SECURITIES AND EXCHANGE COMMISSION
WASHINGTON, DC 20549
-------
FORM 8-K
CURRENT REPORT
PURSUANT TO SECTION 13 OR 15D OF THE
SECURITIES EXCHANGE ACT OF 1934
Date of report (Date of earliest event reported): May 16, 1996
SFX BROADCASTING, INC.
(Exact name of registrant as specified in charter)
Delaware 0-22486 13-3649750
(State or Other Jurisdiction (Commission File No.) (IRS Employer
of Incorporation) Identification No.)
150 East 58th Street, 19th Floor, New York, New York 10155
(Address of principal executive offices) (Zip Code)
Registrant's telephone number, including area code: (212) 407-9191
N/A
(Former name or former addree, if changed since last report)
ITEM 5. OTHER EVENTS
As previously disclosed, the Registrant has received a commitment from
its lender to increase amounts available under its senior credit facility from
$50.0 million to $150.0 million.
In May 1996, the Company entered into an agreement to sell WWKY-AM and
WTKX-FM, both operating in Louisville, Kentucky, for approximately $6.9 million
and a separate agreement to sell WVEZ-FM, also operating in Louisville,
Kentucky, for approximately $12.6 million. Both agreements contain customary
covenants and conditions and may be terminated by either party not then in
default if FCC consent is not obtained within nine months after the date on
which the FCC application is filed.
(c) Exhibits
10.1 Letter agreement between SFX Broadcasting, Inc. and the
Bank of New York dated May 16, 1996.
10.2 Asset Purchase Agreement between SFX Acquisition
Corporation and Clear Channel Radio, Inc. dated
May 13, 1996.
10.3 Asset Purchase Agreement between SFX Broadcasting, Inc.
and Regent Broadcasting of Louisville, Inc. dated
May 13, 1996.
10.4 Press Release issued by the Registrant on May 23, 1996.
SIGNATURES
Pursuant to the requirements of the Securities and Exchange Act of 1934,
the registrant has duly caused this report to be signed on its behalf by the
undersigned thereto duly authorized.
SFX BROADCASTING, INC.
By: /s/ Howard J. Tytel
Name: Howard J. Tytel
Title: Executive Vice President
Dated: May 23, 1996
May 16, 1996
SFX Broadcasting, Inc.
150 East 58th Street
New York, New York 10155
Attention: Robert F.X. Sillerman
Dear Bob:
Based upon recent discussions between The Bank of New York
(the "Bank") and you concerning a $150 million proposed syndicated and secured
credit facility (the "Facility") to be extended to SFX Broadcasting, Inc. (the
"Borrower"), and relying upon the information which you have previously
provided to the Bank, the Bank is pleased to confirm its willingness to act as
agent for, and to extend, the Facility, subject to the conditions set forth in
this letter and the attached term sheet. The Facility will be in the form of a
revolving credit facility which converts to a five year term loan on September
30, 1998. Up to $20 million of the revolving credit facility shall be
available as a letter of credit subfacility prior to the conversion of the
revolving credit facility to a term loan. The Facility would be provided for
pursuant to a credit agreement which would contain terms, conditions of
lending, funding and yield protections, representations and warranties,
covenants, events of default and other provisions customary for a facility of
this size, type and purpose, including, without limitation, the terms and
conditions set forth on the term sheet attached hereto.
The Bank's willingness to act as agent for, and (to the
extent indicated above) to extend, the Facility is subject to (i) the
negotiation and execution of a credit agreement (as described above) and
related security and other documents that are satisfactory in form and
substance to the Bank and its counsel, and the other conditions to closing
outlined in the attached term sheet and (ii) any change in loan syndication or
financial or capital markets
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SFX Broadcasting, Inc. - 2 -
conditions generally that, in the judgment of the Bank, would materially
impair syndication of the Facility.
By executing this letter, you agree that the Bank's
obligations pursuant to the Commitment Letter, dated April 9, 1996, shall be
terminated and you further agree to pay certain non-refundable fees to the
Bank relating to the Facility as follows: (i) an underwriting fee of $3
million, $200,000 of which shall be payable on the date of your acceptance of
this letter, and the balance of which shall be payable simultaneously with the
execution and delivery of definitive documentation for the Facility
("Closing"); (ii) a fee of 3/8% per annum (on the basis of a 360 day year for
the actual number of days elapsed) on the aggregate amount of the commitment
hereunder, accruing from the date of your acceptance of this letter and
payable quarterly thereafter and at the earlier of Closing or cancellation or
termination of the commitment hereunder; (iii) an administrative agency fee of
(A) $25,000 payable at Closing and (B) $100,000 on each anniversary of the
Closing thereafter; and (iv) a letter of credit issuance fee of 0.25% per
annum on the daily aggregate principal amount of the outstanding letters of
credit and payable quarterly in arrears to the Bank. The definitive loan
documentation for the Facility will set forth certain additional fees payable
to the Bank and lenders by you relating to the Facility as outlined in the
attached term sheet.
By executing this letter, you also agree to indemnify and
hold harmless the Bank in its capacity as agent, each of the participating
lenders (including the Bank) and each of their respective officers, directors
employees, affiliates, agents and controlling persons (each, an "Indemnified
Party") from and against any and all losses, claims, damages and liabilities
to which any such Indemnified Party may become subject arising out of or in
connection with any claim, litigation, investigation or proceeding relating to
this letter, the Facility (including the use of the proceeds thereof) or any
related transaction, whether or not any Indemnified Party is a party,
including all legal and other expenses incurred in connection with
investigating or defending any of the foregoing; provided that, the foregoing
indemnity will not, as to any Indemnified Party, apply to
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SFX Broadcasting, Inc. - 3 -
losses, claims, damages, liabilities or related expenses to the extent arising
from the willful misconduct or gross negligence of such Indemnified Party.
You further (a) agree that you will not make any claim
against any Indemnified Party for any special indirect or consequential
damages in respect of any breach or wrongful conduct (whether the claim
therefore is based on contract, tort or duty imposed by law) in connection
with, arising out of or in any way related to the transactions contemplated
and the relationship established by this letter, or any act, omission or event
occurring in connection therewith, and (b) waive, release and agree not to sue
upon any such claim for any such damages, whether or not accrued and whether
or not known or suspected to exist in your favor.
You agree that this letter and the attached term sheet are
for your confidential use only and will not be disclosed by you or any of your
representatives, without our prior written consent, to any person other than
your accountants, attorneys and other advisors, and then only in connection
with the transactions contemplated hereby and only on a confidential basis,
except that, following your acceptance hereof, you may make such disclosures
of the terms and conditions hereof as you are required by law to make.
This letter and the provisions contained herein shall not be
assignable by you and may not be amended or any provision hereof waived or
modified except by a document in writing signed by you and the Bank.
You hereby knowingly, voluntarily and intentionally waive
any right you may have to a trial by jury in respect of any litigation arising
out of, under or in connection with this letter or the transactions
contemplated hereby.
This letter sets forth the entire understanding of the
parties as to the scope of the obligations of the parties hereto and
supersedes all prior agreements, representations and understandings, if any,
relating to the subject matter hereof.
This letter shall be governed by, and construed in
accordance with, the laws of the State of New York.
<PAGE>
SFX Broadcasting, Inc. - 4 -
This letter shall automatically expire if not accepted by
you on or before 5:00 p.m. (New York City time) on May 17, 1996. Please
indicate your acceptance of this letter and your agreement to the terms hereof
by signing the enclosed copy of this letter and returning it to us. By so
doing, you agree that you (A) shall be bound by the terms hereof, (B) will
provide sufficient information, in form and substance acceptable to the Bank,
for the preparation of an information package describing the Borrower, its
subsidiaries and the Facility, (C) consent to the establishment by the Bank of
a syndicate of, and the distribution by the Bank of the aforesaid information
package and other information to, interested lenders, (D) will (and will cause
your management to) take an active role in the syndication process (including,
without limitation, attending bank meetings and making yourselves available to
answer questions during the syndication process), (E) will pay all fees and
expenses incurred by the Bank in connection with the syndication, negotiation
and preparation of the loan documentation relating to the Facility whether or
not the loan documentation is finalized or the syndication is completed and
(F) will fully cooperate with the Bank in connection with the transactions
contemplated hereby.
Even if accepted in accordance with the provisions of the
previous paragraph, this letter shall expire automatically, without further
act or condition and regardless of cause or circumstance, if loan
documentation satisfactory in form and substance to the Bank and its counsel
is not executed on or before September 30, 1996.
Very truly yours,
THE BANK OF NEW YORK
By:/s/ Joseph Matteo
Name: Joseph Matteo
Title: Vice President
Accepted and agreed:
SFX BROADCASTING, INC.
By:/s/ Robert F.X. Sillerman
Name: Robert F.X. Sillerman
Title: Executive Chairman
<PAGE>
SFX BROADCASTING, INC.
SUMMARY OF PROPOSED TERMS AND CONDITIONS
May 16, 1996
BORROWER: SFX Broadcasting, Inc.
GUARANTORS: Each of the Borrower's present and future direct and
indirect subsidiaries.
GUARANTEE: The Guarantors will provide a full and unconditional joint
and several guarantee of the Facility.
FACILITY: $150 million senior secured revolving credit/term loan.
Prior to the Revolving Credit Conversion Date, up to $20.0
million of the Facility shall be available for the
issuance of standby letters of credit ("Letters of
Credit") to support the Borrower's obligations with
respect to deposit requirements associated with proposed
acquisitions and to support ordinary course working
capital needs. Each Lender in the Facility will purchase a
pro rata risk participation in each Letter of Credit
issued by the Letter of Credit Issuing Bank and the
commitment under the Facility shall be deemed utilized in
the amount of all outstanding Letters of Credit. No Letter
of Credit shall have an expiration date which extends
beyond one business day prior to the Revolving Credit
Conversion Date.
USE OF PROCEEDS: To finance Permitted Acquisitions and the payment of cash
deposits in connection with proposed acquisitions, and to
provide availability for working capital and general
corporate purposes, including transaction expenses.
ARRANGING AND
ADMINISTRATIVE
AGENT: The Bank of New York ("BNY" or the "Agent").
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 2
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LETTER OF CREDIT
ISSUING BANK: BNY.
LENDERS: The Agent and a syndicate of financial institutions to be
arranged by the Agent.
DOCUMENTATION: The Facility will be subject to the negotiation, execution
and delivery of a definitive credit agreement (including
schedules, exhibits and ancillary documentation) and
related security agreements and other support
documentation satisfactory to the Lenders. The definitive
credit agreement and related documentation will contain
such representations and warranties, funding and yield
protection provisions, conditions precedent, covenants and
events of default as are described herein and other
provisions appropriate for transactions of this type as
determined by the Lenders. The Lenders may, in their
discretion, structure such definitive documentation to
use, and amend and restate, certain existing credit and
security agreements between one or more of the Lenders and
the Borrower, with such modifications as are determined to
be appropriate for the transactions contemplated hereby.
FINAL MATURITY: September 30, 2003
AVAILABILITY: Up to the full amount of the Facility can be borrowed,
repaid and reborrowed at any time until September 30, 1998
(the "Revolving Credit Conversion Date"), at which time,
subject to there being no default or Event of Default, all
outstandings will convert to a term loan (the "Term
Loan").
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 3
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TERM LOAN
AMORTIZATION: The Term Loan will amortize in equal quarterly installments,
commencing December 31, 1998, with annual reductions equal
to the following percentages:
Year % Reduction
---- -----------
1998 5%
1999 15%
2000 20%
2001 20%
2002 22%
2003 18%
INTEREST RATE: The Borrower may elect to borrow under the Facility
at either (i) the Alternate Base Rate ("ABR") or (ii) the
LIBOR Rate ("LIBOR"), in each case plus the Applicable
Margin.
ABR will be the higher of (i) BNY's Prime Rate and (ii) the
Federal Funds Rate plus 0.5%. LIBOR (adjusted for
reserves) will be available for one, two, three or six
month borrowings.
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 4
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APPLICABLE MARGINS: The Applicable Margins will be based upon the
Total Leverage Ratio, according to the following table:
=============================================================================
Greater Than or Less Than ABR + LIBOR +
Equal to
- -----------------------------------------------------------------------------
6.50x 1.500% 2.750%
- -----------------------------------------------------------------------------
6.00x 6.50% 1.375% 2.625%
- -----------------------------------------------------------------------------
5.50x 6.00x 1.250% 2.500%
- -----------------------------------------------------------------------------
5.00x 5.50x 1.125% 2.375%
- -----------------------------------------------------------------------------
4.50x 5.00x 0.750% 2.000%
- -----------------------------------------------------------------------------
3.50x 4.50x 0.500% 1.750%
- -----------------------------------------------------------------------------
3.50x 0.250% 1.500%
=============================================================================
APPLICABLE LETTER
OF CREDIT FEE: The Borrower shall pay to the Agent for the respective
accounts of the Lenders a per annum Letter of Credit fee
equal to the Applicable Margin with respect to LIBOR
loans, on the daily principal amount of outstanding
Letters of Credit, payable quarterly in arrears, calculated
on the basis of the actual number of days elapsed over a
360-day year.
BORROWINGS: Borrowings will be available upon three business days
written notice for LIBOR loans and one business day
written notice for ABR loans. Drawings for LIBOR loans to
be in amounts not less than $5 million and in multiples of
$1 million for drawings in excess thereof. Drawings for
ABR loans to be in amounts not less than $1 million and in
multiples of $100,000 for drawings in excess thereof.
INTEREST PAYMENTS: Interest on ABR borrowings will be payable quarterly
in arrears and calculated on the basis of the actual
number of days elapsed over a 360 day year.
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 5
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Interest on LIBOR borrowings will be payable in arrears at
(i) the end of each applicable interest period and (ii) in
the case of a period longer than three months, every three
months. Interest on LIBOR borrowings will be calculated on
the basis of the actual number of days elapsed over a 360
day year.
DEFAULT RATE: After maturity (by acceleration or otherwise) and during
the continuance (i) of any payment Event of Default or
(ii) for more than 30 days following any other Event of
Default, all Applicable Margins will increase by 2.00% per
annum.
COMMITMENT FEE: 0.50% per annum on the unused portion of the Facility
payable quarterly in arrears and at maturity, calculated
on the basis of the actual number of days elapsed over a
360 day year.
MANDATORY
PREPAYMENTS: 1. 100% of the net cash proceeds (after cash taxes)
received from (i) station sales or exchanges (reduced
by Reinvested Proceeds within the Reinvestment Period)
other than the Scheduled Asset Sales or (ii) other
dispositions (other than in the ordinary course of
business).
2. 50% of Excess Cash Flow calculated for each fiscal l
year when the Total Leverage Ratio is greater than
4.50 to 1.00, beginning with the year ended December 31,
1998, and payable on March 31st of each succeeding fiscal
year.
3. The issuance of common equity in an amount in excess
of $100 million, measured on a cumulative basis,
shall be applied as follows: (i) 100% of such
proceeds shall be applied to prepay the Facility
until the Total Leverage Ratio is below 6.00 to 1.00,
and (ii) 50% of such proceeds shall be applied to
prepay the Facility until the Total Leverage Ratio is
below 5.00 to 1.00. When the Total Leverage Ratio is
below 5.00 to 1.00, no additional equity issuance
proceeds must be used to prepay the Facility.
4. 100% of all insurance or condemnation recoveries in
excess of amounts used to replace or restore any
properties or which are not used to replace or
restore properties within one year after any
casualty; provided that the Borrower shall have
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 6
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commenced the restoration or replacement process
(including the making of appropriate filings and
requests for approval) within 45 days after such
casualty and diligently pursues the same through
completion.
