UNITED STATES
SECURITIES AND EXCHANGE COMMISSION
Washington, D.C. 20549
SCHEDULE 13D
Under the Securities Exchange Act of 1934
(Amendment No. )*
LIN Television Corporation
(Name of Issuer)
Common Stock, $.01 Par Value Per Share
(Title of Class of Securities)
532776 10 1
(CUSIP Number)
Mark W. Kroloff
Cook Inlet Region, Inc.
2525 "C" Street
Anchorage, Alaska 99503
(907) 274-8638
(Name, Address and Telephone Number of Person
Authorized to Receive Notices and Communications)
December 28, 1994
(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 which is the subject of this Schedule 13D, and is
filing this schedule because of Rule 13d-1(b)(3) or (4), check the following
box [ ].
Check the following box if a fee is being paid with the statement [X]. (A
fee is not required only if the reporting person: (1) has a previous statement
on file reporting beneficial ownership of more than five percent of the class
of securities described in Item 1; and (2) has filed no amendment subsequent
thereto reporting beneficial ownership of five percent or less of such class.)
(See Rule 13d-7.)
Note: Six copies of this statement, including all exhibits, should be filed
with the Commission. See Rule 13d-1(a) 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. 532776 10 1
1 Name Of Reporting Person
S.S. Or I.R.S. Identification No. Of Above Person
Cook Inlet Region, Inc.
92-0042304
2 Check The Appropriate Box If A Member Of A Group*
(a) [X]
(b) [ ]
______________________________________________________________________________
3 SEC USE ONLY
______________________________________________________________________________
4 Source Of Funds*
OO
5 Check Box If Disclosure Of Legal Proceedings Is Required Pursuant
To Items 2(d) Or 2(e)
[ ]
6 Citizenship Or Place Of Organization
Alaska corporation
7 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Voting Power
0
8 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Voting Power
3,357,950
9 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Dispositive Power
0
10 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Dispositive Power
3,357,950
11 Aggregate Amount Beneficially Owned By Each Reporting Person
3,357,950
12 Check Box If The Aggregate Amount In Row (11) Excludes Certain
Shares*
[ ]
13 Percent Of Class Represented By Amount In Row (11)
11.5%
14 Type Of Reporting Person*
CO
* SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
CUSIP No. 532776 10 1
1 Name Of Reporting Person
S.S. Or I.R.S. Identification No. Of Above Person
Cook Inlet Corporation
92-0126955
2 Check The Appropriate Box If A Member Of A Group*
(a) [X]
(b) [ ]
______________________________________________________________________________
3 SEC USE ONLY
______________________________________________________________________________
4 Source Of Funds*
OO
5 Check Box If Disclosure Of Legal Proceedings Is Required Pursuant
To Items 2(d) Or 2(e)
[ ]
6 Citizenship Or Place Of Organization
Alaska corporation
7 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Voting Power
0
8 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Voting Power
3,357,950
9 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Dispositive Power
0
10 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Dispositive Power
3,357,950
11 Aggregate Amount Beneficially Owned By Each Reporting Person
3,357,950
12 Check Box If The Aggregate Amount In Row (11) Excludes Certain
Shares*
[ ]
13 Percent Of Class Represented By Amount In Row (11)
11.5%
14 Type Of Reporting Person*
CO
* SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
CUSIP No. 532776 10 1
1 Name Of Reporting Person
S.S. Or I.R.S. Identification No. Of Above Person
Cook Inlet Communications, Inc.
92-0109612
2 Check The Appropriate Box If A Member Of A Group*
(a) [X]
(b) [ ]
______________________________________________________________________________
3 SEC USE ONLY
______________________________________________________________________________
4 Source Of Funds*
OO
5 Check Box If Disclosure Of Legal Proceedings Is Required Pursuant
To Items 2(d) Or 2(e)
[ ]
6 Citizenship Or Place Of Organization
Alaska corporation
7 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Voting Power
0
8 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Voting Power
3,357,950
9 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Dispositive Power
0
10 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Dispositive Power
3,357,950
11 Aggregate Amount Beneficially Owned By Each Reporting Person
3,357,950
12 Check Box If The Aggregate Amount In Row (11) Excludes Certain
Shares*
[ ]
13 Percent Of Class Represented By Amount In Row (11)
11.5%
14 Type Of Reporting Person*
CO HC
* SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
SCHEDULE 13D
CUSIP No. 532776 10 1
1 Name Of Reporting Person
S.S. Or I.R.S. Identification No. Of Above Person
Cook Inlet Communications Corp.
92-0111344
2 Check The Appropriate Box If A Member Of A Group*
(a) [X]
(b) [ ]
______________________________________________________________________________
3 SEC USE ONLY
______________________________________________________________________________
4 Source Of Funds*
OO
5 Check Box If Disclosure Of Legal Proceedings Is Required Pursuant
To Items 2(d) Or 2(e)
[ ]
6 Citizenship Or Place Of Organization
Delaware corporation
7 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Voting Power
0
8 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Voting Power
3,357,950
9 Number Of Shares Beneficially Owned By Each Reporting Person With
Sole Dispositive Power
0
10 Number Of Shares Beneficially Owned By Each Reporting Person With
Shared Dispositive Power
3,357,950
11 Aggregate Amount Beneficially Owned By Each Reporting Person
3,357,950
12 Check Box If The Aggregate Amount In Row (11) Excludes Certain
Shares*
[ ]
13 Percent Of Class Represented By Amount In Row (11)
11.5%
14 Type Of Reporting Person*
CO HC
* SEE INSTRUCTIONS BEFORE FILLING OUT!
INCLUDE BOTH SIDES OF THE COVER PAGE, RESPONSES TO ITEMS 1-7
(INCLUDING EXHIBITS) OF THE SCHEDULE, AND THE SIGNATURE ATTESTATION.
<PAGE>
Item 1. Security and Issuer
This statement relates to shares of Common Stock, $.01 par value per
share ("Common Stock") of LIN Television Corporation (the "Issuer"), 4
Richmond Square, Floor 2, Providence, Rhode Island 02906.
Item 2. Identity and Background
(a)-(b)
This statement is filed by:
Cook Inlet Region, Inc., an Alaska corporation ("CIRI"). CIRI's
principal business address is 2525 "C" Street, Anchorage, Alaska 99503.
Cook Inlet Corporation, an Alaska corporation ("CIC"), which is a wholly
owned subsidiary of CIRI. CIC's principal business address is 1800
Avenue of the Stars, Suite 450, Los Angeles, California 90067.
Cook Inlet Communications, Inc., an Alaska corporation ("CICI"), which
is a wholly owned subsidiary of CIC. CICI's principal business address
is 1800 Avenue of the Stars, Suite 450, Los Angeles, California 90067.
Cook Inlet Communications Corp., a Delaware corporation ("CICC"), which
is a wholly owned subsidiary of CICI. CICC's principal business address
is 1800 Avenue of the Stars, Suite 450, Los Angeles, California 90067.
CIRI, CIC, CICI and CICC are herein referred to collectively as the
"Reporting Persons."
The Executive Officers and Directors of CIRI are as follows:
Executive Officers
Chairman and Chief Executive
Officer Roy M. Huhndorf
President and Chief Operating
Officer Carl H. Marrs
Senior Vice President Frank R. Klett
Senior Vice President Margaret L. Brown
Vice President Craig A. Floerchinger
Vice President Mark W. Kroloff
Vice President John Monfor
Vice President Barbara A. Donatelli
Vice President Kirk S. McGee
Vice President Gerald G. Booth
The business address of the executive officers listed above is
2525 "C" Street, Anchorage, Alaska 99503.
Directors Roy M. Huhndorf, Chairman
Charles G. Anderson
B. Agnes Brown
Gerald G. Brown
Allan R. Chase
John N. Colberg
Gosta E. Dagg
William D. English
A. Debbie Fullenwider
Janie Leask
Patrick M. Marrs
William C. Prosser
Leo Stephan
Clare Swan
Robert N. Woodhead
The business address of the directors listed above is 2525 "C"
Street, Anchorage, Alaska 99503.
The Executive Officers and Directors of CIC are as follows:
Executive Officers
President and Chief Executive
Officer Roy M. Huhndorf
Vice President Stephen C. Hillard
Vice President Carl H. Marrs
Vice President Mark W. Kroloff
Vice President Mark D. Adolph
Vice President Craig A. Floerchinger
The business address of Mr. Hillard and Mr. Adolph is 1800 Avenue
of the Stars, Suite 450, Los Angeles, California 90067. The
business address of the other executive officers listed above is
2525 "C" Street, Anchorage, Alaska 99503.
Directors Roy M. Huhndorf, Chairman
Charles G. Anderson
B. Agnes Brown
Patrick M. Marrs
Leo Stephan
Robert N. Woodhead
The business address of the directors listed above is 2525 "C"
Street, Anchorage, Alaska 99503.
The Executive Officers and Directors of CICI are as follows:
Executive Officers
President Roy M. Huhndorf
Vice President Stephen C. Hillard
Vice President Mark W. Kroloff
Vice President Carl H. Marrs
Vice President Craig A. Floerchinger
Vice President Mark D. Adolph
The business address of Mr. Hillard and Mr. Adolph is 1800 Avenue
of the Stars, Suite 450, Los Angeles, California 90067. The
business address of the other executive officers listed above is
2525 "C" Street, Anchorage, Alaska 99503.
Directors Roy M. Huhndorf, Chairman
B. Agnes Brown
Patrick M. Marrs
Leo Stephan
The business address of the directors listed above is 2525 "C"
Street, Anchorage, Alaska 99503.
The Executive Officers and Directors of CICC are as follows:
Executive Officers
President and Chief Executive
Officer Roy M. Huhndorf
Vice President Stephen C. Hillard
Vice President Mark W. Kroloff
Vice President Craig A. Floerchinger
Vice President Mark D. Adolph
Vice President Carl H. Marrs
The business address of Mr. Hillard and Mr. Adolph is 1800 Avenue
of the Stars, Suite 450, Los Angeles, California 90067. The
business address of Mr. Huhndorf is 2525 "C" Street, Anchorage,
Alaska 99503.
Directors
Chairman Roy M. Huhndorf
Director B. Agnes Brown
Director Patrick M. Marrs
Director Leo Stephan
The business address of the directors listed above is 2525 "C"
Street, Anchorage, Alaska 99503.
(c) Cook Inlet Region, Inc. is one of the 12 regional corporations
established by Congress under the terms of the Alaskan Native Claims
Settlement Act of 1971. The principal lines of business of CIRI are oil
field services, natural resource development and real estate.
The principal business of Cook Inlet Corporation is to manage its
subsidiaries' investments in communications businesses.
Cook Inlet Communications, Inc. is a holding company and holds the stock
of CICC.
Cook Inlet Communications Corp. is a holding company and holds the stock
of Issuer.
The present principal occupations of the officers and directors of CIRI,
CIC, CICI and CICC are as follows:
Mark D. Adolph, Vice President, Finance and Tax Administration, Cook
Inlet Corporation.
Charles G. Anderson, Proprietor, Charles G. Anderson & Associates.
Gerald G. Booth, Vice President, Energy & Minerals, Cook Inlet Region,
Inc.
B. Agnes Brown, President, Arctic Tug & Barge, Co, Inc. and President,
Kaloa & Company, Inc.
Gerald G. Brown, President, Alaska Supply, Inc.
Margaret L. Brown, Senior Vice President, Oil & Gas, Cook Inlet Region,
Inc.
Allan R. Chase, self employed, property management.
John N. Colberg, Retired Chairman, Cook Inlet Region, Inc.
Gosta E. Dagg, Attorney, Private Practice.
Barbara A. Donatelli, Vice President, Administration, Cook Inlet Region,
Inc.
William D. English, Vice President and Director, Northern Television,
Inc.
Craig Floerchinger, Vice President, Finance and Assistant Treasurer,
Cook Inlet Region, Inc.
A. Debbie Fullenwider, Public Relations, Federal Emergency Management
Agency, Region X.
Stephen C. Hillard, Vice President and Secretary, Cook Inlet
Corporation.
Roy M. Huhndorf, Chairman and Chief Executive Officer, Cook Inlet
Region, Inc.
Frank R. Klett, Senior Vice President, Cook Inlet Region, Inc.
Mark W. Kroloff, Vice President, General Counsel and Assistant
Secretary, Cook Inlet Region, Inc.
Janie Leask, Vice President for Community Development, National Bank of
Alaska.
Carl H. Marrs, President and Chief Operating Officer, Cook Inlet Region,
Inc.
Patrick M. Marrs, Owner and President, Communications North, Inc.
Kirk S. McGee, Vice President, Real Estate, Cook Inlet Region, Inc.
John Monfor, Vice President and Special Assistant to the President, Cook
Inlet Region, Inc.
William C. Prosser, Managing Partner, Huffman Hills Development Company.
Leo Stephan, Retired.
Clare Swan, Tribal Chair and Executive Director, Kenaitze Indian Tribe.
Robert N. Woodhead, Meter Technician and Journeyman Lineman, Chugach
Electric Association.
(d) None of the persons on whose behalf this Schedule 13D is filed, nor, to
the best knowledge of the persons filing this Schedule 13D, any of the
officers and directors of such persons set forth above, have been
convicted, during the last five years, in a criminal proceeding
(excluding traffic violations or similar misdemeanors).
(e) None of the persons on whose behalf this Schedule 13D is filed, nor, to
the best knowledge of the persons filing this Schedule 13D, any of the
officers and directors of such persons set forth above, have, during the
last five years, been party to a civil proceeding resulting in a
judgment, decree or final order relating to any violation of federal or
state securities laws.
(f) To the best knowledge of the persons filing this Schedule 13D, each of
the officers and directors of the corporations listed above are citizens
of the United States.
Item 3. Source and Amount of Funds or Other Consideration
CICC exchanged substantially all of its assets and certain liabilities
in consideration for 3,357,950 shares of Common Stock and approximately $120
million in cash from Issuer on December 28, 1994. This transaction is
described in further detail in response to Item 4.
Item 4. Purpose of Transaction
On December 28, 1994 CICC sold and transferred, and Issuer purchased and
assumed, substantially all the assets and certain liabilities of CICC,
consisting primarily of television station WTNH-TV (the "Station Sale"), in
exchange for (1) 3,357,950 shares of Common Stock and (2) approximately $120
million in cash. The Station Sale was effected pursuant to that Asset
Purchase Agreement dated as of June 7, 1994 by and among LIN Broadcasting
Corporation ("LIN Broadcasting"), Issuer, CICI and CICC (as subsequently
amended on September 26, 1994 and December 6, 1994) (the "Purchase
Agreement").
In connection with the Station Sale, CICC, Issuer and McCaw Cellular
Communications, Inc. ("McCaw") entered into a Stockholders Agreement, dated as
of December 28, 1994 (the "Stockholders Agreement.") Pursuant to the
Stockholders Agreement, CICC and McCaw agreed to vote their shares of Common
Stock to cause the board of directors of Issuer to consist of 10 members, one
of whom is designated by CICC, six of whom are designated by McCaw and three
of whom are designated by McCaw to serve as independent directors if required
by the Television Private Market Value Guarantee dated December 28, 1994
between McCaw and Issuer. The Stockholders Agreement further provides that
McCaw will use its best efforts, until December 28, 1996, to cause the
compensation committee of Issuer's board to consist of one independent
director, one director designated by McCaw and the director nominated by CICC.
CICC's right to nominate a director ceases upon its becoming the
beneficial holder of less than 3.5% of the outstanding Common Stock. Roy M.
Huhndorf, Chief Executive Officer of each of the Reporting Persons, was
elected to Issuer's board of directors upon the closing of the Station Sale on
December 28, 1994. If the director nominated by CICC ceases to serve on the
Issuer's board, CICC may designate a replacement director.
Neither CICC nor McCaw may assign or transfer any Common Stock to an
affiliate or member of a group (as defined in Rule 13d-5 under the Securities
Exchange Act of 1934) that includes the transferor or any of its affiliates,
unless the transferee agrees to be bound by the Stockholders Agreement.
The Stockholders Agreement is terminable upon the earliest to occur of:
(a) the tenth anniversary of its execution, provided that at any time within
two years before such date (or such later termination date if the Stockholders
Agreement has been previously extended), the parties may by written agreement
extend its duration for an additional period not to exceed ten years; (b) with
respect to CICC only, written notice to the other parties, provided that CICC
and its affiliates and group members beneficially own in the aggregate less
than 1% of the outstanding shares of Common Stock; and (c) with respect to
McCaw only, written notice to the other parties, provided that McCaw and its
affiliates and group members beneficially own in the aggregate less than 5% of
the outstanding shares of Common Stock.
While CIRI and its subsidiaries, including the Reporting Persons, have
no present plans to purchase additional shares of Common Stock in the open
market or otherwise, they could determine to do so depending upon price,
market conditions, availability of funds, evaluation of alternative
investments and other factors. While none of the Reporting Persons have any
present plans to sell any of shares of Common Stock held by them, they could
determine, based upon the same set of factors listed above with respect to
purchases, to sell some or all of the shares held by them. CICC and the
Issuer are parties to a Registration Rights Agreement as described under Item
6 below.
Other than as discussed above, the persons filing this Schedule have no
plans or proposals that relate to or would result in the acquisition by any
person of additional securities of Issuer or the disposition of securities of
Issuer; an extraordinary corporate transaction involving Issuer or any of its
subsidiaries; a sale or transfer of a material amount of assets of Issuer or
any of its subsidiaries; a change in the present Board of Directors or
management of Issuer; a material change in the present capitalization or
dividend policy of Issuer; any other material change in Issuer's business or
corporate structure; changes in Issuer's charter or bylaws or other actions
that might impede the acquisition of control of Issuer by any other person;
causing securities of Issuer to be delisted from a national securities
exchange or to cease to be authorized to be quoted in an interdealer quotation
system of a registered national securities association; causing securities of
Issuer to be eligible for termination of registration pursuant to the
Securities Exchange Act of 1934; or any other similar action.
Item 5. Interest in Securities of the Issuer
(a) CICC is the holder and beneficial owner of 3,357,950 shares of
Common Stock, representing 11.5% of the outstanding shares of
Common Stock of Issuer. Each of CIRI, CIC and CICI controls CICC
and thus may be considered to have beneficial ownership of such
shares.
(b) Each of the corporations named in Item 5(a) above shares voting
and investment power with respect to the 3,357,950 shares held by
CICC with each of the other corporations named therein.
(c) Not applicable.
(d) Not applicable.
(e) Not applicable.
Item 6. Contracts, Arrangements, Understandings or Relationships with Respect
to Securities of the Issuer
Stockholders Agreement
Pursuant to the Stockholders Agreement, CICC and McCaw agreed to vote
their shares of Common Stock to cause the board of directors of Issuer to
consist of 10 members, one of whom is designated by CICC, six of whom are
designated by McCaw and three of whom are designated by McCaw to serve as
independent directors if required by the Television Private Market Value
Guarantee dated December 28, 1994 between McCaw and Issuer. The Stockholders
Agreement further provides that McCaw will use its best efforts, until
December 28, 1996, to cause the compensation committee of Issuer's board to
consist of one independent director, one director designated by McCaw and the
director nominated by CICC.
CICC's right to nominate a director ceases upon its becoming the
beneficial holder of less than 3.5% of the outstanding Common Stock. Roy M.
Huhndorf, Chief Executive Officer of each of the Reporting Persons, was
elected to Issuer's board of directors upon the closing of the Station Sale on
December 28, 1994. If the director nominated by CICC ceases to serve on the
Issuer's board, CICC may designate a replacement director.
Neither CICC nor McCaw may assign or transfer any Common Stock to an
affiliate or member of a group (as defined in Rule 13d-5 under the Securities
Exchange Act of 1934) that includes the transferor or any of its affiliates,
unless the transferee agrees to be bound by the Stockholders Agreement.
The Stockholders Agreement is terminable upon the earliest to occur of:
(a) the tenth anniversary of its execution, provided that at any time within
two years before such date (or such later termination date if the Stockholders
Agreement has been previously extended), the parties may by written agreement
extend its duration for an additional period not to exceed ten years; (b) with
respect to CICC only, written notice to the other parties, provided that CICC
and its affiliates and group members beneficially own in the aggregate less
than 1% of the outstanding shares of Common Stock; and (c) with respect to
McCaw only, written notice to the other parties, provided that McCaw and its
affiliates and group members beneficially own in the aggregate less than 5% of
the outstanding shares of Common Stock.
Registration Rights Agreement
CICC and Issuer are parties to a Registration Rights Agreement dated as
of December 28, 1994. Pursuant to the Registration Rights Agreement, Issuer
has agreed, under certain conditions and subject to certain limitations, to
use its reasonable efforts to effect the registration under the Securities Act
of 1933 (the "1933 Act") of the shares of Common Stock held by CICC. Holders
of 20% of registrable shares may demand up to two such registrations prior to
December 28, 2001. In addition, until December 28, 2001, the Issuer will use
its reasonable efforts to include, upon request, registrable shares in a
registration of Common Stock under the 1933 Act by the Issuer on a
registration form and in a manner that would permit registration of
registrable shares for sale to the public, subject to certain limitations.
The Issuer has agreed, subject to certain conditions and limitations, to use
all reasonable efforts (1) to register shares of Common Stock for resale by
CIRI and its subsidiaries in a firm-commitment underwritten public offering of
at least $2 million or in one or more sales during a consecutive 45-day
period, and (2) to keep such registration effective until the earliest of (a)
two years after the request, (b) December 28, 1997 or (c) such time as all
registrable shares have been disposed of by CIRI and its subsidiaries. The
Issuer has agreed to pay all expenses of registration. The Issuer and CICC
have agreed to customary indemnification and contribution provisions for
certain liabilities relating to the registration of the Common Stock.
Purchase Agreement
Pursuant to the Purchase Agreement, LIN Broadcasting and Issuer have
agreed to indemnify CICC for certain losses incurred by the Issuer. Under
certain circumstances, the amount of such indemnification will be based on
CICC's percentage ownership interest in Issuer's Common Stock as of the date
Issuer first learns of the circumstances resulting in such loss, and is
subject to a threshold.
Item 7. Material to Be Filed as Exhibits
1. Asset Purchase Agreement dated June 7, 1994 among LIN Broadcasting
Corporation, LIN Television Corporation, Cook Inlet Communications
Corp. and Cook Inlet Communications Inc.
2. First Amendment to Asset Purchase Agreement dated September 26,
1994 among LIN Broadcasting Corporation, LIN Television
Corporation, Cook Inlet Communications Corp. and Cook Inlet
Communications, Inc.
3. Second Amendment to Asset Purchase Agreement dated September 26,
1994 among LIN Broadcasting Corporation, LIN Television
Corporation, Barclays Bank, PLC, Nationsbank of Texas, N.A., The
Bank of Nova Scotia, Cook Inlet Communications Corp. and Cook
Inlet Communications, Inc.
4. Stockholders Agreement among LIN Television Corporation, McCaw
Cellular Communications, Inc. and Cook Inlet Communications Corp.
dated as of December 28, 1994.
5. Registration Rights Agreement dated December 28, 1994 between LIN
Television Corporation and Cook Inlet Communications Corp.
6. Statement of Reporting Persons pursuant to Rule 13d-1(f)
<PAGE>
Signature
After reasonable inquiry and to the best knowledge and belief of each,
the undersigned hereby certify that the information set forth in this
statement is true, complete and correct.
Dated this 6th day of January, 1995.
COOK INLET REGION, INC.* COOK INLET CORPORATION
By: /s/ Mark W. Kroloff By: /s/ Mark D. Adolph
Mark W. Kroloff Mark D. Adolph
Vice President Vice President
COOK INLET COMMUNICATIONS, INC. COOK INLET COMMUNICATIONS CORP.
By: /s/ Mark D. Adolph By: /s/ Mark D. Adolph
Mark D. Adolph Mark D. Adolph
Vice President Vice President
*In executing and filing this Schedule 13D, Cook Inlet Region, Inc. does not
intend to waive the exemption afforded it under 43 U.S.C. section 1625.
EXHIBIT 1
ASSET PURCHASE AGREEMENT
among
LIN BROADCASTING CORPORATION,
LIN TELEVISION CORPORATION,
COOK INLET COMMUNICATIONS, INC.
and
COOK INLET COMMUNICATIONS CORP.
Dated as of June 7, 1994
<PAGE>
ASSET PURCHASE AGREEMENT
This ASSET PURCHASE AGREEMENT (this "Agreement") is dated as of June 7,
1994 by and among LIN Broadcasting Corporation, a Delaware corporation
("Parent"), LIN Television Corporation, a Delaware corporation and indirect
wholly owned subsidiary of Parent ("Acquiror"), Cook Inlet Communications,
Inc., an Alaska corporation ("Stockholder"), and Cook Inlet Communications
Corp., a Delaware corporation and subsidiary of Stockholder ("Station").
RECITALS
A. Station desires and intends to sell to Acquiror substantially all
of Station's operating assets and to assign, without limitation, the licenses
for WTNH-TV and associated auxiliary stations and contractual rights at the
price and on the terms and conditions hereinafter set forth.
B. Acquiror desires and intends to purchase from Station
substantially all of Station's operating assets and contractual rights, and to
assume substantially all of Station's operating liabilities, at the price and
on the terms and conditions hereinafter set forth.
C. The parties hereto desire to make certain representations,
warranties, covenants and agreements in connection with the sale and purchase
of Station's assets.
D. Parent intends to acquire all the outstanding shares of common
stock, par value $.01 per share, of Acquiror (the "Acquiror Common Stock") and
to effect a distribution of all such shares to Parent's stockholders (the
"Distribution").
AGREEMENT
In consideration of the premises and mutual covenants set forth herein,
the parties hereto agree as follows:
ARTICLE I DEFINITIONS
1.1 Defined Terms
As used in this Agreement, the following terms shall have the following
meanings:
"Accounts Receivable" shall mean all accounts receivable, billed and
unbilled, net of a reasonable allowance for doubtful accounts.
"Acquiror Accounts Payable" shall mean all of Acquiror's accounts
payable in accordance with generally accepted accounting principles on a basis
consistent with the December 31, 1993 audited financial statements of
Acquiror, including an accrual equal to the amount of all unpaid fees and
expenses payable by Acquiror in connection with this Agreement and the
transactions contemplated hereby.
"Acquiror Accrued Expenses" shall mean all of Acquiror's film contract
obligations and other accruals, including all other liabilities that are
classified as current under generally accepted accounting principles, but
excluding Acquiror Accounts Payable, Acquiror Accrued Income Taxes and the
current portion of Acquiror Debt.
"Acquiror Accrued Income Taxes" shall mean all income taxes accrued and
classified as a current liability, including, as a minimum, (i) a federal tax
accrual of $5.1 million, plus (ii) a state tax accrual with respect to Indiana
Broadcasting Corporation of $1.8 million, plus (iii) accrued 1994 income taxes
(net of any related payments and charges), in each case on a basis consistent
with the December 31, 1993 audited financial statements of Acquiror.
"Acquiror Balance Sheet" is defined in Section 4.6.
"Acquiror Cash" shall mean all of Acquiror's cash and cash equivalents
in accordance with generally accepted accounting principles on a basis
consistent with the December 31, 1993 audited financial statements of
Acquiror.
"Acquiror Closing Balance Sheet" shall mean the consolidated balance
sheet of Acquiror immediately preceding the Closing and determined in
accordance with Section 6.3.5 setting forth, among other things, the amounts
of Acquiror Debt, Acquiror's Accounts Receivable, Acquiror Accrued Expenses,
Acquiror Accounts Payable, Acquiror Cash, Acquiror Other Current Assets and
Acquiror Accrued Income Taxes.
"Acquiror Closing Liabilities" shall mean the total of (a) Acquiror
Debt, plus (b) Acquiror Accounts Payable, plus (c) Acquiror Accrued Income
Taxes, plus (d) Acquiror Accrued Expenses, plus (e) Acquiror Other Current
Liabilities, minus (f) Acquiror Cash, minus (g) Acquiror's Accounts
Receivable, minus (h) Acquiror Other Current Assets, minus (i) Acquiror Cost
of Acquisitions, plus (j) Acquiror Proceeds From Asset Dispositions, all
determined with reference to the Acquiror Closing Balance Sheet.
"Acquiror Common Stock" is defined in Recital D.
"Acquiror Cost of Acquisitions" shall mean the actual cost expended
after March 31, 1994 but before the Closing Date and capitalized in the
Acquiror Closing Balance Sheet for local marketing agreements (including, but
not limited to, the Dallas Agreements), equity investments in programming and
television station acquisitions acquired solely with cash and/or debt.
"Acquiror Debt" shall mean all of Acquiror's long-term debt, including
the current portion thereof (and all accrued interest thereon).
"Acquiror Disclosure Document" shall mean any document filed with the
SEC in connection with this Agreement (including the Form S-4) or distributed
to Acquiror's stockholders in connection with the Distribution.
"Acquiror Employee Benefit Plan" is defined in Section 4.20(a).
"Acquiror Financial Information" is defined in Section 6.3.9.
"Acquiror Financial Statements" is defined in Section 4.6.
"Acquiror Loss" is defined in Section 10.3.1(b).
"Acquiror Other Current Assets" shall mean all of Acquiror's film
contract rights and other current assets, including all other assets that are
classified as current under generally accepted accounting principles and on a
basis consistent with the December 31, 1993 audited financial statements of
Acquiror, but excluding Acquiror Cash and Acquiror's Accounts Receivable.
"Acquiror Other Current Liabilities" shall mean all liabilities that are
classified as current liabilities in accordance with generally accepted
accounting principles, except for Acquiror Accounts Payable, Acquiror Accrued
Expenses, Acquiror Accrued Income Taxes and the current portion of Acquiror
Debt.
"Acquiror Proceeds From Asset Dispositions" shall mean the fair market
value of all consideration received as a result of the sale, transfer,
exchange or other disposition of any and all assets of Acquiror after the
execution date of this Agreement and prior to the Closing other than
immaterial transactions (individually or in the aggregate) in the ordinary
course of business consistent with past practice.
"Actual Cash Consideration" shall mean (a) $120,170,000, plus (b) the
amount, if any, by which the Station Closing Accounts Receivable are greater
than $8,250,000, minus (c) the amount, if any, by which the Station Closing
Accounts Receivable are less than $8,250,000, plus (d) the product of (i)
.1151 and (ii) the amount, if any, by which the Acquiror Closing Liabilities
are greater than $172,881,000, minus (e) the product of (i) .1151 and (ii) the
amount, if any, by which the Acquiror Closing Liabilities are less than
$172,881,000, minus (f) the amount of Station Film Payables Outstanding, minus
(g) the amount, if any, by which Station Accounts Payable exceed $2,000,000,
plus (h) the amount, if any, by which Station Accounts Payable are less than
$2,000,000, plus (i) the Stock Option Adjustment Amount.
