
this Agreement), Projections through the year ending 2004, and
any other papers whatsoever (collectively, "Documents") delivered
by or on behalf of the Stockholders or the Company in connection
with this Agreement and the Contemplated Transactions are
authentic if original or
<PAGE>
true and correct copies of the originals. No representation or
warranty of the Stockholders contained in this Agreement and no
Document furnished by or on behalf of the Stockholders or the
Company to BCR pursuant to this Agreement or in connection with
the Contemplated Transactions, contains an untrue statement of a
material fact or omits to state a material fact required to be
stated therein or necessary to make the statements made, in the
context in which made, not materially false or misleading.
Except as otherwise set forth in this Agreement, there is no
material fact that the Stockholders have not disclosed to BCR in
writing that materially adversely affects or, so far as any of
the Stockholders can now foresee, will have a Material Adverse
Effect on the Company or the ability of the Stockholders to
perform this Agreement.
ARTICLE IV
REGISTRATION RIGHTS AND LOCK-UP
4.1 Shelf Registration. Not later than twelve (12) months
from the Closing Date, BCR will file a registration statement
(the "Shelf Registration Statement") covering the number of
shares representing the maximum amount of Merger Consideration
Shares and thereafter shall use its reasonable efforts to (i)
cause the Shelf Registration Statement to be declared effective
as soon as practicable following such filing, and (ii) maintain
such effectiveness (the "Registration Period") until the earlier
of (x) the time at which each Shareholder is no longer subject to
the volume limitations under Rule 144 of the Securities Act, or
(y) such time as all of the Merger Consideration Shares have been
sold.
4.2 Registration Procedures. BCR will, as expeditiously as
possible:
(a) prepare and file with the Commission a Shelf
Registration Statement with respect to the Merger Consideration
Shares and use its best efforts to cause such Shelf Registration
Statement to become and remain effective for a period of time
required for the disposition of Merger Consideration Shares by
each Shareholder;
(b) prepare and file with the Commission such
amendments and supplements to the Shelf Registration Statement
and the prospectus used in connection therewith as may be
necessary to keep such Shelf Registration Statement effective and
to comply with the provisions of the Securities Act with respect
to the sale or other disposition of the Merger Consideration
Shares covered by the Shelf Registration Statement until such
time as all of such securities have been disposed of by each
Shareholder;
(c) furnish each Shareholder such number of copies of
a summary prospectus or other prospectus, including a preliminary
prospectus, in conformity with the requirements of the Securities
Act, and such other documents, as each Shareholder may reasonably
request;
<PAGE>
(d) use its reasonable efforts to register or qualify
the Merger Consideration Shares covered by the Shelf Registration
Statement under such other securities or blue sky laws of such
jurisdictions within the United States and Puerto Rico as each
Shareholder shall reasonably request (provided, however, BCR
shall not be obligated to qualify as a foreign corporation to do
business under the laws of any jurisdiction in which it is not
then qualified or to file any general consent to service or
process), and do such other reasonable acts and things as may be
required of it to enable each Shareholder to consummate the
disposition in such jurisdiction of the securities covered by the
Shelf Registration Statement; and
(e) promptly notify in writing each Shareholder of the
happening of any event, during the period of distribution, as a
result of which the Shelf Registration Statement includes an
untrue statement of a material fact or omits to state any
material fact required to be stated therein or necessary to make
the statements therein not misleading in light of the
circumstances then existing.
4.3 Expenses. All expenses incurred in complying with this
Article IV, including, without limitation, all registration and
filing fees, printing expenses, fees and disbursements of counsel
for BCR shall be paid by BCR.
4.4 Lock-up. Prior to the first anniversary of this
Agreement, no Shareholder shall sell, assign, transfer, pledge,
or encumber or grant any rights or interests or in respect of
(any such transfer, disposition or encumbrance being hereinafter
referred to as "Transfer") any Merger Consideration Shares. Any
purported Transfer in violation of this Agreement shall be null
and void and of no force and effect. Upon a Sale of the Company,
the foregoing prohibition on the Transfer of Merger Consideration
Shares shall terminate.
ARTICLE V
REPRESENTATIONS AND WARRANTIES OF THE SHAREHOLDERS
Each Shareholder hereby represents to BCR on behalf of such
Shareholder that:
(a) Such Stockholder has the full legal right and
power and all authority and approvals required to execute and
deliver this Agreement and to perform fully such Stockholder's
obligations hereunder. This Agreement has been duly executed and
delivered by such Stockholder and (assuming the due
authorization, execution and delivery hereof by BCR) is a valid
and binding obligation of such Stockholder enforceable in
accordance with its terms. The execution and delivery by such
Stockholder of this Agreement, the consummation of the
Contemplated Transactions and the performance by such Stockholder
of this Agreement in accordance with its terms will not (i)
require the approval or consent of any Governmental Body or the
approval or consent of any other Person; (ii) conflict with or
result in any breach or violation of any of the terms and
conditions of, or constitute (or with notice or lapse of time or
both constitute) a default under, any Law or Order of any
Governmental Body applicable to such
<PAGE>
Stockholder or to the Shares held by such Stockholder, or any
Contract to which such Stockholder is a party or by or to which
such Stockholder is or the Shares held by such Stockholder are
bound or subject; or (iii) result in the creation of any Lien on
the Shares held by such Stockholder.