Mandatory prepayments on or prior to the Revolving
Credit Conversion Date will be applied to reduce the
commitment under the Facility. To the extent that the
outstandings under the Facility exceed the commitment
thereunder, such mandatory prepayments will be
applied to reduce the outstandings. Any mandatory
prepayments after the Revolving Credit Conversion
Date will be applied to the Term Loan in the inverse
order of maturity.
The Borrower shall pay any breakage costs associated
with the prepayment of a LIBOR borrowing.
VOLUNTARY
PREPAYMENTS
AND OPTIONAL
COMMITMENT
REDUCTIONS: The Facility may be permanently reduced by the Borrower,
in whole or in part with three business days written
notice to the Agent. The amount of each voluntary
commitment reduction shall be in an amount not less than
$5 million.
Any voluntary prepayments after the Revolving Credit
Conversion Date will be applied to the Term Loan in the
inverse order of maturity.
ABR borrowings may be prepaid without penalty with one
business day written notice in an amount not less than $1
million and in multiples of $100,000 for amounts in excess
thereof. Any LIBOR borrowings may be prepaid with three
business days written notice in an amount not less than $5
million and in multiples of $1 million for amounts in
excess thereof.
The Borrower shall pay any breakage costs associated with
the prepayment of any LIBOR borrowing.
SECURITY: 1. Pledge of all of the capital stock of the Borrower's
present and future direct and indirect subsidiaries,
including special
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 7
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purpose license subsidiaries holding
FCC radio licenses. All intercompany
loans and advances will be evidenced
by intercompany notes that will be
pledged as security. All such
security shall constitute perfected
first priority liens subject only to
permitted liens.
2. Pledge of all of the assets (now or hereafter
acquired) of the Borrower and its present and future
direct and indirect subsidiaries (other than those
that the Agent shall deem immaterial).
CONDITIONS
PRECEDENT
TO CLOSING: Usual and customary for credit facilities of this size,
type and purpose including, without limitation:
1. No material adverse change in the condition
(financial or otherwise), operations, business,
property, performance or prospects of the Borrower
and its subsidiaries taken as a whole since December
31, 1995.
2. The Borrower shall deliver such financial statements
(including audited December 31, 1995 financial
statements), projections and other information as the
Agent shall require, all of which shall be in all
respects satisfactory to the Agent.
3. The ownership and capital structure of the Borrower
and its subsidiaries shall be in all respects
satisfactory to the Agent.
4. Satisfactory review of material agreements.
5. Payment of all fees and expenses.
6. Completion of the Recapitalization on terms and
conditions satisfactory to the Agent and the Lenders.
7. There shall be no Existing Subordinated Notes
outstanding in an amount exceeding an amount
acceptable to the Agent and the Lenders.
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 8
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8. To the extent any of the Existing Subordinated Notes
remain outstanding after consummation of the Tender
Offer, the Lenders shall receive an opinion of
Borrower's counsel, in form and substance
satisfactory to the Agent and the Lenders, and such
other legal opinions, letters and other documentation
(including the amended indenture) as the Agent may
request, in form and substance satisfactory to the
Agent and the Lenders, related to the Existing
Subordinated Notes.
9. Delivery of a solvency certificate from the chief
financial officer as to the Borrower and each
subsidiary of the Borrower.
10. Delivery of such security agreements, mortgages,
financing statements and other security documentation
as may be necessary to effect the pledge referred to
under "Security" above.
11. Delivery of satisfactory legal opinions from the
Borrower's counsel as to the enforceability of all
loan documentation, perfection and priority of liens,
FCC, tax and other regulatory matters, and such other
matters as may be reasonably requested by the
Lenders.
12. Delivery of satisfactory legal opinions from the
Agent's counsel (including special FCC Counsel if
deemed necessary by the Agent).
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 9
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CONDITIONS PRECEDENT
TO THE CLOSING OF
THE PERMITTED
ACQUISITIONS: Usual and customary for credit facilities of this size, type
and purpose including, without limitation:
1. The Lenders shall be satisfied in all material
respects with the terms of the Permitted Acquisition.
2. FCC and SEC issues regarding the Permitted
Acquisition reviewed and resolved to the satisfaction
of the Lenders and their counsel.
3. Simultaneously with the closing of the Permitted
Acquisition, delivery of such additional security
documents as may be necessary to effect the pledge of
all assets acquired in the Permitted Acquisition.
4. The purchase and sale agreement or the plan of
merger, as the case may be, shall be in a form
satisfactory to the Agent and Lenders and shall not
be subject to any modifications without the prior
approval of the Agent and the Lenders.
CONDITIONS PRECEDENT
TO ALL LOANS AND
LETTERS OF CREDIT
ISSUANCES: Usual and customary for credit facilities of this size,
type and purpose including, without limitation:
1. All representations and warranties in the credit
agreement and in any other loan documents are true
and correct as though made on and as of such date
(including, without limitation, no material adverse
change in the condition (financial or otherwise),
operations, business, property, performance or
prospects of the Borrower and its subsidiaries taken
as a whole since December 31, 1995).
2. No default or Event of Default exists or would result
from the requested loans.
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 10
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REPRESENTATIONS
AND WARRANTIES: Usual and customary for credit facilities of this
size, type and purpose, including as to the solvency
of the Borrower and each of its subsidiaries.
COVENANTS: Usual and customary for credit facilities of this
size, type and purpose, including, without limitation:
1. Delivery of unaudited monthly financial reports,
unaudited consolidated and consolidating quarterly,
and audited consolidated and consolidating annual
financial statements within 30, 45 and 90 days,
respectively, after the end of the periods to which
they relate.
2. Maintenance of all material licenses, authorizations
and permits, including FCC licenses.
3. Line of business - limited to radio broadcasting for
the Borrower and all its subsidiaries, provided that
the license subsidiaries shall own the FCC licenses.
4. Prohibition on additional indebtedness (including
capital lease obligations, guarantees and contingent
obligations) provided, however (i) a basket for other
indebtedness of the Borrower (which shall exclude
indebtedness of the Borrower and its subsidiaries
existing on the effective date of the Facility) in an
amount up to $10 million; and (ii) certain existing
contingent obligations, will each be permitted.
5. Limitations on liens (except customary permitted
liens incurred in the ordinary course of business).
6. Capital expenditures in each year shall not exceed
$7.5 million in 1996 and $4.5 million in each year
thereafter, provided, however, that any unused
portions may be carried forward for one year.
7. Operating lease obligations with respect to any one
year shall not exceed $8 million.
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 11
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8. The aggregate amount of all issued and undrawn
Letters of Credit, outstanding cash deposits or
option fee payments made by the Borrower, issued for
the account of the Borrower or made by the Borrower
and its subsidiaries, as the case may be, in
connection with proposed acquisitions, shall not
exceed $15 million (the "Acquisition Deposit Cap").
9. Prohibition on mergers, consolidations, and
acquisitions, provided, however, that so long as no
default or Event of Default would exist before and
after giving effect thereto, the Permitted
Acquisitions will each be allowed.
10. Prohibition on asset sales, provided, however, that
so long as no default or Event of Default would exist
before and after giving effect thereto, the Borrower
may: (i) complete the Scheduled Assets Sales, (ii)
sell MMR station KOLL-FM in Little Rock, Arkansas,
(iii) sell MMR stations WRXR-FM and WKBG-FM in
Augusta, Georgia and (iv) sell other assets provided
that: (1) the BCF attributable to all radio broadcast
stations sold and/or exchanged during the one-year
period ending on the date of the proposed sale shall
not exceed 15% of the BCF of the Borrower; (2) the
BCF attributable to all radio broadcast stations sold
and/or exchanged during the life of the Facility,
after giving effect to the proposed sale shall not
exceed 25% of the BCF of the Borrower; (3) fair value
is received, and (4) at least 75% of the
consideration to be received is in the form of cash.
11. Prohibition on asset exchanges, provided, however,
that so long as no default or Event of Default would
exist before and after giving effect thereto, the
Borrower may: (i) exchange KRLD-AM and the Texas
State Networks in Dallas, Texas for KKRW-FM in
Houston, Texas and (ii) exchange other assets
provided that: (A) (1) the BCF attributable to all
radio broadcast stations sold and/or exchanged during
the one-year period ending on the date of the
proposed exchange shall not exceed 15% of the BCF of
the Borrower; (2) the BCF attributable to all radio
broadcast stations sold and/or exchanged during the
life of the Facility, after giving effect to the
proposed exchange, shall not exceed 25% of the BCF
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 12
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of the Borrower and (3) fair value is received and
(B) the assets received pursuant to such exchanges
are Permitted Acquisitions.
Prior to any acquisition, merger, sale or exchange
permitted under either Items 9, 10 or 11 above, whose
value equals or exceeds $15 million, the Borrower
must provide the Lenders with: (i) pro forma
projections for the duration of the Facility; (ii) a
certificate stating that the Borrower is in
compliance with all covenants on a pro forma basis
after inclusion of the proposed transaction; and
(iii) a certificate stating that immediately before
and after giving effect to the proposed transaction
all representations and warranties shall be true and
correct and no default or Event of Default shall
exist.
12. Prohibition on dividends, repurchases of capital
stock, or any other form of distribution of cash or
other assets, including payments to affiliates other
than those approved by the Required Lenders
(collectively called "Restricted Payments"),
provided, however, that so long as no default or
Event of Default would exist before and after giving
effect thereto, Restricted Payments will be permitted
with respect to: (i) cash dividends equal to 6% per
annum of the redemption price for the Borrower's
Dallas Preferred Stock; (ii) any cash dividends
payable on the Borrower's New Preferred Stock; (iii)
redemptions of the Borrower's Dallas Preferred Stock
pursuant to the exercise of the put rights maintained
by the holder of such shares; (iv) scheduled
redemptions of the Borrower's Redeemable Series B
Preferred Stock; (v) the exercise by R. Steven Hicks
of the put option he holds with respect to his shares
of the Borrower's Class A Common Stock and (vi) up to
$25 million in repurchases of the Borrower's stock
(other than any stock specified in clauses (iii) and
(iv) above), provided that the Total Leverage Ratio
is less than or equal to 4.5x before and after giving
effect thereto.
13. Limitations on partnerships, joint ventures, LMAs,
JSAs, other than: (i) LMAs and JSAs in existence at
closing and
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Summary of Proposed Terms and Conditions
May 16, 1996 Page 13
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(ii) LMAs and JSAs entered into in connection with
the Permitted Acquisitions.
14. Prohibition on the redemption of any portion of the
New Notes until all amounts outstanding under the
Facility are repaid in full, provided, however, the
redemption of the Borrower's Existing Subordinated
Notes at call or maturity will be permitted should
there be no default or Event of Default before and
after giving effect thereto.
FINANCIAL
COVENANTS: 1. Total Leverage Ratio - the ratio shall not at any time
- --------- exceed:
Period Ratio
------ -----
Closing to 12/30/96 7.00x
12/31/96-6/29/97 6.75x
6/30/97-6/29/98 6.50x
6/30/98-6/29/99 6.00x
6/30/99-6/29/00 5.50x
6/30/00-12/30/00 5.00x
12/31/00 and thereafter 4.75x
Notwithstanding the foregoing, as a
condition precedent to the funding
of a Permitted Acquisition, the
Total Leverage Ratio of the Borrower
shall not exceed the lesser of: (i)
6.75 to 1.0 and (ii) the applicable
Total Leverage Ratio covenant.
2. Senior Leverage Ratio - the ratio shall not at any
time exceed:
Period Ratio
Closing to 12/30/96 2.50x
12/31/96-6/29/98 2.25x
6/30/98 and thereafter 2.00x
3. OCF/Pro Forma Interest Expense - the ratio shall not
at any fiscal quarter end be less than:
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May 16, 1996 Page 14
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Period Ratio
------ -----
Closing-12/31/97 1.25x
1/1/98-12/31/98 1.50x
1/1/99-12/31/00 1.75x
1/1/01 and thereafter 2.00x
4. OCF/Pro Forma Debt Service - the ratio shall not at
any fiscal quarter end be less than 1.10x.
5. OCF/Fixed Charges - the ratio shall not at any fiscal
quarter end be less than 1.05x.
6. Maximum market concentration shall not exceed 25% of
BCF.
EVENTS OF DEFAULT: Usual and customary for credit facilities of
this size, type and purpose, including, without
limitation, payment, misrepresentation, covenant,
bankruptcy, ERISA, judgments, Change of Control and cross
defaults.
COST AND YIELD
PROTECTION: Standard provisions for illegality, inability to
determine, indemnification for break funding and increased
costs or reduced return including those arising from
reserve requirements, taxes and capital adequacy.
REQUIRED LENDERS: 60%.
ASSIGNMENTS AND
PARTICIPATIONS: Each Lender may assign all or any part of its loans and
commitments under the Facility, provided that (i) in the
case of a partial assignment, each such assignment shall
be in a minimum amount equal to $5 million and (ii) any
assignment shall require the written consent of the Agent
(which will not be unreasonably withheld). Each Lender may
(i) sell participations in all or a portion of its
interest in loans and commitments under the Facility or
(ii) assign all or a portion of its loans and commitments
under the Facility to a Federal Reserve Bank without the
consent of the Agent.
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May 16, 1996 Page 15
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EXPENSES AND
INDEMNIFICATION: The Borrower will pay the Agent's legal and other
reasonable out-of-pocket expenses incurred in connection
with the negotiation, preparation and execution of the
legal documentation of the Facility and the establishment
of the syndicate, regardless of whether the transaction is
consummated. Documentation shall contain expense and
indemnification provisions for the benefit of the Agent
and the Lenders customary for transactions of this type.
GOVERNING LAW: The law of the State of New York.
WAIVER OF
JURY TRIAL AND
CONSENT TO NEW
YORK JURISDICTION: Required.
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May 16, 1996 Page 16
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DEFINITIONS
BROADCAST
CASH FLOW
("BCF"): OCF plus all corporate expenses.
CHANGE OF
CONTROL: Shall mean any of: (i) a "change of control", as such term
is defined in the indenture to the Borrower's Existing
Subordinated Notes; (ii) a "change of control", as such
term is defined in the indenture to the Borrower's New
Notes; (iii) the failure of Robert F.X. Sillerman
("Sillerman"), any affiliate of Sillerman or, together
with any executor, heir or successor appointed to take
control of Sillerman's affairs in the event of his death,
disability or incapacity, to own directly or indirectly,
in the aggregate, of record and beneficially, more than
35% of the voting power of all issued and outstanding
capital stock of the Borrower; (iv) such changes in the
ownership of the Borrower or any of its subsidiaries that
would require the consent of the FCC; or (v) the failure
of Sillerman to remain employed by the Borrower in his
present capacity.
DALLAS
PREFERRED
STOCK: Shares of preferred capital stock of the Borrower
constituting a portion of the purchase price paid in
connection with the acquisition of station KTCK-AM in
Dallas, Texas.
DEBT SERVICE: For the most recently completed four fiscal
quarters, the sum of: (i) Interest Expense; (ii) the
scheduled principal amortization of Total Funded Debt;
(iii) the scheduled redemption of Redeemable Series B
Preferred Stock; and (iv) obligations due during such
period as a result of the exercise of any put or call
rights with respect to the Dallas Preferred Stock.
EXCESS CASH FLOW: Operating Cash Flow (before any adjustments to
reflect acquisitions, sales and exchanges during such
period) for each fiscal year of the Borrower less the sum
of the following during
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May 16, 1996 Page 17
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such fiscal year: (i) Fixed Charges and (ii) voluntary
prepayments of the Term Loan.