"Affiliate" of any Person (the "Subject") shall mean any other Person
that, directly or indirectly, controls or is controlled by or is under common
control with the Subject and, without limiting the generality of the
foregoing, shall in any event include (a) any Person that beneficially owns or
holds 25% or more of any class of voting securities of the Subject or 25% or
more of the legal or beneficial interest in the Subject and (b) any Person of
which the Subject beneficially owns or holds 25% or more of any class of
voting securities or 25% or more of the legal or beneficial interest.
"Affiliated Group" shall mean any "affiliated group" (as defined in
Section 1504(a) of the Code without regard to the limitations contained in
Section 1504(b) of the Code) and any consolidated, combined or unitary group
under state, local or foreign law that includes (a) in the case of Station and
Stockholder, Station and (b) in the case of Parent and Acquiror, Acquiror or
any of the LIN Stations; provided, however, that the term "Affiliated Group"
shall in no event include any stockholder (or any person that owns, directly
or indirectly, any interest in any such stockholder) of Parent or Cook Inlet
Region, Inc. that owns less than 80% of the outstanding common stock of Parent
or Cook Inlet Region, Inc., respectively.
"Aggregate Option Exercise Price" shall mean the aggregate exercise
price for all employee options to purchase Acquiror Common Stock that are
outstanding or that Acquiror is obligated to issue at the time of the
Distribution that have an exercise price of less than the Open Market Share
Value.
"Aggregate Option Market Price" shall mean the product of (a) the total
number of shares of Acquiror Common Stock subject to employee options that are
outstanding at the time of the Distribution that have an exercise price of
less than the Open Market Share Value and (b) the Open Market Share Value.
"ASCAP Litigation" shall mean the lawsuit entitled Buffalo Broadcasting
Co. v. ASCAP, 546 F. Supp. 274 (S.D.N.Y. 1982), rev'd, 744 F.2d 917 (2d Cir.
1984), cert. denied, 469 U.S. 1211 (1985), and all liabilities attributable to
ASCAP, BMI and local music license fees, including, but not limited to,
administration fees, attorneys' fees and all other liabilities and expenses
relating thereto.
"Assets" is defined in Section 2.1.
"Assignment and Assumption Agreement" shall mean the Assignment and
Assumption Agreement of Acquiror to be delivered by Acquiror to Station at the
Closing, which shall be in a form mutually acceptable to Station and Acquiror.
"Assumed Liabilities" is defined in Section 2.3.
"Balance Sheet Items" is defined in Section 6.3.9.
"Bankruptcy Code" shall mean the Bankruptcy Reform Act of 1978, as
amended, Title 11, United States Code.
"Bill of Sale" shall mean the Bill of Sale of Station to be delivered by
Station to Acquiror at the Closing, which shall be in a form mutually
acceptable to Acquiror and Station.
"Buyer Indemnified Damages" is defined in Section 10.3.1(c).
"Closing" shall mean the closing of the sale and purchase of the Assets
and the assumption by Acquiror of the Assumed Liabilities on the Closing Date,
all in accordance with this Agreement.
"Closing Date" is defined in Section 8.1.
"Closing Shares Outstanding" shall mean the quotient of (a) the number
of shares of Acquiror Common Stock distributed to Parent's stockholders in the
Distribution, divided by (b) .8849.
"COBRA" is defined in Section 6.3.8(c).
"Code" shall mean the Internal Revenue Code of 1986, as amended.
"Communications Act" shall mean the Communications Act of 1934, as
amended, and the rules, regulations and policies of the FCC promulgated
thereunder.
"Confidentiality Agreement" shall mean the letter agreement dated March
23, 1994, between Stockholder and Parent.
"Control" (including, with correlative meanings, the terms
"controlling," "controlled by" and "under common control with"), as used with
respect to any Person, shall mean the possession, directly or indirectly, of
the power to direct or cause the direction of the management and policies of
such Person, whether through the ownership of voting securities or by contract
or otherwise.
"Dallas Agreements" shall mean the agreements that Acquiror and Parent
have entered into with respect to KXTX, Inc., including, without limitation,
agreements regarding the purchase of assets and the purchase of capital stock,
an option to purchase capital stock and a local marketing agreement.
"Deemed Loss" is defined in Section 10.3.1(b).
"Distribution" is defined in Recital D.
"DOJ" shall mean the Antitrust Division of the United States Department
of Justice.
"DOL" shall mean the United States Department of Labor.
"Encumbrance" shall mean any lien, mortgage, pledge, deed of trust,
security interest, conditional sales agreement, charge, encumbrance or other
adverse claim or interest of any kind (including, without limitation, Tax
liens), excluding, in the case of real property, utility easements.
"Environmental Laws" shall mean all federal, state, county or local
statutes, laws, regulations, guidelines, rules, ordinances, codes, licenses,
permits, judgments, writs, decrees, injunctions or orders of any Governmental
Entity relating to the protection of human health and the environment (air,
water, groundwater, soil, noise, odor, wastes and toxic materials), including,
by way of illustration and not limitation, the Clean Air Act, the Federal
Water Pollution Control Act (as amended by the Clean Water Act of 1977 and the
Water Quality Act of 1987), the Resource Conservation and Recovery Act of 1976
(as amended by the Hazardous and Solid Waste Amendments of 1984), the
Comprehensive Environmental Response, Compensation, and Liability Act of 1980
(as amended by the Superfund Amendments and Reauthorization Act of 1986), the
Hazardous Materials Transportation Act, the Toxic Substances Control Act and
any rules and regulations implementing these statutes and laws, as well as all
other applicable federal, state, county, local and foreign environmental
requirements.
"ERISA" shall mean the Employee Retirement Income Security Act of 1974,
as amended.
"Estimated Cash Consideration" is defined in Section 2.6(a).
"Exchange Act" shall mean the Securities Exchange Act of 1934, as
amended, and the rules and regulations promulgated thereunder.
"Excluded Assets" is defined in Section 2.2.
"Excluded Liabilities" is defined in Section 2.4.
"Exclusivity Agreement" shall mean the exclusivity letter agreement
dated April 5, 1994, and amended May 13, 1994, between Acquiror and
Stockholder.
"FCC" shall mean the Federal Communications Commission.
"FCC Applications" is defined in Section 5.1(a).
"FCC Approval" shall mean the FCC's approval of the FCC Applications.
"FCC Licenses" shall mean all licenses and permits issued or granted by,
and any authorizations of, the FCC for the operation of the relevant
station(s), including, but not limited to, the licenses, permits and
authorizations set forth in Schedules 3.7 and 4.7.
"FCC Order" shall mean an order of the FCC, or of the Mass Media Bureau
of the FCC, acting under delegated authority.
"Form S-4" shall mean the registration statement on Form S-4 or any
successor form to be prepared and filed with the SEC by Acquiror pursuant to
Section 6.2.5.
"FTC" shall mean the Federal Trade Commission.
"Governmental Entity" shall mean the United States, any state of the
United States or any federal, state, local or foreign government, court,
administrative agency or commission or other governmental authority or
instrumentality.
"Hazardous Materials" shall mean any hazardous or toxic substance,
material or waste, including, but not limited to, those substances, materials
and wastes listed in the United States Department of Transportation Hazardous
Materials Table (49 C.F.R. section 172.101) or by the United States
Environmental Protection Agency as hazardous substances (40 C.F.R. Part 302
and amendments thereto), petroleum products and their derivatives, and such
other substances, materials and wastes as become regulated or subject to
cleanup authority under any Environmental Laws.
"HSR Act" shall mean the Hart-Scott-Rodino Antitrust Improvements Act of
1976, as amended.
"Indemnifying Party" is defined in Section 10.3.2.
"Indemnitee" is defined in Section 10.3.2.
"Interest" shall mean 8% per annum calculated based on a 365-day year
and the actual number of days elapsed.
"IRS" shall mean the Internal Revenue Service.
"Letter Ruling" is defined in Section 6.2.3.
"Letter Ruling Notice" is defined in Section 6.2.3.
"LIN Personal Property" is defined in Section 4.12(c).
"LIN Real Property" is defined in Section 4.12(a).
"LIN Stations" shall mean all subsidiaries of Acquiror listed on
Schedule 4.3, including, without limitation, the Major LIN Stations and KXAN,
Inc. (KXAN-TV (Austin, Texas)), WAND Television, Inc. (WAND-TV (Decatur-
Champaign-Springfield-Danville, Illinois)) and Indiana Broadcasting
Corporation (WISH-TV (Indianapolis, Indiana) and WANE-TV (Fort Wayne,
Indiana)).
"Major LIN Stations" shall mean North Texas Broadcasting Corporation
(KXAS-TV (Dallas-Fort Worth, Texas)), the WISH-TV division of Indiana
Broadcasting Corporation (WISH-TV (Indianapolis, Indiana)) and WAVY
Television, Inc. (WAVY-TV (Hampton Roads, Virginia)).
"Material Adverse Effect" with respect to any entity or to any assets
shall mean any change or effect that, when taken together with all other
adverse changes and effects (including, without limitation, such changes and
effects that are within the scope of the representations and warranties made
by such entity or as to such assets, but are not individually or in the
aggregate deemed to have a Material Adverse Effect on such entity or such
assets), is, or is reasonably likely to be, materially adverse to the
business, operations, properties, condition (financial or otherwise), assets,
liabilities or prospects of such entity or such assets, as applicable;
provided, however, that economic and regulatory conditions generally affecting
the television broadcasting industry shall not be deemed alone, or in
combination with other factors, to have a Material Adverse Effect; provided
further, that any Tax liability for which Acquiror is or may be liable solely
as a result of being a member of an Affiliated Group (and not as a result of
its own operations) shall not be deemed to have a Material Adverse Effect on
Acquiror to the extent that Parent agrees to indemnify Acquiror for such Tax
liability.
"McCaw" shall mean McCaw Cellular Communications, Inc., a Delaware
corporation.
"Net Book Value" shall mean the net book value of the personal property
of any party as determined in accordance with generally accepted accounting
principles and as reflected in the books and records relied upon by such party
in the preparation of audited financial statements.
"Open Market Share Value" shall mean the average of the high and low
sales prices of the Acquiror Common Stock on the Nasdaq National Market, the
American Stock Exchange, Inc. or the New York Stock Exchange, Inc., as the
case may be, for each of the 20 trading days commencing on the sixth trading
day following the Distribution.
"Parent Threshold Amount" shall have the meaning assigned to that term
in the Solvency Letter Agreement.
"PBGC" shall mean the Pension Benefit Guaranty Corporation.
"Person" shall mean any individual, partnership, joint-stock company,
firm, corporation, association, unincorporated organization, joint venture,
trust or other entity.
"Profit Sharing Plan" shall mean the Profit Sharing Plan for Employees
of Station WTNH-TV.
"Registration Rights Agreement" shall mean the Registration Rights
Agreement to be entered into by Acquiror and Station at the Closing, a form of
which is attached as Exhibit A hereto.
"Related Agreements" shall mean the Stockholders Agreement, the
Registration Rights Agreement, the Assignment and Assumption Agreement and the
Bill of Sale.
"Reorganization Plan" shall mean the Cook Inlet Communications Corp.
Chapter 11 Plan dated July 8, 1993 as confirmed by the United States
Bankruptcy Court for the District of Delaware on August 12, 1993.
"Revenue Procedure" is defined in Section 6.2.3.
"SEC" shall mean the Securities and Exchange Commission.
"Section 355 Representation" is described in Section 10.4.2.
"Securities Act" shall mean the Securities Act of 1933, as amended, and
the rules and regulations promulgated thereunder.
"Seller Indemnified Damages" is defined in Section 10.3.1(a).
"Share Consideration" is defined in Section 2.6(b).
"Solvency Letter Agreement" shall mean that certain Letter Agreement
between McCaw and Cook Inlet Region, Inc., a form of which is attached as
Exhibit D hereto.
"Station Accounts Payable" shall mean all accounts payable of Station in
accordance with generally accepted accounting principles determined as of the
Closing Date and adjusted in accordance with Section 6.3.10, but excluding (a)
Station Film Payables Outstanding and (b) all liabilities relating to employee
accrued vacation and sick leave.
"Station Balance Sheet" is defined in Section 3.6.
"Station Closing Accounts Receivable" shall mean the Accounts Receivable
of Station as of the Closing Date determined with reference to the Station
Closing Balance Sheet and adjusted in accordance with Section 6.3.10.
"Station Closing Balance Sheet" shall mean the balance sheet of Station
immediately preceding the Closing and determined in accordance with Section
6.3.5 setting forth, among other things, the amount of Station Closing
Accounts Receivable.
"Station Employee Benefit Plan" is defined in Section 3.20(a).
"Station Film Payables Outstanding" shall mean the aggregate amount of
all film contract payment obligations owed by Station, other than payment
obligations that are not more than 60 days past their respective contractual
due date.
"Station Financial Information" is defined in Section 6.3.9.
"Station Financial Statements" is defined in Section 3.6.
"Station Personal Property" is defined in Section 3.12(b).
"Station Real Property" is defined in Section 3.12(a).
"Station Tax Indemnitees" is defined in Section 10.4.3.
"Station Union Contracts" shall mean Station's Collective Bargaining
Agreement with the American Federation of Television and Radio Artists
effective for the period May 1, 1993 to April 30, 1996 and Collective
Bargaining Agreement with the National Association of Broadcast Employees and
Technicians (AFL-CIO) effective for the period February 11, 1994 to February
10, 1998.
"Stockholders Agreement" shall mean the Stockholders Agreement to be
entered into by Parent, Acquiror and Station at the Closing, a form of which
is attached as Exhibit B hereto.
"Stock Option Adjustment Amount" shall mean the product of (a) .1151 and
(b) the Aggregate Option Market Price minus the Aggregate Option Exercise
Price.
"Tax" or "Taxes" shall mean all federal, state, local or foreign income,
gross receipts, windfall profits, severance, property, production, sales, use,
license, excise, franchise, employment, withholding or similar taxes imposed
on the income, properties or operations of, in the case of Station, Station or
its Affiliated Group or, in the case of Acquiror, Acquiror or its Affiliated
Group, together with any interest, additions or penalties with respect thereto
and any interest in respect of such additions or penalties, and all reasonable
fees associated with resolving any related disputes, including, but not
limited to, accounting, legal and consulting fees; provided, however, that
such terms shall not include real property transfer taxes or sales taxes
imposed in connection with the transactions contemplated by this Agreement.
"Tax Returns" shall mean all reports and returns required to be filed on
or before the Closing Date with respect to the Taxes of, in the case of
Station, Station and its Affiliated Group and, in the case of Acquiror,
Acquiror and its Affiliated Group, including, without limitation, consolidated
federal income tax returns of the relevant Affiliated Group.
"Tradeout Agreements" shall mean all contracts, agreements or
commitments, oral or written, pursuant to which a party has sold or traded
commercial airtime in consideration for any property or services in lieu of or
in addition to cash, including, without limitation, agreements under which
commercial airtime availabilities within a particular program are exchanged
for the provision of such program.
"WARN Act" shall mean the Worker Adjustment and Retraining Notification
Act.
1.2 Other Definitional Matters
(a) The words "this Agreement," "hereby," "herein," "hereof" and
"hereunder" and words of similar import shall refer to this Agreement as a
whole and not to any particular provision of this Agreement, and the words
"Article," "Section," "Schedule," "Exhibit" and like references are to this
Agreement, unless otherwise specified.
(b) Singular and plural forms, as the case may be, of terms defined
herein shall have correlative meanings.
(c) Any defined term that relates to a document shall include within
its definition any amendments, modifications, renewals, restatements,
extensions, supplements or substitutions that may heretofore have been or that
may hereafter be executed in accordance with the terms thereof and as may be
permitted by this Agreement.
(d) The phrases "after due inquiry of the management of the LIN
Stations" and "after due inquiry of the management of the Major LIN Stations"
shall mean that a representative of Acquiror or Parent has inquired of the
General Managers of the LIN Stations or the Major LIN Stations, respectively.
(e) The phrase "to the knowledge of Parent" and phrases of like import
shall include the knowledge of Parent's direct wholly owned subsidiary, LTC
Holdings, Inc. The phrase "to the knowledge of Acquiror" and phrases of like
import shall include the knowledge of Acquiror's direct wholly owned
subsidiary, LWWI Broadcasting, Inc.
ARTICLE II PURCHASE OF ASSETS AND ASSUMPTION OF LIABILITIES
2.1 Purchase of Assets
At the Closing and subject to the terms and conditions of this
Agreement, Station hereby agrees to sell, assign, transfer, convey and deliver
to Acquiror, and Acquiror hereby agrees to purchase, acquire and accept from
Station, all the tangible and intangible assets owned or held by Station,
including all such assets acquired by Station between the date hereof and the
Closing Date, except for the Excluded Assets (collectively, the "Assets").
The Assets shall include, without limitation, all of Station's right, title
and interest in, to and under the following:
2.1.1 Equipment and Other Personal Property
All machinery, equipment, office furniture, fixtures, office materials
and supplies, motor vehicles, tools, spare parts, leasehold improvements and
other tangible personal property, including, without limitation, the equipment
described in Schedule 3.12(b).
2.1.2 Licenses
Station's FCC Licenses and all other licenses, approvals,
authorizations, consents, orders, registrations and permits (including
renewals or modifications thereof and applications therefor), including,
without limitation, the licenses described in Schedule 3.7 and the call sign
WTNH-TV.
2.1.3 Equipment and Other Personal Property Leases
All leases and rental agreements in respect of equipment or other
tangible personal property, including, without limitation, the leases and
agreements described in Schedule 3.12(b).
2.1.4 Accounts Receivable
All Accounts Receivable earned by Station on or prior to the Closing
Date.
2.1.5 Intellectual Property
All intellectual property rights, and all licenses, sublicenses or like
agreements providing Station any right or concession to use any such
intellectual property, including all trade names, trademarks, service marks,
patents, copyrights and their registrations and applications and all goodwill
associated therewith, and all technology, know-how, trade secrets, jingles,
logotypes, slogans, promotional materials, manufacturing processes, formulae,
drawings, designs, computer programs and all documentary evidence thereof,
including, without limitation, the intellectual property rights described in
Schedule 3.16.
2.1.6 Programming Materials
All rights of Station in and to programs and programming material of
whatever form or nature (whether recorded on film, tape or any other substance
or intended for live performance, whether intended for television broadcast or
any other medium, and whether completed or in production).
2.1.7 Contract Rights and Other Intangible Assets
All network affiliation agreements, film contracts, advertising
contracts, Tradeout Agreements, and other contracts and agreements, intangible
assets, and goodwill associated with Station and Station's name (including
Station's call letters), including, without limitation, the contracts,
agreements and other assets described in Schedule 3.11.
2.1.8 Real Property
All Station Real Property, and rights thereto, including all buildings,
structures and improvements of every nature located thereon, owned or leased
by Station, as described in Schedule 3.12(a).
2.1.9 Claims
Other than the assets included in Excluded Assets, all rights and claims
of Station, whether mature, contingent or otherwise, against third parties
relating to the Assets, whether in tort, contract or otherwise, including,
without limitation, causes of action, unliquidated rights or claims under or
pursuant to all warranties, representations and guarantees made by
manufacturers, suppliers or vendors.
2.1.10 Customer Relationships
All relationships with customers, including, but not limited to, all
files containing information and knowledge about existing and prior customers
of Station.
2.1.11 Files and Records
All files and records, including schematics, technical information and
engineering data, programming information, books of account, employment
records and personnel files, purchase and sale records and correspondence,
advertising records, files and literature, and FCC logs, files and records
(including, without limitation, the files referred to in Section 2.1.10).
2.2 Excluded Assets
Station shall not transfer to Acquiror and Acquiror shall not acquire
from Station the assets that are listed below or described in Schedule 2.2
(collectively, the "Excluded Assets"), which assets are specifically excluded
from the Assets and shall remain the property of Station:
(a) Station's corporate seal, minute books, charter documents,
corporate stock record books and such other books and records as pertain to
Station's organization, existence or share capitalization or as are necessary
to enable Station to file its Tax Returns and reports; provided, however, that
such books and records shall be maintained in existence for a period of five
years following the Closing Date and shall be made available for inspection
and duplication by Acquiror upon request for good cause, at its expense and
during normal business hours;
(b) All cash and cash equivalents such as certificates of deposit,
Treasury bills and other marketable securities;
(c) All claims, judgments, settlements, insurance proceeds, refunds or
other recoveries in respect of any action, suit or proceeding that relate to
any liability retained by Station pursuant to Section 2.4(c);
(d) The names "Cook Inlet Communications" and "Cook Inlet" and
derivations thereof; and
(e) Any claim with respect to, and all benefits of, property tax
appeals with respect to such taxes applicable to periods prior to the Closing.
2.3 Assumption of Liabilities
Subject to the terms and conditions of this Agreement, Acquiror shall
assume and agree to pay, perform and fully discharge the following liabilities
and obligations (collectively, the "Assumed Liabilities"):
(a) All liabilities and obligations of Station that are reflected on
the Station Balance Sheet or that arise between the date of the Station
Balance Sheet and the Closing Date, to the extent that the same remain unpaid
at the Closing Date, except for the Excluded Liabilities;
(b) Liabilities and obligations of Station that arise out of or relate
to the Assets, including, without limitation, all liabilities and obligations
of Station under any contract, license, permit, agreement, arrangement or
undertaking included among the Assets;
(c) Liabilities and obligations arising out of or relating to the
existence of Hazardous Materials upon, about, beneath or migrating or
threatening to migrate to or from any of the Assets or the existence of any
violation of any Environmental Laws pertaining to any of the Assets or the
business operated in connection therewith;
(d) Liabilities and obligations of Station in respect of the Profit
Sharing Plan and the severance, health, vacation and sick leave policies and
programs listed in Schedule 3.20, other than any liability or obligation to
the General Manager of Station resulting from the transactions contemplated by
this Agreement; and
(e) Liabilities relating to or arising out of the ASCAP Litigation.
2.4 Excluded Liabilities
Acquiror shall not assume any liabilities other than the Assumed
Liabilities nor shall it assume any of the following liabilities and
obligations (collectively, the "Excluded Liabilities"), which liabilities and
obligations shall remain liabilities and obligations of Station:
(a) Any liabilities or obligations incurred by Station pursuant to the
express terms of this Agreement;
(b) Other than as provided in Section 2.5, any liabilities for Taxes,
either accruing with respect to or relating to the period prior to and through
the end of the Closing Date;
(c) Any claim, judgment, penalty, settlement agreement or other
obligation to pay damages in respect of any action, suit or proceeding that is
pending or threatened prior to the Closing Date and, other than as provided in
Section 2.3(c) and other than the ASCAP Litigation, any claim or liability for
any injury incurred prior to the Closing Date, whether based on any act or
omission of Station or others, including, without limitation, those listed in
Schedule 3.14;
(d) Except to the extent accrued in Station Accounts Payable or paid
by Station prior to the Closing, all severance obligations and other costs of
termination of employees wherever located resulting from any termination or
cessation of employment occurring prior to the Closing Date, from whatever
source such obligations and costs arise, including, without limitation,
contractual obligations, notices to employees, employment manuals, course of
dealings, past practices or otherwise; and
(e) All long-term debt (to both related and unrelated parties) of
Station, including the current portion thereof (including interest thereon).
Notwithstanding any other provision of this Agreement, Acquiror shall be
obligated to assume Station's obligations under the Station Union Contracts
only to the extent required by law.
2.5 Transfer Taxes
Station and Acquiror shall each pay one-half of all sales and use taxes
arising out of the transfer of the Assets, including real estate transfer and
conveyance taxes.
2.6 Purchase Price
At the Closing and subject to the terms and conditions hereof, in full
consideration for the Assets and in addition to Acquiror's assumption of the
Assumed Liabilities, Acquiror shall deliver to Station:
(a) $120,170,000 in immediately available funds (the "Estimated Cash
Consideration") and
(b) a number of shares of Acquiror Common Stock equal to the product
of (i) .1151 and (ii) the Closing Shares Outstanding (the "Share
Consideration").
Upon determination of the Actual Cash Consideration in accordance with Section
6.3.5, any difference between the Estimated Cash Consideration and the Actual
Cash Consideration shall be settled in accordance with Section 6.3.5.
2.7 Instruments of Sale and Transfer; Further Assurances
On or prior to the Closing Date, Station shall deliver to Acquiror such
instruments of sale and assignment as shall be effective to vest in Acquiror,
on the Closing Date, all of Station's right, title and interest in and to the
Assets. At the Closing, Acquiror shall deliver to Station such additional
instruments of assumption as shall be effective to impose on Acquiror, as of
the Closing Date, the obligation to assume, pay, perform and discharge the
Assumed Liabilities. Station shall take all reasonable additional steps as
may be necessary to put Acquiror in possession and operating control of the
Assets on the Closing Date, and Acquiror shall take all reasonable additional
steps as may be necessary for it to assume the Assumed Liabilities on the
Closing Date.
2.8 Allocation of Purchase Price
Acquiror and Station shall deliver to each other upon final determination
of the Actual Cash Consideration, and shall thereafter timely and properly
file, IRS Form 8594 based on an allocation of the aggregate Actual Cash
Consideration and Share Consideration as mutually agreed upon by Acquiror and
Station.
2.9 Assignment of Contracts and Rights
Notwithstanding anything in this Agreement to the contrary, this
Agreement shall not constitute an agreement to assign any claim, contract,
license, lease, commitment, sales order or purchase order or any claim, right
or benefit arising thereunder or resulting therefrom if the agreement to
assign or attempt to assign, without the consent of a third party, would
constitute a breach thereof or in any way adversely affect the rights of
Acquiror thereunder. Until such consent is obtained, or if an attempted
assignment thereof would be ineffective or would adversely affect the rights
of Station or Acquiror thereunder so that Acquiror would not, in fact, receive
all such rights, Acquiror and Station will cooperate with each other in any
arrangement designed to provide for Acquiror the benefits of, and to permit
Acquiror to assume all liabilities under, any such claim, contract, license,
lease, commitment, sales order or purchase order; provided, however, that such
arrangements will be for the benefit and protection of Station, to the extent
provided in Section 2.3. Any transfer or assignment to Acquiror by Station of
any contract or agreement that shall require the consent or approval of any
third party shall, without reducing or adversely affecting Station's
obligations to transfer or assign such contract or agreement set forth in this
Article II or the representations and warranties of Stockholder and Station
set forth in Article III, be made subject to such consent or approval being
obtained.
ARTICLE III REPRESENTATIONS AND WARRANTIES OF STOCKHOLDER AND STATION
To induce Parent and Acquiror to enter into and perform their obligations
under this Agreement, except as otherwise noted below, Stockholder and Station
jointly represent and warrant to Parent and Acquiror (which representations
and warranties shall survive the Closing as provided in Article X) all as
follows in this Article III:
3.1 Organization and Good Standing
Each of Stockholder and Station is a corporation duly organized, validly
existing and in good standing under the laws of the jurisdiction of its
incorporation. Each of Stockholder and Station has all requisite corporate
power and authority to own, operate and lease its properties and assets and to
carry on its business as now conducted and as currently proposed to be
conducted, and is duly qualified to do business as a foreign corporation, and
is in good standing, in each jurisdiction in which the property owned, leased
or occupied by it or the nature of the business conducted by it makes such
qualification necessary.
3.2 Power and Authority
Each of Stockholder and Station has all requisite corporate power and
authority to execute, deliver and perform this Agreement and the Related
Agreements to which it is a party and to consummate the transactions
contemplated hereby and thereby. This Agreement and the Related Agreements to
which it is a party have been duly authorized by each of Stockholder and
Station, including approval by the stockholders of Station in accordance with
applicable law. This Agreement has been duly executed and delivered by
Stockholder and Station and is, and the Related Agreements to which either is
a party, when executed and delivered by Stockholder or Station, will be,
legal, valid and binding obligations of Stockholder or Station, enforceable
against Stockholder or Station in accordance with their respective terms,
except that (a) such enforcement may be subject to bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in effect
relating to creditors' rights generally, (b) the remedy of specific
performance and injunctive and other forms of equitable relief may be subject
to certain equitable defenses and to the discretion of the court before which
any proceeding therefor may be brought, and (c) indemnification provisions may
be subject to the effect of public policy.
3.3 Capitalization; Subsidiaries; Equity Interest
Except as set forth in Schedule 3.3, Stockholder owns all the
outstanding shares of Station's voting stock, free and clear of all
Encumbrances, options, rights of first refusal and limitations on
Stockholder's voting rights. Station does not own, directly or indirectly,
any equity or similar interest in, or any interest convertible into or
exchangeable for any equity or similar interest in, any corporation,
partnership, joint venture or other business association or entity.
3.4 No Approvals or Notices Required; No Conflicts With Instruments
The execution, delivery and performance of this Agreement and the Related
Agreements by Stockholder and Station and the consummation of the transactions
contemplated hereby and thereby will not (a) constitute a violation (with or
without the giving of notice or lapse of time, or both) of any provision of
law or any judgment, decree, order, regulation or rule of any court or other
Governmental Entity applicable to Stockholder or Station, (b) require any
consent, approval or authorization of, or declaration, filing or registration
with, any Person, except as contemplated in Article V or set forth in Schedule
3.4, (c) except as set forth in Schedule 3.4, result in a material default
(with or without the giving of notice or lapse of time, or both) under, an
acceleration or termination of, or the creation in any party of the right to
accelerate, terminate, modify or cancel, or in any other way materially affect
the rights of Acquiror (as assignee or transferee of Station) under, any
material agreement (including, without limitation, Station's network
affiliation contract), lease, note or other restriction, Encumbrance,
obligation or liability to which Station is a party or by which it is bound or
to which the Assets are subject, (d) except as set forth in Schedule 3.4,
result in the creation of any material lien or Encumbrance upon the Assets,
(e) conflict with or result in a breach of or constitute a default under any
provision of the articles of incorporation or bylaws of Stockholder or
Station, or (f) invalidate or materially adversely affect any material permit,
license, authorization or status used in or necessary for the conduct of
Station's business.
3.5 Relationship With Stockholder
Except as set forth in Schedule 3.5, neither Stockholder nor any
Affiliate of Stockholder is a party to any contract, oral or written, with
Station. Except as set forth in Schedule 3.5, Station is not indebted to
Stockholder or any Affiliate of Stockholder for any amount, and neither
Stockholder nor any Affiliate of Stockholder has any claim against Station for
any liability, damage, loss, advance, compensation or other obligation.
Neither Stockholder nor any Affiliate of Stockholder other than Station owns
or asserts any rights, licenses or any other interests in any of the Assets.