(b) Such Shareholder is acquiring the Merger
Consideration Shares for its own account, for investment, and not
with a view to any "distribution" thereof within the meaning of
the Securities Act, and such Shareholder has no present or
presently contemplated agreement, undertaking, arrangement,
obligation, indebtedness or commitment providing for the
distribution thereof.
(c) Such Shareholder understands that because the
Merger Consideration Shares have not been registered under the
Securities Act, it cannot dispose of any or all of the Merger
Consideration Shares unless the relevant shares are subsequently
registered under the Securities Act or exemptions from such
registration are available. Such Shareholder understands that
each certificate representing the Merger Consideration Shares
will bear the following legend or one substantially similar
thereto:
The securities represented by this
certificate have not been registered under
the Securities Act of 1933 (the "Act"). These
securities have been acquired for investment
and not with a view to distribution or
resale, and may not be sold, mortgaged,
pledged, hypothecated or otherwise
transferred without an effective registration
statement for such securities under the Act
or an opinion of counsel satisfactory to Big
City Radio Inc. is obtained to the effect
that an exemption from such registration
requirements is available.
(d) Such Shareholder is sufficiently knowledgeable and
experienced in the making of investments so as to be able to
evaluate the risks and merits of its investment in BCR, and is
able to bear the economic risk of loss of its investment in BCR.
(e) Such Shareholder has been advised that the Merger
Consideration Shares have not been and are not being registered
under the Securities Act or under the "blue sky" laws of any
jurisdiction and that BCR in issuing the Merger Consideration
Shares is relying upon, among other things, the representations
and warranties of such Shareholder contained in this Article V.
(f) Such Shareholder has been afforded the opportunity
to ask questions of, and receive answers from, BCR and all of its
executed officers and directors and to obtain any additional
information, to the extent that BCR possesses such information or
could have acquired it, necessary to verify the accuracy of the
information contained in any documents delivered to each
Shareholder concerning BCR and has in general had access to all
information each Shareholder deemed material to an investment
decision with respect to the acquisition of the Securities.
<PAGE>
(g) Such Shareholder is an "accredited investor" as
defined in Rule 501 of Regulation D promulgated under the
Securities Act.
(h) Such Shareholder owns his or her shares of HIH
Common Stock free and clear of any and all liens, mortgages,
adverse claims, charges, security interests, encumbrances or
other restrictions or limitations whatsoever (except for
limitations imposed under U.S. federal or applicable state
securities laws) and, upon delivery of and payment for such
Shares as herein provided, such Stockholder will convey to BCR
good and valid title thereto, free and clear of any Lien.
(k) The representations of the Company set forth in
Section 3 are true, correct and complete in all material
respects.
ARTICLE VI
INDEMNIFICATION
6.1 Survival of Representations and Warranties. All
representations and warranties made by each party in this
Agreement shall survive the Closing Date for a period of three
(3) years from the Closing Date. The covenants of the parties
shall survive the Closing Date as provided herein.
6.2 Indemnification by BCR. BCR shall indemnify and defend
and hold harmless each Shareholder against and with respect to
any and all damages, claims, losses, penalties, liabilities,
actions, fines, costs and expenses (including, without
limitation, reasonable attorney's fees and expenses) (all of the
foregoing hereinafter collectively referred to as a "Loss"), with
respect to the following items: (i) any misrepresentation or
breach of warranty or covenant by BCR under this Agreement, or
(ii) any untrue statement of a material fact contained in the
registration statement referenced in Article 11 hereof, or the
omission therefrom of a material fact necessary to make
statements therein, in light of the circumstances under which
they were made, not misleading (other than statements provided by
each Shareholder).
6.3 Indemnification by Shareholder. Each Shareholder shall
indemnify and hold harmless BCR against any Losses with respect
to any misrepresentation or breach of warranty or covenant by
such Shareholder, or HIH under this Agreement, but each case only
to the extent such Losses do not exceed such Shareholder's Pro
Rata Portion of cash received by the Shareholder upon sale of the
Merger Consideration Shares, and subject to the next sentence, in
no event shall the Shareholder's Indemnification Obligation for
Losses exceed the greater of (a) the value of the Merger
Consideration Shares as of the date hereof and (b) the value of
the
<PAGE>
Merger Consideration Shares as of the date the Indemnification
Obligation is to be paid. In the event that the stock or assets
of Hispanic Internet Holdings shall be determined by any court of
competent jurisdiction to not have been the property of HIH and
to be the property of another person or entity (other than the
Shareholders), and as a result thereof, BCR shall be required to
forfeit the todoahora.com site and/or related assets, or to incur
Losses to retain such site and/or assets, all of the Merger
Consideration Shares shall be promptly transferred to BCR by the
Shareholders, without consideration, the Shareholders shall
indemnify and hold harmless BCR against any Losses with respect
to such determination.