EXISTING
SUBORDINATED
NOTES: The Borrower's outstanding 11.375% senior subordinated
notes due October 1, 2000.
FIXED CHARGES: For the most recently completed four fiscal
quarters for the Borrower and its subsidiaries on a
consolidated basis, the sum of the following paid during
such fiscal period: (i) Debt Service; (ii) cash income
taxes paid; (iii) capital expenditures; (iv) all dividends
paid with respect to the Dallas Preferred Stock and (v)
any dividends paid with respect to the New Preferred
Stock.
INTEREST EXPENSE: The sum of: (i) all interest expense and commitment fees
incurred with respect to Total Funded Debt.
LIBERTY
ACQUISITION: The acquisition of all of the shares of capital stock of
Liberty Broadcasting, Incorporated.
MMR ACQUISITION: The acquisition of all the shares of capital stock of
Multi-Market Radio, Inc. ("MMR").
NEW NOTES: The $440 million principal amount of unsecured senior
subordinated notes issued by the Borrower in May 1996.
NEW PREFERRED
STOCK: The $120 million or more of cumulative convertible
exchangeable preferred stock issued by the Borrower in May
1996.
OPERATING
CASH FLOW ("OCF"): For the most recently completed four fiscal quarters,
(i) broadcast revenues (exclusive of reciprocal
revenues) minus (ii) expenses (excluding depreciation,
amortization, reciprocal expenses, interest expense,
income tax expense and the $5 million provision for the
Texas Rangers Contract), plus (iii) non-recurring expense
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May 16, 1996 Page 18
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items (including the amount of operating losses associated
with the Texas Rangers Contract) or non-cash expense items
mutually agreed upon by the Borrower and the Required
Lenders; less (iv) the amount of any cash payments related
to non-cash charges (exclusive of those associated with
the Texas Rangers Contract) that were added back in
determining OCF pursuant to (iii) above in any prior
period.
OCF will be adjusted to reflect acquisitions and
dispositions during such period. BCF from radio
broadcasting stations managed and operated by the Borrower
pursuant to LMAs, time brokerage agreements and JSAs which
is to be included in the calculation of BCF shall not
exceed 10% of BCF from stations owned by the Borrower
which are not subject to LMAs, time brokage agreements or
JSAs.
Pro forma adjustments related to station operating
expenses mutually agreed upon by the Borrower and the
Required Lenders will be included in the calculation of
OCF.
PERMITTED
ACQUISITIONS: Shall mean any of the following: (i) the MMR Acquisition;
(ii) WHSL-FM in Greensboro, NC; (iii) acquisitions in
Principal Markets; (iv) acquisitions in Top 75 markets
made when the Total Leverage Ratio is less than 5.50 to
1.00 before and after giving effect thereto; and (v) all
other acquisitions approved by the Required Lenders.
PRINCIPAL
MARKET: A market in which the Borrower owns two or more FM radio
stations.
PRISM
ACQUISITION: The acquisition of the assets of Prism Radio Partners,
L.P.
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May 16, 1996 Page 19
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PRO FORMA
DEBT SERVICE: The sum of: (i) Pro Forma Interest Expense; (ii) the
scheduled current maturities of Total Funded Debt;
(iii) the scheduled redemption of Redeemable Series B
Preferred Stock; and (iv) obligations due as a result of
the exercise of any put or call rights with respect to the
Dallas Preferred Stock (but in no event more than $2
million), each measured for the four fiscal quarters
immediately succeeding the date of determination.
PRO FORMA
INTERES EXPENSE: Interest Expense calculated for the four fiscal
quarters following the calculation quarter, giving effect
to the Total Funded Debt outstanding and the rates in
effect as of the date of determination and the
amortization scheduled during such period.
RECAPITALIZATION: Shall refer to all of the following taken together: (i)
the Tender Offer; (ii) the issuance of the New Notes and
New Preferred Stock; (iii) the Liberty Acquisition; (iv)
the Prism Acquisition; (v) the acquisition of WTRG-FM and
WRDU-FM in Raleigh, NC; (vi) the acquisition of WTCK-AM,
WMFR-AM and WMAG-FM in Greensboro, NC; (vii) the
acquisition of WJDX-FM, WSTZ-FM and WZRX-AM in Jackson,
MS; and (viii) the acquisition of WROQ-FM in Greenville,
SC.
REINVESTED
PROCEEDS: Net cash proceeds (after cash taxes) from station sales or
exchanges which are used to acquire additional radio
stations through a merger, acquisition or exchange in
accordance with the covenants during the Reinvestment
Period.
REINVESTMENT
PERIOD: Nine months from the date that proceeds from a station
sale or exchange are received by the Borrower.
SCHEDULED
ASSET SALES: Shall mean the sale of any of the following: (i)
stations WXVR- FM, WXTR-FM and WQSI-AM in Washington, DC
acquired in connection with the Liberty Acquisition; (ii)
stations WVEZ-FM, WWKY-AM and WTFX-FM in Louisville,
Kentucky acquired in
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May 16, 1996 Page 20
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connection with the Prism Acquisition; and (iii) station
KTCK-AM in Dallas, Texas.
SENIOR
FUNDED DEBT: Total Funded Debt less the sum of: (i) the amount
outstanding under the Existing Subordinated Notes and (ii)
the amount outstanding under the New Notes.
SENIOR
LEVERAGE RATIO: The ratio of: (i) Senior Funded Debt less cash and
cash equivalents in excess of $5 million to (ii) OCF.
TENDER OFFER: The repurchase of up to all of the Company's Existing
Subordinated Notes.
TOTAL
FUNDED DEBT: Shall include all outstandings under the Facility and any
other borrowed money and similar type indebtedness
(including capital lease obligations) of the Borrower and
its subsidiaries, on a consolidated basis.
TOTAL
LEVERAGE RATIO: The ratio of: (i) Total Funded Debt less cash and cash
equivalents in excess of $5 million to (ii) OCF. Pro
forma adjustments to the Total Leverage Ratio mutually
agreed upon by the Borrower and the Required Lenders may
be made with respect to the Scheduled Asset Sales
(exclusive of the Washington, DC station sales) should
they take place following the closing of the MMR
Acquisition.
ASSET PURCHASE AGREEMENT
Between
SFX ACQUISITION CORPORATION
and
CLEAR CHANNEL RADIO, INC.
May 13, 1996
<PAGE>
TABLE OF CONTENTS
Page
1. ASSETS TO BE CONVEYED............................................. 1
1.1 Station Licenses......................................... 2
1.2 Station Property and Equipment........................... 2
1.3 Contracts................................................ 2
1.4 Real Property............................................ 2
1.5 Records.................................................. 3
1.6 Intangibles.............................................. 3
1.7 Accounts Receivable...................................... 3
2. EXCLUDED ASSETS; ASSUMED LIABILITIES.............................. 3
2.1 Excluded Assets.......................................... 3
2.2 Assumed Liabilities...................................... 4
3. PURCHASE PRICE.................................................... 4
3.1 Purchase Price........................................... 4
3.2 Method of Payment........................................ 4
3.3 Adjustments and Prorations............................... 4
3.4 Allocation of Purchase Price............................. 5
4. SELLER'S REPRESENTATIONS AND WARRANTIES........................... 5
4.1 Station Licenses......................................... 5
4.2 Compliance With Laws..................................... 5
4.3 Title to Assets.......................................... 6
4.4 Condition of Station Equipment........................... 6
4.5 Real Property............................................ 6
4.6 Contracts................................................ 7
4.7 Intangible Property Rights............................... 7
4.8 Litigation............................................... 8
4.9 Financial Statements..................................... 8
4.10 Organization and Standing................................ 8
4.11 Authorization............................................ 8
4.12 Binding Agreement........................................ 8
4.13 Insolvency Proceedings................................... 8
4.14 Absence of Conflicting Agreements........................ 9
4.15 Other Buyers............................................. 9
4.16 Insurance................................................ 9
4.17 Personnel................................................ 9
4.18 Trade or Barter.......................................... 9
4.19 Prism Representations.................................... 9
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5. BUYER'S REPRESENTATIONS AND WARRANTIES............................ 10
5.1 Organization and Standing................................ 10
5.2 Authorization............................................ 10
5.3 Binding Agreement........................................ 10
5.4 Absence of Conflicting Agreements........................ 10
5.5 Litigation............................................... 10
5.6 Licensee Qualifications.................................. 10
5.7 Ability to Perform....................................... 11
6. COVENANTS OF SELLER............................................... 11
6.1 Maintenance of Business and Station Equipment............ 11
6.2 Agreements............................................... 11
6.3 Promotion of Business.................................... 12
6.4 Compliance With Laws..................................... 12
6.5 Administrative Violations................................ 12
6.6 Liens.................................................... 12
6.7 Insurance................................................ 12
6.8 Consents................................................. 12
6.9 Reasonable Efforts/Cooperation........................... 12
6.10 Trade Agreements ........................................ 13
6.11 Sales Reports............................................ 13
6.12 Access................................................... 13
6.13 Changes in Representations and Warranties................ 13
6.14 Notification............................................. 13
6.15 Environmental Audit...................................... 13
6.16 Delivery of Financial Statements and Audit .............. 14
7. COVENANTS OF BUYER................................................ 14
7.1 Administrative Violations................................ 14
7.2 Reasonable Efforts/Cooperation............................14
7.3 Changes In Representations And Warranties................ 15
7.4 Notification............................................. 15
8. REGULATORY APPROVALS.............................................. 15
8.1 Application for FCC Consent.............................. 15
8.2 Control of Stations...................................... 15
8.3 Other Notifications...................................... 15
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9. CONDITIONS TO BUYER'S OBLIGATION................................... 15
9.1 Representations and Warranties; No Material Adverse Change 15
9.2 Compliance with Covenants................................. 16
9.3 Closing Documents......................................... 16
9.4 Receipt of Third Party Consents........................... 16
9.5 Release of Liens.......................................... 16
9.6 No Adverse Proceedings.................................... 16
9.7 Regulatory Consents....................................... 16
9.8 Opinion of Seller's Counsel............................... 16
9.9 Prism Acquisition......................................... 16
10. CONDITIONS TO SELLERS' OBLIGATION.................................. 17
10.1 Representations and Warranties............................... 17
10.2 Compliance with Covenants.................................... 17
10.3 Closing Documents............................................ 17
10.4 Regulatory Consents.......................................... 17
10.5 Payment...................................................... 17
10.6 Prism Acquisition......................................... 17
11. CLOSING............................................................ 17
11.1 Closing Date; Closing Place.................................. 17
11.2 Delivery of Closing Documents................................ 17
12. CLOSING DOCUMENTS.................................................. 18
12.1 Closing Documents To Be Delivered By Seller.................. 18
12.2 Closing Documents To Be Delivered By Buyer................... 18
12.3 Other Closing Documents and Acts............................. 19
13. TERMINATION........................................................ 19
13.1 Absence of FCC Consent.................................... 19
13.2 Events of Default......................................... 19
13.3 Damage or Loss............................................ 20
13.4 Effect of Termination..................................... 21
14. INDEMNIFICATION; SURVIVAL.......................................... 21
14.1 Seller's Indemnities...................................... 21
14.2 Buyer's Indemnities....................................... 21
14.3 Limitation................................................ 22
14.4 Notice and Opportunity to Defend.......................... 22
14.5 Survival.................................................. 23
14.6 Arbitration of Disputes................................... 23
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15. TRANSFER TAXES, FEES AND EXPENSES................................. 24
15.1 Transfer Taxes and Similar Charges.......................... 24
15.2 FCC Filing and Grant Fees................................ 24
15.3 Expenses................................................. 24
16. ASSIGNABILITY..................................................... 24
17. CONFIDENTIALITY................................................... 24
18. COVENANT NOT TO SOLICIT PERSONNEL................................. 25
19. COVENANT NOT TO COMPETE........................................... 25
20. NOTICES........................................................... 26
21. ENTIRE AGREEMENT.................................................. 26
22. COUNTERPARTS...................................................... 27
23. HEADINGS.......................................................... 27
24. EXHIBITS.......................................................... 27
25. SEVERABILITY...................................................... 27
26. CHOICE OF LAW..................................................... 27
27. BROKER............................................................ 27
28. WAIVER............................................................ 27
29. ATTORNEY'S FEES................................................... 27
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SCHEDULES
SCHEDULE 1.1.....................................................
Station Licenses and Station Applications
SCHEDULE 1.2.....................................................
Station Equipment
SCHEDULE 1.3.....................................................
Contracts to be Assumed
SCHEDULE 1.4.....................................................
Real Property
SCHEDULE 1.6.....................................................
Intangible Property
SCHEDULE 3.4.....................................................
Allocation
SCHEDULE 4.3.....................................................
Liens
SCHEDULE 4.8.....................................................
Litigation
SCHEDULE 4.9.....................................................
Financial Statements
SCHEDULE 4.18....................................................
Trade and Barter Agreements
EXHIBIT
A Opinion of Seller's Counsel
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<PAGE>
ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is entered
into as of this 13th day of May, 1996, by and among SFX Acquisition
Corporation, a Delaware corporation ("Seller"), Clear Channel Radio, Inc., a
Nevada corporation ("Clear Channel"), and Clear Channel Radio Licenses, Inc.,
a Nevada corporation ("Clear Channel Licenses") (together, "Buyer").
RECITALS:
WHEREAS, on February 9, 1996, Seller entered into an
Agreement (the "Prism Asset Purchase Agreement") with Prism Radio Partners,
L.P. ("Prism"), pursuant to which Seller has agreed to acquire certain radio
stations owned and operated by Prism, including radio Stations WWKY-AM and
WTFX-FM, Louisville, Kentucky, pursuant to licenses issued by the Federal
Communications Commission (the "FCC") (each, a "Station," and collectively,
the "Stations"); and
WHEREAS, upon closing of the Prism Asset Purchase Agreement,
Seller desires to sell and assign and Buyer desires to purchase those assets
of Seller used or useful in the operation of the Stations, including the
licenses and other authorizations issued by the FCC for the operation of the
Stations; and
WHEREAS, the parties recognize that the licenses and other
authorizations issued by the FCC for the operation of the Stations may not be
assigned to Buyer without the prior consent of the FCC.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, and of
the mutual promises and covenants set forth below, the parties hereby agree as
follows:
1. ASSETS TO BE CONVEYED. Subject to the terms and conditions of this
Agreement, on the Closing Date (as defined below), Seller shall assign,
transfer and deliver to Buyer and Buyer shall purchase from Seller all of the
assets presently used in the operation of the Stations (other than Excluded
Assets, as defined below), including, without limitation, the following (the
"Assets"):
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1.1 Station Licenses. All licenses, permits, and other authorizations
issued by the FCC and other federal, state or local governmental agencies or
authorities for the operation of the Stations listed on Schedule 1.1, together
with any additions thereto between the date hereof and the Closing Date (the
"Station Licenses"), and all applications for modification, extension or
renewal thereof pending as of the Closing Date including without limitation
those listed on Schedule 1.1 and those filed between the date hereof and the
Closing Date (the "Station Applications").
1.2 Station Property and Equipment. All fixed and tangible personal
property owned by Seller presently used in the operation of the Stations,
including the property listed on Schedule 1.2, together with any replacements,
improvements and additions thereto made between the date hereof and the
Closing Date, less any retirements or dispositions thereof made between the
date hereof and the Closing Date in the ordinary course of business (the
"Station Equipment").