3.6 Financial Statements
Stockholder has delivered to Acquiror (a) balance sheets and statements
of income, stockholders' equity and cash flows of Station as of and for the
fiscal years ended December 31, 1991, 1992 and 1993, and accompanying notes,
audited by KPMG Peat Marwick, independent certified public accountants, and
(b) unaudited balance sheets and statements of income, stockholders' equity
and cash flows of Station as of and for the fiscal quarter ended March 31,
1994 (the balance sheet for the fiscal quarter ended March 31, 1994 being
herein referred to as the "Station Balance Sheet"). All the foregoing
financial statements are herein referred to as the "Station Financial
Statements." The Station Financial Statements have been prepared in
conformity with generally accepted accounting principles on a basis consistent
with prior accounting periods and present fairly the financial position,
results of operations and changes in financial position of Station as of the
dates and for the periods indicated, subject, in the case of the quarterly
financial statements, to normal year-end adjustments. Station has no
liability or obligation of any nature (absolute, contingent or otherwise) that
would have been required to be reserved against in the Station Financial
Statements in accordance with generally accepted accounting principles and
that was not fully reflected or reserved against therein, except for liability
reserves or obligations incurred since the date of the Station Balance Sheet
(i) in the ordinary course of business consistent with past practice or (ii)
specifically set forth in Schedule 3.6.
3.7 Licenses; Governmental Authorizations
Set forth in Schedule 3.7 is a true and complete list of all of
Station's FCC Licenses and other licenses, approvals, authorizations,
consents, orders, registrations and permits from Governmental Entities
(including renewals or modifications thereof and applications therefor). No
material licenses, approvals, authorizations, consents, orders, registrations
or permits other than those set forth in Schedule 3.7 are required for Station
to operate in the manner in which it is operating on the date hereof and as it
is currently contemplated to be operated. Except for matters set forth in
Schedule 3.7, no investigation, notice of investigation, violation, order,
complaint, action or other proceeding is pending or, to Stockholder's or
Station's knowledge, threatened before the FCC or any other Governmental
Entity to revoke, refuse to renew or modify Station's FCC Licenses or any
other authorizations of Station that could in any manner threaten or adversely
affect Station's FCC Licenses or the operations of Station as now conducted.
To Stockholder's or Station's knowledge, no event has occurred that permits,
or after notice or lapse of time, or both, would permit, the revocation or
termination of Station's FCC Licenses or the imposition of any restriction
thereon of such a nature as may materially limit the operations of Station as
now conducted.
3.8 Compliance With FCC Licenses
Except as set forth in Schedule 3.8, Station, its physical facilities,
electrical and mechanical systems, and transmitting and studio equipment are
being and have been operated in all material respects (a) in accordance with
the specifications of the applicable FCC License and in accordance with each
document submitted in support of such FCC License and (b) in compliance with
all requirements of the Communications Act.
3.9 Absence of Certain Changes or Events
Except as set forth in Schedule 3.9, since the date of the Station
Balance Sheet, Station has not:
(a) taken any action or entered into or agreed to enter into any
transaction, agreement or commitment (other than this Agreement and matters
relating hereto), except in the ordinary course of business consistent with
past practice;
(b) created or incurred any new debt or reduced any outstanding debt,
except (i) in the ordinary course of business consistent with past practice
and (ii) in connection with the redemption of Station's 10.75% Series A and
Series B Senior Secured Notes due 1998;
(c) encumbered or disposed of any Asset or made any capital
expenditure, except in the ordinary course of business consistent with past
practice;
(d) entered into or agreed to enter into any film contract, except for
film contracts entered into after the date of this Agreement in the ordinary
course of business consistent with past practice;
(e) taken any action resulting in the reduction or increase of its
working capital (current assets, including cash, less current liabilities,
excluding short-term, or the current portion of long-term, debt), except for
such customary changes as may be required in the ordinary course of business
consistent with past practice;
(f) changed in any material way other than in the ordinary course of
business consistent with past practice the compensation and terms of
employment provided to officers and principal employees; or
(g) entered into or agreed to enter into any transaction, agreement or
commitment, suffered the occurrence of any event or experienced any change in
financial condition, business, results of operations or otherwise that, in the
aggregate, has resulted, or could reasonably be expected to result, in a
Material Adverse Effect on the Assets or Station.
3.10 Taxes
No tax is required to be withheld pursuant to Section 1445 of the Code
as a result of the transfer contemplated by this Agreement.
3.11 Contracts
Schedule 3.11 contains a true and complete list of all material
contracts, oral or written, to which Station is a party or that relate to the
business or operations of Station, including, without limitation, network
affiliation agreements, national representation agreements, any agreements
with Stockholder, management agreements, local marketing agreements, film
contracts, advertising contracts that are not terminable without penalty
within 180 days after the date of the Station Balance Sheet, Tradeout
Agreements that are not terminable without penalty within 180 days after the
date of the Station Balance Sheet, security agreements, conditional sale
agreements, instruments relating to the borrowing of money, broker or
distributorship agreements and all other contracts that by their terms
contemplate aggregate payments by any party thereto of $500,000 or more, true
and complete copies of which have been delivered to Acquiror. Each such
contract is valid and in full force and effect, Station has performed all
material obligations imposed upon it thereunder and there is not under such
contract any default or event of default on the part of Station or, to
Stockholder's or Station's knowledge, any other party thereto that would, or
could reasonably be expected to, result in a Material Adverse Effect on the
Assets or Station. Station has not received notice, nor is Stockholder or
Station otherwise aware, that any party to any such contract intends to
cancel, terminate or refuse to renew the same or to exercise or decline to
exercise any option or right thereunder.
3.12 Property
(a) Attached as Schedule 3.12(a) is a true and complete list of all
real property owned, leased or rented by Station, including all easements,
rights-of-way, servitudes, leases, permits, licenses, options and other real
property rights (the "Station Real Property"), other than the Oxford property
referenced in Section 6.3.11. Schedule 3.12(a) contains a true and complete
list of all leases, subleases, rental agreements, contracts of sale, tenancies
or licenses of any portion of the Station Real Property, true and complete
copies of which have been delivered to Acquiror.
(b) Station has provided to Acquiror a true and complete list of all
personal property having a Net Book Value in excess of $25,000 that is owned,
leased or rented by Station or used in its operations (the "Station Personal
Property"). Schedule 3.12(b) contains a true and complete list of all leases,
subleases, rental agreements, service contracts, contracts of sale, tenancies
or licenses of any portion of the Station Personal Property, true and complete
copies of which have been delivered to Acquiror. The Station Real Property
and the Station Personal Property include all tangible properties and assets
(whether real, personal or mixed, other than, in the case of the Station
Personal Property, property rights with an individual Net Book Value of less
than $25,000) used in the conduct of the business and operations of Station as
now conducted and as currently proposed to be conducted.
(c) With respect to the Station Real Property that is owned by Station
in fee simple, Station has good and marketable title to such Station Real
Property free and clear of all Encumbrances, except as set forth in Schedule
3.12(c). With respect to the Station Real Property in which Station holds a
leasehold interest, the leasehold interest is free and clear of all
Encumbrances, except as set forth in Schedule 3.12(c). The Encumbrances set
forth in Schedule 3.12(c) do not in any material respect impair or reduce the
value or utility of the Station Real Property for use in the business and
operations of Station as now conducted and as currently proposed to be
conducted.
(d) There are no applicable adverse zoning, building or land use codes
or rules, ordinances, regulations or other restrictions relating to zoning or
land use that currently or, to Stockholder's or Station's knowledge after due
inquiry with applicable authorities, may prospectively prevent or cause the
imposition of material fines or penalties as the result of the use of all or
any portion of the Station Real Property for the conduct thereon of the
business of Station as now conducted and as currently proposed to be
conducted. Except as set forth in Schedule 3.12(g), Station has received all
necessary approvals with regard to occupancy and maintenance of the Station
Real Property.
(e) Each lease of any portion of the Station Real Property, and each
lease, license, rental agreement, contract of sale or other agreement to which
the Station Personal Property is subject, is valid and in good standing,
Station has performed all material obligations imposed upon it thereunder and
neither Station nor, to Stockholder's or Station's knowledge, any other party
thereto is in material default thereunder in any material respect, nor is
there any event that with notice or lapse of time, or both, would constitute a
default thereunder by Station or, to Stockholder's or Station's knowledge, any
other party thereto that would, or could reasonably be expected to, result in
a Material Adverse Effect on the Assets or Station. Station has not received
notice, nor is Stockholder or Station otherwise aware, that any party to any
such contract intends to cancel, terminate or refuse to renew the same or to
exercise or decline to exercise any option or other right thereunder. No
Station Real Property or Station Personal Property is subject to any lease,
license, contract of sale or other agreement that could reasonably be expected
to have a Material Adverse Effect on the Assets or Station.
(f) Except as set forth in Schedule 3.12(b) and for (i) assessments
with respect to Taxes not yet due and payable and (ii) mechanics',
materialmen's, carriers' and other similar liens securing indebtedness that is
in the aggregate less than $25,000, is not yet due and payable, and was
incurred in the ordinary course of business, the Station Personal Property is
free and clear of all Encumbrances, and, other than Station Personal Property
leased by Station and so noted on the list supplied pursuant to Section
3.12(b), Station has good and marketable title thereto.
(g) Except as specifically set forth in Schedule 3.12(g), Station has
no knowledge of any material physical defect in the Station Real Property.
Station is not in default under any covenant, condition, restriction,
easement, right-of-way or governmental approval relating to the Station Real
Property, the failure to comply with which would, or could reasonably be
expected to, result in a Material Adverse Effect on the Assets or Station.
(h) None of (i) the Station Real Property, (ii) the operations or
activities of the Station, or (iii) any of the other Assets constitutes,
severally or in the aggregate, an "establishment," as that term is defined in
Connecticut General Statutes section 22a-134, and the transactions
contemplated by this Agreement do not constitute the transfer of an
establishment as defined in such section.
3.13 Compliance With Environmental Laws
To Stockholder's or Station's knowledge, except as specifically set forth
in Schedule 3.13:
(a) neither Station nor any other Person (including, without
limitation, any previous owner, lessee or sublessee) has treated, stored or
disposed of Hazardous Materials on the Station Real Property, or any real
property previously owned, leased, subleased or used by Station, in violation
of any applicable Environmental Law or common law, in each case as in
existence on or prior to the Closing Date;
(b) there have been no releases of Hazardous Materials, pollutants or
contaminants by any Person (including, without limitation, any previous owner,
lessee or sublessee) on, at or from any assets or properties, including,
without limitation, the Station Real Property, or any real property previously
owned, leased, subleased or used by Station that could subject Acquiror to
liability under any Environmental Law or common law, in each case as in
existence on or prior to the Closing Date;
(c) there has been no generation or transportation of Hazardous
Materials, pollutants or contaminants by Station that could subject Acquiror
to liability under any Environmental Law or common law, in each case as in
existence on or prior to the Closing Date; and
(d) there are no Hazardous Materials present at adjacent properties
that could migrate to, through, over or under the Station Real Property.
3.14 Claims and Legal Proceedings
Except as specifically set forth in Schedule 3.14, there are no claims
(including, without limitation, Tax claims), actions, suits, arbitrations,
proceedings or investigations pending or, to Stockholder's or Station's
knowledge, threatened against Station before or by any Governmental Entity or
any other Person relating to the Assets or the business or operations of
Station or that question the validity of this Agreement or any Related
Agreement or any action taken or to be taken by Stockholder or Station
pursuant hereto or thereto or in connection with the transactions contemplated
hereby or thereby. To Stockholder's or Station's knowledge, there is no valid
basis for any such claim, action, suit, arbitration, proceeding or
investigation, other than as specifically set forth in Schedule 3.14. There
are no outstanding or unsatisfied judgments, orders, decrees or stipulations
to which Stockholder or Station is a party that involve the transactions
contemplated hereby or that would, or could reasonably be expected to, alone
or in the aggregate, have a Material Adverse Effect on the Assets or Station.
3.15 Labor Matters
There are no disputes, material employee grievances or material
disciplinary actions pending or, to Stockholder's or Station's knowledge,
threatened between Station and any of its present or former employees.
Station has complied in all material respects with all provisions of all laws
relating to the employment of labor and has no liability for any arrears of
wages or Taxes or penalties for failure to comply with any such laws.
Stockholder and Station have no knowledge of any organizational efforts
presently being made or threatened by or on behalf of any labor union with
respect to any of Station's employees. From the date of the Station Balance
Sheet to and including the Closing Date, Station has not made any loans in the
aggregate greater than $5,000 to any of its directors, officers or employees
or those of Stockholder.
Except as specifically set forth in Schedule 3.15, Station is not a
party to any:
(a) management, employment or other contract providing for the
employment or rendition of executive services;
(b) employment contract with any current or former employee that is
not terminable without penalty by Station on 30 days' notice;
(c) Station Employee Benefit Plan in which any current or former
employee may participate, except as set forth in Schedule 3.20; or
(d) collective bargaining agreement or other agreement with any labor
union or other employee organization (and no such agreement is currently being
requested by, or is under discussion by management with, any group of
employees or others).
Each such contract or other agreement or arrangement set forth in Schedule
3.15 is valid and in full force and effect, Station has performed all material
obligations imposed upon it thereunder and there are no defaults or events of
default under such contract, agreement or arrangement by Station or, to
Stockholder's or Station's knowledge, any other party thereto that would, or
could reasonably be expected to, have a Material Adverse Effect on the Assets
or Station or that would materially adversely affect the relationship of
Acquiror with the employees of Station.
3.16 Patents, Trademarks, Etc.
Set forth in Schedule 3.16 is a true and complete list of (a) all
patents, patent applications, trademark registrations and applications
therefor, trade names, service marks, and copyright registrations and
applications therefor owned by Station or that are used or useful in its
operations and (b) all interference actions or adverse claims made or
threatened in respect thereof and all claims made or threatened for alleged
infringement thereof. To Stockholder's or Station's knowledge, Station does
not infringe any valid patent, trademark, trade name, service mark or
copyright of any other Person, and no other Person is infringing upon any such
rights of Station. Station has not entered into any agreement to indemnify
any Person against any claim or charge of infringement of any patents,
trademarks, trade names, service marks, copyrights, technology, know-how,
trade secrets, processes or other intangible rights.
3.17 Accounts Receivable
All Accounts Receivable of Station are collectible within 180 days after
the date incurred in the amounts at which they are carried on Station's books
on the Closing Date.
3.18 Applicable Laws
Except as set forth in Schedule 3.18, Station has complied with all
previously existing, and is in compliance with all presently existing,
federal, state, local and foreign laws (including, without limitation, Tax
laws), rules, ordinances, decrees and orders applicable to the Assets or the
business or operations of Station, the failure to comply with which might,
alone or in the aggregate, have a Material Adverse Effect on the Assets or
Station.
3.19 Insurance
Set forth in Schedule 3.19 is a true and complete list of all of
Station's policies of insurance, including:
(a) the name, address and telephone number of the insurer and broker;
(b) the policy number, amount, expiration date and a brief description
of coverage, including the amount of any deductible; and
(c) material exceptions to each such policy.
3.20 Employee Benefit Plans
(a) Set forth in Schedule 3.20 is a true and complete list of each
employee benefit plan, fund, program, contract or arrangement, whether formal
or informal, covering or benefiting current or former employees of Station and
to which Station has an obligation to contribute, including, but not limited
to, all "employee benefit plans" as defined in Section 3(3) of ERISA, and
specifically including all retirement, pension, profit-sharing, stock bonus,
savings, thrift, bonus, cafeteria, medical, health, dental, vision,
hospitalization, welfare, life insurance, disability, accident insurance,
group insurance, sick pay, holiday and vacation programs, executive or
deferred compensation plans or contracts, stock purchase, stock option or
stock appreciation rights plans or arrangements, employment and consulting
contracts, and severance agreements, policies or plans (each, a "Station
Employee Benefit Plan"). True and correct copies of each Station Employee
Benefit Plan have been delivered to Acquiror, along with, to the extent
applicable to the particular Station Employee Benefit Plan, the following
information: copies of the annual reports (Form 5500 series) filed for the
last three years, copies of the summary plan descriptions, summary annual
reports, summaries of material modifications and all material employee manuals
or communications filed or distributed with respect to the Station Employee
Benefit Plan during the last three years, copies of all valuation and
actuarial reports, accountants' opinions and financial statements prepared
with respect to the Station Employee Benefit Plan for the last three years,
copies of any insurance contracts or trust agreements through which the
Station Employee Benefit Plan is funded, the most recent IRS determination
letter issued with respect to the Station Employee Benefit Plan and notice of
any material adverse change occurring with respect to any Station Employee
Benefit Plan since the date of the most recently completed and filed annual
report.
(b) With respect to each Station Employee Benefit Plan described in
Section 3.20(a) or any other plan, fund or program currently or previously
maintained or contributed to (or required to be contributed to) by Station or
any member of Station's controlled group (as defined in Section 4001(a)(14) of
ERISA) that is subject to Title IV of ERISA:
(i) no such plan has been terminated so as to subject, directly or
indirectly, any Asset to any liability, contingent or otherwise, or the
imposition of any lien under Title IV of ERISA;
(ii) no proceeding has been initiated or threatened by any Person
(including the PBGC) to terminate any such plan;
(iii) no condition or event exists or is threatened or expected to
occur that has or could subject, directly or indirectly, any Asset to any
liability, contingent or otherwise, or the imposition of any lien under Title
IV of ERISA or Section 412 of the Code, whether to the PBGC or to any other
Person or otherwise;
(iv) if any such plan were to be terminated as of the Closing Date, no
Asset would be subject, directly or indirectly, to any liability, contingent
or otherwise, or the imposition of any lien under Title IV of ERISA, and all
benefits accrued to the Closing Date (whether or not vested) would be fully
funded in accordance with the actuarial assumptions and methods utilized by
such plan for valuation purposes;
(v) no event has occurred since the inception of any such plan or is
threatened or expected to occur that would constitute a "reportable event"
within the meaning of Section 4043 of ERISA;
(vi) the funding method used in connection with any such plan is
acceptable under ERISA, and the actuarial assumptions used in connection
therewith are, in the aggregate, reasonable; and
(vii) no such plan is a multiemployer plan (as defined in Section
4001(a)(3) of ERISA).
(c) Neither Station nor any Station Employee Benefit Plan currently or
previously maintained or contributed to by Station provides or has any
obligation to provide (or contribute toward the cost of) postretirement
welfare benefits with respect to current or former employees of Station,
including, without limitation, postretirement medical, dental, life insurance,
severance or any other similar benefit, whether provided on an insured or a
self-insured basis, other than medical payments under COBRA.
(d) With respect to each Station Employee Benefit Plan: (i) all
payments due from any such Station Employee Benefit Plan (or from Station with
respect to any such Station Employee Benefit Plan) have been made, and all
amounts properly accrued to date as liabilities of Station that have not been
paid have been properly recorded on the books of Station; (ii) Station has
complied with, and each such Station Employee Benefit Plan conforms in form
and operation to, all applicable laws and regulations, including, but not
limited to, ERISA and the Code in all respects, and all reports and
information relating to such Station Employee Benefit Plans required to be
filed with any Governmental Entity have been timely filed; (iii) all reports
and information required to be disclosed or provided to participants or their
beneficiaries have been timely disclosed or provided; (iv) no such plan that
is subject to Section 302 of ERISA or Section 412 of the Code has ever
incurred an "accumulated funding deficiency" (as defined in Section 302 of
ERISA and Section 412 of the Code), whether or not such deficiency has been
waived; (v) no event has occurred or is threatened or expected to occur that
would constitute a "prohibited transaction" within the meaning of Section 406
or 407 of ERISA or Section 4975 of the Code with respect to any Station
Employee Benefit Plan; (vi) no event or omission has occurred or is threatened
or expected to occur in connection with any Station Employee Benefit Plan that
would subject Station or any Station Employee Benefit Plan to a fine, penalty,
tax or liability, whether pursuant to any agreement, instrument,
indemnification obligation, statute, regulation or rule of law; (vii) each
such Station Employee Benefit Plan that is intended to be qualified under
Section 401 of the Code has been qualified, since its inception, under such
Code section, and any trust established thereunder has been exempt, since its
inception, from taxation under Section 501 of the Code, and no facts exist
that have adversely affected (or could adversely affect) such qualification or
exemption; (viii) such Station Employee Benefit Plan has been operated, since
its inception, in accordance with its terms; (ix) no such Station Employee
Benefit Plan is currently under investigation, audit or review, directly or
indirectly, by the IRS or the DOL, and, to Station's best knowledge, no such
action is contemplated or under consideration by the IRS or the DOL; and (x)
there are no actions, suits or claims pending (other than routine claims for
benefits) or threatened with respect to any Station Employee Benefit Plan or
against the assets of such Station Employee Benefit Plan.
(e) The transactions contemplated by this Agreement will not result in
the payment or a series of payments by Station to any Person of a "parachute
payment" within the meaning of Section 280G of the Code.
(f) Station has complied with the continuation coverage requirements
of Sections 601 through 608 of ERISA, Section 4980B of the Code and the
requirements of any similar state law regarding continued insurance coverage,
and Station has incurred no liability with respect to its failure to offer or
provide continued coverage in accordance with the foregoing requirements, nor
is there any suit or action pending or threatened with respect to such
requirements.
(g) If required under the WARN Act or any other applicable state law
regulating plant closings or mass layoffs, Station has caused there to be
filed or distributed, as appropriate, all required filings and notices.
Station has provided Acquiror with a copy of all such filings and notices and
evidence acceptable to Acquiror of the date that such filings and notices were
filed or distributed.
(h) Other than as set forth in Schedule 3.20, the consummation of the
transactions contemplated by this Agreement will not entitle any current or
former employee of Station to severance pay, unemployment compensation or any
other payment, or accelerate the time of payment or vesting, or increase the
amount of compensation due to any such current or former employee. Further,
Station has not announced any type of plan or binding commitment to create any
additional Station Employee Benefit Plan or to amend or modify any existing
Station Employee Benefit Plan.
3.21 Brokerage
Except as set forth in Schedule 3.21, neither Stockholder nor Station has
retained any broker or finder in connection with the transactions contemplated
by this Agreement. Any brokerage or finder's fee due to any broker or finder
in violation of the foregoing representation shall be paid by Stockholder.
3.22 Absence of Questionable Payments
Neither Stockholder nor Station nor any director, officer, agent,
employee or other Person acting on behalf of Stockholder or Station has used,
to Stockholder's or Station's knowledge, any funds of Station for unlawful
contributions, payments, gifts or entertainment or made any unlawful
expenditures relating to political activity to any government official or
other Person in connection with the business or operations of Station.
Neither Stockholder nor Station nor any director, officer, agent, employee or
other Person acting on behalf of Stockholder or Station has accepted or
received, to Stockholder's or Station's knowledge, any unlawful contributions,
payments, gifts or expenditures in connection with the business or operations
of Station.
3.23 Chapter 11 Representations
In all material respects, Station and its Affiliates have complied with
all provisions of the Bankruptcy Code and have performed all of their
obligations under the Reorganization Plan. There are no pending objections to
Claims or Interests (as such terms are defined in the Reorganization Plan)
under Section 15.02 of the Reorganization Plan.
3.24 Full Disclosure
No information furnished by Stockholder or Station to Parent or Acquiror
in connection with this Agreement (including, but not limited to, the Station
Financial Statements and all information in the Schedules) is false or
misleading in any material respect. In connection with such information and
with this Agreement and the transactions contemplated hereby, Stockholder and
Station have not made any untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements made or
information delivered, in light of the circumstances under which they were
made, not misleading.
ARTICLE IV REPRESENTATIONS AND WARRANTIES OF PARENT AND ACQUIROR
To induce Stockholder and Station to enter into and perform their
obligations under this Agreement, Parent and Acquiror jointly represent and
warrant to Stockholder and Station (which representations and warranties shall
survive the Closing as provided in Article X) all as follows in this Article
IV:
4.1 Organization and Good Standing
Each of Parent and Acquiror is a corporation duly organized, validly
existing and in good standing under the laws of the state of Delaware. Each
of Parent, Acquiror and each of the LIN Stations has all requisite corporate
power and authority to own, operate and lease its properties and assets and to
carry on its business as now conducted and as currently proposed to be
conducted, and is duly qualified to do business as a foreign corporation, and
is in good standing, in each jurisdiction in which the property owned, leased
or occupied by it or the nature of the business conducted by it makes such
qualification necessary.
4.2 Power and Authority
Each of Parent and Acquiror has all requisite corporate power and
authority to execute, deliver and perform this Agreement and the Related
Agreements to which it is a party and to consummate the transactions
contemplated hereby and thereby. This Agreement and the Related Agreements to
which it is a party have been duly authorized by each of Parent and Acquiror.
This Agreement has been duly executed and delivered by Parent and Acquiror and
is, and the Related Agreements to which either is a party, when executed and
delivered by Parent or Acquiror, will be, legal, valid and binding obligations
of Parent and Acquiror, enforceable against Parent or Acquiror in accordance
with their respective terms, except that (a) such enforcement may be subject
to bankruptcy, insolvency, reorganization, moratorium or other similar laws
now or hereafter in effect relating to creditors' rights generally, (b) the
remedy of specific performance and injunctive and other forms of equitable
relief may be subject to certain equitable defenses and to the discretion of
the court before which any proceeding therefor may be brought, and (c)
indemnification provisions may be subject to the effect of public policy.
4.3 Capitalization; Subsidiaries; Equity Interests
(a) The authorized capital stock of Acquiror consists of 1,000 shares
of Acquiror Common Stock, 200 shares of which are issued and outstanding. All
the issued and outstanding shares of Acquiror Common Stock are held by
Parent's direct wholly owned subsidiary, LTC Holdings, Inc., free and clear,
except as set forth in Schedule 4.3, of all Encumbrances, options, rights of
first refusal and limitations on voting rights. All outstanding shares of
Acquiror Common Stock are duly authorized, validly issued, fully paid and
nonassessable, and no class of Acquiror's capital stock is entitled to
preemptive rights. There are no options, warrants or other rights to acquire
capital stock or securities representing the right to purchase or receive
capital stock from Acquiror, except that Acquiror intends to issue employee
stock options immediately following the Distribution in accordance with
Schedule 4.3. The shares of Acquiror Common Stock issuable pursuant to this
Agreement will be, when so issued, duly authorized, validly issued, fully paid
and nonassessable and free of any preemptive or similar right.
(b) Acquiror owns, directly or indirectly, all the outstanding capital
stock of each subsidiary set forth in Schedule 4.3, free and clear, except as
set forth in Schedule 4.3, of all Encumbrances, options, rights of first
refusal and limitations on voting rights. Attached to Schedule 4.3 is an
organizational chart illustrating the ownership structure of Acquiror and each
of the LIN Stations. Each subsidiary set forth in Schedule 4.3 operates the
television station with the call letters set forth opposite its name in
Schedule 4.3. Except as set forth in Schedule 4.3 and except interests
acquired after the date of this Agreement in the ordinary course of business
consistent with past practice (as such term is used in Section 6.2.2),
Acquiror does not own, directly or indirectly, any equity or similar interest
in, or any interest convertible into or exchangeable for any equity or similar
interest in, any corporation, partnership, joint venture or other business
association or entity.
4.4 No Approvals or Notices Required; No Conflicts With Instruments
The execution, delivery and performance of this Agreement and the Related
Agreements by Parent and Acquiror, the issuance of the shares of Acquiror
Common Stock to Station and the consummation of the transactions contemplated
hereby and by the Related Agreements will not (a) constitute a violation (with
or without the giving of notice or lapse of time, or both) of any provision of
law or any judgment, decree, order, regulation or rule of any court or other
Governmental Entity applicable to Parent or Acquiror, (b) require any consent,
approval or authorization of, or declaration, filing or registration with, any
Person, except as contemplated in Article V or set forth in Schedule 4.4, (c)
except as set forth in Schedule 4.4, result in a material default (with or
without the giving of notice or lapse of time, or both) under, an acceleration
or termination of, or the creation in any party of the right to accelerate,
terminate, modify or cancel, any material agreement (including, without
limitation, the LIN Stations' network affiliation contracts), lease, note or
other restriction, Encumbrance, obligation or liability to which Acquiror is a
party or by which it is bound or to which its assets are subject, (d) except
as set forth in Schedule 4.4, result in the creation of any material lien or
Encumbrance upon the assets of Acquiror or any of the LIN Stations or the
shares of Acquiror Common Stock being delivered in connection herewith, (e)
conflict with or result in a breach of or constitute a default under any
provision of the certificate of incorporation or by-laws of Parent or
Acquiror, or (f) invalidate or materially adversely affect any material
permit, license, authorization or status used in or necessary for the conduct
of Acquiror's business.
4.5 Relationship With Parent
Except as set forth in Schedule 4.5, neither Parent nor any Affiliate of
Parent is a party to any contract, oral or written, with Acquiror or any of
the LIN Stations. Except as set forth in Schedule 4.5, neither Acquiror nor
any of the LIN Stations is indebted to Parent or any Affiliate of Parent for
any amount, and neither Parent nor any Affiliate of Parent has any claim
against Acquiror or any of the LIN Stations for any liability, damage, loss,
advance, compensation or other obligation. Neither Parent nor any Affiliate
of Parent other than Acquiror owns or asserts any rights, licenses or any
other interests in any of the assets of Acquiror or any of the LIN Stations.
4.6 Financial Statements
Acquiror has delivered to Stockholder (a) consolidated balance sheets
and consolidated statements of income, stockholders' equity and cash flows of
Acquiror as of and for the fiscal years ended December 31, 1991, 1992 and
1993, and accompanying notes, audited by Ernst & Young, independent certified
public accountants, and (b) unaudited consolidated balance sheets and
consolidated statements of income, stockholders' equity and cash flows of
Acquiror as of and for the fiscal quarter ended March 31, 1994 (the
consolidated balance sheet for the fiscal quarter ended March 31, 1994 being
herein referred to as the "Acquiror Balance Sheet"). All the foregoing
consolidated financial statements are herein referred to as the "Acquiror
Financial Statements." The Acquiror Financial Statements have been prepared
in conformity with generally accepted accounting principles on a basis
consistent with prior accounting periods and present fairly the financial
position, results of operations and changes in financial position of Acquiror
and its subsidiaries on a consolidated basis as of the dates and for the
periods indicated, subject, in the case of the quarterly financial statements,
to normal year-end adjustments. Acquiror has no liability or obligation of
any nature (absolute, contingent or otherwise) that would have been required
to be reserved against in the Acquiror Financial Statements in accordance with
generally accepted accounting principles and that was not fully reflected or
reserved against therein, except for liability reserves or obligations
incurred since the date of the Acquiror Balance Sheet (i) in the ordinary
course of business consistent with past practice or (ii) specifically set
forth in Schedule 4.6.