ARTICLE VII
DEFINITIONS
As used herein, the following term shall have the following
respective meanings:
Closing. "C1osing" shall have the meaning ascribed to such
term in Section 1.12 hereof.
Closing Date. "Closing Date" shall have the meaning
ascribed to such term in Section 1.12 hereof.
Code. "Code" shall mean the Internal Revenue Code of 1986,
as amended.
Commission. "Commission" means the Securities and Exchange
Commission.
Exchange Act. "Exchange Act" means the Securities Exchange
Act of 1934, as amended.
GAAP. "GAAP" means generally accepted accounting
principles.
Incorporated Documents. "Incorporated Documents" shall mean
BCR's most recent Annual Report on Form 10-K filed with the
Commission and each Form 10-Q Quarterly Report and each Current
Report on Form 8-K filed with the Commission since the end of the
fiscal year to which such Annual Report relates, including any
amendments thereto.
Loss. "Loss" shall have the meaning ascribed to such term
in Section 5.2 hereof.
Material Adverse Change or Material Adverse Effect.
"Material Adverse Change" or "Material Adverse Effect" shall mean
a material adverse effect on the business or financial condition
of BCR and its subsidiaries, taken as a whole, or HIH taken as a
whole, as the case may be.
<PAGE>
Pro Rata Portion. "Pro Rata Portion" shall mean the
percentage set forth opposite such Shareholder's name on Schedule
I.
Registration Period. "Registration Period" shall have the
meaning ascribed to such term in Section 4.1 hereof.
Securities Act. "Securities Act" means the Securities Act
of 1933, as amended.
Shelf Registration Statement. "Shelf Registration
Statement" shall have the meaning ascribed to such term in
Article IV hereof.
ARTICLE VIII
GENERAL
8.1 Amendments, Waivers and Consents. No failure or delay
on the part of any party hereto in exercising any right, power or
remedy hereunder shall operate as a waiver thereof. The remedies
provided for herein are cumulative and are not exclusive of any
remedies that may be available to any party hereto at law or in
equity or otherwise. This Agreement may be amended only with the
prior written consent of BCR and each Shareholder.
8.2 Governing Law. This Agreement shall be deemed to be a
contract made under, and shall be construed in accordance with,
the laws of the State of New York, without giving effect to
conflicts of laws principles thereof.
8.3 Section Headings. The descriptive headings in this
Agreement have been inserted for convenience only and shall not
be deemed to limit or otherwise affect the construction of any
provision thereof or hereof.
8.4 Counterparts. This Agreement may be executed
simultaneously in any number of counterparts, each of which when
so executed and delivered shall be taken to be an original; but
such counterparts shall together constitute but one and the same
document.
8.5 Notices and Demands. Any notice or demand which is
required or provided to be given under this Agreement shall be
deemed to have been sufficiently given and received for all
purposes when received and may be delivered by hand, telecopy,
telex or other method of facsimile, certified or registered mail,
postage and charges prepaid, return receipt requested, or by
overnight delivery, to the address set forth on the signature
page hereto.
8.6 Severability. Each provision of this Agreement shall
be interpreted in such a manner as to be effective and valid
under applicable law, but if any provision of this Agreement
<PAGE>
shall be deemed prohibited or invalid under such applicable law,
such provision shall be ineffective only to the extent of such
prohibition or invalidity, and such prohibition or invalidity
shall not invalidate the remainder of such provision or the other
provisions of this Agreement.
8.7 Integration. This Agreement, including the exhibits,
documents and instruments referred to herein or therein,
constitutes the entire agreement, and supersedes all other prior
agreements and understandings, both written and oral, among the
parties with respect to the subject matter hereof, including,
without limitation, the letter of intent between the parties
hereto in respect of the transactions contemplated herein.
8.8 Brokers. Each party represents that no broker, finder,
agent or similar intermediary has acted on behalf of BCR or such
Shareholder in connection with this Agreement or the transactions
contemplated hereby.
8.9 Publicity. BCR shall not issue any public release or
announcement concerning this Agreement or the transactions
contemplated hereby that identifies such Shareholder without the
prior written consent of such Shareholder, except as required by
law (in which case, so far as possible, there shall be
consultation between the parties prior to such announcement).
8.10 Expenses. Each party shall bear its own expenses with,
respect to the transactions contemplated hereby.
* * * * * *
IN WITNESS WHEREOF, the parties hereto have executed this
Investment and Registration Rights Agreement on the date first
written above.
HISPANIC INTERNET HOLDINGS, INC.
By: _______________________________
BIG CITY RADIO INC.
By: _______________________________
SHAREHOLDERS:
___________________________________
Charles M. Fernandez
___________________________________
Phillip Frost, M.D.
___________________________________
Deisy Fernandez
___________________________________
Earle Mack
___________________________________
Carlos Padron
<PAGE>
SCHEDULE I
LIST OF SHAREHOLDERS
Name Number of Shares of HIH Pro Rata Portion
Charles M. Fernandez 560,000 56%
Phillip Frost, M.D. 175,000 17.5%
Deisy Fernandez 140,000 14%
Earle Mack 90,000 9%
Carlos Padron 35,00 3.5%
Totals 1,000,000 100%