1.3 Contracts. All rights of Seller in, to and under (a) all Contracts
listed on Schedule 1.3 which are in existence on the Closing Date, together
with any renewals or extensions thereof entered into by Seller in the ordinary
course of business between the date hereof and the Closing Date (including the
trade balances owing by Seller in the form of air time as listed on Schedule
4.18, except that Buyer shall not be required to assume such trade balances to
the extent that they exceed by more than $10,000 the consideration then owed
to the Stations in connection with the underlying trades), (b) all Contracts
for the sale of air time on the Stations for cash entered into in the ordinary
course of business at the usual rates, (c) all Contracts entered into by
Seller with the prior written consent of Buyer and (d) all other Contracts
entered into by Seller in the ordinary course of business consistent with the
provisions of Section 6.2 between the date hereof and the Closing Date, which
are in existence on the Closing Date and which relate to the operation of the
Stations (collectively, the "Assumed Contracts"). For purposes of this
Agreement, "Contracts" means all contracts, leases and other agreements,
including any amendments and modification thereto, to which Seller is a party
and which relate to the business or operation of the Stations, and which
either are in effect on the date hereof or are entered into by Seller between
the date hereof and the Closing Date.
1.4 Real Property. All of Seller's right, title and interest in and to
the real property owned and leased by Seller and described on Schedule 1.4
(collectively, the "Real Property").
1.5 Records. All business records of Seller including, but not
limited to, logs, local public records file materials, engineering records,
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<PAGE>
personnel files, lists of advertisers, sales correspondence, equipment
warranties, and market research data, relating to or used in the operation of
the Stations or necessary to show compliance with any law or regulation
applicable to the Stations and not pertaining solely to Seller's business
affairs (the "Business Records").
1.6 Intangibles. The service marks, trademarks, trade names, patents,
copyrights, call signs, franchises, slogans, logos, jingles and other
intangible assets used or useful in the operation of the Stations, and any
registrations and applications for registration of any such intangible assets,
as listed on Schedule 1.6, together with any associated goodwill and any
additions thereto between the date hereof and the Closing Date (the
"Intangible Property").
1.7 Accounts Receivable. All rights of Seller as of the Closing Date to
payment for the sale of advertising time by the Stations and services
performed by the Stations.
2. EXCLUDED ASSETS; ASSUMED LIABILITIES.
2.1 Excluded Assets. The parties agree that the following assets shall be
"Excluded Assets" and shall not be among the Assets sold and purchased
pursuant to this Agreement:
(a) Seller's cash, cash equivalents, and marketable securities on
hand or in banks;
(b) All tangible personal property of the Stations disposed of or
consumed between the date of this Agreement and the Closing Date in the
ordinary course of business;
(c) All tangible personal property of the Stations disposed of or
consumed between the date of this Agreement and the Closing Date in the
ordinary course of business;
(d) Seller's insurance policies and all insurance proceeds and
insurance claims of Seller relating to property or equipment repaired,
replaced or restored by Seller prior to the Closing Date;
(e) All claims, rights and interest in and to any refunds of
federal, state or local taxes for transactions and periods prior to the
Closing Date; and
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(f) Seller's name, minute books, ledgers, charter documents, tax
records, and such other internal books and records as pertain to the
organization, existence, capitalization or financial performance of Seller.
2.2 Assumed Liabilities. As of the Closing Date, Buyer
shall assume (a) all obligations and liabilities of Seller arising from and
after the Closing Date under the Assumed Contracts, provided, however, that
Buyer shall not assume Seller's obligations under any equity, carried interest
or cash-flow performance components ("Incentive Arrangements") of employment
agreements with Seller's managers and (b) all other obligations and expenses
arising from the operation of the Stations by Buyer from and after the Closing
Date. Seller shall remain solely responsible for national sales representation
fees due and payable prior to Closing. The liabilities and obligations of
Seller to be assumed pursuant to this Section 2.2 are referred to herein as
the "Assumed Liabilities."
3 PURCHASE PRICE.
3.1 Purchase Price. The total consideration for the Assets
shall be (a) Six Million Eight Hundred Eighty-two Thousand Three Hundred Fifty-
two Dollars and Ninety-Four Cents ($6,882,352.94) (the "Purchase Price"),
payable by Buyer to Seller as set forth in Section 3.2 below, and (b)
assumption of the Assumed Liabilities.
3.2 Method of Payment.
Subject to the provisions of Section 11.1 hereof, at
Closing Buyer shall pay to Seller, by wire transfer of federal funds (in
accordance with wire transfer instructions to be given to Buyer by Seller
prior to Closing), the Purchase Price, plus or minus any adjustments as set
forth in Section 3.3.
3.3 Adjustments and Prorations. All expenses and operating income
arising from the ownership and operation of the Stations shall be prorated
between Buyer and Seller as of 12:01 a.m. on the Closing Date. Such prorations
shall include, without limitation, all ad valorem, real estate and other
property taxes (but excluding sales taxes covered by Section 15.1 of this
Agreement), vacation and sick leave, business and license fees, music and
other license or regulatory fees (including any retroactive adjustments
thereof made after the Closing Date), power and utility expenses, time sales
agreements, frequency discounts, rents, prepaid advertising, trade and barter
receivables, trade and barter payables (subject in the case of trade and
barter receivables and payables to Section 1.3), and similar prepaid and
deferred items attributable to the ownership and operation of the Stations.
The proration of FCC regulatory fees shall be based upon the actual rates for
1996, unless the FCC has not set the
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1996 rates by the Closing Date, in which case the proration shall be based
on the 1995 rates and shall be final. Seller shall provide Buyer a list of all
known proratable items and payables at least five (5) days before the Closing
Date. To the extent reasonably possible, such prorations shall be completed at
Closing by an adjustment to the Purchase Price. As to those prorations and
adjustments not reasonably capable of being ascertained on the Closing Date,
an adjustment and proration shall be made (and the adjustment payment required
by the proration shall be paid by separate check) within ninety (90) days
after the Closing Date. In the event of any disputes between the parties as to
the prorations and adjustments described in this Section, the amounts not in
dispute shall nonetheless be paid at the time provided in this Section and
such disputes shall be determined by an independent certified public
accountant mutually acceptable to the parties with the fees and expenses of
such accountant being paid one-half by Seller and one-half by Buyer.
3.4 Allocation of Purchase Price. The Purchase Price shall be allocated
among the Assets as set forth in Schedule 3.4. Such allocation shall be
conclusive and binding for all purposes, and each party shall prepare and file
all income tax returns (including such forms as may be required by applicable
regulations) in a manner consistent with such allocation.
4 SELLER'S REPRESENTATIONS AND WARRANTIES.
Seller represents and warrants to Buyer as follows:
4.1 Station Licenses. The Station Licenses listed in Schedule 1.1
constitute all of the material licenses, permits and authorizations necessary
or useful for the operation of the Stations as they now are operated. At
Closing, Seller shall be the authorized legal holder of the Station Licenses.
To the best of Seller's knowledge, the Station Licenses are in full force and
effect and expire on the dates shown in Schedule 1.1. To the best of Seller's
knowledge, none of the Station Licenses is subject to any restriction or
condition which would limit in any material respect the full operation of the
Stations as now operated, and Seller is not aware of any reason why those
Station Licenses that are subject to expiration might not be renewed in the
ordinary course, or of any reason why any of the Station Licenses might be
revoked, or of any reason why any of the Station Applications might not be
granted.
4.2 Compliance With Laws. At Closing, Seller shall be in compliance in
all material respects with, and is not in material violation of, the federal,
state and local laws, regulations or governmental orders applicable to the
Stations and the Assets, including, without limitation, any applicable
statutes, ordinances or codes relating to zoning and land use, health and
sanitation, environmental protection, occupational safety, and the use of
electrical power, where the failure to so comply would have a material adverse
effect on the operation of the Stations. Specifically, but without limitation,
the Stations shall be
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in compliance in all material respects with the Communications Act of 1934, as
amended, all rules, regulations and published policies of the FCC thereunder,
as announced from time to time by the FCC (the "FCC Rules"), and all Federal
Aviation Administration rules and regulations applicable to the towers used by
the Stations. Except for FCC approval of the Assignment Application (as
defined in Section 8.1 hereof), no action, consent or other approval is
required to be obtained by Seller from governmental authorities in connection
with the trans actions contemplated by this Agreement. No judgment, decree,
order or notice of violation has been issued by any such authority which
permits, or would permit, revocation, modification or termination of any
governmental permit, license or authorization or which results or could result
in any material impairment of any rights thereunder.
4.3 Title to Assets. No assets or property other than the Assets are
necessary to conduct the business or operation of the Stations as it is
presently being conducted, and at Closing Seller shall deliver good and
marketable title to all of the Assets free and clear of all debts, liens,
security interests, mortgages, trusts, claims or other defects of title or
encumbrances or contractual rights of others of any kind ("Liens"), except for
the rights of third parties under Contracts that are part of the Assets,
"Permitted Liens" (as defined below), and Liens set forth in Schedule 4.3
which shall be removed as of the Closing Date. "Permitted Liens" are liens for
taxes, fees, assessments and other governmental charges not yet due and
payable, and encumbrances (excluding judgments and security interests) which
do not in the aggregate materially detract from the value of the Assets or
materially detract from or interfere with the use of the Assets in the
ordinary course of business as presently conducted.
4.4 Condition of Station Equipment. To the best of Seller's knowledge,
the Station Equipment listed on Schedule 1.2, except as otherwise specifically
indicated therein, is in good operating condition and not in need of repair
(ordinary wear and tear excepted) and is available for immediate use by Buyer
in the operation of the Stations. To the best of Seller's knowledge, the
Stations' transmitting and studio equipment is operating in material
compliance with the terms and conditions of the Station Licenses and the FCC
Rules, including the terms of the construction permits underlying such
licenses, which are expressly or by operation of law or the FCC's policies
carried forward in the Station Licenses.
4.5 Real Property. Prism owns or leases all of the Real Property listed
on Schedule 1.4. At Closing, Seller shall hold good and marketable title to
the owned Real Property, and valid leasehold interests in the leased Real
Property. All Real Property (including the improvements thereon) is in usable
condition and repair consistent with its present use, complies in all material
respects with all applicable building or zoning codes or other applicable
governmental regulations, and is available for immediate use in the conduct of
the
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business of the Stations. At Closing, Seller shall be in material
compliance with all applicable federal, state, county or local laws,
ordinances, regulations, statutes, consent decrees, orders and other
requirements of all governmental, regulatory or administrative agencies
relating to, which impose liability for, or which establish standards of
conduct concerning, the preservation of environmentally sensitive areas or the
manufacture, processing, generation, distribution, use, treatment, storage,
discharge, emission, release, disposal, cleanup, transport or handling of
substances or materials, except where the failure to so comply would not have
a material adverse effect on the operation of the Stations. To Seller's best
knowledge, there is no proceeding or inquiry by any federal, state, county or
local governmental authority or any nongovernmental entity or person pending
or threatened with respect to the presence of hazardous or toxic wastes,
substances or materials about, on, at, under, or within any of the Real
Property or the migration or transportation thereof from or to other property.
To Seller's best knowledge, none of the following is present about, on, at,
under or within any of the Real Property to an extent which could reasonably
be expected to have a material adverse effect on Buyer: (i) asbestos, (ii)
fuel, oil or gasoline storage tanks, or (iii) substance or material that
requires investigation, remediation or cleanup under any applicable law, rule
or regulation.
4.6 Contracts. Except as indicated on Schedule 1.3, to the best of
Seller's knowledge the Assumed Contracts are valid, binding and enforceable by
Seller, and freely assignable without the consent of the other contracting
party. Seller has delivered to Buyer true and complete copies of the Assumed
Contracts and all amendments and other modifications thereto. To the best of
Seller's knowledge, there has not occurred as to any of the Assumed Contracts
any material default by Seller or any other party thereto. Schedule 1.3
contains a true and complete list of all of the Assumed Contracts, some of
which require the consent of any contracting party other than Seller as a
condition of their valid assignment to Buyer and, subject to obtaining any
such consents, Seller shall have at Closing full legal power and authority to
assign its rights under the Assumed Contracts to Buyer, and such assignment
shall not materially affect the validity, enforceability or continuity of any
of the Assumed Contracts.
4.7 Intangible Property Rights. Except as described in Schedule 1.6, at
Closing Seller shall have good and marketable title to all Intangible Property
free and clear of any third party claims, or if any such Intangible Property
is licensed or franchised to Seller the rights and interests of Seller in and
to such Intangible Property shall be valid and in good standing and
uncontested. Seller has received no notice of any infringement or unlawful use
of any of the Intangible Property and is not aware of any grounds therefor.
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4.8 Litigation. Except as provided in Schedule 4.8, to the best of
Seller's knowledge there is no action, suit, investigation, complaint, or
other proceeding pending or, to Seller's best knowledge, threatened before the
FCC or any court, agency or governmental authority that could reasonably be
expected to give rise to any claim against the Assets or the Stations or to
adversely affect Seller's ability to perform in accordance with the terms of
this Agreement or Buyer's ability to operate the Stations, and Seller knows of
no reasonable basis for any such action, suit, investigation, complaint or
other proceeding.
4.9 Financial Statements. Seller has furnished Buyer with the financial
statements listed on Schedule 4.9 (the "Financial Statements"). The audited
Financial Statements for the years ended December 31, 1995 and December 31,
1994 have been prepared in accordance with generally accepted accounting
principles consistently applied, and fairly present the financial position of
the Stations as of December 31, 1995 and December 31, 1994 and the results of
operations and changes in financial position for the periods indicated. The
Operating Statement for the quarter ended March 31, 1996 fairly presents the
results of operations of the Stations for such period, subject to normal
year-end adjustments.
4.10 Organization and Standing. Seller is a corporation duly organized,
validly existing and in good standing under the laws of the State of Delaware,
is qualified to do business in Delaware and at Closing will be qualified to do
business in Kentucky. Seller has full power and authority to carry on its
business and to conduct the operations of the Stations and to enter into and
perform this Agreement.
4.11 Authorization. Seller's execution, delivery and performance of this
Agreement and the consummation of the transactions contemplated hereby have
been duly authorized by all necessary corporate action on Seller's part.
4.12 Binding Agreement. This Agreement has been duly executed and
delivered by Seller to Buyer and constitutes the valid and binding agreement
of Seller, enforceable against Seller in accordance with its terms, except as
the enforceability of this Agreement may be affected by bankruptcy, insolvency
or similar laws affecting creditors' rights generally and by judicial
discretion in the enforcement of equitable remedies.
4.13 Insolvency Proceedings. Neither Seller nor the Assets are the
subject of any pending or, to Seller's knowledge, threatened insolvency
proceedings, including without limitation any bankruptcy, receivership,
reorganization, composition or arrangement with creditors, voluntary or
involuntary. Seller has not made an assignment for the benefit of creditors or
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taken any action with a view to or that would constitute a valid basis for the
institution of any such insolvency proceedings.
4.14 Absence of Conflicting Agreements. Subject to obtaining the consents
required under Section 9.4 and the regulatory approvals provided under Section
9.7, the execution, delivery and performance of this Agreement by Seller (a)
to the best of Seller's knowledge, does not require the consent of any third
party, (b) does not and shall not conflict with, result in a breach of, or
constitute a default under any law, judgment, order, ordinance, decree, rule,
regulation, or ruling of any court or governmental instrumentality which is
applicable to Seller, (c) does not and shall not conflict with, constitute
grounds for termination of, result in a breach of, constitute a default order,
or accelerate or permit the acceleration of any performance required by any
contract, agreement, instrument, license or permit to which Seller is a party
or by which Seller may be bound and which relates specifically to the Assets,
and (d) does not and shall not create any claim, liability, mortgage, lien,
pledge, condition, charge or encumbrance of any nature whatsoever on the
Assets.
4.15 Other Buyers. No other person has any prior right under any oral or
written agreement or understanding to purchase the Stations or any or all of
the Assets from Seller.