4.7 Licenses; Governmental Authorizations
Set forth in Schedule 4.7 is a true and complete list of all of the
Major LIN Stations' FCC Licenses and other licenses, approvals,
authorizations, consents, orders, registrations and permits from Governmental
Entities (including renewals or modifications thereof and applications
therefor). No material licenses, approvals, authorizations, consents, orders,
registrations or permits other than those set forth in Schedule 4.7 are
required for the Major LIN Stations to operate in the manner in which they are
operating on the date hereof and as they are currently contemplated to be
operated. Except for matters set forth in Schedule 4.7, no investigation,
notice of investigation, violation, order, complaint, action or other
proceeding is pending or, to Parent's or Acquiror's knowledge after due
inquiry of the management of the LIN Stations, threatened before the FCC or
any other Governmental Entity to revoke, refuse to renew or modify the LIN
Stations' FCC Licenses or any other authorizations of the LIN Stations that
could in any manner threaten or adversely affect the LIN Station's FCC
Licenses or the operations of the LIN Stations as now conducted. To Parent's
or Acquiror's knowledge, after due inquiry of the management of the LIN
Stations, no event has occurred that permits, or after notice or lapse of
time, or both, would permit, the revocation or termination of the LIN
Station's FCC Licenses or the imposition of any restriction thereon of such a
nature as may materially limit the operations of any of the LIN Stations as
now conducted.
4.8 Compliance With FCC Licenses
Except as set forth in Schedule 4.8, the LIN Stations, their physical
facilities, electrical and mechanical systems, and transmitting and studio
equipment are being and have been operated in all material respects (a) in
accordance with the specifications of the applicable FCC License and in
accordance with each document submitted in support of such FCC License and (b)
in compliance with all requirements of the Communications Act.
4.9 Absence of Certain Changes or Events
(a) Except as set forth in Schedule 4.9, since the date of the
Acquiror Balance Sheet, there has not been any:
(i) change in the business, business prospects, operations or
financial condition of Acquiror and its subsidiaries that has resulted, or
could reasonably be expected to result, in a Material Adverse Effect on
Acquiror or any of the Major LIN Stations or
(ii) declaration, setting aside or payment of any dividend or other
distribution (whether in cash, stock, property or any combination thereof) in
respect of the Acquiror Common Stock, or any redemption or other acquisition
by Acquiror of any shares of Acquiror Common Stock.
(b) Except as set forth in Schedule 4.9, since the date of the
Acquiror Balance Sheet, neither Acquiror nor any of the LIN Stations have:
(i) taken any action or entered into or agreed to enter into any
transaction, agreement or commitment (other than this Agreement and matters
relating hereto), except in the ordinary course of business consistent with
past practice;
(ii) created or incurred any new debt or reduced any outstanding debt,
except in the ordinary course of business consistent with past practice;
(iii) encumbered or disposed of any of their properties or made any
capital expenditure, except in the ordinary course of business consistent with
past practice; or
(iv) taken any action resulting in the reduction or increase of their
working capital (current assets, including cash, less current liabilities,
excluding short-term, or the current portion of long-term, debt), except for
such customary changes as may be required in the ordinary course of business
consistent with past practice.
(c) Except as set forth in Schedule 4.9, since the date of the
Acquiror Balance Sheet, neither Acquiror nor any of the Major LIN Stations
have:
(i) entered into or agreed to enter into any film contract, except for
film contracts entered into after the date of this Agreement in the ordinary
course of business consistent with past practice;
(ii) changed in any material way other than in the ordinary course of
business consistent with past practice the compensation and terms of
employment provided to officers and principal employees; or
(iii) entered into or agreed to enter into any transaction, agreement
or commitment, suffered the occurrence of any event or experienced any change
in financial condition, business, results of operations or otherwise that, in
the aggregate, has (A) interfered with the properties or the normal and usual
operation of the business or business prospects of Acquiror or any of the
Major LIN Stations or (B) resulted, or could reasonably be expected to result,
in a Material Adverse Effect on Acquiror or any of the Major LIN Stations.
For purposes of this Section 4.9, "ordinary course of business
consistent with past practice" shall have the meaning used in Section 6.2.2.
4.10 Taxes
Except as set forth in Schedule 4.10, (a) all Tax Returns that are
required to be filed by or with respect to Acquiror's and Parent's Affiliated
Group, respectively, have been duly filed, (b) all Taxes shown to be due on
the Tax Returns referred to in clause (a) have been paid in full, (c) the Tax
Returns referred to in clause (a) have been examined by the IRS or the
appropriate state, local or foreign taxing authority or the period for
assessment of the Taxes in respect of which such Tax Returns were required to
be filed has expired, (d) all deficiencies asserted or assessments made as a
result of such examinations have been paid in full, (e) no issues that have
been raised by the relevant taxing authority in connection with the
examination of any of the Tax Returns referred to in clause (a) are currently
pending, and (f) no waivers of statutes of limitations have been given by or
requested with respect to any Taxes of Acquiror or Parent's Affiliated Group.
For federal income tax purposes, Parent is the common parent of an affiliated
group that files a consolidated federal income tax return. No Tax liability
or other liability will be imposed on Acquiror for any period up to and
including the Closing Date as a result of the termination of the Tax Sharing
Agreement, dated August 10, 1990, between Parent and Acquiror.
4.11 Contracts
Schedule 4.11 contains a true and complete list of (a) all material
contracts, oral or written, to which Acquiror or any of the Major LIN Stations
is a party or that relate to the business or operations of Acquiror or any of
the Major LIN Stations, including, without limitation, all agreements with
Parent, Acquiror or any of their Affiliates, management agreements relating to
WOOD-TV, film contracts, advertising contracts that are not terminable without
penalty within 180 days after the date of the Acquiror Balance Sheet, Tradeout
Agreements that are not terminable without penalty within 180 days after the
date of the Acquiror Balance Sheet, security agreements, conditional sale
agreements, instruments relating to the borrowing of money and broker or
distributorship agreements, (b) all contracts, oral or written, to which any
LIN Station is a party relating to network affiliation or national
representation, as well as all local marketing agreements and all agreements
with Parent, Acquiror or any of their Affiliates, and (c) all other contracts,
oral or written, to which any LIN Station is a party that by their terms
contemplate aggregate payments by any party thereto of $500,000 or more. True
and complete copies of each contract identified in Schedule 4.11 have been
delivered to Station. Each such contract is valid and in full force and
effect, Acquiror or the relevant LIN Station has performed all material
obligations imposed upon it thereunder and there is not under such contract
any default or event of default on the part of Acquiror or such LIN Station
or, to Parent's or Acquiror's knowledge after due inquiry of the management of
the LIN Stations, any other party thereto that would, or could reasonably be
expected to, result in a Material Adverse Effect on Acquiror or any of the LIN
Stations. Acquiror has not received notice, nor is Parent or Acquiror
otherwise aware after due inquiry of the management of the LIN Stations, that
any party to any such contract intends to cancel, terminate or refuse to renew
the same or to exercise or decline to exercise any option or right thereunder.
4.12 Property
(a) With respect to that real property owned, leased or rented by
Acquiror or any of the LIN Stations, including all easements, rights-of-way,
servitudes, leases, permits, licenses, options and other real property rights
(the "LIN Real Property") that is owned by any of such entities in fee simple,
Acquiror or the relevant LIN Station has good and marketable title to such LIN
Real Property free and clear of all Encumbrances, except as set forth in
Schedule 4.12(a). With respect to that LIN Real Property in which Acquiror or
any of the LIN Stations holds a leasehold interest, the leasehold interest is
free and clear of all Encumbrances, except as set forth in Schedule 4.12(a).
The Encumbrances set forth in Schedule 4.12(a) do not in any material respect
impair or reduce the value or utility of the LIN Real Property for use in the
business and operations of the Acquiror or the relevant LIN Station as now
conducted and as currently proposed to be conducted.
(b) Except as set forth in Schedule 4.12(b), there are no applicable
adverse zoning, building or land use codes or rules, ordinances, regulations
or other restrictions relating to zoning or land use that currently or, to
Parent's or Acquiror's knowledge after due inquiry with applicable
authorities, may prospectively prevent or cause the imposition of material
fines or penalties as the result of the use of all or any portion of the LIN
Real Property for the conduct thereon of the business now conducted and as
currently proposed to be conducted. Acquiror has received all necessary
approvals with regard to occupancy and maintenance of the LIN Real Property.
(c) Each lease of any portion of the LIN Real Property, and each
lease, license, rental agreement, contract of sale or other agreement to which
the personal property having a Net Book Value in excess of $100,000 that is
owned, leased or rented by Acquiror or any of the LIN Stations or used in
their operations (the "LIN Personal Property") is subject, is valid and in
good standing, Acquiror or the relevant LIN Station has performed all material
obligations imposed upon it thereunder and neither Acquiror nor, to Parent's
or Acquiror's knowledge after due inquiry of the management of the LIN
Stations, any other party thereto is in material default thereunder in any
material respect, nor is there any event that with notice or lapse of time, or
both, would constitute a default thereunder by Acquiror or, to Parent's or
Acquiror's knowledge after due inquiry of the management of the LIN Stations,
any other party thereto that would, or could reasonably be expected to, result
in a Material Adverse Effect on Acquiror or any of the LIN Stations. Acquiror
has not received notice, nor is Parent or Acquiror otherwise aware after due
inquiry of the management of the LIN Stations, that any party to any such
contract intends to cancel, terminate or refuse to renew the same or to
exercise or decline to exercise any option or other right thereunder. No LIN
Real Property or LIN Personal Property is subject to any lease, license,
contract of sale or other agreement that could reasonably be expected to have
a Material Adverse Effect on Acquiror or any of the LIN Stations.
(d) Except for (i) assessments with respect to Taxes not yet due and
payable and (ii) mechanics', materialmen's, carriers' and other similar liens
securing indebtedness that is in the aggregate less than $100,000, is not yet
due and payable, and was incurred in the ordinary course of business, the LIN
Personal Property is free and clear of all Encumbrances, and, other than LIN
Personal Property leased by Acquiror or any of the LIN Stations, Acquiror or
the relevant LIN Station has good and marketable title thereto.
(e) Except as specifically set forth in Schedule 4.12(e), Acquiror has
no knowledge after due inquiry of the management of the LIN Stations of any
material physical defect in the LIN Real Property. Neither Acquiror nor any
of the LIN Stations is in default under any covenant, condition, restriction,
easement, right-of-way or governmental approval relating to the LIN Real
Property, the failure to comply with which would, or could reasonably be
expected to, result in a Material Adverse Effect on Acquiror or any of the LIN
Stations.
4.13 Compliance With Environmental Laws
To Parent's or Acquiror's knowledge after due inquiry of the management
of the LIN Stations, except as specifically set forth in Schedule 4.13:
(a) neither Acquiror nor any other Person (including, without
limitation, any previous owner, lessee or sublessee) has treated, stored or
disposed of Hazardous Materials on the LIN Real Property, or any real property
previously owned, leased, subleased or used by Acquiror or any of the LIN
Stations in violation of any applicable Environmental Law or common law, in
each case as in existence on or prior to the Closing Date;
(b) there have been no releases of Hazardous Materials, pollutants or
contaminants by any Person (including, without limitation, any previous owner,
lessee or sublessee) on, at or from any assets or properties, including,
without limitation, the LIN Real Property, or any real property previously
owned, leased, subleased or used by Acquiror or any of the LIN Stations that
could subject Acquiror or any of the LIN Stations to liability under any
Environmental Law or common law, in each case as in existence on or prior to
the Closing Date;
(c) there has been no generation or transportation of Hazardous
Materials, pollutants or contaminants by Acquiror that could subject Acquiror
or any of the LIN Stations to liability under any Environmental Law or common
law, in each case as in existence on or prior to the Closing Date; and
(d) there are no Hazardous Materials present at adjacent properties
that could migrate to, through, over or under the LIN Real Property.
4.14 Claims and Legal Proceedings
Except as specifically set forth in Schedule 4.14, there are no claims
(including, without limitation, Tax claims), actions, suits, arbitrations,
proceedings or investigations pending or, to Parent's or Acquiror's knowledge
after due inquiry of the management of the LIN Stations, threatened against
Parent or Acquiror or any of the LIN Stations before or by any Governmental
Entity or any other Person relating to the business or operations of Acquiror
or any of the LIN Stations or that question the validity of this Agreement or
any Related Agreement or any action taken or to be taken by Parent or Acquiror
pursuant hereto or thereto or in connection with the transactions contemplated
hereby or thereby. To Parent's or Acquiror's knowledge, after due inquiry of
the management of the LIN Stations, there is no valid basis for any such
claim, action, suit, arbitration, proceeding or investigation, other than as
specifically set forth in Schedule 4.14. There are no outstanding or
unsatisfied judgments, orders, decrees or stipulations to which Parent or
Acquiror or any of the LIN Stations is a party that involve the transactions
contemplated hereby or that would, or could reasonably be expected to, alone
or in the aggregate, have a Material Adverse Effect on Acquiror or any of the
LIN Stations.
4.15 Labor Matters
There are no disputes, material employee grievances or material
disciplinary actions pending or, to Parent's or Acquiror's knowledge after due
inquiry of the management of the LIN Stations, threatened between Acquiror or
any of the LIN Stations and any of its (or their) present or former employees.
Acquiror and each of the LIN Stations have complied in all material respects
with all provisions of all laws relating to the employment of labor and have
no liability for any arrears of wages or Taxes or penalties for failure to
comply with any such laws. Parent and Acquiror have no knowledge after due
inquiry of the management of the LIN Stations of any organizational efforts
presently being made or threatened by or on behalf of any labor union with
respect to any of Acquiror's or any of the LIN Stations' employees. From the
date of the Acquiror Balance Sheet to and including the Closing Date, Acquiror
and the LIN Stations have not made any loans to any of their directors,
officers or employees or those of Parent.
Except as specifically set forth in Schedule 4.15 (provided, however,
that talent contracts that by their terms contemplate aggregate payments of
less than $500,000 to which the LIN Stations other than the Major LIN Stations
are parties are not required to be included in Schedule 4.15), neither
Acquiror nor any of the LIN Stations is a party to any:
(a) management, employment or other contract providing for the
employment or rendition of executive services;
(b) employment contract with any current or former employee that is
not terminable without penalty by Acquiror or the relevant LIN Station on 30
days' notice;
(c) Acquiror Employee Benefit Plan in which any current or former
employee may participate, except as set forth in Schedule 4.20; or
(d) collective bargaining agreement or other agreement with any labor
union or other employee organization (and no such agreement is currently being
requested by, or is under discussion by management with, any group of
employees or others).
Each such contract or other agreement or arrangement set forth in Schedule
4.15 is valid and in full force and effect, Acquiror or the relevant LIN
Station has performed all material obligations imposed upon it thereunder and
there are no defaults or events of default under such contract, agreement or
arrangement by Acquiror or the relevant LIN Station or, to Parent's or
Acquiror's knowledge after due inquiry of the management of the LIN Stations,
any other party thereto that would, or could reasonably be expected to, have a
Material Adverse Effect on Acquiror or any of the LIN Stations or that would
materially adversely affect the relationship of Acquiror or any of the LIN
Stations with their employees.
4.16 Patents, Trademarks, Etc.
Set forth in Schedule 4.16 is a true and complete list of (a) all
patents, patent applications, trademark registrations and applications
therefor, trade names, service marks, and copyright registrations and
applications therefor owned by the LIN Stations or that are used or useful in
their operations and (b) all interference actions or adverse claims made or
threatened in respect thereof and all claims made or threatened for alleged
infringement thereof. To Parent's or Acquiror's knowledge after due inquiry
of the management of the LIN Stations, none of the LIN Stations infringes any
valid patent, trademark, trade name, service mark or copyright of any other
Person, and no other Person is infringing upon any such rights of a LIN
Station. No LIN Station has entered into any agreement to indemnify any
Person against any claim or charge of infringement of any patents, trademarks,
trade names, service marks, copyrights, technology, know-how, trade secrets,
processes or other intangible rights.
4.17 Accounts Receivable
All Accounts Receivable of Acquiror are collectible within 180 days after
the date incurred in the amounts at which they are carried on Acquiror's books
on the Closing Date.
4.18 Applicable Laws
Except as set forth in Schedule 4.18, Acquiror and the LIN Stations have
complied with all previously existing, and are in compliance with all
presently existing, federal, state, local and foreign laws (including, without
limitation, Tax laws), rules, ordinances, decrees and orders applicable to
their business or operations, the failure to comply with which might, alone or
in the aggregate, have a Material Adverse Effect on Acquiror or any of the LIN
Stations.
4.19 Insurance
Set forth in Schedule 4.19 is a true and complete list of all of
Acquiror's and the Major LIN Stations' policies of insurance, including:
(a) the name, address and telephone number of the insurer and broker;
(b) the policy number, amount, expiration date and a brief description
of coverage, including the amount of any deductible; and
(c) material exceptions to each such policy.
4.20 Employee Benefit Plans
(a) Set forth in Schedule 4.20 is a true and complete list of each
employee benefit plan, fund, program, contract or arrangement, whether formal
or informal, covering or benefiting current or former employees of Acquiror or
any of the LIN Stations and to which Acquiror or any of the LIN Stations have
an obligation to contribute, including, but not limited to, all "employee
benefit plans" as defined in Section 3(3) of ERISA, and specifically including
all retirement, pension, profit-sharing, stock bonus, savings, thrift, bonus,
cafeteria, medical, health, dental, vision, hospitalization, welfare, life
insurance, disability, accident insurance, group insurance, sick pay, holiday
and vacation programs, executive or deferred compensation plans or contracts,
stock purchase, stock option or stock appreciation rights plans or
arrangements, employment and consulting contracts, and severance agreements,
policies or plans (each, an "Acquiror Employee Benefit Plan"). True and
correct copies of each Acquiror Employee Benefit Plan have been delivered to
Station, along with, to the extent applicable to the particular Acquiror
Employee Benefit Plan, the following information: copies of the annual
reports (Form 5500 series) filed for the last three years, copies of the
summary plan descriptions, summary annual reports, summaries of material
modifications and all material employee manuals or communications filed or
distributed with respect to the Acquiror Employee Benefit Plan during the last
three years, copies of all valuation and actuarial reports, accountants'
opinions and financial statements prepared with respect to the Acquiror
Employee Benefit Plan for the last three years, copies of any insurance
contracts or trust agreements through which the Acquiror Employee Benefit Plan
is funded, the most recent IRS determination letter issued with respect to the
Acquiror Employee Benefit Plan and notice of any material adverse change
occurring with respect to any Acquiror Employee Benefit Plan since the date of
the most recently completed and filed annual report.
(b) With respect to each Acquiror Employee Benefit Plan described in
Section 4.20(a) or any other plan, fund or program currently or previously
maintained or contributed to (or required to be contributed to) by Acquiror or
any member of Acquiror's controlled group (as defined in Section 4001(a)(14)
of ERISA) that is subject to Title IV of ERISA:
(i) no such plan has been terminated so as to subject, directly or
indirectly, any property of Acquiror or any of the LIN Stations to any
liability, contingent or otherwise, or the imposition of any lien under Title
IV of ERISA;
(ii) no proceeding has been initiated or threatened by any Person
(including the PBGC) to terminate any such plan;
(iii) no condition or event exists or is threatened or expected to
occur that could subject, directly or indirectly, any property of Acquiror or
any of the LIN Stations to any liability, contingent or otherwise, or the
imposition of any lien under Title IV of ERISA or Section 412 of the Code,
whether to the PBGC or to any other Person or otherwise;
(iv) if any such plan were to be terminated as of the Closing Date, no
asset of Acquiror or any of the LIN Stations would be subject, directly or
indirectly, to any liability, contingent or otherwise, or the imposition of
any lien under Title IV of ERISA, and all benefits accrued to the Closing Date
(whether or not vested) would be fully funded in accordance with the actuarial
assumptions and methods utilized by such plan for valuation purposes;
(v) no event has occurred since the inception of any such plan or is
threatened or expected to occur that would constitute a "reportable event"
within the meaning of Section 4043 of ERISA;
(vi) the funding method used in connection with any such plan is
acceptable under ERISA, and the actuarial assumptions used in connection
therewith are, in the aggregate, reasonable; and
(vii) no such plan is a multiemployer plan (as defined in Section
4001(a)(3) of ERISA).
(c) Neither Acquiror nor any of the LIN Stations nor any Acquiror
Employee Benefit Plan currently or previously maintained or contributed to by
Acquiror or any of the LIN Stations provides or has any obligation to provide
(or contribute toward the cost of) postretirement welfare benefits with
respect to current or former employees of Acquiror or any of the LIN Stations,
including, without limitation, postretirement medical, dental, life insurance,
severance or any other similar benefit, whether provided on an insured or
self-insured basis, other than medical payments under COBRA.
(d) With respect to each Acquiror Employee Benefit Plan: (i) all
payments due from any such Acquiror Employee Benefit Plan (or from Acquiror or
any of the LIN Stations with respect to any such Acquiror Employee Benefit
Plan) have been made, and all amounts properly accrued to date as liabilities
of Acquiror or any of the LIN Stations that have not been paid have been
properly recorded on the books of Acquiror; (ii) Acquiror has complied with,
and each such Acquiror Employee Benefit Plan conforms in form and operation
to, all applicable laws and regulations, including, but not limited to, ERISA
and the Code in all respects, and all reports and information relating to such
Acquiror Employee Benefit Plans required to be filed with any Governmental
Entity have been timely filed; (iii) all reports and information required to
be disclosed or provided to participants or their beneficiaries have been
timely disclosed or provided; (iv) no such plan that is subject to Section 302
of ERISA or Section 412 of the Code has ever incurred an "accumulated funding
deficiency" (as defined in Section 302 of ERISA and Section 412 of the Code),
whether or not such deficiency has been waived; (v) no event has occurred or
is threatened or expected to occur that would constitute a "prohibited
transaction" within the meaning of Section 406 or 407 of ERISA or Section 4975
of the Code with respect to any Acquiror Employee Benefit Plan; (vi) no event
or omission has occurred or is threatened or expected to occur in connection
with any Acquiror Employee Benefit Plan that would subject Acquiror, any of
the LIN Stations or any Acquiror Employee Benefit Plan to a fine, penalty, tax
or liability, whether pursuant to any agreement, instrument, indemnification
obligation, statute, regulation or rule of law; (vii) each such Acquiror
Employee Benefit Plan that is intended to be qualified under Section 401 of
the Code has been qualified, since its inception, under such Code section, and
any trust established thereunder has been exempt, since its inception, from
taxation under Section 501 of the Code, and no facts exist that have adversely
affected (or could adversely affect) such qualification or exemption; (viii)
such Acquiror Employee Benefit Plan has been operated, since its inception, in
accordance with its terms; (ix) no such Acquiror Employee Benefit Plan is
currently under investigation, audit or review, directly or indirectly, by the
IRS or the DOL, and, to Acquiror's best knowledge after due inquiry of the
management of the LIN Stations, no such action is contemplated or under
consideration by the IRS or the DOL; and (x) there are no actions, suits or
claims pending (other than routine claims for benefits) or threatened with
respect to any Acquiror Employee Benefit Plan or against the assets of such
Acquiror Employee Benefit Plan.
(e) The transactions contemplated by this Agreement will not result in
the payment or a series of payments by Acquiror or any of the LIN Stations to
any Person of a "parachute payment" within the meaning of Section 280G of the
Code.
(f) Acquiror and each of the LIN Stations have complied with the
continuation coverage requirements of Sections 601 through 608 of ERISA,
Section 4980B of the Code and the requirements of any similar state law
regarding continued insurance coverage, and none of Acquiror nor any of the
LIN Stations have incurred any liability with respect to any failure to offer
or provide continued coverage in accordance with the foregoing requirements,
nor is there any suit or action pending or threatened with respect to such
requirements.
(g) If required under the WARN Act or any other applicable state law
regulating plant closings or mass layoffs, Acquiror and each of the LIN
Stations have caused there to be filed or distributed, as appropriate, all
required filings and notices. Acquiror has provided Station with a copy of
all such filings and notices and evidence acceptable to Station of the date
that such filings and notices were filed or distributed.
(h) The consummation of the transactions contemplated by this
Agreement will not entitle any current or former employee of Acquiror or any
of the LIN Stations to severance pay, unemployment compensation or any other
payment, or accelerate the time of payment or vesting, or increase the amount
of compensation due to any such current or former employee. Further, neither
Acquiror nor any of the LIN Stations has announced any type of plan or binding
commitment to create any additional Acquiror Employee Benefit Plan or to amend
or modify any existing Acquiror Employee Benefit Plan.
4.21 Reports
All registration statements, prospectuses, reports, proxy statements and
other documents required to be filed with the SEC by Parent since January 1,
1992 have been so filed. Parent has furnished Station with a complete and
correct copy of Parent's annual reports on Form 10-K for the fiscal years
ended December 31, 1992 and 1993, and Parent's definitive proxy statement for
its annual meeting of stockholders held May 25, 1993, and will furnish Station
with any report or proxy statement filed by Parent with the SEC between the
date of this Agreement and the Closing Date promptly after such filing. Each
of the Forms 10-K at the time it was filed did not, and any other such report
filed by Parent hereafter and prior to the Closing Date at the time it is
filed will not, contain any untrue statement of a material fact relating to
Acquiror or omit to state a material fact relating to Acquiror required to be
stated therein or necessary in order to make the statements therein, in light
of the circumstances under which they were made, not misleading.
4.22 Brokerage
Except as set forth in Schedule 4.22, neither Parent nor Acquiror has
retained any broker or finder in connection with the transactions contemplated
by this Agreement. Any brokerage or finder's fee due to any broker or finder
in violation of the foregoing representation shall be paid by Acquiror.
4.23 Absence of Questionable Payments
Neither Parent nor Acquiror nor any director, officer, agent, employee or
other Person acting on behalf of Parent or Acquiror or any of the LIN Stations
has used, to Parent's or Acquiror's knowledge after due inquiry of the
management of the LIN Stations, any funds of Acquiror or any of the LIN
Stations for unlawful contributions, payments, gifts or entertainment or made
any unlawful expenditures relating to political activity to any government
official or other Person in connection with the business or operations of
Acquiror or any of the LIN Stations. Neither Parent nor Acquiror nor any
director, officer, agent, employee or other Person acting on behalf of Parent
or Acquiror or any of the LIN Stations has accepted or received, to Parent's
or Acquiror's knowledge after due inquiry of the management of the LIN
Stations, any unlawful contributions, payments, gifts or expenditures in
connection with the business or operations of Acquiror or any of the LIN
Stations.
4.24 Full Disclosure
No information furnished by Parent or Acquiror to Stockholder or Station
in connection with this Agreement (including, but not limited to, the Acquiror
Financial Statements and all information in the Schedules) is false or
misleading in any material respect. In connection with such information and
with this Agreement and the transactions contemplated hereby, Parent and
Acquiror have not made any untrue statement of a material fact or omitted to
state a material fact necessary in order to make the statements made or
information delivered, in light of the circumstances under which they were
made, not misleading.
ARTICLE V GOVERNMENTAL CONSENTS
5.1 FCC Consent
The Distribution and the assignment of Station's FCC Licenses as
contemplated by this Agreement are subject to the prior consent and approval
of the FCC.
(a) Promptly upon the execution of this Agreement, (i) Acquiror shall
prepare and file with the FCC applications and any other necessary instruments
or documents to effectuate the Distribution and (ii) Acquiror and Station
shall prepare and file with the FCC applications and any other necessary
instruments or documents to request the FCC to approve the assignment of
Station's FCC Licenses to Acquiror (the applications and instruments and
documents referred to in clauses (i) and (ii) being the "FCC Applications").
The parties shall prosecute the FCC Applications with all reasonable diligence
and otherwise use their reasonable efforts to obtain the FCC Approval as
expeditiously as practicable. In addition, each party shall notify the other
parties hereto in the event that it becomes aware of any other facts, actions,
communications or occurrences that might, directly or indirectly, affect the
parties' intent or ability to obtain the FCC Approval.
(b) If the FCC Approval imposes any condition on any party hereto,
such party shall use its reasonable efforts to comply with such condition;
provided, however, that no party shall be required to comply with any
condition that would be unduly burdensome or that would have a Material
Adverse Effect on it. If reconsideration or judicial review is sought with
respect to the FCC Approval, Acquiror and Station shall oppose vigorously such
efforts for reconsideration or judicial review (but nothing herein shall be
construed to limit any party's right to terminate this Agreement pursuant to
Article IX).
(c) Each party hereto shall pay its own expenses in connection with
the preparation and prosecution of the FCC Applications, and Acquiror and
Station shall each pay one-half of the FCC filing fee for consent to
assignment of the license of WTNH-TV from Station to Acquiror.
(d) Between the date hereof and the Closing Date, neither Acquiror or
Parent nor any direct or indirect parent or subsidiary of Acquiror or Parent
shall directly or indirectly control, supervise or direct, or attempt to
control, supervise or direct, the operations of Station. Until the Closing,
such operations, including complete control and supervision of all programs,
shall be the sole responsibility of Station. Neither title nor right to
possession shall pass to Acquiror until the Closing.
5.2 HSR Act
As soon as reasonably practicable after the execution of this Agreement,
Parent, on behalf of Acquiror as Acquiror's ultimate parent entity, and
Stockholder, on behalf of Station as Station's ultimate parent entity, shall
prepare and file with the DOJ and the FTC the premerger notification form
required pursuant to the HSR Act and a request for early termination of the
waiting period. Acquiror, Parent, Stockholder and Station shall further (a)
discuss with each other any comments the reviewing party may have; (b)
cooperate with each other in connection with such filings, which cooperation
shall include, but not be limited to, furnishing the other with such
information or documents as may be reasonably required in connection with such
filings; (c) promptly file after any request by the FTC or the DOJ any
appropriate information or documents so requested by the FTC or the DOJ; and
(d) notify each other of any other communications with the FTC or the DOJ that
relate to the transactions contemplated hereby and, to the extent appropriate,
permit the other to participate in any conferences with the FTC or the DOJ.
Each party hereto shall pay its own expenses and filing fees in connection
with the preparation and filing of the premerger notification form.
ARTICLE VI FURTHER AGREEMENTS
6.1 Further Agreements of Stockholder and Station
Stockholder and Station, as applicable, agree to perform and observe the
following agreements:
6.1.1 Schedules, Exhibits, Etc.
All representations and warranties contained herein shall apply to any
Exhibits, Schedules and certificates delivered by Stockholder or Station, or
any officer of Stockholder or Station, to Acquiror, and each such Exhibit,
Schedule or certificate shall be deemed to be a representation by Stockholder
or Station, as applicable, as to the matters set forth therein.