4.16 Insurance. Seller shall maintain policies of fire, casualty,
liability and other forms of insurance in such amounts and against such risks
and losses as is comparable to the policies Seller maintains for its other
properties of this type.
4.17 Personnel. At Closing, Seller shall have complied in all material
respects with all applicable statutes, regulations and orders relating to
employment, wages, hours, equal employment opportunity, collective bargaining,
pension and welfare plans, and the payment of social security, unemployment,
disability and similar taxes. To Seller's best knowledge, Prism is not liable
for or in arrears with respect to any of such taxes. Neither Prism nor Seller
is a party to any collective bargaining agreement covering any employees at
the Stations.
4.18 Trade or Barter. Schedule 4.18, to be provided at Closing, sets
forth all of the trade and barter agreements then in effect that relate to the
business or operation of the Stations.
4.19 Prism Representations. To the best of Seller's knowledge, the
representations and warranties which Prism has given Seller in the Prism Asset
Purchase Agreement are truthful, and Seller shall provide Buyer with the
benefit of the representations which Prism has given Seller in that agreement.
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5 BUYER'S REPRESENTATIONS AND WARRANTIES. Buyer represents and warrants
to Seller that:
5.1 Organization and Standing. Clear Channel is a Nevada corporation duly
organized, validly existing and in good standing under the laws of the State
of Nevada, and Clear Channel Licenses is a Nevada corporation duly organized,
validly existing and in good standing under the laws of the State of Nevada.
Each of those corporations is qualified to do business in its state of
incorporation and in Kentucky. Buyer has full power and authority to enter
into and to perform this Agreement.
5.2 Authorization. The execution, delivery and performance of this
Agreement by Buyer and the consummation of the transactions contemplated
hereby have been duly authorized by all necessary action on Buyer's part.
5.3 Binding Agreement. This Agreement has been duly executed and
delivered to Seller and constitutes a valid and binding agreement of Buyer,
enforceable against Buyer in accordance with its terms, except as the
enforceability of this Agreement may be affected by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and by judicial discretion
in the enforcement of equitable remedies.
5.4 Absence of Conflicting Agreements. The execution, delivery and
performance of this Agreement by Buyer (a) does not require the consent of any
third party, (b) does not and shall not conflict with, result in a breach of,
or constitute a default under any law, judgment, order, ordinance, decree,
rule, regulation, or ruling of any court or governmental instrumentality which
applicable to Buyer, and (c) does not and shall not conflict with, constitute
grounds for termination of, result in a breach of, constitute a default order,
or accelerate or permit the acceleration of any performance required by any
contract, agreement, instrument, license or permit to which Buyer is a party
or by which Buyer may be bound.
5.5 Litigation. There is no action, suit, investigation or other
proceeding pending or, to Buyer's best knowledge, threatened before any court,
agency or governmental authority that could reasonably be expected to
adversely affect Buyer's ability to perform in accordance with the terms of
this Agreement, and Buyer is not aware of any facts which could reasonably be
expected to result in any such proceeding.
5.6 Licensee Qualifications. As of the date the Assignment Application is
filed with the FCC and as of the Closing Date, Buyer and/or Buyer's permitted
assignees (as provided in Section 16 hereof) shall be legally, financially and
otherwise qualified to be the assignee(s) of all of the FCC Licenses and the
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owner(s) and operator(s) of all the Stations under applicable
federal statutes and rules in effect on such dates, including, without
limitation, the Communications Act of 1934, as amended, and the rules,
regulations and policies of the FCC, including, without limitation, Section
73.3555 of the FCC's Rules pertaining to multiple ownership.
5.7 Ability to Perform. Buyer has the financial capacity to perform its
obligations hereunder.
6 COVENANTS OF SELLER. Seller covenants and agrees that, between the date
of this Agreement and the Closing Date, except as expressly permitted by this
Agreement or with the prior written consent of Buyer:
6.1 Maintenance of Business and Station Equipment. Seller and Prism shall
conduct the business of the Stations and use the Assets only in the ordinary
course of business, consistent with past practices. Seller and Prism shall
maintain all of the Station Equipment in a condition substantially the same as
exists on the date of this Agreement (ordinary wear and tear excepted). Seller
and Prism shall not other than in the ordinary course of business or after
receiving Buyer's prior written approval (i) sell or dispose of or commit to
sell or dispose of any of the Station Assets; (ii) grant or agree to grant any
general increases in the rates of salaries or compensation payable to
employees of the Stations; (iii) grant or agree to grant any specific bonus or
increase to any executive or management employee of the Stations; or (iv)
provide for any new pension, retirement or other employment benefits for
employees of the Stations or any increases in any existing benefits. Without
limiting the generality of the foregoing, Seller and Prism shall maintain the
independent identity of the Stations and their current formats and call signs;
use all reasonable efforts to retain the services of key employees at the
Stations; use all reasonable efforts to preserve its present relationships
with suppliers, advertisers, listeners and other persons having business
dealings with the Stations; continue its recent sales and promotional
practices; refrain from discounting receivables; maintain the books, accounts
and records relating to the business of the Stations in the usual, regular and
ordinary manner; perform all material obligations relating to the business of
the Stations; refrain from changing the Stations's frequency except to the
extent required by the rules and regulations of the FCC; and refrain from any
material changes in the broadcast hours or in the percentage or types of
programming broadcast by the Stations, except such changes as in the good
faith judgment of Seller are required by the public interest.
6.2 Agreements. Seller may enter into or renew any contract, agreement,
commitment or other understanding or arrangement in the ordinary course of
business, provided, however, that except with respect to contracts for the
sale of time for cash and except for trade agreements, the liability under any
such contract to be assumed by Buyer at Closing shall not exceed
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Twenty Thousand Dollars ($20,000), without the prior written approval
of the Buyer, which approval shall not be unreasonably withheld, and further
provided that Seller shall not enter into any new national rep agreement or
renew any existing national rep agreement prior to Closing. At least five (5)
days prior to the Closing Date, Seller shall provide Buyer with a list of all
Contracts entered into between the date hereof and the Closing Date of the
type to be included in the Assumed Contracts pursuant to Section 1.3, together
with true and correct copies of all such Contracts.
6.3 Promotion of Business. Seller and Prism shall spend not less than one
hundred percent (100%) of the cash promotions, advertising and research
expenditures budgeted for the Stations in aggregate for the period from the
date of this Agreement through the Closing Date.
6.4 Compliance With Laws. Seller and Prism shall operate the Stations in
all material respects in accordance with FCC Rules and Regulations and the
Station Licenses and with all other laws, regulations, rules and orders, and
shall not cause or permit by any act, or failure to act, any of the Station
Licenses to expire, be surrendered, adversely modified, or otherwise
terminated, or the FCC to institute any proceedings for the suspension,
revocation or adverse modification of any of the Station Licenses, or fail to
prosecute with due diligence any pending applications to the FCC.
6.5 Administrative Violations. If Seller receives an administrative or
other order relating to any violation of the FCC Rules, or of any other
federal, state or local regulatory or administrative body, it shall promptly
notify Buyer in writing of such order, including a copy thereof, and use its
reasonable efforts to remove or correct such violations.
6.6 Liens. Seller shall not create, assume or permit to exist any Lien
upon any of the Assets, except for those listed on Schedule 4.3 which shall be
removed at or prior to Closing.
6.7 Insurance. Seller shall maintain insurance policies on the Stations
and the Assets. 6.8 Consents. Seller shall use its reasonable efforts to
obtain the valid and binding consents of third parties necessary for the
assignment of the Assumed Contracts to Buyer as required under Section 9.4.
6.9 Reasonable Efforts/Cooperation. Seller shall use its reasonable
efforts and cooperate with Buyer in good faith to the extent reasonably
required to satisfy fully all of Seller's obligations hereunder and to
accomplish the transactions contemplated by this Agreement in an expeditious
fashion. Seller shall take no action or fail to take any action within its
reasonable control the effect
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of which would be to hinder or delay the consummation of the transactions
contemplated by this Agreement or interfere with the performance of Buyer's
obligations hereunder.
6.10 Trade Agreements. Seller shall use its reasonable efforts to
complete all obligations owing by Seller under trade agreements prior to the
Closing.
6.11 Sales Reports. Seller shall provide Buyer with sales reports for the
Stations on a weekly basis during the term of this Agreement. Additionally,
within twenty-five (25) days of the end of each month, Seller shall deliver to
Buyer an unaudited statement of revenue and expenses of the Stations for the
month then ended. The weekly sales reports and the monthly statements of
revenue and expenses shall be true and complete to the best of Seller's
knowledge and shall fairly and accurately represent the results of operation
of the Stations for the period covered by such reports and statements. Seller
shall also furnish to Buyer any and all other information at such times as
such information is customarily prepared by Seller concerning the financial
condition of the Station as Buyer may reasonably request.
6.12 Access. At the reasonable request of and upon reasonable notice from
Buyer, prior to the Closing Seller shall cause to be given to Buyer and
Buyer's representatives full and reasonable access during normal business
hours to all of Seller's properties, books, contracts, reports and records,
including financial information, in each case relating to the Stations, in
order that Buyer may have full opportunity to make such investigation as it
desires of the Stations, and Seller shall furnish Buyer with such information
as Buyer may reasonably request in connection therewith. The rights of Buyer
under this paragraph shall not be exercised by Buyer in such a manner as to
interfere unreasonably with the business or operation of the Stations.
6.13 Changes in Representations and Warranties. Seller shall provide
Buyer prompt written notice of any change in any of the information contained
in the representations and warranties made in Section 4 hereof.
6.14 Notification. Seller shall notify Buyer of any material litigation,
arbitration or administrative proceeding pending or, to its knowledge,
threatened against Seller which challenges the transactions contemplated
hereby.
6.15 Environmental Audit. Buyer may cause a Phase I environmental audit
of the Real Property to be conducted by the company that last conducted the
audit of such Real Property. All costs of such audit shall be paid by Buyer.
If the environmental audit discloses the presence of a hazardous
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substance on the Real Property, Seller is obligated to pay the first Seventy
Thousand Dollars ($70,000) of costs with respect to removal of such hazardous
substance. If such costs will exceed $70,000, Buyer may elect, by written
notice to Seller given within five (5) business days after receipt by Buyer of
information indicating that such costs will exceed $70,000, to terminate this
Agreement pursuant to Section 13 hereof unless Seller elects, in its sole
discretion and by written notice to Buyer given within five (5) business days
after receipt of Buyer's notice, to remove such hazardous substance at
Seller's expense.
6.16 Delivery of Financial Statements and Audit. Seller shall furnish
Buyer with copies of the audited financial statements for the Stations for the
year ended December 31, 1995 within seven (7) days after the date on which the
audit report is delivered to Seller by Prism's auditors; however, such
statements need not be furnished if Prism's audit report does not segregate
financial information for the Stations. Buyer shall have the right at its
expense to have its auditors review the Stations' quarterly financial
statements for GAAP compliance for any quarterly period ending prior to
Closing, and Seller agrees to cooperate with Buyer and Buyer's auditor in the
conduct of such review; provided, however, that in no event shall such review
or procedures delay the Closing.
7 COVENANTS OF BUYER. Buyer covenants and agrees that, between the date
of this Agreement and the Closing Date, except as expressly permitted by this
Agreement or with the prior written consent of Seller, it shall act in
accordance with the following:
7.1 Administrative Violations. If Buyer (and/or Buyer's permitted
assignees) receives an administrative or other order relating to Buyer's
(and/or Buyer's permitted assignees) ability to be the assignee of the Station
Licenses, it shall promptly notify Seller in writing of such order, including
a copy thereof, and use its reasonable efforts to remove or correct such
violations.
7.2 Reasonable Efforts/Cooperation. Buyer shall use its reasonable
efforts and cooperate with the Seller in good faith to the extent reasonably
required to satisfy fully all of Buyer's obligations hereunder and to
accomplish the transactions contemplated by this Agreement in an expeditious
fashion. Buyer shall take no action or fail to take any action within its
reasonable control the effect of which would be to hinder or delay the
consummation of the transactions contemplated by this Agreement or interfere
with the performance of Seller's obligations hereunder.
7.3 Changes In Representations And Warranties. Buyer shall provide Seller
prompt written notice of any change in any of the information contained in the
representations and warranties made in Section 5 hereof.
7.4 Notification. Buyer shall notify Seller of any material litigation,
arbitration or administrative proceeding pending or, to its knowledge,
threatened against Buyer which challenges the transactions contemplated
hereby.
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8. REGULATORY APPROVALS.
8.1 Application for FCC Consent. Within five (5) days from the date
hereof, Seller and Buyer (and/or Buyer's permitted assignees) shall file an
application with the FCC requesting its written consent to the assignment from
Seller to Buyer (and/or Buyer's permitted assignees) of the Station Licenses
and the Station Applications (the "Assignment Application"). The parties shall
diligently take all steps necessary or desirable and proper to prosecute the
Assignment Application expeditiously and to obtain the FCC's determination
that grant of the Assignment Application shall serve the public interest,
convenience and necessity (the "FCC Consent"). The failure by either party to
diligently prosecute the Assignment Application, or the taking of any action
by either party that reasonably could be expected to delay grant of the FCC
Consent, shall be deemed a material breach of this Agreement.
8.2 Control of Stations. Between the date of this Agreement and the
Closing Date, Buyer shall not directly or indirectly control, supervise or
direct, or attempt to control, supervise or direct, the operation of the
Stations. Such operation shall remain the sole responsibility of Seller and
Prism.
8.3 Other Notifications. Should any fact which would cause any
governmental regulatory agency to deny its consent to the transactions
contemplated by this Agreement come to either party's attention, such party
shall promptly notify the other party thereof and shall use its reasonable
efforts to take such steps as may be necessary to remove any such impediment
to the transactions contemplated by this Agreement.
9. CONDITIONS TO BUYER'S OBLIGATION. The obligation of Buyer to consummate
the transaction contemplated by this Agreement is subject to the satisfaction
(or written waiver by Buyer) of each of the following conditions on or prior
to the Closing Date:
9.1 Representations and Warranties; No Material Adverse Change. The
representations and warranties of Seller to Buyer contained herein shall be
true and correct in all material respects as of the Closing Date as ifmade on
and as of the Closing Date. No material adverse change shall have occurred
which impairs the operation of the Stations.
9.2 Compliance with Covenants. All of the covenants to be complied with
or performed by Seller on or prior to the Closing Date shall have been duly
complied with and performed in all material respects.
9.3 Closing Documents. Seller shall deliver to Buyer duly executed
closing documents as specified in Section 12.1, all of which shall be
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dated as of the Closing Date and shall be in a form reasonably satisfactory to
Buyer.
9.4 Receipt of Third Party Consents. Seller shall have obtained all
required consents, waivers or approvals of third parties to Buyer's assumption
of the Assumed Contracts, or Seller shall have made alternative arrangements
reasonably acceptable to Buyer so as to ensure that Buyer shall enjoy all of
the rights and privileges of Seller under such Assumed Contracts on and after
the Closing Date.
9.5 Release of Liens. Seller shall have delivered to Buyer releases or
termination statements as to all Liens other than Permitted Liens.
9.6 No Adverse Proceedings. No suit, action, claim or governmental
proceedings shall be pending against, and no order, decree or judgment of any
court, agency or governmental authority shall have been rendered against any
party hereto which seeks to restrain or prohibit the transactions contemplated
by this Agreement or would render it unlawful, as of the Closing Date, to
effect the transactions contemplated by this Agreement in accordance with its
terms, or which would impair the ability of Buyer to realize the benefits of
the transactions contemplated hereunder or which seeks damages in connection
with the transactions contemplated hereby.