6.1.2 Conduct Prior to the Closing Date
From the date of this Agreement to and including the Closing Date, except
as permitted, required or specifically contemplated by this Agreement or
otherwise as approved in writing by Acquiror, which approval shall not be
unreasonably withheld, Stockholder and Station shall:
(a) take no action that will cause any representation, warranty,
Exhibit or Schedule to this Agreement to be untrue in any material respect on
the Closing Date;
(b) use their reasonable efforts to preserve and protect Station's FCC
Licenses and the goodwill of Station, the continuity of its business and its
beneficial relationships with employees, suppliers, creditors, distributors,
customers and others having business relationships with it;
(c) operate the business of Station in the ordinary course of business
consistent with past practice and maintain the current business and legal
organization of Station;
(d) not purchase, sell, lease, mortgage, pledge or otherwise acquire
or dispose of any Asset, except for Station Personal Property sold or
otherwise disposed of or purchased or otherwise acquired in the ordinary
course of business consistent with past practice;
(e) (i) keep the equipment, machinery and systems used in the
operations of Station in accordance with FCC requirements and licensing rules
and (ii) except in the ordinary course of business consistent with past
practice, maintain all of Station's properties in good working order and
repair and replace any thereof that shall be worn out, lost, stolen or
destroyed;
(f) except in the ordinary course of business consistent with past
practice, (i) not increase or otherwise change the rate or nature of the
compensation (including wages, salaries, bonuses and benefits under any
Station Employee Benefit Plan) that is paid or payable to any employee of
Station, except pursuant to the current terms of existing collective
bargaining agreements and Station Employee Benefit Plans, (ii) not enter into
any employment, severance, consulting or similar agreement with any past,
present or proposed employee of Station, (iii) not contribute or make any
commitment to, or representation that it will contribute any amounts to, any
Station Employee Benefit Plan or collective bargaining agreement for employees
of Station, or (iv) not otherwise alter any such plan or the funding thereof,
except as required by law or by the current terms of any such plan as in
effect on the date of the Station Balance Sheet;
(g) maintain Station's files and records in the usual, regular and
ordinary manner consistent with past practice, and not make any change in the
accounting methods or practices or make any changes in the depreciation or
amortization policies or rates applicable to the business and operations of
Station;
(h) not merge or consolidate with any other Person;
(i) utilize the film rights and packages of Station only in the
ordinary course of business consistent with past practice and not sell or
otherwise dispose of any such rights or packages or accelerate the usage of
such rights and packages;
(j) except as permitted by Section 6.3.7 and except in the ordinary
course of business consistent with past practice, make all payments on such
film rights and packages on a current basis, except to the extent Station has
a valid dispute with respect to any such payments;
(k) not enter or agree to enter into any film contract other than in
the ordinary course of business consistent with past practice and not enter
into or agree to enter into any cable retransmission or must-carry agreement
purporting to bind Station;
(l) not violate any law, statute, rule, governmental regulation or
order in connection with the operations of Station, including, without
limitation, the Communications Act and the rules and regulations thereunder;
(m) promptly notify Acquiror of any event or occurrence taking place
or arising between the date hereof and the Closing Date that would, or could
reasonably be expected to, result in a Material Adverse Effect on the Assets
or Station;
(n) deliver to Acquiror within 30 days of the end of each accounting
month a balance sheet for Station as of the end of such month, together with a
statement of profit and loss for Station;
(o) except in the ordinary course of business consistent with past
practice, cause the liabilities of Station to be paid when the same become
due;
(p) (i) not remove any fixtures, equipment or Station Personal
Property from Station premises other than in the ordinary course of business
consistent with past practice unless the same are replaced prior to the
Closing Date with similar items of at least equal value and quality; (ii) not
sell, transfer, lease or otherwise dispose of any asset or property included
in the Assets other than in the ordinary course of business consistent with
past practice; (iii) not sell, discount or otherwise dispose of any Accounts
Receivable (except by collection in the ordinary course of business); (iv)
except in the ordinary course of business consistent with past practice, not
incur any material obligation or liability relating to Station, whether fixed
or contingent; and (v) except in the ordinary course of business consistent
with past practice, not cancel or compromise any debt or claim relating to
Station or waive or release any rights of material value included in the
Assets;
(q) except in the ordinary course of business consistent with past
practice, (i) not make any material change in the character of the Assets or
the business of Station or cause Station to enter into any new business,
relocate any of its facilities or acquire any additional operations or
businesses and (ii) not terminate, discontinue, close or dispose of any
facility or business operation of Station;
(r) not acquire any assets or properties that involve the making of
any capital expenditures by Station, except in the ordinary course of business
consistent with past practice;
(s) except in the ordinary course of business consistent with past
practice, not transfer, grant, license, assign, terminate or otherwise dispose
of, modify, change or cancel any right or obligation with respect to any
intellectual property rights included in the Assets;
(t) not cause Station to make any loan or extension of credit or
incur, assume or guarantee any indebtedness for money borrowed (which for this
purpose shall include nonrecourse borrowings) or otherwise enter into any
material transaction, agreement, arrangement or understanding pursuant to
which any party agrees to provide or provides Station with any funds, in each
case other than in the ordinary course of business consistent with past
practice and other than as necessary or desirable to effect the redemption of
Station's 10.75% Series A and Series B Senior Secured Notes due 1998;
(u) not cause Station to (i) declare, pay or set aside for payment any
dividend or other distribution in respect of its capital stock, except for
dividends payable with respect to Station's outstanding shares of preferred
stock in accordance with the terms of Station's Certificate of Incorporation,
(ii) directly or indirectly redeem, repurchase or otherwise acquire any shares
of its capital stock, or (iii) transfer to Stockholder or any stockholder or
Affiliate of Stockholder any right, property or interest of Station;
(v) except as permitted by Section 6.3.7, not cause any payment or
collection to be made by Station or to it at an earlier or later time than in
accordance with its customary business practices or otherwise materially
modify its normal methods of conducting its operations or managing its cash
flow other than as necessary or desirable to effect the redemption of
Station's 10.75% Series A and Series B Senior Secured Notes due 1998;
(w) not enter into, amend or extend any Tradeout Agreement with
respect to the sale of advertising time that would create any obligation of or
liability to Station, except in the ordinary course of business consistent
with past practice or except for advertising time that will have been expended
prior to the Closing Date; and not enter into, amend or extend any order,
contract or agreement after the date hereof for the sale of advertising time
on Station that will not expire at or prior to the Closing Date or is not
terminable by Acquiror without penalty within 60 days after the Closing Date
other than in the ordinary course of business consistent with past practice;
and
(x) not agree to take any of the actions prohibited by this Section
6.1.2, or engage in any action or conduct that would violate this Section
6.1.2.
6.1.3 No Solicitation of Transactions
Neither Stockholder nor Station shall directly or indirectly, through
any officer, director, agent or otherwise, solicit, initiate or encourage the
submission of any proposal or offer from any Person relating to any
acquisition or purchase of all or (other than in the ordinary course of
business) any portion of the Assets or any direct or indirect equity interest
in Station or any business combination with Station or participate in any
negotiations regarding, or furnish to any other Person any information with
respect to, or otherwise cooperate in any way with, or assist or participate
in, facilitate or encourage, any effort or attempt by any other Person to do
or seek any of the foregoing. Stockholder immediately shall cease and cause
to be terminated any existing discussions or negotiations with any parties
conducted heretofore with respect to any of the foregoing. Station agrees not
to release any third party from, or waive any provision of, any
confidentiality or standstill agreement to which Station is a party.
6.1.4 Insurance and Loss of or Damage to Assets
Station shall give Acquiror prompt written notice of (a) any loss,
damage or destruction to any of the tangible Assets occurring on or after the
date hereof and on or prior to the Closing Date in excess of $25,000
individually or in aggregate of $50,000, (b) the estimated value of the
portion of the tangible Assets so lost, damaged or destroyed, and (c) the
estimated cost of repair, replacement or reconstruction thereof.
6.1.5 Tax Representations
Station and Stockholder shall deliver to Acquiror the representations
set forth in Exhibit C attached hereto, made by officers of Station and
Stockholder under penalties of perjury, for delivery to the IRS in connection
with Parent's request for the Letter Ruling from the IRS.
6.1.6 Confidentiality
The Confidentiality Agreement shall remain in full force and effect,
except as modified by Section 6.1.3 and this Section 6.1.6. In addition,
after the Closing, Stockholder agrees to maintain any operating or proprietary
information and material relating to Station in confidence pursuant to this
Section 6.1.6 and not use such information for any purpose other than internal
accounting and tax return preparation purposes or in connection with this
Agreement.
6.1.7 Securities Agreement
Stockholder will not sell, pledge, transfer or otherwise dispose of any
shares of Acquiror Common Stock issued to Station as consideration for the
transfer of the Assets, except in compliance with the Securities Act,
including compliance with Rule 145 under the Securities Act, if applicable, or
pursuant to an effective registration statement.
6.1.8 Consents
Stockholder and Station shall use their reasonable efforts to obtain and
deliver to Acquiror at the Closing consents to the assignment of all
agreements, contracts and instruments assigned to Acquiror hereunder and
requiring such consent to assignment; provided, however, that Stockholder and
Station shall not be required to pay any amounts or incur any obligations to
any of the other parties under any of such agreements, contracts or
instruments to obtain such consents, and that the failure to obtain such
consents, other than those specified in Schedule 7.2.4, shall not be a
condition to Parent's and Acquiror's obligations to consummate the
transactions contemplated by this Agreement or constitute a breach of
Stockholder's or Station's obligations under this Agreement.
6.2 Further Agreements of Acquiror and Parent
Acquiror and Parent, as applicable, agree to perform and observe the
following agreements:
6.2.1 Schedules, Exhibits, Etc.
All representations and warranties contained herein shall apply to any
Exhibits, Schedules and certificates delivered by Parent or Acquiror, or any
officer of Parent or Acquiror, to Station, and each such Exhibit, Schedule or
certificate shall be deemed to be a representation by Parent or Acquiror, as
applicable, as to the matters set forth therein.
6.2.2 Conduct Prior to the Closing Date
From the date of this Agreement to and including the Closing Date, except
as set forth in Schedule 6.2.2, and except as permitted, required or
specifically contemplated by this Agreement or otherwise approved in writing
by Station, which approval shall not be unreasonably withheld, Acquiror and
Parent shall:
(a) take no action that will cause any representation, warranty,
Exhibit or Schedule to this Agreement to be untrue in any material respect on
the Closing Date;
(b) use their reasonable efforts to preserve and protect the LIN
Stations' FCC Licenses and the goodwill of Acquiror and the LIN Stations, the
continuity of their businesses and their beneficial relationships with
employees, suppliers, creditors, distributors, customers and others having
business relationships with them;
(c) operate the businesses of Acquiror and the LIN Stations in the
ordinary course of business consistent with past practice and maintain the
current business and legal organization of Acquiror other than to effect the
Distribution;
(d) (i) keep the equipment, machinery and systems used in the
operations of Acquiror and the LIN Stations in accordance with FCC
requirements and licensing rules and (ii) except in the ordinary course of
business consistent with past practice, maintain all of the properties of
Acquiror and the LIN Stations in good working order and repair and replace any
thereof that shall be worn out, lost, stolen or destroyed;
(e) maintain the files and records of Acquiror and of the LIN Stations
in the usual, regular and ordinary manner consistent with past practice, and
not make any change in the accounting methods or practices or make any changes
in the depreciation or amortization policies or rates applicable to the
business and operations of Acquiror or the LIN Stations;
(f) except in the ordinary course of business consistent with past
practice, make all payments on film rights and packages on a current basis,
except to the extent Acquiror has a valid dispute with respect to any such
payments;
(g) not violate any law, statute, rule, governmental regulation or
order in connection with the operations of Acquiror or the LIN Stations,
including, without limitation, the Communications Act and the rules and
regulations thereunder;
(h) promptly notify Station of any event or occurrence taking place or
arising between the date hereof and the Closing Date that would, or could
reasonably be expected to, result in a Material Adverse Effect on Acquiror or
any of the LIN Stations;
(i) deliver to Station within 30 days of the end of each accounting
month a balance sheet for Acquiror as of the end of such month, together with
a statement of profit and loss for Acquiror;
(j) except in the ordinary course of business consistent with past
practice, cause the liabilities of Acquiror and the LIN Stations to be paid
when the same become due;
(k) not cause Parent to sell its shares of Acquiror Common Stock or
permit Acquiror to merge or consolidate with any other Person, as a result of
which sale, merger or consolidation Parent would own less than 65% of the
outstanding capital stock of Acquiror, or permit Acquiror to sell all or
substantially all of its assets;
(l) not allow Acquiror to sell or otherwise transfer or dispose of its
interests in the Major LIN Stations;
(m) not allow Acquiror to incur any indebtedness for money borrowed
that would cause Acquiror's total indebtedness to exceed 5.5 times its
earnings before interest, taxes, depreciation and amortization measured as of
the end of the most recently completed fiscal quarter for the four consecutive
fiscal quarters then ended;
(n) not allow any LIN Station to terminate its existing network
affiliation or replace its network affiliation agreement with an agreement
with terms that are materially less favorable to such LIN Station than its
existing network affiliation agreement;
(o) cause Acquiror to permit a representative of Station or
Stockholder to attend all meetings of Acquiror's Board of Directors and to
receive copies of all materials presented to Acquiror's Board of Directors in
connection with such meetings, except with respect to agenda items or
materials that involve Stockholder or Station;
(p) not permit Acquiror to (i) declare or pay any dividend, or make
any other distribution, on any class of capital stock of Acquiror or (ii)
redeem, repurchase or otherwise acquire for consideration any shares of any
class of capital stock of Acquiror;
(q) not permit Acquiror to pay any amounts, or transfer any funds, to
Parent, or any Affiliate of Parent, for any purpose, other than as set forth
in Schedule 6.2.2;
(r) cause Acquiror to provide Station with advance notice of any
contemplated (i) change of the President of Acquiror or of any of the General
Managers of the Major LIN Stations, (ii) acquisition or disposition of any
television station or license or of any other assets material to Acquiror or
any of the Major LIN Stations, (iii) fundamental change in the business or
business philosophy of Acquiror or of any of the Major LIN Stations, and (iv)
programming expenditures or negotiation of film acquisition or programming
contracts material to Acquiror or any of the Major LIN Stations; and
(s) not agree to take any of the actions prohibited by this Section
6.2.2, or engage in any action or conduct that would violate this Section
6.2.2.
For purposes of this Section 6.2.2, action in the "ordinary course of
business consistent with past practice" shall include, but not be limited to,
entering into transactions consistent with past practice involving
acquisitions or dispositions of properties or businesses, including, without
limitation, disposition of any of the LIN Stations other than the Major LIN
Stations, entering into local marketing agreements and joint ventures,
participating in programming for cable channels and television stations other
than the LIN Stations and developing and entering into arrangements for new
broadcasting technologies, but shall not be deemed to permit or contemplate a
fundamental change in the business or business philosophy of Acquiror or any
of the Major LIN Stations.
6.2.3 Letter Ruling
Parent shall use its reasonable efforts to obtain as soon as practicable
a private letter ruling (the "Letter Ruling") from the IRS by providing to the
IRS all information required under Revenue Procedure 86-41, 1986-2 C.B. 716,
as amended through the date hereof (the "Revenue Procedure"), to the effect
that neither Parent nor any of its stockholders will be required to recognize
gain or loss, or include any amount in income, as a result of the
Distribution, pursuant to Section 355 of the Code and any other applicable
sections of the Code.
Parent will not withdraw from the IRS its request for the Letter Ruling
unless either (a) the IRS requests any information or action not required
under the Revenue Procedure or (b) the IRS indicates that it will not issue
the Letter Ruling, in either of which events Parent may, in its sole
discretion, withdraw from the IRS its request for the Letter Ruling.
Acquiror and Parent shall keep Station informed on an ongoing basis with
respect to the status of Parent's efforts to obtain the Letter Ruling. In the
event that (a) Parent withdraws from the IRS its request for the Letter Ruling
or (b) after December 31, 1994, Jones, Day, Reavis & Pogue (or any successor
counsel to Parent) indicates to Parent that it is not likely that the IRS will
issue the Letter Ruling, Acquiror and Parent shall immediately, and in all
such events within three business days, provide Station with written notice of
same (the "Letter Ruling Notice").
6.2.4 Distribution
Following receipt of the Letter Ruling and immediately prior to the
Closing, Parent shall effect the Distribution; provided, however, that Parent
shall in no event be required to effect the Distribution in the absence of the
Letter Ruling, the FCC Approval provided in Section 7.1.3 and expiration of
the applicable waiting period under the HSR Act.
6.2.5 Registration of Acquiror Common Stock
Promptly following the execution of this Agreement, Acquiror shall
prepare, at its expense, the Form S-4 registering the shares of Acquiror
Common Stock for sale by Acquiror to Station pursuant to the Securities Act,
shall file the Form S-4 with the SEC in accordance with the Securities Act and
shall use its reasonable efforts to cause the Form S-4 to be declared
effective prior to the Closing. Acquiror shall take any action reasonably
required to be taken under the Exchange Act, the Securities Act or state
securities or other blue sky laws in connection with the issuance of the
shares of Acquiror Common Stock pursuant to this Agreement.
6.2.6 Listing
Acquiror shall use its reasonable efforts to cause the Acquiror Common
Stock to be authorized for quotation on the Nasdaq National Market or listed
on the New York Stock Exchange, Inc. or the American Stock Exchange, Inc.
6.2.7 Consents
Parent and Acquiror shall take any and all actions necessary to ensure
that the representations and warranties contained in Section 4.4 will be true
on the Closing Date as though made on that date without reference to the
exceptions set forth in Schedule 4.4.
6.2.8 Compliance With Securities Laws
Parent and Acquiror shall comply in all material respects with federal
and state securities laws in effecting the Distribution, provided that Parent
and Acquiror may rely upon any written information furnished by Stockholder or
Station expressly for use in connection with the Acquiror Disclosure
Documents.
6.2.9 Parent Undertakings
Parent shall cause any successor to the business or assets of Parent to
assume Parent's obligations under this Agreement and the Related Agreements
(including, without limitation, under Section 10.3 and Section 10.4 hereof)
and, for so long as any obligations remain outstanding hereunder, to (y) have
assets sufficient to meet the Parent Threshold Amount or (z) obtain a
third-party guarantee or letter of credit in an amount equal to the Parent
Threshold Amount. Parent shall also cause any Person (other than McCaw) that
alone or with its Affiliates owns 50% or more of the outstanding voting shares
of Parent or its successors to assume McCaw's obligations under the Solvency
Letter Agreement and, for so long as the Solvency Letter Agreement shall
remain outstanding, to (y) have assets with a Net Market Value sufficient to
meet the Parent Threshold Amount or (z) obtain a third-party guarantee or
letter of credit in an amount equal to the Parent Threshold Amount. Neither
this Section 6.2.9 nor the transactions contemplated hereby shall be deemed in
any way to release (i) Parent from its obligations under the terms of this
Agreement or any of the Related Agreements or (ii) McCaw from its obligations
under the Solvency Letter Agreement.
6.3 Further Agreements
Parent, Acquiror, Stockholder and Station agree to perform and observe
the following agreements:
6.3.1 Access; Information
From the date of this Agreement to and including the Closing Date, (a)
Stockholder and Station will grant Acquiror and its agents, employees,
accountants and attorneys reasonable access during normal business hours to,
and the opportunity to examine and make copies of, all of their books,
records, documents, instruments and papers relating to the Assets, and the
business and operations of Station, and the right to inspect all the
facilities, properties and assets relating to the business and operations of
Station at any reasonable time, including the right to meet with Stockholder's
and Station's agents, employees, accountants and attorneys and (b) Parent and
Acquiror will grant Stockholder and its agents, employees, accountants and
attorneys reasonable access during normal business hours to, and the
opportunity to examine and make copies of, all of their books, records,
documents, instruments and papers relating to the properties (tangible or
intangible), business and operations of Acquiror, and the right to inspect all
the facilities, properties and assets relating to the business and operations
of Acquiror at any reasonable time, including the right to meet with Parent's
and Acquiror's agents, employees, accountants and attorneys.
6.3.2 Advice of Claims
From the date of this Agreement to and including the Closing Date,
Acquiror will promptly advise Stockholder in writing, and Stockholder will
promptly advise Acquiror in writing, if either has notice or knowledge of the
commencement or threat of any claims, litigation or proceedings against or
affecting, in the case of Acquiror, any of its or any of the LIN Station's
properties (tangible or intangible), business or operations and, in the case
of Stockholder, the Assets, the business or operations of Station or any
rulings, decrees or other material developments in any claim, action or suit
set forth in Schedule 3.14 or arising after the date hereof.
6.3.3 Other Cooperation Prior to Closing Date
Stockholder and Station will fully cooperate with Acquiror and
Acquiror's counsel and accountants in connection with any steps required to be
taken as part of the obligations of Parent and Acquiror under this Agreement,
and Parent and Acquiror will fully cooperate with Stockholder and
Stockholder's counsel and accountants in connection with any steps required to
be taken as part of the obligations of Stockholder and Station under this
Agreement. None of Parent, Acquiror, Stockholder or Station will undertake
any course of action inconsistent with this Agreement or that would make any
representation, warranty or agreement made by it in this Agreement untrue.
6.3.4 Other Cooperation After Closing Date
Stockholder and Station will cooperate with Acquiror, at Acquiror's
reasonable request, to effect an orderly and prompt transfer of title,
possession and control of the Assets and the Assumed Liabilities from Station
to Acquiror on and after the Closing Date. Stockholder and Station will also
cooperate with Acquiror after the date hereof in completing or filing any
documents or affidavits deemed necessary by Acquiror to preserve or improve
the rights of Acquiror in and to the Assets transferred pursuant to Section
2.1.5.
Parent and Acquiror will (a) cooperate with Stockholder and Station
after the date hereof in completing or filing any documents or affidavits
deemed necessary by Station to further evidence or document Acquiror's
assumption of Station's liabilities pursuant to Section 2.3 and (b) maintain
the confidentiality of all employment records and personnel files acquired
pursuant to the terms hereof and shall use such records and files only in the
ordinary course of business and in accordance with applicable law.
6.3.5 Post-Closing Adjustment
(a) As soon as practicable after the Closing Date, but in no event
later than 45 days thereafter, Station shall prepare and deliver to Acquiror
the Station Closing Balance Sheet. As soon as practicable after the Closing
Date, but in no event later than 45 days thereafter, Acquiror shall prepare
and deliver to Station the Acquiror Closing Balance Sheet and a calculation of
the Actual Cash Consideration. Acquiror shall have an opportunity to review
and comment upon the Station Closing Balance Sheet, and Station shall have an
opportunity to review and comment upon the Acquiror Closing Balance Sheet and
the calculation of the Actual Cash Consideration.
(b) The Station Closing Balance Sheet and the Acquiror Closing Balance
Sheet shall be prepared in accordance with generally accepted accounting
principles on a basis consistent (including account classifications) with that
used in the preparation of the Station Financial Statements and the Acquiror
Financial Statements, respectively, and shall present fairly the financial
position of Station and Acquiror, respectively, as of the date indicated.
Station will deliver a certificate confirming the representation set forth in
Section 3.6 with respect to the Station Closing Balance Sheet and Acquiror
will deliver a certificate confirming the representation set forth in Section
4.6 with respect to the Acquiror Closing Balance Sheet.
(c) If the Actual Cash Consideration exceeds the Estimated Cash
Consideration, Acquiror shall pay the amount of such difference to Station
plus Interest from the Closing Date to, but excluding, the date such amount is
paid in full. If the Estimated Cash Consideration exceeds the Actual Cash
Consideration, Station shall pay the amount of such difference to Acquiror
plus Interest from the Closing Date to, but excluding, the date such amount is
paid in full. If payment is required to be made pursuant to this Section
6.3.5, the settlement shall take place by delivery of immediately available
funds to the party entitled to receive such funds promptly after calculation
of the Actual Cash Consideration.
6.3.6 Accounts Receivable
Acquiror shall use commercially reasonable efforts to collect all the
Accounts Receivable of Station within 180 days after the Closing Date. Except
for accounts with respect to which a bona fide payment dispute exists before
the Closing, all payments received by Acquiror from any entity that
constitutes an obligor with respect to any of the accounts included within the
Accounts Receivable of Station as of the Closing Date shall be credited first
against the amounts owed by such obligor included within the Accounts
Receivable of Station in order of the date of invoice until all such amounts
are paid in full. Acquiror shall not compromise, settle or adjust any such
accounts without the specific written permission of Station. Acquiror shall
make available to Station such information as may be necessary or desirable to
permit Station to monitor Acquiror's efforts to collect the Accounts
Receivable of Station. With respect to any accounts not paid in full within
90 days after the Closing Date, Station shall have the right, but not the
obligation, to take control from Acquiror of the effort to collect such
accounts. Any and all payments received by Station with respect to such
Accounts Receivable of Station as a result of any such collection efforts by
Station shall be forwarded within five days of receipt thereof to Acquiror,
provided that Station shall be entitled to deduct therefrom reasonable costs
of collection.
6.3.7 Film Payables
Station agrees to use reasonable efforts to pay its film contract
obligations no more than 60 days after the contractual due date of each such
film contract obligation.
6.3.8 Employee Matters
(a) Schedule 6.3.8 contains a true and complete list of all persons
employed by Station, their current position with Station, their current
employment status and their current accrued paid leave, whether for vacation,
sickness or other circumstance. Station shall provide to Acquiror at the
Closing a true and complete copy of each personnel file maintained by Station
for each of its employees.
(b) Acquiror agrees to employ at the Closing each of the employees of
Station who are made available to Acquiror by Station. Such persons shall
become employees of Acquiror and shall initially have positions (including
status, offices, titles and reporting requirements), authority, duties and
responsibilities comparable to those held and exercised by such employee with
Station on the Closing Date; provided, however, that Acquiror shall in no
event be restricted from making such employment decisions after the Closing as
it deems appropriate. Acquiror further agrees initially to provide each such
employee with compensation and a package of benefit plans, taken as a whole,
comparable to those in effect on the Closing Date; provided, however, that
Acquiror shall in no event be restricted from making such compensation and
benefit decisions after the Closing as it deems appropriate. Acquiror agrees
to give such employees full credit for the paid time off and sick pay earned
or accrued by them during, and to which they are entitled as a result of,
their employment by Station, either by allowing such employees such paid time
off and sick pay as to which such employees would have been entitled as of the
Closing Date under the policies of Station if such employees had remained
employees of Station or, upon termination of employment, by making full
payment to such employees of the paid time off that such employees would have
received had they taken such paid time off.
(c) Acquiror agrees to provide the employees of Station with health
care benefits consistent with those provided by Acquiror to its existing
employees. Acquiror further agrees to permit employees of Station
participating in Station's health care plans to participate in Acquiror's
health care plans; provided, however, that such health care benefits shall be
immediately available to such employees as of the Closing Date, and such
employees shall become as of the Closing Date participants thereunder, without
regard to any applicable waiting period or any limitation with respect to
preexisting conditions. Acquiror agrees to act as a successor employer for
purposes of the Consolidated Omnibus Budget Reconciliation Act of 1985, as
amended ("COBRA"), so that Station's employees will not, as a result, be
deemed to have had a termination of employment for purposes of COBRA and that
any COBRA notices or coverage required to be given or made available to any
such employee shall be given or made by Acquiror, not Station.
(d) Acquiror acknowledges and agrees that as of the date and time the
Closing is effective, Acquiror is considered for purposes of the WARN Act the
employer of the employees of Station and that Acquiror (and not Station) shall
thereupon be responsible for complying with the WARN Act with respect to such
employees and that prior to such time none of such employees shall be, nor
shall they be deemed to be, terminated for purposes of the WARN Act.
(e) Acquiror shall indemnify, defend and hold Station harmless from
and against any and all losses, claims and expenses of any kind whatsoever,
including, without limitation, attorneys' fees and costs of investigation,
resulting from or arising out of (i) the discharge or other termination of
employment by Acquiror from and after the Closing Date of any employee of
Station, including, without limitation, claims for health care coverage or
benefits and all compliance obligations (including, without limitation, the
obligation to give notice or pay money) of Station or Acquiror under the WARN
Act, and (ii) the Station Union Contracts from and after the Closing.
(f) Acquiror agrees to assume sponsorship of the Profit Sharing Plan
as of the Closing; provided, however, that Acquiror shall have the right to
amend or terminate the Profit Sharing Plan at any time and in any manner it
deems appropriate or desirable, including, but not by way of limitation,
merging the Profit Sharing Plan into a plan sponsored or maintained by
Acquiror. Station agrees, represents and covenants that it will complete the
Form 5500 for the 1993 plan year and file such form with the IRS not later
than July 31, 1994, and will provide Acquiror with a copy of such filing and
such other evidence as the Acquiror may require to establish that the filing
has occurred within 10 days after said filing occurs. Stockholder and Station
agree, represent and covenant that they and their Affiliates will provide any
assistance and any information that Acquiror deems necessary to obtain a
determination from the IRS that the Profit Sharing Plan is qualified under
Section 401(a) of the Code and that the related trust is exempt from federal
income taxation under Section 501(a) of the Code.
6.3.9 Financial Information
Station has provided Acquiror and Parent with certain internal budget
documents, pacing reports and similar items (collectively, the "Station
Financial Information") regarding the prospective performance of Station. The
Station Financial Information was prepared in the ordinary course of business
for Station's internal purposes, consists only of management's estimate of
Station's future performance in the categories reflected in the Station
Financial Information, and does not constitute any representation or agreement
that Station's actual performance will match the Station Financial
Information.
Acquiror has provided Station and Stockholder with certain internal
budget documents, pacing reports, projections and similar items (collectively,
the "Acquiror Financial Information") regarding the prospective performance of
Acquiror, as well as projected balance sheet items of Acquiror as of September
30, 1994 ("Balance Sheet Items"). The Acquiror Financial Information was
prepared in the ordinary course of business for Acquiror's internal purposes,
consists only of management's estimate of Acquiror's future performance in the
categories reflected in the Acquiror Financial Information, and does not
constitute any representation or agreement that Acquiror's actual performance
will match the Acquiror Financial Information. The Balance Sheet Items were
prepared in good faith, consistent with generally accepted accounting
principles and with Acquiror's regularly prepared financial statements, and
constitute management's best estimate of such items as of September 30, 1994,
but do not constitute any representation or agreement that Acquiror's actual
September 30, 1994 balance sheet will match the Balance Sheet Items.
6.3.10 Prorations; Trade Agreements
Notwithstanding any other provision of this Agreement:
(a) In calculating the amount of the Station Accounts Payable, all
items of expense (including prepaid expenses) arising from the business or
operations of Station, including, without limitation, rents, property and
payroll taxes (other than taxes payable in connection with the consummation of
the transactions contemplated by this Agreement, which shall be paid in
accordance with the terms of Section 2.5), assessments, business and license
fees (other than the Station Film Payables Outstanding), insurance premiums,
salaries and wages (other than as excluded from the definition of Station
Accounts Payable), and charges for heat, power, water, utilities and other
current operating expenses, shall be prorated as of the Closing Date on the
basis of a 365-day year, so as to effectuate the parties' intent that (i) only
items of expense arising from or relating to periods prior to the Closing are
included in the Station Accounts Payable and (ii) the amount of any expenses
prepaid by Station attributable to post-Closing Date periods is credited
against the expenses included in the Station Accounts Payable; and
(b) To the extent that the aggregate value (as determined by reference
to Station's rate card as in effect at the Closing) by which Station's post-
Closing Date obligations under trade, barter or similar arrangements for the
sale of advertising time (with the exception of film contracts or program
barter agreements) is greater than the aggregate fair market value of the
goods, services or other items to be received by Acquiror as Station's
successor on or after the Closing Date, the amount of such difference shall be
(i) added to the amount of the Station Accounts Payable, if positive, or (ii)
added to the amount of the Station Closing Accounts Receivable, if negative.