9.7 Regulatory Consents. Subject to the provisions of Section 11.1
hereof, the FCC Consent shall have been granted.
9.8 Opinion of Seller's Counsel. Seller shall have delivered to Buyer an
opinion from Seller's counsel, dated as of the Closing Date, containing the
points set forth in Exhibit A.
9.9 Prism Acquisition. Seller shall have acquired the Stations pursuant
to the consummations of the transactions contemplated by the Prism Asset
Purchase Agreement.
10. CONDITIONS TO SELLERS' OBLIGATION. The obligation
of Seller to consummate the transaction contemplated by this Agreement is
subject to the satisfaction (or written waiver by Seller) of each of the
following conditions on or prior to the Closing Date:
10.1 Representations and Warranties. The representations and warranties
of Buyer to Seller contained herein shall be true and correct in all material
respects as of the Closing Date as if made on and as of the Closing Date
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.
10.2 Compliance with Covenants. All of the covenants to be complied with
or performed by Buyer on or before the Closing Date shall have been duly
complied with and performed in all material respects.
10.3 Closing Documents. Buyer shall deliver to Seller duly executed
closing documents as specified in Section 12.2, all of which shall be dated as
of the Closing Date and shall be in a form reasonably satisfactory to Seller.
10.4 Regulatory Consents. Subject to the provisions of Section 11.1
hereof, the FCC Consent shall have been granted.
10.5 Payment. Buyer shall pay Seller the Purchase Price as provided in
Section 3, subject to the provisions of Section 12.1.
10.6 Prism Acquisition. Seller shall have acquired the Stations pursuant
to the consummation of the transactions contemplated by the Prism Asset
Purchase Agreement.
11. CLOSING.
11.1 Closing Date; Closing Place. The closing of the purchase and sale of
the Assets contemplated hereunder (the "Closing") shall take place on a date
mutually agreed upon by the parties but in no event later than five (5) days
after the FCC Consent is granted (such date shall be the "Closing Date"). The
Closing shall commence at 10:00 a.m. on the Closing Date at such place as is
agreed upon by the parties (the "Closing Place"). Notwithstanding the
foregoing, if the FCC licenses for the Stations have not all been renewed by
order of the FCC as of the Closing Date for a full regular renewal term, then
Buyer may delay the Closing until five (5) days after those licenses have all
been so renewed.
11.2 Delivery of Closing Documents. On the Closing Date at the Closing
Place, Seller shall deliver to Buyer the closing documents listed in
Section 12.1 ("Seller's Closing Documents"), and Buyer shall deliver to Seller
the closing documents listed in Section 12.2 ("Buyer's Closing Documents").
12. CLOSING DOCUMENTS.
12.1 Closing Documents To Be Delivered By Seller. On the Closing Date at
the Closing Place, Seller shall deliver to Buyer:
(a) One or more assignments transferring to Clear Channel Licenses
the Station Licenses;
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(b) One or more bills of sale conveying to Clear Channel all of the
Station Equipment;
(c) One or more assignments assigning the Assumed Contracts to Clear
Channel;
(d) One or more assignments conveying to Clear Channel the
Intangible Property and Business Records;
(e) One or more general warranty deeds conveying to Clear Channel
the Seller's interest in the owned Real Property and one or more
assignments assigning the leases to the leased Real Property to the
Buyer;
(f) A certificate executed by a duly authorized officer of Seller
certifying as to satisfaction of the conditions set forth in Sections 9.1
and 9.2; and
(g) An opinion of Seller's corporate counsel relating to matters set
forth in Exhibit A.
12.2 Closing Documents To Be Delivered By Buyer. On the Closing Date at
the Closing Place, Buyer shall deliver to Seller:
(a) One or more agreements by which Buyer assumes the Assumed
Liabilities and agrees to perform, from and after the Closing Date, all
of the Assumed Liabilities;
(b) The Purchase Price, subject to the provisions of Section 11.1;
(c) A certificate executed by Buyer's Chief Executive Officer,
certifying as to satisfaction of the conditions set forth in Sections
10.1 and 10.2; and
12.3 Other Closing Documents and Acts. The parties shall also execute
such other documents and perform such other acts, before and after Closing, as
may be necessary for the implementation and consummation of this Agreement.
13. TERMINATION.
13.1 Absence of FCC Consent. If the FCC Consent has not been granted with
respect to both of the Stations within nine (9) months after the date the
Assignment Application is filed, this Agreement and the transactions
contemplated hereby may be terminated at the option of either party upon
written
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notice to the other; provided, however, that neither party may terminate this
Agreement pursuant to this Section 13.1 (a) in the event of an Event of
Default by such party (as defined below), or (b) if a delay in any decision or
determination by the FCC with respect to the Assignment Application has been
caused or materially contributed to by (i) any failure on the part of such
party to furnish, file or make available information within its control, (ii)
the willful furnishing by such party of incorrect, inaccurate or incomplete
information, or (iii) any action taken by such party for the purpose of
delaying any decision or determination by the FCC respecting the Assignment
Application.
13.2 Events of Default. This Agreement and the transactions contemplated
by this Agreement may be terminated by either party at any time prior to the
Closing upon expiration of the "Cure Period" (as defined below) if the other
party breaches this Agreement in any material respect and fails to cure such
breach within the Cure Period (such uncured breach being referred to herein as
an "Event of Default" by such party). An Event of Default shall not be deemed
to have occurred until ten (10) business days after the non-defaulting party
has provided the other party with written notice specifying the event or
events that if not cured would constitute an Event of Default and specifying
the actions necessary to cure within such ten (10) day period (the "Cure
Period"), and such cure has not been effected within such Cure Period;
provided that, if the claimed default cannot be cured within such ten (10) day
period but the party claimed to be in default has commenced to cure the
default within such ten (10) day period and thereafter diligently continues to
attempt to cure the default, then the Cure Period shall be extended for such
time (not to exceed sixty (60) days) as is reasonably necessary to cure the
default. In the event of an Event of Default by one of the parties, or if a
delay in any decision or determination by the FCC with respect to the
Assignment Application has been caused or materially contributed to by any
failure on the part of such party to furnish, file or to make available
information within its control or by the willful furnishing by such party of
incorrect, inaccurate or incomplete information or by any such action taken by
such party for the purposes of delaying any decision or determination
respecting the Assignment Application, such party shall not be entitled to
terminate this Agreement.
13.3 Damage or Loss.
(a) The risk of loss or damage to the Assets shall be upon Seller at
all times prior to the completion of the Closing. In the event of such
loss or damage Seller shall promptly notify Buyer and shall use its
reasonable efforts to repair, replace or restore the lost or damaged
Assets to their former condition as soon as possible. If material damage
has occurred that precludes the operation of the Stations within the
terms of the Station Licenses and the FCC Rules, and the Assets have not
been repaired or restored prior to the Closing Date, Buyer may, at its
option:
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(i) elect to consummate the Closing and accept the Stations "as
is," in which event Seller shall pay over to Buyer any proceeds of
insurance received by Seller and attributable to damage to the
Stations or the Assets and thereafter Seller shall have no further
obligation to repair, replace or restore the damaged property; or
(ii) elect to postpone the Closing Date for a period of up to
sixty (60) days, with prior consent of the FCC if necessary (which
the parties shall use their reasonable efforts to obtain), to permit
Seller to make such repair, replacement or restoration as is
required to restore the lost or damaged property to the equivalent
of its former condition in all material respects. If Seller cannot
complete such repair, replacement or restoration within such sixty
(60) day extension period, Buyer may terminate this Agreement by
giving written notice to Seller and the parties shall be released
and discharged from any further obligation hereunder. If the parties
disagree whether the property has been adequately repaired, replaced
or restored, or whether the Stations can be operated within the
terms of the Station Licenses, the matter shall be referred to a
mutually-acceptable qualified consulting communications engineer,
who shall be a member of the Association of Federal Communications
Consulting Engineers, whose decision shall be final, and whose fees
and expenses shall be shared equally by Buyer and Seller.
(b) Notwithstanding the foregoing, if any event occurs which
prevents broadcast transmissions or other operation of the Stations in a
normal and usual manner in accordance with the terms of the Station
Licenses and the FCC Rules for a period of more than five (5) consecutive
days, then Buyer shall have the right to terminate this Agreement at any
time within fifteen (15) days after Buyer becomes aware of such event
without further liability hereunder, or Buyer may proceed in the manner
set forth in Section 13.3(a); otherwise, Buyer shall remain fully
obligated to consummate the transactions contemplated hereunder (except
to the extent Seller has failed to fulfill its obligations hereunder).
13.4 Effect of Termination. Upon termination of this Agreement, the
parties shall be released and discharged from any further obligation hereunder
(except for the indemnification requirements of Section 14 and the
confidentiality requirements of Section 17); provided, however, that
termination of this Agreement pursuant to Section 13.1 or 13.2 shall not
relieve either party of any liability for such party's breach of this
Agreement prior to the date of termination. In the event that termination of
this Agreement is attributable to an Event of Default by Buyer, the liquidated
damages provided for below shall be paid to Seller and such payment shall
conclusively demonstrate that Seller has elected as its sole remedy the
termination of the Agreement and the recovery of the liquidated damages, it
being agreed that in light of the nature of the Assets, damages are impossible
to calculate with any precision. In such event, Buyer
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shall pay to Seller as liquidated damages and not as a penalty an amount equal
to One Million Dollars ($1,000,000) ("Liquidated Damages"), payable by Buyer
within ten (10) business days after the date Seller notifies Buyer of the
termination of this Agreement by virtue of such default, by certified check or
by wire transfer of immediately available Federal funds to an account
designated by Seller.
14.INDEMNIFICATION; SURVIVAL.
14.1 Seller's Indemnities. Seller shall indemnify, defend by counsel
reasonably acceptable to Buyer, and hold harmless Buyer, its officers,
directors, affiliates, employees, agents, successors, and permitted assigns
(the "Buyer Indemnitees") from and against all demands, claims, actions, and
causes of action ("Claims") and assessments, losses, costs, damages,
liabilities, interest, penalties, court costs, and reasonable accounting,
consulting, engineering and attorneys' fees ("Losses") asserted against,
imposed upon or incurred by any of the Buyer Indemnitees, directly or
indirectly, resulting from or arising out of (i) the ownership or operation of
the Stations or the Assets prior to the Closing Date, (ii) the failure of
Seller to pay, perform or discharge any of Seller's obligations or liabilities
not expressly assumed by Buyer pursuant to this Agreement, or (iii) the breach
by Seller of any of its representations and warranties contained in Section 4
hereof.
14.2 Buyer's Indemnities. Buyer shall indemnify, defend by counsel
reasonably acceptable to Seller, and hold harmless Seller, its partners,
affiliates, employees, agents, successors and permitted assigns (the "Seller
Indemnitees") from and against all Claims and Losses asserted against, imposed
upon or incurred by any of the Seller Indemnitees, directly or indirectly,
resulting from or arising out of (i) the ownership or operation of the
Stations or the Assets by Buyer from and after the Closing Date, (ii) the
failure of Buyer to pay, perform or discharge any of Buyer's obligations,
including any obligations expressly assumed by Buyer pursuant to this
Agreement, or (iii) the breach by Buyer of any of its representations and
warranties contained in Section 5 hereof.
14.3 Limitation. Notwithstanding the foregoing, (i) each party shall be
liable for Losses incurred as a result of any breach, failure or inaccuracy of
any representation, warranty, covenant or agreement made by it herein only if
the aggregate of such Losses exceeds $70,000; provided, however, that the
$70,000 limitation shall not apply if such $70,000 threshold is exceeded, and
(ii) the aggregate liability of Seller for Losses incurred as a result of any
breach, failure or inaccuracy of any representation, warranty, covenant or
agreement made by Seller herein shall not exceed Eight Hundred Fifty Thousand
Dollars ($850,000).
14.4 Notice and Opportunity to Defend.
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(a) As soon as is reasonably practicable after any Seller Indemnitee
or any Buyer Indemnitee becomes aware of any Claim or Loss with respect
to which it is entitled to indemnification under Sections 14.1 or 14.2
hereof, such Seller Indemnitee or Buyer Indemnitee, as the case may be
(the "Indemnified Party"), shall give written notice thereof (a "Claims
Notice") to the party from which indemnity is claimed (the "Indemnifying
Party"). A Claims to the extent feasible) of the Claim or Loss that has
been or may be suffered by the Indemnified Party. Prior to delivering any
Claims Notice, the Indemnified Party shall take all reasonable means
necessary to preserve its defenses and rights regarding such Claim or
Loss. The failure of any Indemnified Party to promptly give any
Indemnifying Party a Claims Notice shall not preclude such Indemnified
Party from obtaining indemnification under this Section 14, except to the
extent that such Indemnified Party's failure has materially prejudiced
the Indemnifying Party's rights or materially increased its liabilities
and obligations hereunder.
(b) With respect to any Claim or Loss that involves legal
proceedings ("Legal Claims"), the Indemnifying Party shall have the right
by written notice to the Indemnified Party not later than thirty (30)
days after receipt of a Claims Notice to assume the control of the
defense, compromise or settlement of such Legal Claim, provided that such
assumption shall, by its terms, be without cost to the Indemnified Party.
(c) Upon the assumption of control by the Indemnifying Party as
provided in Section 14.4(b), the Indemnifying Party shall, at its
expense, diligently proceed with the defense, compromise or settlement of
the Legal Claim at Indemnifying Party's sole expense, including
employment of counsel reasonably satisfactory to the Indemnified Party
and, in connection therewith, the Indemnified Party shall cooperate
fully, but at the expense of the Indemnifying Party, to make available to
the Indemnifying Party all pertinent information and witnesses under the
Indemnified Party's control, and take such other steps as in the opinion
of counsel for the Indemnifying Party are necessary to enable the
Indemnifying Party to conduct such defense.
(d) The final determination of any Legal Claim, including all
related costs and expenses, shall be binding and conclusive upon
Indemnifying Party and Indemnified Party; provided, however, that in the
Indemnifying Party's defense of such Legal Claim, except with the written
consent of the Indemnified Party, the Indemnifying Party shall not
consent to entry of any judgment or enter into any settlement, which does
not include as an unconditional term thereof the provision by the
claimant to the Indemnified Party of a release from all liability in
respect of such Legal Claim.
(e) Should the Indemnifying Party fail to give notice to the
Indemnified Party as provided in Section 14.4(b), the Indemnified Party
shall be entitled, at the Indemnifying Party's expense, to defend, settle
or
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compromise the Legal Claim as in its sole discretion may appear advisable, and
such final determination, settlement or compromise of the Legal Claim shall be
binding upon the Indemnifying Party.
14.5 Survival. The representations and warranties of Seller and Buyer
pursuant to Sections 4 and 5 hereof, respectively, shall continue in force for
a period of four (4) months following the Closing Date, after which time the
indemnification obligations of Seller and Buyer under Sections 14.1(iii) and
14.2(iii), respectively, shall be limited to claims asserted during such four
(4) month period. The indemnification obligations of Seller and Buyer pursuant
to Sections 14.1(i) and (ii) and 14.2(i) and (ii), respectively, shall
continue in force for a period of eighteen (18) months following the Closing
Date, after which time the parties' obligations to make payments hereunder
shall be limited to the payment of claims asserted during such eighteen (18)
month period; provided, however, that the foregoing time limitation shall not
apply to any taxes attributable to the ownership or operation of the Stations
prior to the Closing Date and to the obligations and liabilities of Buyer
arising under any Assumed Contracts having a term extending beyond such
eighteen (18) month period.