6.3.11 Oxford Property
At the Closing, Station shall convey by quit claim deed without warranty
all of its right, title and interest (if any) to the Oxford property (more
particularly described in the Chicago Title Insurance Company Commitment for
Title Insurance, Title Number 944201332, effective May 26, 1994) to Acquiror,
including, without limitation, by assigning to Acquiror any rights Station may
have to such property pursuant to the Asset Purchase Agreement, dated July 30,
1985, between Capital Cities Communications, Inc. and Cook Inlet
Communications, L.P. Station will negotiate with Capital Cities
Communications, Inc. and otherwise use its reasonable efforts to attempt to
provide Acquiror with good and marketable title to such property evidenced by
a warranty deed relating to such property. In connection with the foregoing,
Station shall not be obligated to pay any amount or undertake any obligation
to Capital Cities Communications, Inc. or its successors or Affiliates.
ARTICLE VII CONDITIONS PRECEDENT TO CLOSING
7.1 General Conditions
The respective obligations of Parent, Acquiror, Stockholder and Station
to effect the Closing of the transactions contemplated hereby are subject to
the satisfaction on or prior to the Closing Date of the following conditions:
7.1.1 Legal Proceedings
No order of any court or administrative agency shall be in effect that
enjoins, restrains, conditions or prohibits consummation of this Agreement,
and no litigation, investigation or administrative proceeding initiated by any
bona fide third party shall be pending or threatened that would enjoin,
restrain, condition or prohibit consummation of this Agreement.
7.1.2 HSR Act
Any applicable waiting period under the HSR Act relating to the
transactions contemplated by this Agreement shall have expired or been
terminated.
7.1.3 FCC Approval
The FCC Approval shall have been issued with no conditions that are,
individually or in the aggregate, materially adverse to Acquiror, such FCC
Approval shall be in full force and effect and the FCC Order containing such
FCC Approval shall have become "Final." For the purposes hereof, the FCC
Order shall have become "Final" when the FCC Order has been issued by the FCC,
when the time for filing any protest, request for stay, petition or request
for reconsideration, petition for rehearing or appeal or review of the FCC
Order by or to the FCC or any court or Governmental Entity having jurisdiction
over the FCC Order or the premises or review or reconsideration by the FCC on
its own motion has expired and when no protest, request for stay, petition or
request for reconsideration, petition for rehearing or appeal or review of the
FCC Order is pending.
7.2 Conditions to Obligations of Parent and Acquiror
Parent's and Acquiror's respective obligations to effect the Closing of
the transactions contemplated hereby are subject to the satisfaction on or
prior to the Closing Date of the following conditions:
7.2.1 Accuracy of Representations and Warranties
The representations and warranties made by Stockholder and Station
herein (including applicable Exhibits and Schedules) shall have been true in
all material respects when made and, except as permitted by Section 6.1.2,
shall be true in all material respects as of the Closing Date as though made
on that date, except in each case (a) to the extent of any event, occurrence
or condition that constitutes a breach of any of such representations and
warranties, but which would not, or could not be reasonably expected to,
result in a Material Adverse Effect on Station (provided, however, that
nothing herein, nor consummation of the Closing, shall be deemed to constitute
a waiver of such breach), (b) as affected by the transactions contemplated
hereby, and (c) to the extent that such representations and warranties are
made as of a specified date, in which case such representations and warranties
shall be true in all material respects as of the specified date.
7.2.2 Letter Ruling
Parent shall have received the Letter Ruling.
7.2.3 Performance of Agreement
Stockholder and Station shall have performed in all material respects
all obligations and agreements and complied in all material respects with all
covenants and conditions contained in this Agreement that are to be performed
and complied with by them on or prior to the Closing Date.
7.2.4 Consents
Acquiror shall have received written consents to the assignment of those
agreements set forth in Schedule 7.2.4, which consents shall in all respects
be satisfactory to Acquiror in its reasonable discretion.
7.2.5 No Material Change
From the date of the Station Balance Sheet to the Closing Date, Station
shall not have suffered any event or occurrence that would, or could
reasonably be expected to, result in a Material Adverse Effect on the Assets
or Station.
7.2.6 WTHN-TV License Renewal
The FCC shall have issued an order granting the license renewal
application of WTNH-TV, Hartford-New Haven, Connecticut, without material
adverse condition, for a period to expire April 1, 1999, and such FCC order
shall have become final as defined in Section 7.1.3.
7.3 Conditions to Obligations of Stockholder and Station
Stockholder's and Station's respective obligations to effect the Closing
of the transactions contemplated hereby are subject to the satisfaction on or
prior to the Closing Date of the following conditions:
7.3.1 Accuracy of Representations and Warranties
The representations and warranties made by Parent and Acquiror herein
(including applicable Exhibits and Schedules) shall have been true in all
material respects when made and, except as permitted by Section 6.2.2 and
except that the representations and warranties set forth in the first two
sentences of Section 4.3 shall be updated to reflect Acquiror's capitalization
as it exists on the Closing Date, shall be true in all material respects as of
the Closing Date as though made on that date, except in each case (a) to the
extent of any event, occurrence or condition that constitutes a breach of any
of such representations and warranties, but which would not, or could not
reasonably be expected to, result in a Material Adverse Effect on Acquiror or
any of the Major LIN Stations (provided, however, that nothing herein, nor
consummation of the Closing, shall be deemed to constitute a waiver of such
breach), (b) as affected by the transactions contemplated hereby, and (c) to
the extent that such representations and warranties are made as of a specified
date, in which case such representations and warranties shall be true in all
material respects as of the specified date. Notwithstanding the foregoing,
the representations and warranties contained in Section 4.4 shall be true on
the Closing Date as though made on such date without reference to the
exceptions set forth in Schedule 4.4.
7.3.2 Performance of Agreement
Parent and Acquiror shall have performed in all material respects all
obligations and agreements and complied in all material respects with all
covenants and conditions contained in this Agreement that are to be performed
and complied with by them on or prior to the Closing Date.
7.3.3 Effectiveness of Form S-4
The Form S-4 shall have been declared effective by the SEC, and no stop
order suspending the effectiveness of the Form S-4 shall be in effect and no
proceeding for such purpose shall be pending before or threatened by the SEC.
7.3.4 Distribution
The Distribution shall have been effected.
7.3.5 Listing
The Acquiror Common Stock shall have been authorized for quotation on
the Nasdaq National Market or listed on the New York Stock Exchange, Inc. or
the American Stock Exchange, Inc.
7.3.6 No Material Change
From the date of the Acquiror Balance Sheet to the Closing Date, neither
Acquiror nor any of the Major LIN Stations shall have suffered any event or
occurrence that would, or could reasonably be expected to, result in a
Material Adverse Effect on Acquiror or any of the Major LIN Stations.
ARTICLE VIII THE CLOSING
8.1 Closing Date
The Closing shall take place as soon as practicable at an hour on such
date as is agreed to by the parties (the "Closing Date") and at a place to be
determined by the parties. At the Closing, each of the parties shall take all
such action and deliver all such documents, instruments, certificates and
other items as may be required, under this Agreement or otherwise, to perform
or fulfill all covenants, conditions and agreements on its part to be
performed or fulfilled on or prior to the Closing Date.
8.2 Documents to Be Delivered by Parent and Acquiror
Parent and Acquiror shall deliver the following documents, agreements
and supporting papers to Stockholder at or prior to the Closing, the delivery
of which shall be a condition to the performance by Stockholder and Station of
the obligations to be performed by Stockholder and Station at the Closing:
(a) the Estimated Cash Consideration and certificate(s) representing
the Share Consideration;
(b) an executed copy of each of the Related Agreements to which Parent
or Acquiror is a party;
(c) an executed copy of the Solvency Letter Agreement;
(d) executed Officer's Certificates of the President or Vice President
and Secretary of each of Parent and Acquiror in a form mutually acceptable to
Stockholder and Acquiror; and
(e) opinions of Perkins Coie, Covington & Burling and Ford & Harridan,
counsel to Parent and Acquiror, in the forms attached as Exhibit E hereto.
8.3 Documents to Be Delivered by Stockholder and Station
Stockholder and Station shall deliver the following documents,
agreements and supporting papers to Acquiror at or prior to the Closing, the
delivery of which shall be a condition to the performance by Parent and
Acquiror of the obligations to be performed by Parent and Acquiror at the
Closing:
(a) an executed copy of each of the Related Agreements to which
Stockholder or Station is a party;
(b) an executed copy of the Solvency Letter Agreement;
(c) executed Officer's Certificates of the President or Vice President
and Secretary of each of Stockholder and Station in a form mutually acceptable
to Acquiror and Stockholder;
(d) opinions of Mugger, Tolles & Olson and Hopkins & Sutter, counsel
to Stockholder and Station, in the forms attached as Exhibit F hereto;
(e) an executed copy of each of the warranty deeds relating to the
Station Real Property, duly endorsed in favor of Acquiror and, in each case,
in due form for recordation with the appropriate governmental authorities;
(f) American Land Title Association policies of title insurance, with
extended coverage, dated as of the Closing Date, insuring that fee simple
title to each parcel of the Station Real Property is vested in Acquiror,
subject only to the Encumbrances described in Schedule 3.12(c), which policies
of title insurance shall insure up to the amounts mutually acceptable to
Acquiror and Station;
(g) any and all certificates of title relating to Station Personal
Property included in the Assets;
(h) consents to assignment of the agreements set forth in Schedule
7.2.4;
(i) an executed Non-Foreign Person Certificate in the form required by
the Foreign Investment in Real Property Tax Act of 1984; and
(j) a "Conveyance Tax Return" and, as applicable, a "Conveyance Tax
Statement" as provided for under Connecticut law relating to the Station Real
Property.
ARTICLE IX TERMINATION
This Agreement may be terminated as follows in this Article IX, provided
that the party terminating this Agreement is not then in material default
hereof, upon written notice to the other parties:
(a) by any party if the Closing shall not have occurred by March 31,
1995; or
(b) by any party after Parent's delivery of the Letter Ruling Notice
to Station; or
(c) by Parent and Acquiror, if Stockholder or Station should default
in any material respect in the observance or in the due and timely performance
of any of its covenants or agreements herein contained; or
(d) by Stockholder and Station, if Parent or Acquiror should default
in any material respect in the observance or in the due and timely performance
of any of its covenants or agreements herein contained.
Notwithstanding the foregoing, any notice of termination pursuant to
subsection (c) or (d) shall not be effective unless the terminating party
shall have given to the defaulting party at least 30 days' advance written
notice of its claim of default so as to afford the other party the opportunity
to cure.
ARTICLE X GENERAL
10.1 Expenses
Except as expressly provided to the contrary, whether or not the
transactions contemplated by this Agreement are consummated, each party hereto
shall pay its own fees, costs and expenses incident to the negotiation,
preparation and carrying out of this Agreement and the Related Agreements and
the consummation of the transactions contemplated hereby and thereby;
provided, however, that the cost of the title insurance policies referred to
in Section 8.3(g) shall be split evenly between Station and Acquiror.
10.2 Amendment
The parties hereto may amend, modify or supplement this Agreement at any
time, but only in a written amendment duly executed on behalf of each of the
parties.
10.3 Indemnification and Survival of Warranties
10.3.1 Generally
(a) Subject to the limitations set forth in Section 10.3.5, Parent and
Acquiror, jointly and severally, agree to indemnify and hold harmless
Stockholder and Station, their successors and permitted assigns, and the
officers, directors, Affiliates, employees, controlling Persons and agents of
the foregoing and to hold each such party harmless against and in respect of
any and all losses, damages, penalties, costs and expenses, including
reasonable attorneys' and accountants' fees (the "Seller Indemnified
Damages"), incurred by any such party by reason of any of the following: (i)
a breach of any of the representations or warranties made by Parent or
Acquiror in this Agreement, (ii) Acquiror's failure to satisfy the Assumed
Liabilities, (iii) a breach of undertakings by Parent or Acquiror in any other
document, agreement or amendment relating to or executed in connection with
this Agreement or the Related Agreements, or in any Officer's Certificate or
other certificate delivered to Stockholder at or in connection with the
Closing, (iv) the nonperformance (whether partial or total) of any covenant or
agreement made in this Agreement or the Related Agreements by Parent or
Acquiror, or (v) liability or alleged liability to unaffiliated third parties
under the Securities Act, the Exchange Act, state securities laws or related
common law claims because of any untrue statement or alleged untrue statement
of a material fact contained in any Acquiror Disclosure Document, including
any preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, the omission or alleged omission to state
therein a material fact required to be stated therein, or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, or in connection therewith any other violation or
alleged violation by Acquiror of the Securities Act, the Exchange Act, any
state securities law or any rule or regulation promulgated thereunder or any
related common law claim; provided, however, that Acquiror and Parent shall
not be liable in any such case referred to in this subparagraph (v) for any
such Seller Indemnified Damages to the extent that they are not permitted to
be paid under law (in which event the Indemnitees shall be entitled to
contribution as to Seller Indemnified Damages in such proportion as is
appropriate to reflect the relative fault of the Indemnifying Parties and the
Indemnitees) or that they arise out of or are based upon any of the foregoing
that occurs in reliance upon and in conformity with written information
furnished by Stockholder or Station expressly for use in connection with such
Acquiror Disclosure Document.
(b) In addition to the rights afforded by Section 10.3.1(a) and
subject to the limitations set forth in Section 10.3.5, Parent agrees to pay
to Station and its successors and permitted assigns the amount of any and all
losses, damages, penalties, costs and expenses, including reasonable
attorneys' and accountants' fees, incurred by Acquiror by reason of (i) the
existence of any condition or fact, or the happening of any event, that
constitutes a breach of any of the representations or warranties made by
Parent or Acquiror in this Agreement and (ii) all federal and state Taxes
imposed on the operations or property of Acquiror or any of Acquiror's
subsidiaries for all periods or portions of periods up to and including the
Closing Date, which are not otherwise accrued for on the Acquiror Closing
Balance Sheet (either (i) or (ii), an "Acquiror Loss"); provided, however,
that the payment to be made to any Indemnitee (as defined below) with respect
to an Acquiror Loss shall be equal to the product of (y) such payee's
percentage ownership interest in the Acquiror Common Stock as of the date that
Acquiror first learned of the circumstance that resulted in such Acquiror Loss
(counting for purposes of determining such ownership interest only those
shares of Acquiror Common Stock included as part of the Share Consideration)
multiplied by (z) the amount of the Acquiror Loss (such product being the
"Deemed Loss"). The parties hereto hereby agree and acknowledge that the
foregoing agreement regarding the calculation of an Indemnitee's claim for
damages under this Section 10.3.1(b) with respect to a Deemed Loss is
reasonable and appropriate, given that it may be impracticable or extremely
difficult to establish such Indemnitee's actual damages. Nothing in Section
10.3.1(a) or (b) shall be construed to limit any claims Indemnitees under this
section may have against the Indemnifying Parties under state or federal
securities laws, provided that amounts payable to any Indemnitee as a Deemed
Loss and any other amounts payable to such Indemnitee under other potential
causes of action, including, without limitation, pursuant to Section
10.3.1(a), arising out of the same facts and circumstances shall be offset
against each other.
(c) Subject to the limitations set forth in Section 10.3.5,
Stockholder and Station, jointly and severally, agree to indemnify and hold
harmless Parent and Acquiror, their successors and permitted assigns, and the
officers, directors, Affiliates, employees, controlling Persons and agents of
the foregoing and to hold each such party harmless against and in respect of
any and all losses, damages, penalties, costs and expenses, including
reasonable attorneys' and accountants' fees (the "Buyer Indemnified Damages"),
incurred by any such party by reason of any of the following: (i) a breach of
any of the representations or warranties made by Stockholder or Station in
this Agreement, (ii) Station's failure to satisfy the Excluded Liabilities,
(iii) a breach of undertakings by Stockholder or Station in any other
document, agreement or amendment relating to or executed in connection with
this Agreement or the Related Agreements, or in any Officer's Certificate or
other certificate delivered to Acquiror at or in connection with the Closing,
(iv) the nonperformance (whether partial or total) of any covenant or
agreement made in this Agreement or the Related Agreements by Stockholder or
Station, or (v) liability or alleged liability to unaffiliated third parties
under the Securities Act, the Exchange Act, state securities laws or related
common law claims because of any untrue statement or alleged untrue statement
of a material fact contained in any Acquiror Disclosure Document, including
any preliminary prospectus or final prospectus contained therein or any
amendments or supplements thereto, the omission or alleged omission to state
therein a material fact required to be stated therein, or necessary to make
the statements therein, in light of the circumstances under which they were
made, not misleading, or in connection therewith any other violation or
alleged violation by Acquiror of the Securities Act, the Exchange Act, any
state securities law or any rule or regulation promulgated thereunder or any
related common law claim because of reliance by Acquiror or Parent upon and in
conformity with written information furnished by Stockholder or Station
expressly for use in connection with the Acquiror Disclosure Documents. To
the extent such Buyer Indemnified Damages are not permitted to be paid under
law, the Indemnitees shall be entitled to contribution as to Buyer Indemnified
Damages in such proportion as is appropriate to reflect the relative fault of
the Indemnifying Parties and the Indemnitees.
Nothing in this section shall be construed to limit any claims
Indemnitees under this section may have against the Indemnifying Parties under
state or federal securities laws.
(d) For purposes of the indemnifications made in this Section 10.3,
all representations and warranties shall be deemed to have been made as of and
on the Closing Date, except to the extent that such representations and
warranties are made as of a specified date, in which case such representations
and warranties shall be deemed to have been made as of such specified date.
10.3.2 Notice
In the event of any matter that may give rise to the right of Parent,
Acquiror, Stockholder or Station, their successors or permitted assigns, or
the officers, directors, Affiliates, employees, controlling Persons or agents
of the foregoing to be indemnified under this Section 10.3 (the "Indemnitee")
with respect to claims made by third parties, if any Indemnitee is threatened
with any claim, or any claim is presented to, or any action or proceeding is
commenced against, such Indemnitee that may give rise to the right of
indemnification hereunder, the Indemnitee shall promptly notify the party or
parties bearing the indemnification obligation (the "Indemnifying Party")
thereof in writing.
The failure to deliver written notice to the Indemnifying Party within a
reasonable time to the extent such delay is prejudicial shall relieve such
Indemnifying Party of liability to the Indemnitee under this Section 10.3 to
the extent of the monetary impact of such prejudice, but the omission so to
deliver written notice to the Indemnifying Party will not relieve it of any
liability that it may have to any Indemnitee otherwise.
10.3.3 Procedure for Third-Party Claims
With respect to claims made or actions or proceedings commenced by third
parties, the Indemnifying Party shall have the right to participate in the
defense of such claim, action or proceeding and, except as to such third party
claims, actions or proceedings seeking damages in excess of the remaining
limitations set forth in Section 10.3.5, and except as to third party claims,
actions or proceedings seeking, in whole or in part, injunctive or other
equitable relief against Indemnitee, to the extent the Indemnifying Party so
desires, jointly with any other Indemnifying Party similarly notified, to
assume the defense thereof with counsel mutually satisfactory to such parties
and the Indemnitee. The Indemnifying Party shall assume the expense of the
Indemnitee's attorneys' fees unless the Indemnifying Party and the Indemnitee
agree upon mutually satisfactory counsel to assume the defense, in which case
the Indemnifying Party shall be obligated to pay only the fees and expenses of
such mutually satisfactory counsel. In the event the Indemnifying Party
undertakes to compromise or defend any such liability, the Indemnifying Party
shall so notify the Indemnitee promptly in writing of its intention to do so,
and the Indemnitee shall cooperate with the Indemnifying Party and its counsel
in the compromising of or the defending against any such liability or claim
except that the Indemnifying Party may not seek to compromise or settle any
liability which exceeds the remaining limitations on indemnification set forth
in Section 10.3.5 or any claim, action or proceeding which involves injunctive
or other equitable relief against the Indemnitee without the express written
approval of the Indemnitee. Such approval may be given or withheld by
Indemnitee in its sole discretion. Such cooperation shall include, without
limitation, providing the Indemnifying Party reasonable access to the
Indemnitee's business records, research, documents and employees as they
relate to the defense of any indemnified claim. In response to a bona fide
settlement offer, the Indemnifying Party may settle the monetary portion of an
indemnifiable matter that it has duly elected to contest to the extent such
settlement does not exceed the remaining limitations set forth in Section
10.3.5 and does not involve a matter in which injunctive or other equitable
relief is sought but such matters shall only be settled with the consent of
the Indemnitee, which consent shall not be unreasonably withheld. In the
event the Indemnitee unreasonably declines to consent to the monetary
settlement described in the preceding sentence, then the Indemnitee shall have
no right to indemnification beyond, and the Indemnifying Party shall have no
obligation to pay damages or attorneys' fees hereunder in excess of, the
amount of the proposed settlement.
10.3.4 Survival
All representations and warranties made by Parent, Acquiror, Stockholder
and Station shall survive the Closing to the following extent:
(a) the representations and warranties made by Stockholder and Station
in Sections 3.1 and 3.2 and by Parent and Acquiror in Sections 4.1, 4.2 and
4.3(a) shall survive indefinitely;
(b) all other representations and warranties shall survive for a
period of three years; and
(c) except as to claims under Sections 10.3.1(a)(v) and 10.3.1(c)(v),
no party shall be entitled to indemnification under this Section 10.3 unless
such claim for indemnification is asserted in writing to the party from whom
indemnification is sought within three years after the Closing Date.
10.3.5 Certain Limitations
(a) No claim for indemnification for any breach of any representation
or warranty under Section 10.3.1(a) or for any Deemed Loss under Section
10.3.1(b) shall be made by any party until the aggregate amount of any Seller
Indemnified Damages and Deemed Losses equals or exceeds $2,775,000, at which
time the Indemnitees shall have the right to indemnification for all Seller
Indemnified Damages and Deemed Losses, including the first $2,775,000 of such
Seller Indemnified Damages and Deemed Losses up to an aggregate maximum
indemnification payment of $15 million pursuant to Section 10.3.1(a) for
breaches of any representations or warranties and for Deemed Losses under
Section 10.3.1(b). The terms of this Section 10.3.5(a) shall not apply to a
Deemed Loss relating to federal and state Taxes under Section 10.3.1(b)(ii).
(b) No claim for indemnification for any breach of any representation
or warranty shall be made under Section 10.3.1(c) or 10.4.1 by any party until
the aggregate amount of any Buyer Indemnified Damages and claims pursuant to
Section 10.4.1 equals or exceeds $925,000, at which time the Indemnitees shall
have the right to indemnification for all Buyer Indemnified Damages and claims
pursuant to Section 10.4.1, including the first $925,000 of such Buyer
Indemnified Damages and claims pursuant to Section 10.4.1. Stockholder and
Station shall be liable for an aggregate maximum payment of $15 million
pursuant to Section 10.3.1(c) for breaches of any representations or
warranties and Section 10.4.1.
10.3.6 Effectiveness
The provisions of this Section 10.3 shall have no force or effect prior
to consummation of the Closing.
10.4 Tax Indemnification and Tax Matters
10.4.1 Stockholder and Station Indemnification
Subject to the limitations set forth in Section 10.3.5, Stockholder and
Station, jointly and severally, agree to indemnify and hold harmless Acquiror
and its successors, permitted assigns, officers, directors, employees and
agents for all Taxes (a) imposed on Stockholder's and Station's Affiliated
Group for any taxable year or (b) imposed on Station or its successors, or for
which Station or its successors may otherwise be liable for any period or
portion of a period up to and including the Closing Date.
10.4.2 Additional Stockholder and Station Indemnification
Stockholder and Station, jointly and severally, also agree to indemnify
and hold harmless Parent and its successors (the "Parent Tax Indemnitees") for
their proportionate share of the Taxes imposed upon Parent as a result of the
Distribution not qualifying for nonrecognition of gain (or no inclusion of
income) treatment under Section 355 of the Code, but only to the extent the
Distribution's failure to so qualify is finally determined, in judicial
proceedings to which Stockholder and Station are parties, to have been
proximately caused, in whole or in part, by a breach of a Section 355
Representation by Stockholder or Station. Stockholder and Station's
proportionate share of such Taxes shall be determined by a comparison between
(i) the extent to which their breach of a Section 355 Representation
proximately caused the Distribution to not qualify for nonrecognition of gain
(or no inclusion of income) treatment under Section 355 of the Code and (ii)
the extent to which the actions of any other person or entity not an Affiliate
of Stockholder or Station proximately caused the Distribution not to qualify
for nonrecognition of gain (or no inclusion of income) treatment under Section
355 of the Code. Notwithstanding the foregoing, unless Stockholder's and
Station's proportionate share of responsibility equals or exceeds 25%,
Stockholder and Station shall have no responsibility to indemnify under this
Section 10.4.2 and no liability to any person or entity based upon the breach
of such representation. For purposes hereof, only the following shall
constitute a Section 355 Representation: the representations made by
Stockholder or Station in Exhibit C to this Agreement. Stockholder and
Station agree and acknowledge that the Section 355 Representations are being
made directly to Parent and Acquiror and that Parent and Acquiror intend to
rely upon the Section 355 Representations. Stockholder and Station shall be
liable for no more than an aggregate maximum of $35 million for breaches of
Section 355 representations.
10.4.3 Additional Parent Indemnification
Parent agrees to indemnify, defend, and hold harmless Stockholder,
Station, and each of their successors, permitted assigns, officers, directors,
employees, and agents (the "Station Tax Indemnitees") from and against any and
all claims, causes of action, losses, damages, costs, and expenses (including
attorney's fees and costs of investigation) of any nature whatsoever arising
out of or resulting from the Distribution not qualifying for nonrecognition of
gain (or no inclusion of income) treatment under Section 355 of the Code,
provided, however, that Parent shall not be required by the terms hereof to
indemnify Stockholder or Station with respect to any amount required to be
paid by Stockholder or Station to the Parent Tax Indemnitees pursuant to the
terms of Section 10.4.2.
10.4.4 Separate Obligations
The indemnification obligations set forth in Sections 10.4.2 and 10.4.3
are separate and independent. Accordingly, Parent's obligation to indemnify
the Station Tax Indemnitees set forth in Section 10.4.3 shall not be
diminished or in any way affected by the pendency of any claim against
Stockholder or Station pursuant to the terms of Section 10.4.2, provided,
however, that in the event a final determination is obtained in judicial
proceedings to which Stockholder and Station are parties holding that
Stockholder and Station are obligated to indemnify the Parent Tax Indemnitees
pursuant to the terms of Section 10.4.2, then the amount of any such
indemnification obligation may be offset following such determination against
any amounts due to the Station Tax Indemnitees pursuant to the terms of
Section 10.4.3. The above is not intended to delay the obligation of
Stockholder and/or Station to pay any indemnification in accordance with
Section 10.4.2 after a final determination is obtained in judicial
proceedings.
10.4.5 Procedure as to Judicial Proceedings Relating to Section 10.4.2
Indemnification
For the purpose of seeking a final determination in a judicial
proceeding to which Stockholder and Station are parties as to Stockholder
and/or Station's responsibility for indemnification under Section 10.4.2, if
deemed necessary by Parent Tax Indemnitees, Stockholder and Station consent
and submit to jurisdiction over them in the courts (state or federal) of the
State of Washington. The requirements in Sections 10.4.2, 10.4.3, and 10.4.4
that both Stockholder and Station be parties to such a proceeding shall not
apply if either no longer exists at the time such a judicial determination is
sought in which event only the then existing entity, if any, need be made a
party to the judicial proceeding.
10.4.6 Limitation
(a) Stockholder and Station shall not be entitled to indemnification
for a 10.4.3 Claim (as defined below) under Section 10.4.3 unless such 10.4.3
Claim is pending within seven years and one month after the Trigger Date (as
defined below). Any claim pursuant to the indemnification provisions of
Section 10.4.3 hereof or any written indication from the IRS of its intention
to challenge the Distribution's qualification for nonrecognition of gain (or
no inclusion of income) treatment under Section 355 of the Code shall be
considered claims (each, a "10.4.3 Claim"). The date on which Acquiror files
its federal income tax return with the Internal Revenue Service for the year
in which the Distribution is completed shall be the trigger date (the "Trigger
Date").
(b) Parent shall not be entitled to indemnification for a 10.4.2 Claim
(as defined below) under Section 10.4.2 unless such 10.4.2 Claim is pending
within three years after the Trigger Date. Any claim pursuant to the
indemnification provisions of Section 10.4.2 hereof or any written indication
from the IRS of its intention to challenge the Distribution's qualification
for nonrecognition of gain (or no inclusion of income) treatment under Section
355 of the Code shall be considered claims (each, a "10.4.2 Claim").
10.4.7 Assistance and Cooperation
After the Closing Date, each of Stockholder, Station, Parent and
Acquiror shall:
(a) assist (and cause their respective Affiliates to assist) the other
parties in preparing any Tax Returns or reports that any such other party is
responsible for preparing and filing in accordance with this Section 10.4;
(b) cooperate fully in preparing for any audits of, or disputes with
taxing authorities regarding, any Tax Returns;
(c) make available to the other parties and to any taxing authority as
reasonably requested all information, records and documents relating to Taxes
of Station or Taxes of Parent as a result of the Distribution; and
(d) furnish the other parties with copies of all correspondence
received from any taxing authority in connection with any Tax audit or
information request relating to Taxes that the other parties may be required
to indemnify under Section 10.4.1 or 10.4.2.
10.4.8 Parent Indemnification of Acquiror
Parent agrees to indemnify Acquiror for all Tax liability for which
Acquiror is or may be liable solely as a result of being a member of Parent's
Affilitated Group (and not as a result of its own operations).
10.5 Waivers
Any terms, covenants, representations, warranties or agreements of any
party hereto may be waived at any time by an instrument in writing executed by
the party for whose benefit such terms exist. The failure of any party at any
time or times to require performance of any provision hereof shall not in any
manner affect its right at a later time to enforce the same. No waiver by any
party of any condition or breach of any terms, covenants, representations,
warranties or agreements contained in this Agreement shall be effective unless
in writing, and no waiver in any one or more instances shall be deemed to be a
further or continuing waiver of any other condition or any breach of any other
terms, covenants, representations, warranties or agreements.
10.6 Counterparts
This Agreement may be executed simultaneously 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.
10.7 Headings
The headings preceding the text of Sections of this Agreement are for
convenience of reference only and shall not be deemed parts hereof.
10.8 Applicable Law
This Agreement shall be governed by and construed and enforced in
accordance with the laws of the state of Washington, as applied to contracts
executed and to be fully performed in such state by citizens of such state.
10.9 Parties in Interest
All the terms and provisions of this Agreement shall be binding upon and
inure to the benefit of and be enforceable against the respective successors
and permitted assigns of the parties hereto, whether herein so expressed or
not, but this Agreement shall not be assigned by any party hereto in whole or
in part without the prior written consent of the other parties hereto.
Nothing in Section 6.3.8 shall be construed to give to any employee of Station
any legal or equitable right, remedy or claim under this Agreement.
10.10 Notices
Any notice or demand desired or required to be given hereunder shall be
in writing and given by personal delivery, facsimile or certified or
registered mail, postage prepaid and addressed as set forth below, or to such
other address as any party shall have previously designated by such notice.
Any notice delivered personally or by facsimile shall be deemed to be received
on the date of delivery and any notice mailed shall be deemed to be received
three days after the date on which it was mailed, so long as it is in fact
received within five days.
Notices to Parent, Acquiror, Stockholder and Station shall be sent,
unless any such party shall have notified the other parties hereto in writing
of any change in such address:
TO PARENT:
LIN Broadcasting Corporation
5295 Carillon Point
Kirkland, Washington 98033
Attention: General Counsel
Facsimile: (206) 828-1900
TO ACQUIROR:
LIN Television Corporation
5295 Carillon Point
Kirkland, Washington 98033
Attention: General Counsel
Facsimile: (206) 828-1900
TO STOCKHOLDER:
Cook Inlet Communications, Inc.
Suite 450
1800 Avenue of the Stars
Los Angeles, California 90067
Attention: Stephen C. Hillard
Facsimile: (310) 556-2752
with a copy to:
Munger, Tolles & Olson
Suite 3500
355 South Grand Avenue
Los Angeles, California 90071
Attention: John Frank
Facsimile: (213) 687-3702
TO STATION:
Cook Inlet Communications Corp.
Suite 450
1800 Avenue of the Stars
Los Angeles, California 90067
Attention: Stephen C. Hillard
Facsimile: (310) 556-2752
with a copy to:
Munger, Tolles & Olson at the above address
10.11 Bulk Sales Laws
Acquiror hereby waives compliance with the Bulk Sales Laws of the state
of Connecticut, and Stockholder agrees to indemnify and hold harmless Acquiror
from, and reimburse Acquiror for, any and all claims, liabilities or
obligations that Acquiror may suffer or incur by virtue of such noncompliance.
10.12 Entire Understanding
The terms set forth in this Agreement, together with the other agreements
executed by the parties and their Affiliates on the date hereof and the
Confidentiality Agreement, as modified by Section 6.1.6, are intended to be
the final, complete and exclusive expression of the parties' agreement and
supersede all prior or contemporaneous understandings or agreements, whether
oral or written.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have entered into and signed this
Agreement as of the date and year first above written.
LIN BROADCASTING CORPORATION
By /s/ Donald Guthrie
Its Senior Vice President-
Finance
LIN TELEVISION CORPORATION
By /s/ Donald Guthrie
Its Vice President
COOK INLET COMMUNICATIONS, INC.
By /s/ Stephen C. Hillard
Its Vice President
COOK INLET COMMUNICATIONS CORP.
By /s/ Stephen C. Hillard
Its Vice President
EXHIBIT 2
FIRST AMENDMENT TO
ASSET PURCHASE AGREEMENT
THIS FIRST AMENDMENT TO ASSET PURCHASE AGREEMENT (this "Amendment"),
dated as of September 26, 1994, is by and among LIN Broadcasting Corporation,
a Delaware corporation ("Parent"), LIN Television Corporation, a Delaware
corporation ("Acquiror"), Cook Inlet Communications, Inc., an Alaska
corporation ("Stockholder"), and Cook Inlet Communications Corp., a Delaware
corporation ("Station").
RECITALS
Parent, Acquiror, Stockholder and Station have entered into that certain
Asset Purchase Agreement, dated as of June 7, 1994 (the "Agreement"), and now
desire to amend the Agreement.
AGREEMENT
In consideration of the premises and mutual covenants set forth herein,
the parties hereto agree as follows:
1. The definition of "Acquiror Disclosure Document" in Section 1.1 of
the Agreement is amended to delete the parenthetical language.
2. The definition of "Form S-4" in Section 1.1 of the Agreement is
amended to delete such definition in its entirety.
3. Section 6.2.5 of the Agreement is amended to delete such section
in its entirety; Sections 6.2.6 through 6.2.9 of the Agreement are renumbered
accordingly; and the cross-reference in the last sentence of Section 6.2.9 of
the Agreement is amended to substitute "6.2.8" in lieu of "6.2.9."
4. Section 7.3.3 of the Agreement is amended to delete such section
in its entirety, and Sections 7.3.4 through 7.3.6 of the Agreement are
renumbered accordingly.
5. Exhibit A to the Agreement is amended in its entirety to read as
set forth in Exhibit A attached hereto.
6. Exhibit B to the Agreement is amended in its entirety to read as
set forth in Exhibit B attached hereto.
7. Except as expressly modified herein, each provision of the
Agreement remains in full force and effect and is in no way amended, affected,
impaired or invalidated hereby, and the rights and obligations of the parties
hereto under the Agreement as modified herein are hereby ratified and
confirmed.
8. All references in the Agreement to "this Agreement" shall mean the
Agreement as modified by this Amendment.
9. This Amendment shall be governed by and construed and enforced in
accordance with the laws of the State of Washington, as applied to contracts
executed and to be fully performed in such state by citizens of such state.
10. This Amendment may be executed simultaneously in any number of
counterparts, each of which shall be deemed an original, and all of which
together shall constitute one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties hereto have entered into and signed this
Amendment as of the date and year first above written.
LIN BROADCASTING CORPORATION
By /s/ Roberta R. Katz
Its Senior Vice President
LIN TELEVISION CORPORATION
By /s/ Roberta R. Katz
Its Secretary
COOK INLET COMMUNICATIONS, INC.
By /s/ Mark D. Adolph
Its Vice President
COOK INLET COMMUNICATIONS CORP.
By /s/ Mark D. Adolph
Its Vice President
EXHIBIT 3
SECOND AMENDMENT TO
ASSET PURCHASE AGREEMENT
THIS SECOND AMENDMENT TO ASSET PURCHASE AGREEMENT (this
"Amendment"), dated as of December 6, 1994, is by and among LIN
Broadcasting Corporation, a Delaware corporation ("Parent"), LIN
Television Corporation, a Delaware corporation ("Acquiror"), Cook
Inlet Communications, Inc., an Alaska corporation
("Stockholder"), and Cook Inlet Communications Corp., a Delaware
corporation ("Station").
RECITALS
Parent, Acquiror, Stockholder and Station have entered into
that certain Asset Purchase Agreement, dated as of June 7, 1994,
as amended by that certain First Amendment to Asset Purchase
Agreement, dated as of September 26, 1994 (the "Agreement"), and
now desire to amend the Agreement.
AGREEMENT
In consideration of the premises and mutual covenants set
forth herein, the parties hereto agree as follows:
1. Exhibit B to the Agreement is amended in its entirety
to read as set forth in Exhibit B attached hereto.
2. Except as expressly modified herein, each provision of
the Agreement remains in full force and effect and is in no way
amended, affected, impaired or invalidated hereby, and the rights
and obligations of the parties hereto under the Agreement as
modified herein are hereby ratified and confirmed.
3. All references in the Agreement to "this Agreement"
shall mean the Agreement as modified by this Amendment.
4. This Amendment shall be governed by and construed and
enforced in accordance with the laws of the State of Washington,
as applied to contracts executed and to be fully performed in
such state by citizens of such state.
5. This Amendment may be executed simultaneously in any
number of counterparts, each of which shall be deemed an
original, and all of which together shall constitute one and the
same instrument.
IN WITNESS WHEREOF, the parties hereto have entered into and
signed this Amendment as of the date and year first above
written.
LIN BROADCASTING CORPORATION
By /s/ Donald Guthrie
Its Senior Vice President-
Finance
LIN TELEVISION CORPORATION
By /s/ Donald Guthrie
Its Vice President
COOK INLET COMMUNICATIONS, INC.
By /s/ Mark D. Adolph
Its Vice President
COOK INLET COMMUNICATIONS CORP.
By /s/ Mark D. Adolph
Its Vice President
EXHIBIT 4
LIN TELEVISION CORPORATION
STOCKHOLDERS AGREEMENT
THIS STOCKHOLDERS AGREEMENT (this "Agreement") is made as of the 28th
day of December, 1994, by and among LIN TELEVISION CORPORATION, a Delaware
corporation (the "Company"), McCAW CELLULAR COMMUNICATIONS, INC., a Delaware
corporation ("McCaw"), and COOK INLET COMMUNICATIONS CORP., a Delaware
corporation ("Cook Inlet") (McCaw and Cook Inlet being referred to
collectively as, the "Stockholders").
RECITALS
A. McCaw, through its wholly owned subsidiary, owns 13,494,750 shares
of common stock, par value $.01 per share (the "Common Stock"), of the
Company.
B. Cook Inlet is acquiring 3,357,950 shares of the Common Stock as
partial consideration for the sale of substantially all of its assets to the
Company pursuant to an Asset Purchase Agreement dated June 7, 1994, as amended
(the "Asset Purchase Agreement").
C. It is a condition to the Asset Purchase Agreement that the parties
enter into this Agreement.
AGREEMENT
NOW THEREFORE, in consideration of the foregoing and the agreements set
forth below, the parties hereby agree as follows:
1. General
1.1 Voting of Shares
The Stockholders shall vote or cause to be voted all shares of Common
Stock or other voting securities of the Company beneficially owned by them or
as to which they have voting power (the "Stock"), and shall timely take any
other necessary actions to accomplish and effectuate the provisions of this
Agreement.
1.2 Legend on Certificates
Each certificate evidencing any of the Stock shall bear a legend
substantially as follows:
"The securities represented by this certificate are subject
to the terms and conditions of a certain Stockholders
Agreement dated as of December 28, 1994, as at any time
amended, and may not be transferred except in accordance
with the terms and provisions of said Agreement, a copy of
which is on file at the principal executive office of the
Company and will be furnished to the holder of this
certificate upon request and without charge."
2. Election of Directors
2.1 Composition of the Board of Directors
The Stockholders shall take all necessary action to cause the Company's
Board of Directors to consist of ten (10) members. In connection with each
election of directors of the Company, the Stockholders will take all necessary
action to cause members of the Company's Board of Directors (except in the
case of replacement directors, which is governed by Section 2.2) to be
nominated, in accordance with the Company's procedure for nomination of
directors as provided in its By-Laws and to the extent permissible in
accordance with applicable legal requirements, as follows:
(a) McCaw Nominees. McCaw shall have the right to designate six
(6) qualified nominees, each of whom shall be a United States citizen;
provided, however, that if at any time McCaw is the beneficial owner of less
than twenty-five percent (25%) of the outstanding Common Stock, McCaw's right
under this Agreement to nominate six nominees shall thereupon cease.
(b) Cook Inlet Nominees. Cook Inlet shall have the right to
designate one (1) qualified nominee, who shall be a United States citizen;
provided, however, that if at any time Cook Inlet is the beneficial holder of
less than three and one-half percent (3 1/2%) of the outstanding Common Stock,
Cook Inlet's right under this Agreement to nominate one director shall
thereupon cease.
(c) Independent Directors. If required by the Television
Private Market Value Guarantee dated December 28, 1994 between the Company and
McCaw (the "TV PMVG"), McCaw shall designate, in addition to the nominees
designated pursuant to paragraph (a) above, the three (3) nominees selected to
serve as the independent directors under Section 1 of the TV PMVG (the
"Independent Directors").
The Stockholders shall cause the persons so designated above to be
nominated for election to the Company's Board of Directors at the time and in
the manner proper for such nomination, whereupon the Stockholders shall cast
all the votes they are entitled to cast in such election (whether at an annual
or special meeting of stockholders or by written consent in lieu of a meeting
or otherwise and whether they are entitled to cast such votes as a result of
ownership or other control of Stock or by proxy or otherwise) for the election
of such nominees to the Company's Board of Directors.
2.2 Replacement of Directors
In the event one or more directors shall cease to serve on the Company's
Board of Directors at a time when the entire Board of Directors is not being
elected, the party that so designated such person, subject to the next
succeeding sentence, shall be entitled to and shall designate a replacement
director as soon as practicable. In the event of the resignation, withdrawal
or removal of any Independent Director, McCaw will as soon as practicable
designate in accordance with the terms of the TV PMVG another nominee to serve
as Independent Director. The Stockholders shall thereafter cooperate to
effectuate the election to the Board of Directors each replacement director
designated as provided in this Section 2.2 as soon as practicable and shall
cast all the votes they are entitled to vote (whether at an annual or special
meeting of stockholders or by written consent in lieu of a meeting or
otherwise and whether they are entitled to cast such votes as a result of
ownership or other control of Stock or by proxy or otherwise) for election of
such replacement director to the Company's Board of Directors.
2.3 Removal of Directors
In the event that any Stockholder that has nominated a director proposes
that such director be removed from the Company's Board of Directors subject,
in the case of the Independent Directors, to the terms of the TV PMVG, upon
the giving of notice thereof to the other Stockholders, the Stockholders will
cast all the votes they are entitled to vote (whether at an annual or special
meeting of stockholders or by written consent in lieu of a meeting or
otherwise and whether they are entitled to cast such votes as a result of
ownership or other control of Stock or by proxy or otherwise) and will
otherwise cooperate to remove from the Company's Board of Directors such
director as soon as practicable.
2.4 Composition of the Compensation Committee of the Board of
Directors
McCaw shall use its best efforts to cause the Compensation
Committee of the Company's Board of Directors to be comprised of, for the
period ending 24 months from the date of execution of this Agreement, one
Independent Director, the Cook Inlet director designated pursuant to
Section 2.1(b) and one director designated by McCaw. Thereafter, the
Compensation Committee of the Company's Board of Directors shall consist of
such directors as are selected by the Company's Board of Directors.
3. Remedies
3.1 Specific Performance
The parties acknowledge that money damages are not an adequate remedy
for violations of this Agreement and that any party may, in its sole
discretion, apply to a court of competent jurisdiction for specific
performance or injunctive or such other relief as such court may deem just and
proper in order to enforce this Agreement or prevent any violation hereof and,
to the extent permitted by applicable law, each party waives any objection to
the imposition of such relief.
3.2 Remedies Cumulative
All rights, powers and remedies provided under this Agreement or
otherwise available in respect hereof at law or in equity shall be cumulative
and not alternative, and the exercise or beginning of the exercise of any
thereof by any party shall not preclude the simultaneous or later exercise of
any other such right, power or remedy by such party.
4. Successors and Assigns
The provisions of this Agreement shall inure to the benefit of, and
shall be binding upon, any successors to the parties hereto but shall not
otherwise be transferable. No Stockholder may assign or transfer any Common
Stock, or any right to vote or direct the vote of any Common Stock, to any
assignee or transferee that is an affiliate of such Stockholder or a "group"
of which such Stockholder or any affiliate is a part (as such term is used in
Rule 13d-5 under the Securities Exchange Act of 1934, as amended) unless such
assignee or transferee shall agree in writing, as a condition to such transfer
or assignment, to be bound as a Stockholder under this Agreement.
5. Third-Party Beneficiaries
This Agreement is not intended to be for the benefit of and shall not be
enforceable by any person or entity that is not a party hereto, including,
without limitation, any stockholders of the Company not parties hereto.
6. Termination of Agreement
This Agreement shall terminate and be of no further force or effect upon
the earliest to occur of:
(a) The tenth (10th) anniversary of the date hereof (the
"Termination Date"); provided, however, that at any time within two (2) years
prior to the Termination Date (as the same may be extended from time to time
pursuant to this paragraph), any or all of the parties hereto may by written
agreement extend the duration of this Agreement for an additional period not
to exceed ten (10) years;
(b) With respect to Cook Inlet only, written notice by Cook
Inlet to the other parties hereto, provided that Cook Inlet and its affiliates
and group (as described above) members beneficially own in the aggregate less
than one percent (1%) of the outstanding shares of Common Stock; and
(c) With respect to McCaw only, written notice by McCaw to the
other parties hereto, provided that McCaw and its affiliates and group (as
described above) members beneficially own in the aggregate less than five
percent (5%) of the outstanding shares of Common Stock.
7. Miscellaneous
7.1 No Conflicts
The parties hereto represent that they are not parties to and do not
know of any other agreements that conflict with any of the provisions of this
Agreement.
7.2 Further Assurances
Each party shall execute and deliver such additional instruments and
other documents and shall take such further actions as may be necessary or
appropriate to effect, carry out and comply with all their obligations under
this Agreement.
7.3 Counterparts
This Agreement may be executed in more than one counterpart, each of
which shall constitute an original of this Agreement, but all of which, when
taken together, shall constitute one and the same instrument.
7.4 Amendment
Except as otherwise provided herein, no amendment, waiver,
interpretation, alteration or modification of any provision of this Agreement
shall be binding unless in writing and signed by authorized representatives of
all the parties hereto.
7.5 Applicable Law
This Agreement shall for all purposes be governed by and construed in
accordance with the laws of Washington, without regard to the choice of law
provisions thereof.
7.6 Notices
Notices given hereunder shall be in writing and shall be deemed to have
been duly given (a) on the date of personal delivery, (b) on the date of
facsimile transmission if such transmission is sent before or during the
addressee's business hours on a day that is not a Saturday, Sunday or
statutory holiday in the location of the addressee (a "Business Day"), (c)
on the Business Day following facsimile transmission if such transmission is
sent after the addressee's business hours or on a day that is not a Business
Day, or (d) five (5) days after being mailed by registered or certified mail,
return receipt requested, in each case to the party being notified at the
address specified below or at such other address of which the addressee may
subsequently notify the other parties in writing. Until otherwise notified,
notices shall be directed as follows:
If to the Company:
LIN Television Corporation
5295 Carillon Point
Kirkland, WA 98033
Attn: General Counsel
If to McCaw:
McCaw Cellular Communications, Inc.
5400 Carillon Point
Kirkland, WA 98033
Attn: General Counsel
If to Cook Inlet:
Cook Inlet Communications Corp.
1800 Avenue of the Stars
Suite 450
Los Angeles, CA 90067
Attn: General Counsel
With a copy to:
Munger, Tolles & Olson
355 South Grand Avenue
35th Floor
Los Angeles, CA 90071
Attn: John B. Frank
7.7 Waivers
Any failure of any party to insist upon or enforce strict performance of
any of the provisions of this Agreement or to exercise any rights or remedies
under this Agreement shall not be interpreted or construed as a waiver or
relinquishment to any extent of such party's right to assert or rely upon any
such provision, right or remedy in that or any other instance.
7.8 Headings
The headings of the sections of this Agreement are for convenience only
and shall not by themselves determine the interpretation of this Agreement.
7.9 Severability
If any of the provisions or any portion of the provisions of this
Agreement shall be invalid or unenforceable, such invalidity or
unenforceability shall not invalidate or render unenforceable the entire
Agreement, but rather the entire Agreement shall be construed as if not
containing the particular invalid or unenforceable provisions or portion
thereof and the rights and obligations of the parties hereto shall be
construed and enforced accordingly.
7.10 Entire Agreement
This Agreement contains the entire agreement and understanding among the
parties with respect to the subject matter hereof and supersedes all prior
understandings and representations.
IN WITNESS WHEREOF, this Agreement has been executed as of the date and
year first above written.
LIN TELEVISION CORPORATION
By: /s/ Peter E. Maloney
Title: Vice President
MCCAW CELLULAR COMMUNICATIONS, INC.
By: /s/ Peter L.S. Currie
Title: Executive Vice President
COOK INLET COMMUNICATIONS CORP.
By: /s/ Mark D. Adolph
Title: Vice President
EXHIBIT 5
REGISTRATION RIGHTS AGREEMENT
This REGISTRATION RIGHTS AGREEMENT (this "Agreement") is made and
entered into on December 28, 1994 between LIN Television Corporation, a
Delaware corporation (the "Company"), and Cook Inlet Communications Corp., a
Delaware corporation ("Station").
RECITALS
A. The Company and Station have entered into an Asset Purchase
Agreement dated as of June 7, 1994 and amended as of September 26, 1994 and
December 6, 1994 (the "Purchase Agreement") pursuant to which the Company will
issue shares of its common stock, $.01 par value per share ("Common Stock"),
to Station as partial consideration for the purchase of substantially all its
assets.
B. The execution and delivery of this Agreement by the Company is a
condition precedent to the obligations of the parties under the Purchase
Agreement.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing and the mutual
covenants contained herein, the parties hereto agree as follows:
1. Definitions
For the purposes of this Agreement, the following terms have the
meanings indicated below:
1933 Act. The Securities Act of 1933, as amended, and the rules
and regulations promulgated thereunder.
1934 Act. The Securities Exchange Act of 1934, as amended, and
the rules and regulations promulgated thereunder.
Commission. The Securities and Exchange Commission.
Form S-1. Such form under the 1933 Act as in effect on the date
hereof or any registration form subsequently adopted by the Commission.
Form S-3. Such form under the 1933 Act as in effect on the date
hereof or any similar short-form registration form subsequently adopted by the
Commission.
Register, registration and registered. A registration effected by
preparing and filing a registration statement or similar document with the
Commission in compliance with the 1933 Act, and the declaration or ordering of
effectiveness of such registration statement or document.
Registrable Securities. The Shares (as defined below); provided,
however, that those Shares as to which the following apply shall cease to be
Registrable Securities: (a) a registration statement with respect to the sale
of such Registrable Securities (other than any registration statement
registering the sale of such securities by the Company to Station) shall have
become effective under the 1933 Act and such Registrable Securities shall have
been disposed of under such registration statement; (b) such Registrable
Securities shall have been sold pursuant to Rule 144 or any successor rule or
provision promulgated under the 1933 Act; or (c) such Registrable Securities
shall have ceased to be outstanding.
Registration Expenses. All expenses incident to the Company's
performance of or compliance with Sections 2 and 4, including, without
limitation, all registration and filing fees (including filing fees with
respect to the Commission and to the National Association of Securities
Dealers, Inc.), all fees and expenses of complying with state securities or
"blue sky" laws (including fees and disbursements of underwriters' counsel in
connection with any "blue sky" memorandum or survey), all printing expenses,
all registrars' and transfer agents' fees and all fees and disbursements of
the Company's counsel and independent public accountants.
Selling Expenses. All underwriters' discounts, fees and
commissions, applicable transfer taxes, fees and disbursements of counsel for
any underwriter of any Registrable Securities being registered (other than as
described above) including such fees and disbursements of counsel which the
parties expect to be paid by the underwriter, and any fees and disbursements
of any counsel, accountants or other advisors for any seller of the
Registrable Securities being registered.
Shares. The shares of Common Stock issued to Station pursuant to
the Purchase Agreement and any securities that may be issued by the Company
from time to time with respect to, in exchange for, or in replacement of such
shares of Common Stock, including, without limitation, securities issued as a
stock dividend on or pursuant to a stock split of such shares of Common Stock.
2. Request for Registration
2.1 Request by Station
Subject to the limitations set forth in Section 2.2, upon written
request of the holder or holders of an aggregate of 20% or more of the
Registrable Securities then outstanding that the Company effect the
registration of all or part of the Registrable Securities held by such holder
or holders, the Company will promptly give written notice of such requested
registration to all holders of Registrable Securities and thereupon will
promptly exercise all reasonable efforts to effect the registration under the
1933 Act of:
(a) the Registrable Securities that the Company has been so
requested to register by such holder or holders and
(b) all other Registrable Securities that the Company has been
requested to register by the holders of Registrable Securities by written
request delivered to the Company within 15 days after the giving of such
written notice by the Company.
Each such registration shall be on Form S-1, or on Form S-3 (if
available for such offering), as determined by the Company, permitting
registration of such Registrable Securities for resale by such holders in the
manner or manners designated by them (including, without limitation, one or
more underwritten offerings).
The Company shall use all reasonable efforts to keep such registration
effective for a period of 30 days from the date on which the registration is
declared effective (subject to extension pursuant to the next paragraph of
this Section 2.1) or for such shorter period that will terminate when all
Registrable Securities covered by such registration have been sold pursuant to
such registration or withdrawn from sale, unless such failure to become or
remain effective is the result of an action or failure to act by any holder of
Registrable Securities to be covered by such registration.
A registration will not be deemed to have been effected unless it has
become effective; provided, that if after it has become effective the offering
of Registrable Securities pursuant to such registration is interfered with by
any stop order or other governmental agency, such registration will be
extended for the period of any such suspension or, if required, a new
registration statement shall be filed and diligently prosecuted, so that the
holders shall have had Registrable Securities included in an effective
registration until they have been sold.
If any of the Registrable Securities covered by a registration pursuant
to this Section 2.1 are to be sold in an underwritten offering, the investment
banker or investment bankers and manager or managers that will manage the
offering will be selected by the holders of a majority of such Registrable
Securities included in such offering, provided that such investment banker or
manager shall be reasonably satisfactory to the Company.
2.2 Limitations on Registration Obligation
The Company's obligations under Section 2.1 shall be subject to the
following limitations:
(a) the Company shall not be required to effect a registration
pursuant to Section 2.1 unless the requests from such holder or holders for
such registration, which have not been withdrawn or reduced, cover Registrable
Securities at least equal to an aggregate offering of $2,000,000;
(b) if the Company shall furnish to such holder or holders a
certificate signed by the President or Vice President of the Company stating
that the Board of Directors reasonably believes that, during such period, the
requested registration would have a material adverse effect on, or interfere
in any material respect with, any proposal or plan by the Company to engage in
any private or public financing or any material pending corporate development
or transaction, including, without limitation, a material acquisition of
assets, any tender offer or any merger, consolidation or other similar
transaction material to the Company and its subsidiaries taken as a whole, the
Company shall have the right to defer the filing or effectiveness of the
registration statement for a period of not more than 120 days in any one
calendar year after receipt of the request of such holder or holders under
Section 2.1; provided, however, that no deferral of the registration pursuant
to this Section 2.2(b) shall relieve the Company of its obligations pursuant
to this Agreement by virtue of Section 2.2(c);
(c) the Company shall not be required to effect any registration
pursuant to Section 2.1 if the written request therefor is not received by the
Company within seven years from the date of this Agreement;
(d) the Company shall not be obligated to effect more than two
registrations pursuant to Section 2.1;
(e) if (i) the registration pursuant to Section 2.1 involves a
firm commitment underwritten offering and (ii) the managing underwriters of
such offering shall advise such holders in writing that, in their judgment,
the total amount of securities proposed to be included in such offering is
sufficiently large to materially and adversely affect the success of the
offering, then the number of shares of Registrable Securities that are
proposed to be registered by each holder who requests registration pursuant to
Section 2.1 shall be reduced pro rata in proportion to the reduction in the
total number of shares of Registrable Securities as to which registration has
been requested. To the extent Registrable Securities requested to be
registered are excluded from the offering, then the holders of such
Registrable Securities shall have the right to one additional registration
hereunder with respect to such Registrable Securities, provided that the
failure of such Registrable Securities to be registered is through no fault of
such holder, and provided that such an additional registration is available on
only one occasion; and
(f) the Company shall not be obligated to effect any
registration pursuant to Section 2.1 if a registration statement is effective
pursuant to Section 2.6 permitting the sale of Registrable Securities in the
manner designated by the requesting holders.
2.3 Inclusion of the Company's Securities in Registration
The Company, on its own behalf or on behalf of its security holders,
shall have the right to include any of the Company's securities in any
registration initiated by a holder or holders of Registrable Securities
pursuant to Section 2.1 (to the extent permitted by the rules applicable to
use of Form S-1 or other appropriate form); provided, however, that if (i) the
registration pursuant to Section 2.1 involves a firm commitment underwritten
offering and (ii) the managing underwriters of such underwritten offering
shall advise the Company in writing that, in their judgment, the distribution
of all or a specified portion of the securities to be registered on behalf of
the Company or its security holders pursuant to this Section 2.3 concurrently
with the Registrable Securities being distributed by such underwriters will
materially and adversely affect the distribution of such Registrable
Securities by such underwriters, then the Company will exclude all or such
specified portion of such securities (other than the Registrable Securities)
to be registered on behalf of the Company or its security holders from such
underwritten offering and will select, in its sole discretion, the securities
to be so excluded from such offering.
2.4 Withdrawal of Registrable Securities by Holders
The holders of Registrable Securities may withdraw their Shares from
registration, but unless the withdrawal is due to a material adverse change in
the condition, business or prospects of the Company which was not, and upon
reasonable investigation of public information by such holders could not have
been, known at the time of the request, the proposed registration shall be
counted as one of the two registrations referred to in Section 2.2(d).
Notwithstanding the foregoing, any request for a registration that is
withdrawn by the holders prior to the effectiveness of the registration
statement shall not be counted as one of the two registrations referenced in
Section 2.2(d) if the holders reimburse the Company for all expenses incurred
by the Company in preparing such registration statement.
2.5 Piggyback Registration
2.5.1 If the Company shall, at any time prior to the
seventh anniversary of this Agreement, propose to register any shares of
Common Stock under the 1933 Act, whether or not for sale for its own account,
on a registration form and in a manner that would permit registration of
Registrable Securities for sale to the public under the 1933 Act, it will each
such time give prompt written notice to all holders of Registrable Securities
of its intention to do so, describing such securities and specifying the form
and manner and the other relevant facts involved in such proposed registration
and, upon the written request of any such holder of Registrable Securities
delivered to the Company within 15 days after such notice shall have been
given to such holder and subject to the limitations set forth in Section
2.5.2, the Company will use all reasonable efforts to effect the registration
under the 1933 Act, as expeditiously as is reasonably possible, of all
Registrable Securities that the Company has been so requested to register by
the holders of Registrable Securities, to the extent required to permit the
disposition (in accordance with the intended method thereof specified in such
notice from the Company as aforesaid) of the Registrable Securities so to be
registered. The Company shall use all reasonable efforts to cause the
managing underwriter or underwriters of a proposed firm commitment
underwriting to permit the holders of Registrable Securities requesting to be
included in such offering to include such securities in such offering on the
same terms and conditions as any similar security of the Company included
therein.