14.6 Arbitration of Disputes. In the event the parties are unable to
resolve a dispute regarding the amount of a Claim or whether a Claim is
covered by this Section 14, or if any other dispute arises with respect to
this Agreement, except as otherwise provided herein, such dispute shall be
decided by arbitration. Arbitration shall be initiated by either party giving
written notice to arbitrate to the other party, stating the question to be
arbitrated and the name of the arbitrator selected by that party. Within ten
(10) days of the date of said notice, the other party shall select and give
written notice of its arbitrator to the initiating party. The two arbitrators
so selected shall select a third arbitrator and give written notice thereof to
the parties within five (5) days after the second arbitrator is chosen. The
arbitration shall be conducted solely by the third arbitrator, who shall hear
evidence and make an award within twenty (20) days after the notice of
selection of the third arbitrator is given to the parties, which award, when
signed by the third arbitrator, shall be final. If either party shallrefuse or
neglect to appoint an arbitrator within ten (10) days after the other shall
have appointed an arbitrator and given written notice to arbitrate to the
other, requiring such party to appoint an arbitrator, then the arbitrator so
appointed by the first party shall have power to proceed to arbitrate and
determine the matters of disagreement as if he were an arbitrator appointed by
both the parties hereto for that purpose, and his award in writing signed by
him shall be final; provided, however, that such award shall be made within
fifteen (15) days after such refusal or neglect of the other party to appoint
an arbitrator. The party against which such award is made shall pay all costs
and expenses of the arbitration.
15. TRANSFER TAXES, FEES AND EXPENSES
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15.1 Transfer Taxes and Similar Charges. All costs of transferring the
Assets from Seller to Buyer in accordance with this Agreement, including all
costs of recordation, documentary filing and transfer fees, and any stamp,
sales, excise, use and transfer taxes, shall be paid one-half by Seller and
one-half by Buyer.
15.2 FCC Filing and Grant Fees. Any filing or grant fees for the
Assignment Application shall be paid one-half by Seller and one-half by Buyer.
15.3 Expenses. Except as set forth above in this Section 15, each party
shall be solely responsible for all costs and expenses, including legal fees
and related costs, incurred by it in connection with the negotiation,
preparation and performance of and compliance with the terms of this Agreement
(including the preparation of the Assignment Application).
16. ASSIGNABILITY. This Agreement may not be assigned by either party
without the prior written consent of the other party. Notwithstanding the
foregoing, Buyer shall have the right to assign certain of its rights
hereunder to assignees who, to the reasonable satisfaction of Seller, meet the
qualifications specified in Section 5.6 hereof, provided that such assignment
must be made prior to the filing of the Assignment Application with the FCC,
and further provided that Buyer shall remain liable for all of its obligations
hereunder.
17. CONFIDENTIALITY. The existence and terms of this Agreement shall be
kept confidential by both parties prior to the filing of the Assignment
Application with the FCC. Except as necessary for the consummation of the
transactions contemplated hereunder, Buyer and Seller shall keep confidential
all information obtained by them with respect to the other party in connection
with this Agreement and the transactions contemplated hereunder, and if the
transactions contemplated hereunder are not consummated for any reason, each
shall return to the other, without retaining a copy thereof, or destroy any
confidential schedules, documents or other written informationobtained from
the other in connection with this Agreement and the transactions contemplated
hereunder and any work papers, notes, memoranda or other internally generated
documentation that memorializes information provided by the other party,
except where such information is generally known or readily available through
other lawful sources or where such party is advised by counsel in writing that
its disclosure is required in accordance with the law. Buyer and Seller agree
to provide access to information obtained by them with respect to the other
party only to those responsible officers, employees or agents who are directly
involved in the transactions contemplated by this Agreement. Because the
breach or threatened breach of the covenants contained in this Section 17
would result in irreparable injury to the non-breaching party for which such
party shall not have an adequate remedy at law, the non-breaching party shall
be entitled to equitable remedies, including a decree of specific performance
and temporary and
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permanent injunctive relief, to enforce this Section 17, as well as any
and all other remedies to which such party may be entitled pursuant to this
Agreement.
18. COVENANT NOT TO SOLICIT PERSONNEL. For a period commencing on the
date hereof and ending one (1) year following the Closing Date, Seller shall
not in any manner whatsoever (i) induce or attempt to induce any person
employed in providing services for the Stations to terminate his or her
employment at the Stations, (ii) solicit any such employee for employment by
Seller or (iii) hire any person who within the preceding one (1) year was
employed (by Buyer or Seller) in providing services for the Stations.
19. COVENANT NOT TO COMPETE. For a one (1) year period commencing on the
Closing Date, Seller shall not directly or indirectly engage in, whether as an
owner, operator, partner, consultant, advisor or otherwise, or assist any
other person or entity in engaging in, the radio broadcasting business within
a 75-mile radius of any of the Stations.
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20. NOTICES. All necessary notices required to be given under this
Agreement shall be in writing addressed as follows:
If to Seller, to:
SFX Acquisition Corporation
150 East 58th Street-19th Floor
New York, New York 10155
Attn: Robert F.X. Sillerman
Executive Chairman
with a copy to:
SFX Acquisition Corporation
150 East 58th Street-19th Floor
New York, New York 10155
Attn: Richard A. Liese
Vice President and Assistant Secretary
If to Buyer, to:
Clear Channel Radio, Inc.
200 Concord Plaza, Suite 600
San Antonio, Texas 78216
Attn: Randall Mays
with a copy to:
Lawrence M. Miller, Esq.
Schwartz, Woods & Miller
Suite 300, The Dupont Circle Building
1350 Connecticut Avenue, N.W.
Washington, D.C. 20036
Notices shall be deemed given three (3) business days after being mailed by
certified mail, return receipt requested, or on the first business day after
being sent, prepaid, by nationally recognized overnight courier which requires
a return receipt. Any party may change the address to which notices under this
Agreement are to be sent to it by giving written notice of a change of address
in the manner provided in this Agreement for giving notice.
21. ENTIRE AGREEMENT. This Agreement supersedes all prior agreements
between the parties and contains all of the terms agreed upon with respect to
the subject matter hereof. This Agreement may not be altered or
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amended except by an instrument in writing signed by the party against whom
enforcement of any such change is sought.
22. COUNTERPARTS. This Agreement may be signed in any number of
counterparts with the same effect as if the signature on each such counterpart
were on the same instrument.
23. HEADINGS. The headings of the Sections of this Agreement are for
convenience only and in no way modify, interpret or construe the meaning of
specific provisions of the Agreement.
24. EXHIBITS. The Exhibit and Schedules to this Agreement are a material
part of this Agreement.
25. SEVERABILITY. In case any one or more of the provisions contained in
this Agreement should be held invalid, illegal or unenforceable in any
respect, the validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired.
26. CHOICE OF LAW. This Agreement is to be construed and governed by the
laws of the Commonwealth of Kentucky.
27. BROKER. The parties represent to each other that no broker, finder or
agent has been engaged in connection with this Agreement and the transactions
contemplated hereunder, and the parties agree to indemnify and hold each other
harmless against any claim from any broker, finder or agent based upon any
agreement, arrangement or understanding alleged to have been made by the
indemnifying party.
28. WAIVER. No waiver by any party of any of the provisions hereof shall
be effective unless explicitly set forth in writing and executed by the party
so waiving. The waiver by any party hereto of a breach of any provision of
this Agreement shall not operate of be construed as a waiver of any subsequent
breach.
29. ATTORNEY'S FEES. In the event of a dispute between the parties hereto
arising out of or related to this Agreement or the interpretation or
enforcement of this Agreement, the prevailing party shall be entitled to
recover reasonable attorney's fees, costs and expenses from the other party.
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IN WITNESS WHEREOF, the parties have executed this Agreement
as of the date first written above.
SFX ACQUISITION CORPORATION
By: /s/ Robert F.X. Sillerman
Title: Executive Chairman
CLEAR CHANNEL RADIO, INC.
By: /s/ Randall T. Mays
Title: Vice President
CLEAR CHANNEL RADIO LICENSES, INC.
By: /s/ Randall T. Mays
Title: Vice President
Guarantee:
SFX Broadcasting, Inc., a Delaware Corporation, hereby guarantees the
performance of Seller under this Asset Purchase Agreement.
SFX BROADCASTING, INC.
By: /s/Robert F.X. Sillerman
Robert F.X. Sillerman
Executive Chairman
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EXHIBIT A
Opinion of Seller's Counsel
1. Seller is a corporation duly formed, validly existing and in good
standing under the laws of the State of Delaware, and is qualified to
do business in the States of Delaware and Kentucky.
2. Seller has full power and authority under Delaware law to enter into
and to perform its obligations under the Asset Purchase Agreement.
3. The execution, delivery and performance of the Asset Purchase
Agreement by Seller and the consummation by Seller of the
transactions contemplated thereby have been duly authorized by all
necessary partnership action on Seller's part.
4. The Asset Purchase Agreement has been duly executed and delivered by
Seller and constitutes a valid and binding agreement of Seller,
enforceable against Seller in accordance with its terms.
5. The execution and delivery of the Asset Purchase Agreement by Seller
and the purchase of the Stations by Seller pursuant to the Asset
Purchase Agreement do not: (i) to our best knowledge, violate any
United States federal or Delaware statute, rule or regulation
applicable to Seller, (ii) violate the provisions of Seller's
governing documents, or (iii) to our best knowledge, require any
consents, approvals, authorizations, registrations, declarations or
filings by Seller under any United States federal or Delaware
statute, rule or regulation applicable to Seller, except for the FCC
Consent.
[Usual exceptions shall apply to opinion.]
[Such counsel shall not opine as to FCC matters.]
ASSET PURCHASE AGREEMENT
Between
SFX BROADCASTING, INC.
and
REGENT BROADCASTING OF LOUISVILLE, INC.
May 13, 1996
<PAGE>
TABLE OF CONTENTS
Page
1. ASSETS TO BE CONVEYED................................................... 1
1.1 Station Licenses................................................... 2
1.2 Station Property and Equipment..................................... 2
1.3 Contracts.......................................................... 2
1.4 Real Property...................................................... 2
1.5 Records............................................................ 3
1.6 Intangibles........................................................ 3
1.7 Accounts Receivable................................................. 3
2. EXCLUDED ASSETS; ASSUMED LIABILITIES.................................... 3
2.1 Excluded Assets.................................................... 3
2.2 Assumed Liabilities................................................ 4
3. PURCHASE PRICE.......................................................... 4
3.1 Purchase Price..................................................... 4
3.2 Method of Payment.................................................. 4
3.3 Adjustments and Prorations......................................... 4
3.4 Allocation of Purchase Price....................................... 5
4. SELLER'S REPRESENTATIONS AND WARRANTIES................................. 5
4.1 Station Licenses................................................... 5
4.2 Compliance With Laws............................................... 5
4.3 Title to Assets.................................................... 6
4.4 Condition of Station Equipment..................................... 6
4.5 Real Property...................................................... 6
4.6 Contracts.......................................................... 7
4.7 Intangible Property Rights......................................... 7
4.8 Litigation......................................................... 7
4.9 Financial Statements............................................... 8
4.10 Organization and Standing.......................................... 8
4.11 Authorization...................................................... 8
4.12 Binding Agreement.................................................. 8
4.13 Insolvency Proceedings............................................. 8
4.14 Absence of Conflicting Agreements.................................. 9
4.15 Other Buyers....................................................... 9
4.16 Insurance.......................................................... 9
4.17 Personnel.......................................................... 9
4.18 Trade or Barter.................................................... 9
4.19 Prism Representations.............................................. 9
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5. BUYER'S REPRESENTATIONS AND WARRANTIES.................................. 9
5.1 Organization and Standing.......................................... 9
5.2 Authorization...................................................... 10
5.3 Binding Agreement.................................................. 10
5.4 Absence of Conflicting Agreements.................................. 10
5.5 Litigation......................................................... 10
5.6 Licensee Qualifications............................................ 10
5.7 Ability to Perform................................................. 10
6. COVENANTS OF SELLER..................................................... 11
6.1 Maintenance of Business and Station Equipment...................... 11
6.2 Agreements......................................................... 11
6.3 Promotion of Business.............................................. 12
6.4 Compliance With Laws............................................... 12
6.5 Administrative Violations.......................................... 12
6.6 Liens.............................................................. 12
6.7 Insurance.......................................................... 12
6.8 Consents........................................................... 12
6.9 Reasonable Efforts/Cooperation..................................... 12
6.10 Trade Agreements .................................................. 13
6.11 Sales Reports...................................................... 13
6.12 Access............................................................. 13
6.13 Changes in Representations and Warranties.......................... 13
6.14 Notification....................................................... 13
6.15 Environmental Audit................................................ 13
6.16 Delivery of Financial Statements and Audit......................... 14
7. COVENANTS OF BUYER...................................................... 14
7.1 Administrative Violations.......................................... 14
7.2 Reasonable Efforts/Cooperation......................................14
7.3 Changes In Representations And Warranties.......................... 14
7.4 Notification....................................................... 14
8. REGULATORY APPROVALS.................................................... 15
8.1 Application for FCC Consent........................................ 15
8.2 Control of Station................................................. 15
8.3 Other Notifications................................................ 15
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9. CONDITIONS TO BUYER'S OBLIGATION....................................... 15
9.1 Representations and Warranties;No Material Adverse Change......... 15
9.2 Compliance with Covenants......................................... 15
9.3 Closing Documents................................................. 15
9.4 Receipt of Third Party Consents................................... 16
9.5 Release of Liens.................................................. 16
9.6 No Adverse Proceedings............................................ 16
9.7 Regulatory Consents............................................... 16
9.8 Opinion of Seller's Counsel....................................... 16
9.9 Prism Acquisition................................................. 16
10. CONDITIONS TO SELLERS' OBLIGATION....................................... 16
10.1 Representations and Warranties.................................... 16
10.2 Compliance with Covenants......................................... 17
10.3 Closing Documents................................................. 17
10.4 Regulatory Consents............................................... 17
10.5 Payment........................................................... 17
10.6 Prism Acquisition................................................. 17
11. CLOSING................................................................. 17
11.1 Closing Date; Closing Place....................................... 17
11.2 Delivery of Closing Documents..................................... 17
12. CLOSING DOCUMENTS....................................................... 17
12.1 Closing Documents To Be Delivered By Seller. ..................... 17
12.2 Closing Documents To Be Delivered By Buyer ....................... 18
12.3 Other Closing Documents and Acts.................................. 18
13. TERMINATION............................................................. 18
13.1 Absence of FCC Consent............................................. 18
13.2 Events of Default.................................................. 19
13.3 Damage or Loss..................................................... 19
13.4 Effect of Termination.............................................. 20
14. INDEMNIFICATION; SURVIVAL............................................... 21
14.1 Seller's Indemnities............................................... 21
14.2 Buyer's Indemnities................................................ 21
14.3 Limitation......................................................... 21
14.4 Notice and Opportunity to Defend................................... 22
14.5 Survival........................................................... 23
14.6 Arbitration of Disputes............................................ 23
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15. TRANSFER TAXES, FEES AND EXPENSES...................................... 24
15.1 Transfer Taxes and Similar Charges............................... 24
15.2FCC Filing and Grant Fees.......................................... 24
15.3Expenses........................................................... 24
16. ASSIGNABILITY.......................................................... 24
17. CONFIDENTIALITY........................................................ 24
18. COVENANT NOT TO SOLICIT PERSONNEL...................................... 25
19. COVENANT NOT TO COMPETE................................................ 25
20. NOTICES................................................................ 25
21. ENTIRE AGREEMENT....................................................... 26
22. COUNTERPARTS........................................................... 26
23. HEADINGS............................................................... 26
24. EXHIBITS............................................................... 26
25. SEVERABILITY........................................................... 26
26. CHOICE OF LAW.......................................................... 27
27. BROKER................................................................. 27
28. WAIVER................................................................. 27
29. ATTORNEY'S FEES........................................................ 27
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SCHEDULES
SCHEDULE 1.1.................................................................