2.5.2 The Company's obligations under Section 2.5.1 shall
be subject to the following limitations:
(a) if, at any time after giving such written notice
of its intention to register any of such securities and prior to the effective
date of the registration statement filed in connection with such registration,
the Company shall determine for any reason not to register such securities,
the Company may, at its election, give written notice of such determination to
each holder of Registrable Securities that has requested to register
Registrable Securities and thereupon the Company shall be relieved of its
obligation to register any Registrable Securities in connection with such
registration;
(b) if (i) the registration so proposed by the
Company involves a firm commitment underwritten offering and (ii) the managing
underwriters of such underwritten offering shall advise the Company in writing
that, in their judgment, the total amount of securities which they or the
Company and any other persons or entities intended to include in such offering
is sufficiently large to materially and adversely affect the success of the
distribution of such securities by such underwriters, then the Company will
promptly advise each such holder of Registrable Securities thereof and may
require, by written notice to each such holder accompanying such advice, that
all or such specified portion of such Registrable Securities be excluded from
such underwritten offering; provided, however, that the securities so excluded
shall be apportioned first to any selling security holders other than holders
of Registrable Securities and then pro rata among holders of Registrable
Securities according to the total dollar amount of securities entitled to be
included therein owned by each holder of Registrable Securities or in such
other proportions as shall mutually be agreed to by such holders of
Registrable Securities;
(c) the Company shall not be obligated to effect any
registration of Registrable Securities under this Section 2.5 incidental to
the registration of any of its securities in connection with mergers,
acquisitions, exchange offers, distributions to its stockholders, dividend
reinvestment plans, stock option or other employee benefit plans, debenture
offerings or preferred stock offerings;
(d) if the registration so proposed by the Company
involves an underwritten offering, the right of any holder to include his or
her Registrable Securities in such registration shall be conditioned upon the
following: (i) such holder shall participate in such underwriting and only
such holder's shares of Registrable Securities that are to be distributed
pursuant to the underwriting shall be included in such registration and (ii)
all holders proposing to distribute their Registrable Securities through such
underwriting shall enter into an underwriting agreement in customary form with
the underwriter or underwriters; and
(e) the Company shall not be obligated to include
Registrable Securities in any offering pursuant to Section 2.5.1 if a
registration statement is effective pursuant to Section 2.6 permitting the
sale of Registrable Securities in the manner designated by the requesting
holders.
2.6 Shelf Registration
For purposes of this Section 2.6, the term "Station" shall mean Station,
Cook Inlet Region, Inc. or any direct or indirect subsidiary of Cook Inlet
Region, Inc.; provided that any such party is a holder of Registrable
Securities.
2.6.1 Registration. Upon Station's written request during
the three-year period following the Closing (as defined in the Purchase
Agreement), the Company shall promptly exercise all reasonable efforts to
effect the registration of the Registrable Securities under the 1933 Act.
Such registration shall be on Form S-1, or on Form S-3 (if available for such
offering), as determined by the Company, permitting registration of the
Registrable Securities for resale by Station in the manner or manners
designated by it (including, without limitation, one or more underwritten
offerings). The Company shall use all reasonable efforts to keep such
registration effective until the earliest of (a) the expiration of two years
after such request for registration by Station, (b) the expiration of three
years after the Closing, and (c) such time as all the Registrable Securities
have been disposed of by Station.
2.6.2 Sales Pursuant to Registration Statement.
(a) In addition to the other rights granted herein
and the right to sell Registrable Securities in transactions not requiring
registration under the 1933 Act, Station shall have the right during the
period commencing upon the effective date of the registration statement and
ending upon the date at which the Company is no longer obligated to take
action to maintain the effectiveness of the registration statement pursuant to
Section 2.6.1 to sell, transfer or otherwise dispose of the Registrable
Securities pursuant to, and in accordance with the plan of distribution
contemplated by, the registration statement, provided that any and all offers,
sales, transfers or other dispositions of Registrable Securities by Station
pursuant to the registration statement shall only be made pursuant to a
Distribution (as defined in paragraph (b) below) and the other requirements of
this Agreement and then only during the period from commencement to
termination of such Distribution.
(b) The term "Distribution" for purposes of this
Section 2.6.2 shall mean either (i) a public offering of the Registrable
Securities by or for the account of Station in an Organized Offering (as
defined in Section 2.6.5(a)) or (ii) one or more offers or sales of the
Registrable Securities during any consecutive 45-day period by or for the
account of Station (a "45-Day Offering"). An Organized Offering shall be
deemed to commence on the date specified in Section 2.6.2(d) and to terminate
on the latest date Station receives payment for the Registrable Securities
sold by it. A 45-Day Offering shall commence on the date specified in Section
2.6.2(d) and shall terminate on the 44th day thereafter, unless terminated
earlier by notice from Station to the Company; provided, however, that in the
event that the Company gives notice to Station pursuant to Section 2.6.3, the
termination date shall be extended for a number of days equal to the number of
days that Station was required to discontinue disposing of Registrable
Securities pursuant to Section 2.6.3, unless terminated earlier by notice from
Station to the Company.
(c) Station may not commence a Distribution or make
offers or sales pursuant thereto prior to the date which is five business days
after the date upon which a notice of the proposed Distribution (the
"Distribution Notice") is delivered to the Company. Unless otherwise
prohibited by another provision of this Agreement, Station may deliver to the
Company a Distribution Notice at any time. Each Distribution Notice shall
state that Station desires to engage in a Distribution and shall specify (i)
the type of proposed Distribution, the proposed manner of offering and sale
and the proposed managing underwriters, if any, (ii) to the extent known, the
participating brokers or sales agents, if any, and (iii) the number of
Registrable Securities proposed to be sold in such Distribution, which number
shall not be less than 1% of Common Stock outstanding at Closing. Station
covenants that each Distribution Notice shall be given in good faith and shall
accurately reflect a proposal which is under serious consideration by Station.
No Distribution Notice may be delivered by Station at a time when either a
Distribution described in a prior Distribution Notice has not been completed
or otherwise terminated or such prior Distribution Notice has not been
withdrawn.
Station agrees that it will proceed in good
faith, subject to the exercise of reasonable business judgment, to commence
each proposed Distribution as promptly as practicable, to complete each
Distribution within a reasonable time after commencement and to withdraw any
Distribution Notice promptly upon Station's determination not to commence or,
if commenced, not to complete, the proposed Distribution which is the subject
of such Distribution Notice.
(d) Each Distribution undertaken and carried out by
Station shall be made in a manner consistent with the description thereof set
forth in the related Distribution Notice.
With respect to a proposed Distribution which is
a 45-Day Offering, the Distribution shall be deemed to have commenced on the
first date at which Station is permitted to commence such Distribution and
make offers or sales pursuant thereto under Section 2.6.2(c).
With respect to a proposed Distribution which is
an Organized Offering, Station and the Company shall cooperate to effect such
Distribution as provided in Section 2.6.5 and the Distribution shall be deemed
to commence upon the earlier of (i) the initial selling efforts (which shall
not include communications relating to organization of an underwriting
syndicate and related activities of the type that customarily occur prior to
the filing of a registration statement under the 1933 Act) and (ii) the
initial public filing of any supplemental public offering documents with the
Commission or other governmental agency or any stock exchange.
Station may determine not to proceed with any
Distribution or proposed Distribution at any time for any reason, provided
that if Station so determines it shall immediately abandon and terminate all
activities in connection with such Distribution or proposed Distribution and
immediately notify the Company of such determination.
The fact that a Distribution Notice (or any of
the other notices provided for in this Section 2.6.2) has been delivered and
the contents of any such notice shall be treated confidentially by the parties
and their representatives, except as otherwise required by law or applicable
stock exchange or National Association of Securities Dealers, Inc. rules or as
necessary to carry out the provisions of this Agreement.
(e) The Company shall be entitled for a period,
which shall not exceed 21 days from the date of delivery of the certificate
specified in subsection (ii) below, with respect to each Distribution, to
postpone such Distribution, if the Company (i) determines, in its reasonable
judgment, that the sale of Registrable Securities pursuant to the Distribution
(or any public disclosure which would be necessary or advisable in connection
with such Distribution) would have a material adverse effect on, or interfere
in any material respect with, any proposal or plan by the Company to engage in
any private or public financing or any material pending corporate development
or transaction, including, without limitation, a material acquisition of
assets, any tender offer or any merger, consolidation or other similar
transaction material to the Company and its subsidiaries taken as a whole and
(ii) gives Station a certificate signed by an officer of the Company setting
forth such determination within five business days of receipt of a
Distribution Notice. Station may not deliver a subsequent Distribution Notice
during the period of any such postponement. The Company may request a
postponement only twice during any consecutive 180-day period and no
postponement period shall exceed 21 consecutive days.
2.6.3 Notice of Event From the Company. Station agrees
that, upon receipt of any notice from the Company of the happening of any
event of the kind described in Section 4(f)(vi), Station will forthwith
discontinue disposing of Registrable Securities until receipt of copies of an
appropriate supplement or amendment to the relevant prospectus.
2.6.4 Notice of Event From Station. Station shall promptly
notify the Company at any time when a prospectus is being used or is required
to be delivered by the 1933 Act of the occurrence of any event of which
Station is aware relating to Station, the Registrable Securities or the plans
for the proposed distribution thereof which requires the preparation of an
appropriate supplement or amendment to such prospectus so that, as thereafter
delivered to the purchasers of Registrable Securities, such prospectus will
not contain an untrue statement of a material fact or an omission to state a
material fact required to be stated therein or necessary to make the
statements therein, in light of the circumstances under which they were made,
not misleading, and the Company will promptly make available to Station any
such supplement or amendment to such prospectus. Station also agrees that,
upon delivery of any notice by it of the happening of any event of the kind
described in the preceding sentence of this paragraph, Station will forthwith
discontinue disposing of Registrable Securities pursuant to such prospectus
until receipt of the copies of the supplement or amendment to such prospectus
contemplated by this Section 2.6.4.
2.6.5 Organized Offering of Registrable Securities.
(a) An "Organized Offering" shall mean a public
offering of $2,000,000 or more effected through customary firm commitment
underwriting arrangements. Subject to the provisions of Section 2.6.2, at any
time and from time to time after the effectiveness of the registration
statement, Station may deliver a Distribution Notice proposing an Organized
Offering.
(b) The investment banker or investment bankers and
manager or managers that will manage the offering will be selected by Station,
provided that such investment banker or manager shall be reasonably
satisfactory to the Company.
3. Expenses
The Company will pay all Registration Expenses in connection with each
of the registrations of Registrable Securities effected by the Company
pursuant to Section 2; provided, however, that the Company shall not be
required to pay Registration Expenses for any registration process begun
pursuant to Section 2 if the registration process is terminated by the Company
pursuant to Section 2.2(a) because of withdrawals of requests for registration
by the holders of Registrable Securities (in which case all withdrawing
holders shall bear such expenses pro rata in proportion to the shares of
Registrable Securities withdrawn); provided, further, however, that if at the
time of such withdrawal the withdrawing holders have learned of a material
adverse change in the condition, business or prospects of the Company from
that which was not, and, upon reasonable investigation would not have been,
known to the withdrawing holders at the time of their request, then the
withdrawing holders shall not be required to pay any of such expenses and
shall retain their rights pursuant to Section 2. Holders of Registrable
Securities being registered pursuant to this Agreement shall pay all Selling
Expenses with each such holder bearing a pro rata portion of the Selling
Expenses based upon the number of Registrable Securities registered in such
registration by each such holder.
4. Registration Procedures: The Company's Obligations
If and whenever the Company is required to effect the registration of
any Registrable Securities under this Agreement, the Company will as
expeditiously as is reasonably possible:
(a) prepare and file with the Commission, on any appropriate
form, a registration statement with respect to such Registrable Securities and
use all reasonable efforts to cause such registration statement to become and
remain effective; provided, however, that before filing a registration
statement or prospectus or any amendments or supplements thereto, including
documents incorporated by reference after the initial filing of the
registration statement, the Company shall furnish to the holders of the
Registrable Securities covered by such registration statement and the
underwriters, if any, copies of all such documents proposed to be filed, which
documents will be subject to the review of such holders and underwriters, and
the Company will not file any registration statement or amendment thereto or
any prospectus or any supplement thereto (including such documents
incorporated by reference) to which the holders of a majority of the shares of
the Registrable Securities covered by such registration statement or the
underwriters, if any, shall reasonably object, but their reasonable objection
may only be with respect to information contained in such document about the
selling holder of the Registrable Securities and may be based only upon an
assertion that such information contains an untrue statement of a material
fact or an omission to state any material fact required to be stated therein
or necessary to make the statements therein, in light of the circumstances,
not misleading;
(b) prepare and file with the Commission such amendments and
supplements to such registration statement and the prospectus used in
connection therewith as may be necessary to keep such registration statement
effective for the applicable period, cause the related prospectus to be
supplemented by any required prospectus supplement, and as so supplemented to
be filed pursuant to Rule 424 (or any similar provisions then in force) under
the 1933 Act, and comply with the provisions of the 1933 Act with respect to
the disposition of all Registrable Securities and other securities covered by
such registration statement in accordance with the intended method of
disposition by the seller or sellers thereof set forth in such registration
statement;
(c) furnish to each selling holder of Registrable Securities and
each managing underwriter, without charge, at least one signed copy of the
registration statement and any posteffective amendment thereto, including
financial statements and schedules, all documents incorporated therein by
reference and all exhibits (including those incorporated by reference);
(d) furnish to each seller of such Registrable Securities such
number of copies of the prospectus and any supplements thereto included in
such registration statement (including a preliminary prospectus) and other
documents as such seller may reasonably request in order to facilitate the
sale or disposition of such Registrable Securities, and consent to the use of
the prospectus or any amendment or supplement thereto by each of the selling
holders of Registrable Securities and the underwriters, if any, in connection
with the offering and sale of the Registrable Securities covered by the
prospectus or any amendment or supplement thereto;
(e) use all reasonable efforts to register or qualify all
securities covered by such registration statement under such other securities
or "blue sky" laws of such jurisdictions as each seller or underwriter shall
reasonably request, and do any and all other acts and things that may be
necessary to enable such seller or underwriter to consummate the disposition
in such jurisdictions of its Registrable Securities covered by such
registration statement, except that the Company shall not for any such purpose
be required to qualify generally to do business as a foreign corporation in
any jurisdiction wherein it is not so qualified, or to subject itself to
taxation in respect of doing business in any such jurisdiction, or to consent
to general service of process in any such jurisdiction;
(f) notify the selling holders of Registrable Securities and the
managing underwriters, if any, promptly, and (if requested by any such person)
confirm such advice in writing:
(i) when the prospectus or any prospectus supplement or
posteffective amendment has been filed, and, with respect to the
registration statement or any posteffective amendment, when the same has
become effective;
(ii) of any request by the Commission for amendments or
supplements to the registration statement or the prospectus or for
additional information;
(iii) of the issuance by the Commission of any stop order
suspending the effectiveness of the registration statement or the
initiation of any proceedings for that purpose;
(iv) if at any time the representations and warranties of the
Company contemplated by paragraph (k) below cease to be true and
correct;
(v) of the receipt by the Company of any notification with
respect to the suspension of the qualification of the Registrable
Securities for sale in any jurisdiction or the Company's knowledge of
the initiation or threatening of any proceedings for such purpose; and
(vi) of the happening of any event as a result of which the
prospectus included in such registration statement, as then in effect,
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 or if it is necessary to amend or supplement such prospectus to
comply with the law, and, at the request of any such seller, prepare and
furnish to such seller a reasonable number of copies of a supplement to
or an amendment of such prospectus as may be necessary so that, as
thereafter delivered to the purchasers of such Registrable Securities or
securities, such prospectus, as amended or supplemented, will comply
with the law;
(g) cause all Registrable Securities to be listed on any
national securities exchange on which shares of Common Stock are then listed,
if such securities are not already so listed and if such listing is then
permitted under the rules of such exchange, or qualify such securities for
inclusion in the National Association of Securities Dealers, Inc. Automated
Quotation System, and provide a transfer agent and registrar for such
Registrable Securities not later than the effective date of such registration
statement;
(h) issue to any underwriter or any other person to which any
holder of Registrable Securities may sell such Registrable Securities in
connection with such registration (and to any direct or indirect transferee of
any such underwriter or to such holder, if such registered offering is not
underwritten) certificates evidencing such Registrable Securities without any
legend restricting the transferability of the Registrable Securities;
(i) use all reasonable efforts to obtain the withdrawal of any
order suspending the effectiveness of the registration statement or the
lifting of any suspension of the qualifications (or exemption from
qualification) at the earliest possible moment;
(j) if reasonably requested by the managing underwriter or
underwriters or the holders of a majority of the Registrable Securities being
sold in connection with an underwritten offering, immediately incorporate in a
prospectus supplement or posteffective amendment such information as the
managing underwriters and the holders of a majority of the Registrable
Securities being sold agree should be included therein relating to the sale of
the Registrable Securities, including, without limitation, information with
respect to the number of shares of Registrable Securities being sold to such
underwriters and the purchase price being paid therefor by such underwriters
and with respect to any other terms of the underwritten (or best efforts
underwritten) offering of the Registrable Securities to be sold in such
offering; and make all required filings of such prospectus supplement or
posteffective amendment as soon as notified of the matters to be incorporated
in such prospectus supplement or posteffective amendment;
(k) otherwise use its commercially reasonable efforts to comply
with all applicable rules and regulations of the Commission, and make
generally available to its security holders earnings statements satisfying the
provisions of Section 11(a) of the 1933 Act, no later than 45 days after the
end of any 12-month period (or 90 days, if such period is a fiscal year) (i)
commencing at the end of any fiscal quarter in which Registrable Securities
are sold to underwriters in an underwritten offering or, if not sold to
underwriters in such an offering, (ii) beginning with the first month of the
Company's first fiscal quarter commencing after the effective date of the
registration statement, which statements shall cover said 12-month periods;
and
(l) enter into such agreements (including an underwriting
agreement) and take all such actions in connection therewith in order to
expedite or facilitate the disposition of such Registrable Securities and, in
such connection, whether or not an underwriting agreement is entered into and
whether or not the registration is an underwritten registration:
(i) make such representations and warranties to the holders of
such Registrable Securities and the underwriters, if any, in form,
substance and scope as are customarily made by issuers to underwriters
in primary underwritten offerings;
(ii) obtain opinions of counsel to the Company and updates
thereof (which counsel and opinions (in form, scope and substance) shall
be reasonably satisfactory to the managing underwriters, if any, and the
holders of a majority of the shares of Registrable Securities being
sold) addressed to each selling holder and the underwriters, if any,
covering the matters customarily covered in opinions requested in
underwritten offerings and such other matters as may be reasonably
requested by the underwriters;
(iii) obtain "cold comfort" letters and updates thereof from the
Company's independent certified public accountants addressed to the
selling holders of Registrable Securities and the underwriters, if any,
such letters to be in customary form and covering matters of the type
customarily covered in "cold comfort" letters by underwriters in
connection with primary underwritten offerings;
(iv) if an underwriting agreement is entered into, the same shall
set forth in full the customary indemnification provisions and
procedures of Section 7 hereof with respect to all parties to be
indemnified pursuant to said Section; and
(v) deliver such documents and certificates as may be requested
by the holders of a majority of the shares of Registrable Securities
being sold and the managing underwriters, if any, to evidence compliance
with clause (i) above and with any customary conditions contained in the
underwriting agreement.
The above shall be done at each closing under such underwriting or similar
agreement or as and to the extent required thereunder.
In the event the Company shall give any notice of the happening of an
event of the kind described in Section 4(f)(vi), the time period mentioned in
Section 2.1 shall be extended by the number of days during the period from and
including the date of the giving of such notice to and including the date when
each seller of Registrable Securities covered by such registration statement
either receives the copies of the supplemented or amended prospectus
contemplated by Section 4(f)(vi) or is advised in writing by the Company that
the use of the Prospectus may be resumed.
5. Preparation; Reasonable Investigation
In connection with the preparation and filing of each registration
statement registering Registrable Securities under the 1933 Act, the Company
will give the holders of Registrable Securities on whose behalf such
Registrable Securities are to be so registered and their underwriters, if any,
and their respective counsel and accountants, the opportunity to participate
in the preparation of such registration statement, each prospectus included
therein or filed with the Commission, and each amendment thereof or supplement
thereto, and will afford such holders of Registrable Securities, underwriters,
counsel and accountants reasonable access to the Company's records, personnel
and properties, including all financial records, and cause the Company's
officers, directors and employees to supply all information reasonably
requested by any such representative, underwriter, attorney or accountant in
connection with the registration.
6. Furnish Information
The Company may require each seller of Registrable Securities as to
which registration is being effected to furnish to the Company such
information regarding such seller, the Registrable Securities held by such
seller and the intended method of disposition of such securities as shall be
reasonably required to effect the registration of such seller's Registrable
Securities as the Company may reasonably request, and the Company may exclude
from such registration the Registrable Securities of any seller who
unreasonably refuses to furnish such information within a reasonable period
after receiving such request.
7. Indemnification and Contribution
In the event any Registrable Securities are included in a registration
statement under Section 2:
(a) To the extent permitted by law, the Company will indemnify
and hold harmless each seller of Registrable Securities, the officers,
directors, agents and employees of each seller of Registrable Securities, any
underwriter (as defined in the 1933 Act) for each seller of Registrable
Securities and each person, if any, who controls each seller of Registrable
Securities or any underwriter within the meaning of the 1933 Act or the 1934
Act, against any losses, claims, damages or liabilities (joint or several) to
which they may become subject under the 1933 Act, the 1934 Act or other
federal or state law, insofar as such losses, claims, damages or liabilities
(or actions in respect thereof) arise out of or are based upon any of the
following statements, omissions or violations (collectively, a "Violation"):
(i) any untrue statement or alleged untrue statement of a material fact
contained in such registration statement, including any preliminary prospectus
or final prospectus contained therein or any amendments or supplements
thereto, (ii) the omission or alleged omission to state therein a material
fact required to be stated therein, or necessary to make the statements
therein, in light of the circumstances under which they were made, not
misleading, or (iii) any violation or alleged violation by the Company of the
1933 Act, the 1934 Act, any state securities law or any rule or regulation
promulgated under the 1933 Act, the 1934 Act or any state securities law; and
the Company will reimburse each seller of Registrable Securities, and each
such officer, director, agent, employee, underwriter or controlling person for
any legal or other expenses reasonably incurred by it, him or her in
connection with investigating or defending any such loss, claim, damage,
liability or action; provided, however, that the indemnity agreement contained
in this Section 7(a) shall not apply to amounts paid in settlement of any such
loss, claim, damage, liability or action if such settlement is effected
without the consent of the Company (which consent shall not be unreasonably
withheld), nor shall the Company be liable in any such case for any such loss,
claim, damage, liability or action to the extent that it arises out of or is
based upon a Violation which occurs in reliance upon and in conformity with
written information furnished expressly for use in connection with such
registration by a seller of Registrable Securities, or any such underwriter or
controlling person.
(b) To the extent permitted by law, each seller of Registrable
Securities will indemnify and hold harmless the Company, each of its officers,
directors, agents or employees, each person, if any, who controls the Company
within the meaning of the 1933 Act and any underwriter against any losses,
claims, damages or liabilities (joint or several) to which they may become
subject, under the 1933 Act, the 1934 Act or other federal or state law,
insofar as such losses, claims, damages or liabilities (or actions in respect
thereto) arise out of or are based upon any Violation, in each case to the
extent (and only to the extent) that such Violation occurs in reliance upon
and in conformity with information furnished by such seller of Registrable
Securities expressly for use in connection with such registration; and each
seller of Registrable Securities will reimburse any legal or other expenses
reasonably incurred by the Company or any such officer, director, agent,
employee, controlling person or underwriter in connection with investigating
or defending any such loss, claim, damage, liability or action; provided,
however, that the indemnity agreement contained in this Section 7(b) shall not
apply to amounts paid in settlement of any such loss, claim, damage, liability
or action if such settlement is effected without the consent of such seller of
Registrable Securities, which consent shall not be unreasonably withheld.
(c) Promptly after receipt by an indemnified party under this
Section 7 of notice of the commencement of any action (including any
governmental action), such indemnified party will, if a claim in respect
thereof is to be made against any indemnifying party under this Section 7,
deliver to the indemnifying party a written notice of the commencement thereof
and the indemnifying party shall have the right to participate in, and, to the
extent the indemnifying party so desires, jointly with any other indemnifying
party similarly noticed, to assume the defense thereof with counsel mutually
satisfactory to the parties; provided, however, that an indemnified party
shall have the right to retain its own counsel, with the fees and expenses to
be paid by the indemnifying party, if representation of such indemnified party
by the counsel retained by the indemnifying party would be inappropriate due
to actual or potential differing or conflicting interests between such
indemnified party and any other party represented by such counsel in such
proceeding. The failure to deliver written notice to the indemnifying party
within a reasonable time of the commencement of any such action, to the extent
prejudicial to its ability to defend such action, shall relieve such
indemnifying party of liability to the indemnified party under this Section 7
to the extent of such prejudice, but the omission so to deliver written notice
to the indemnifying party will not relieve it of any liability that it may
have to any indemnified party otherwise than under this Section 7.
(d) If recovery is not available under the foregoing
indemnification provisions of this Section 7, for any reason other than as
specified therein, the parties entitled to indemnification by the terms
thereof shall be entitled to contribution to liabilities and expenses in such
proportion as is appropriate to reflect the relative fault of the indemnifying
parties and the indemnified parties, except to the extent that contribution is
not permitted under Section 11(f) of the 1933 Act. The relative fault of such
indemnifying party and indemnified party shall be determined by reference to,
among other things, the parties' relative knowledge and access to information
concerning the matter with respect to which the claim was asserted, the
opportunity to correct and prevent any statement or omission and any other
equitable considerations appropriate under the circumstances. The Company and
each seller of Registrable Securities agree that it would not be equitable if
the amount of such contribution were determined by pro rata or per capita
allocation. A seller of Registrable Securities shall not be obligated to make
any contribution hereunder which in the aggregate exceeds the total public
offering price of the securities sold by such seller of Registrable
Securities, less the aggregate amount of any damages which such seller of
Registrable Securities has otherwise been required to pay in respect of the
same claim or any substantially similar claim.
8. Reports Under the 1934 Act
With a view to making available to the holders of Registrable Securities
the benefits of Rule 144 promulgated under the 1933 Act and any other rule or
regulation of the Commission that may at any time permit a holder of
Registrable Securities to sell securities of the Company to the public without
registration or pursuant to a registration hereunder, the Company agrees to:
(a) make and keep public information available, as those terms
are understood and defined in Rule 144, at all times;
(b) take such action as is reasonably necessary to enable
holders of Registrable Securities to utilize Form S-3 for the sale of their
Registrable Securities;
(c) file with the Commission in a timely manner all reports and
other documents required of the Company under the 1933 Act and the 1934 Act;
and
(d) furnish to any holder of Registrable Securities, so long as
such holder owns any Registrable Securities, forthwith upon request (i) a
written statement by the Company that it has complied with the reporting
requirements of Rule 144, the 1933 Act and the 1934 Act, and/or that it
qualifies as a registrant whose securities may be resold pursuant to Form S-3
(at any time after it so qualifies), (ii) a copy of the most recent annual or
quarterly report of the Company and such other reports and documents filed
with the Commission by the Company, and (iii) such other information as may be
reasonably requested in availing any such holder of any rule or regulation of
the Commission which permits the selling of any such securities without
registration or pursuant to such form, including making publicly available
other information necessary to permit sales pursuant to Rule 144A under the
1933 Act.
9. Registration of Securities Other Than Registrable Securities
The Company has not granted and, without the written consent of the
holders of a majority of the then-outstanding Registrable Securities, shall
not grant to any person the right to request the Company to register any
equity securities under the 1933 Act unless the rights so granted are subject
to the prior rights of the Holders of Registrable Securities set forth in, and
are not otherwise in conflict or inconsistent with the provisions of, this
Agreement.
10. Miscellaneous
10.1 Amendment and Waivers
Any provision of this Agreement may be amended and the observance
thereof may be waived (either generally or in a particular instance and either
retroactively or prospectively), only with the written consent of the Company
and the holders of a majority of the Registrable Securities then outstanding.
Any amendment or waiver effected in accordance with this Section 10.1 shall be
binding upon each holder of Registrable Securities at the time outstanding,
each future holder of Registrable Securities, and the Company.
10.2 No Inconsistent Agreements
The Company will not on or after the date of this Agreement enter into
any agreement with respect to its securities that is inconsistent with the
rights granted to the holders of Registrable Securities in this Agreement or
otherwise conflicts with the provisions hereof. The Company has not
previously entered into any agreement with respect to its securities granting
any registration rights to any person. The rights granted to the holders of
Registrable Securities hereunder do not in any way conflict with and are not
inconsistent with the rights granted to the holders of the Company's
securities under any such agreements.
10.3 Successors and Assigns
This Agreement shall inure to the benefit of and be binding upon the
successors and assigns of each of the parties, including, without limitation
and without the need for an express assignment, subsequent holders of
Registrable Securities; provided, however, that this Agreement shall not inure
to the benefit of or be binding upon a successor or assign of a holder of
Registrable Securities unless and to the extent such successor or assign
acquired Registrable Securities from such holder, and such successor or assign
is restricted by Rule 144 of the Commission in the public sale of such
Registrable Securities because such successor or assign is an "affiliate" of
the Company at the time of sale.
10.4 Notices
Any notice required or permitted to be given hereunder shall be in
writing given by personal delivery, certified or registered mail (postage
prepaid) or facsimile, addressed as respectively set forth below or to such
other address as any party shall have previously designated by such a notice.
The effective date of any notice or request shall be three days from the date
it is sent so long as it is in fact received within five days, or when sent by
facsimile or personally delivered.
Notices to the Company and holders of Registrable Securities shall be
sent as follows:
To the Company:
LIN Television Corporation
5295 Carillon Point
Kirkland, WA 98033
Attention: General Counsel
Fax: (206) 828-1900
To a holder of Registrable Securities:
Cook Inlet Communications Corp.
Suite 450
1800 Avenue of the Stars
Los Angeles, CA 90067
Attention: Stephen C. Hillard
Fax: (310) 556-2752
with a copy to:
Munger, Tolles & Olson
35th Floor
355 South Grand Avenue
Los Angeles, CA 90071-1560
Attention: John B. Frank
Fax: (213) 687-3702
610.5 Governing Law
This Agreement shall be governed by and construed in accordance with the
internal laws of the State of Washington without regard to conflicts-of-laws
principles.
10.6 Counterparts
This Agreement may be executed in two or more counterparts, each of
which shall be deemed to be an original and all of which together shall
constitute one and the same instrument.
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of the
date first written above.
LIN TELEVISION CORPORATION
By: /s/ Peter E. Maloney
Its Vice President
COOK INLET COMMUNICATIONS CORP.
By: /s/ Mark D. Adolph
Its Vice President
EXHIBIT 6
JOINT FILING AGREEMENT
The undersigned persons hereby agree that reports on
Schedule 13D, and amendments thereto, may be filed in a single
statement on behalf of all such persons and, further, each of
such persons designates Cook Inlet Region, Inc. as its agent and
Attorney-in-Fact for the purpose of executing any and all
Schedule 13D filings required to be made by it with the
Securities and Exchange Commission.
Dated this 5th day of January, 1995.
COOK INLET REGION, INC. COOK INLET CORPORATION
By: /s/ Mark W. Kroloff By: /s/ Mark D. Adolph
Mark W. Kroloff Mark D. Adolph
Vice President Vice President
COOK INLET COMMUNICATIONS, INC. COOK INLET COMMUNICATIONS
CORP.
By: /s/ Mark D. Adolph By: /s/ Mark D. Adolph
Mark D. Adolph Mark D. Adolph
Vice President Vice President