Station Licenses and Station Applications
SCHEDULE 1.2.................................................................
Station Equipment
SCHEDULE 1.3.................................................................
Contracts to be Assumed
SCHEDULE 1.4.................................................................
Real Property
SCHEDULE 1.6.................................................................
Intangible Property
SCHEDULE 3.4.................................................................
Allocation
SCHEDULE 4.3.................................................................
Liens
SCHEDULE 4.8.................................................................
Litigation
SCHEDULE 4.9.................................................................
Financial Statements
SCHEDULE 4.18................................................................
Trade and Barter Agreements
EXHIBIT
A Opinion of Seller's Counsel
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ASSET PURCHASE AGREEMENT
THIS ASSET PURCHASE AGREEMENT (the "Agreement") is entered into as of
this 13th day of May, 1996, by and between SFX Acquisition Corporation, a
Delaware corporation ("Seller") and Regent Broadcasting of Louisville, Inc., a
Delaware corporation ("Buyer").
RECITALS:
WHEREAS, on February 9, 1996, Seller entered into an agreement (the
"Prism Asset Purchase Agreement") with Prism Radio Partners, L.P. ("Prism"),
pursuant to which Seller has agreed to acquire certain radio stations owned
and operated by Prism, including Station WVEZ-FM, Louisville, Kentucky (the
"Station"), pursuant to a license issued by the Federal Communications
Commission (the "FCC"); and
WHEREAS, upon closing of the Prism Asset Purchase Agreement, Seller
desires to sell and assign and Buyer desires to purchase those assets of
Seller used or useful in the operation of the Station, including the licenses
and other authorizations issued by the FCC for the operation of the Station;
and
WHEREAS, the parties recognize that the licenses and other
authorizations issued by the FCC for the operation of the Station may not be
assigned to Buyer without the prior consent of the FCC.
AGREEMENT
NOW, THEREFORE, in consideration of the foregoing, and of the mutual
promises and covenants set forth below, the parties hereby agree as follows:
1. ASSETS TO BE CONVEYED. Subject to the terms and
conditions of this Agreement, on the Closing Date (as defined below), Seller
shall assign, transfer and deliver to Buyer and Buyer shall purchase from
Seller all of the assets presently used in the operation of the Station (other
than Excluded Assets, as defined below), including, without limitation, the
following (the "Assets"):
1.1 Station Licenses. All licenses, permits, and other
authorizations issued by the FCC and other federal, state or local
governmental agencies or authorities for the operation of the Station listed
on Schedule 1.1,
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together with any additions thereto between the date hereof
and the Closing Date (the "Station Licenses"), and all applications for
modification, extension or renewal thereof pending as of the Closing Date
including without limitation those listed on Schedule 1.1 and those filed
between the date hereof and the Closing Date (the "Station Applications").
1.2 Station Property and Equipment. All fixed and tangible
personal property owned by Seller presently used in the operation of the
Station, including the property listed on Schedule 1.2, together with any
replacements, improvements and additions thereto made between the date hereof
and the Closing Date, less any retirements or dispositions thereof made
between the date hereof and the Closing Date in the ordinary course of
business (the "Station Equipment").
1.3 Contracts. All rights of Seller in, to and under (a) all
Contracts listed on Schedule 1.3 which are in existence on the Closing Date,
together with any renewals or extensions thereof entered into by Seller in the
ordinary course of business between the date hereof and the Closing Date
(including the trade balances owing by Seller in the form of air time as
listed on Schedule 4.18, except that Buyer shall not be required to assume
such trade balances to the extent that they exceed by more than $10,000 the
consideration then owed to the Station in connection with the underlying
trades), (b) all Contracts for the sale of air time on the Station for cash
entered into in the ordinary course of business at the usual rates, (c) all
Contracts entered into by Seller with the prior written consent of Buyer and
(d) all other Contracts entered into by Seller in the ordinary course of
business consistent with the provisions of Section 6.2 between the date hereof
and the Closing Date, which are in existence on the Closing Date and which
relate to the operation of the Station (collectively, the "Assumed
Contracts"). For purposes of this Agreement, "Contracts" means all contracts,
leases and other agreements, including any amendments and modification
thereto, to which Seller is a party and which relate to the business or
operation of the Station, and which either are in effect on the date hereof or
are entered into by Seller between the date hereof and the Closing Date.
1.4 Real Property. All of Seller's right, title and interest in
and to the real property owned and leased by Seller and described on Schedule
1.4 (collectively, the "Real Property").
1.5 Records. All business records of Seller including, but not
limited to, logs, local public records file materials, engineering records,
personnel files, lists of advertisers, sales correspondence, equipment
warranties, and market research data, relating to or used in the operation of
the Station or
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necessary to show compliance with any law or regulation applicable to the
Station and not pertaining solely to Seller's business affairs (the "Business
Records").
1.6 Intangibles. The service marks, trademarks, trade names,
patents, copyrights, call signs, franchises, slogans, logos, jingles and other
intangible assets used or useful in the operation of the Station, and any
registrations and applications for registration of any such intangible assets,
as listed on Schedule 1.6, together with any associated goodwill and any
additions thereto between the date hereof and the Closing Date (the
"Intangible Property").
1.7 Accounts Receivable. All rights of Seller as of the Closing
Date to payment for the sale of advertising time by the Station and services
performed by the Station.
2. EXCLUDED ASSETS; ASSUMED LIABILITIES.
2.1 Excluded Assets. The parties agree that the following assets
shall be "Excluded Assets" and shall not be among the Assets sold and
purchased pursuant to this Agreement:
(a) Seller's cash, cash equivalents, and marketable
securities on hand or in banks;
(b) All tangible personal property of the Station disposed
of or consumed between the date of this Agreement and the Closing Date in the
ordinary course of business;
(c) Seller's insurance policies and all insurance proceeds
and insurance claims of Seller relating to property or equipment repaired,
replaced or restored by Seller prior to the Closing Date;
(d) All claims, rights and interest in and to any refunds of
federal, state or local taxes for transactions and periods prior to the
Closing Date; and
(e) Seller's name, minute books, ledgers, charter documents,
tax records, and such other internal books and records as pertain to the
organization, existence, capitalization or financial performance of Seller.
2.2 Assumed Liabilities. As of the Closing Date, Buyer shall
assume (a) all obligations and liabilities of Seller arising from and after
the Closing Date under the Assumed Contracts, provided, however, that Buyer
shall not assume Seller's obligations under any equity, carried interest or
cash-flow
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performance components ("Incentive Arrangements") of employment agreements
with Seller's managers and (b) all other obligations and expenses arising from
the operation of the Station by Buyer from and after the Closing Date. Seller
shall remain solely responsible for national sales representation fees due and
payable prior to Closing. The liabilities and obligations of Seller to be
assumed pursuant to this Section 2.2 are referred to herein as the "Assumed
Liabilities."
3. PURCHASE PRICE.
3.1 Purchase Price. The total consideration for the Assets shall
be (a) Twelve Million Six Hundred Seventeen Thousand Six Hundred Forty-Seven
Dollars and Six Cents ($12,617,647.06) (the "Purchase Price") payable by Buyer
to Seller as set forth in Section 3.2 below, and (b) assumption of the Assumed
Liabilities.
3.2 Method of Payment.
(a) Subject to the provisions of Section 11.1 hereof, at
Closing Buyer shall pay to Seller, by wire transfer of federal funds (in
accordance with wire transfer instructions to be given to Buyer by Seller
prior to Closing), the Purchase Price, plus or minus any adjustments as set
forth in Section 3.3.
3.3 Adjustments and Prorations. All expenses and operating
income arising from the ownership and operation of the Station shall be
prorated between Buyer and Seller as of 12:01 a.m. on the Closing Date. Such
prorations shall include, without limitation, all ad valorem, real estate and
other property taxes (but excluding sales taxes covered by Section 15.1 of
this Agreement), vacation and sick leave, business and license fees, music and
other license or regulatory fees (including any retroactive adjustments
thereof made after the Closing Date), power and utility expenses, time sales
agreements, frequency discounts, rents, prepaid advertising, trade and barter
receivables, trade and barter payables (subject in the case of trade and
barter receivables and payables to Section 1.3(a)), and similar prepaid and
deferred items attributable to the ownership and operation of the Station. The
proration of FCC regulatory fees shall be based upon the actual rates for
1996, unless the FCC has not set the 1996 rates by the Closing Date, in which
case the proration shall be based on the 1995 rates and shall be final. Seller
shall provide Buyer a list of all known proratable items and payables at least
five (5) days before the Closing Date. To the extent reasonably possible, such
prorations shall be completed at Closing by an adjustment to the Purchase
Price. As to those prorations and adjustments not reasonably capable of being
ascertained on the Closing Date, an adjustment and proration shall be made
(and the adjustment payment required by the proration shall be paid by
separate check) within ninety (90) days after the Closing Date. In
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the event of any disputes between the parties as to the prorations and
adjustments described in this Section, the amounts not in dispute shall
nonetheless be paid at the time provided in this Section and such disputes
shall be determined by an independent certified public accountant mutually
acceptable to the parties with the fees and expenses of such accountant being
paid one-half by Seller and one-half by Buyer.
3.4 Allocation of Purchase Price. The Purchase Price shall be
allocated among the Assets as set forth in Schedule 3.4. Such allocation shall
be conclusive and binding for all purposes, and each party shall prepare and
file all income tax returns (including such forms as may be required by
applicable regulations) in a manner consistent with such allocation.
4. SELLER'S REPRESENTATIONS AND WARRANTIES. Seller
represents and warrants to Buyer as follows:
4.1 Station Licenses. The Station Licenses listed in Schedule
1.1 constitute all of the material licenses, permits and authorizations
necessary or useful for the operation of the Station as they now are operated.
At Closing Seller shall be the authorized legal holder of the Station
Licenses. To the best of Seller's knowledge, the Station Licenses are in full
force and effect and expire on the dates shown in Schedule 1.1. None of the
Station Licenses is subject to any restriction or condition which would limit
in any material respect the full operation of the Station as now operated, and
Seller is not aware of any reason why those Station Licenses that are subject
to expiration might not be renewed in the ordinary course, or of any reason
why any of the Station Licenses might be revoked, or of any reason why any of
the Station Applications might not be granted.
4.2 Compliance With Laws. At Closing, Seller shall be in
compliance in all material respects with, and not in material violation of,
the federal, state and local laws, regulations or governmental orders
applicable to the Station and the Assets, including, without limitation, any
applicable statutes, ordinances or codes relating to zoning and land use,
health and sanitation, environmental protection, occupational safety, and the
use of electrical power, where the failure to so comply would have a material
adverse effect on the operation of the Station. Specifically, but without
limitation, the Station shall be in compliance in all material respects with
the Communications Act of 1934, as amended, all rules, regulations and
published policies of the FCC thereunder, as announced from time to time by
the FCC (the "FCC Rules"), and all Federal Aviation Administration rules and
regulations applicable to the towers used by the Station. Except for FCC
approval of the Assignment Application (as defined in Section 8.1 hereof), no
action, consent or other approval is required to be obtained by Seller from
governmental authorities in connection with the transactions contemplated by
this Agreement. No judgment, decree, order or
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notice of violation has been issued by any such authority which permits, or
would permit, revocation, modification or termination of any governmental
permit, license or authorization or which results or could result in any
material impairment of any rights thereunder.
4.3 Title to Assets. No assets or property other than the Assets
are necessary to conduct the business or operation of the Station as it is
presently being conducted, and at Closing Seller shall deliver good and
marketable title to all of the Assets free and clear of all debts, liens,
security interests, mortgages, trusts, claims or other defects of title or
encumbrances or contractual rights of others of any kind ("Liens"), except for
the rights of third parties under Contracts that are part of the Assets,
"Permitted Liens" (as defined below), and Liens set forth in Schedule 4.3
which shall be removed as of the Closing Date. "Permitted Liens" are liens for
taxes, fees, assessments and other governmental charges not yet due and
payable, and encumbrances (excluding judgments and security interests) which
do not in the aggregate materially detract from the value of the Assets or
materially detract from or interfere with the use of the Assets in the
ordinary course of business as presently conducted.
4.4 Condition of Station Equipment. To the best of Seller's
knowledge, the Station Equipment listed on Schedule 1.2, except as otherwise
specifically indicated therein, is in good operating condition and not in need
of repair (ordinary wear and tear excepted) and is available for immediate use
by Buyer in the operation of the Station. To the best of Seller's knowledge,
the Station's transmitting and studio equipment is operating in material
compliance with the terms and conditions of the Station Licenses and the FCC
Rules, including the terms of the construction permits underlying such
licenses, which are expressly or by operation of law or the FCC's policies
carried forward in the Station Licenses.
4.5 Real Property. Prism owns or leases all of the Real Property
listed on Schedule 1.4. At Closing, Seller shall hold good and marketable
title to the owned Real Property, and valid leasehold interests in the leased
Real Property. All Real Property (including the improvements thereon) is in
usable condition and repair consistent with its present use, complies in all
material respects with all applicable building or zoning codes or other
applicable governmental regulations, and is available for immediate use in the
conduct of the business of the Station. At Closing, Seller shall be in
material compliance with all applicable federal, state, county or local laws,
ordinances, regulations, statutes, consent decrees, orders and other
requirements of all governmental, regulatory or administrative agencies
relating to, which impose liability for, or which establish standards of
conduct concerning, the preservation of environmentally sensitive areas or the
manufacture, processing, generation, distribution, use, treatment, storage,
discharge, emission, release, disposal, cleanup, transport or handling of
substances or materials, except where the failure to so comply would not have
a
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material adverse effect on the operation of the Station. To Seller's best
knowledge, there is no proceeding or inquiry by any federal, state, county or
local governmental authority or any nongovernmental entity or person pending
or threatened with respect to the presence of hazardous or toxic wastes,
substances or materials about, on, at, under, or within any of the Real
Property or the migration or transportation thereof from or to other property.
To Seller's best knowledge, none of the following is present about, on, at,
under or within any of the Real Property to an extent which could reasonably
be expected to have a material adverse effect on Buyer: (i) asbestos, (ii)
fuel, oil or gasoline storage tanks, or (iii) substance or material that
requires investigation, remediation or cleanup under any applicable law, rule
or regulation.
4.6 Contracts. Except as indicated on Schedule 1.3, to the best
of Seller's knowledge the Assumed Contracts are valid, binding and enforceable
by Seller, and freely assignable without the consent of the other contracting
party. Seller has delivered to Buyer true and complete copies of the Assumed
Contracts and all amendments and other modifications thereto. To the best of
Seller's knowledge, there has not occurred as to any of the Assumed Contracts
any material default by Seller or any other party thereto. Schedule 1.3
contains a true and complete list of all of the Assumed Contracts, some of
which require the consent of any contracting party other than Seller as a
condition of their valid assignment to Buyer and, subject to obtaining any
such consents, Seller shall have at Closing full legal power and authority to
assign its rights under the Assumed Contracts to Buyer, and such assignment
shall not materially affect the validity, enforceability or continuity of any
of the Assumed Contracts.
4.7 Intangible Property Rights. Except as described in Schedule
1.6, at Closing Seller shall have good and marketable title to all Intangible
Property free and clear of any third party claims, or if any such Intangible
Property is licensed or franchised to Seller the rights and interests of
Seller in and to such Intangible Property shall be valid and in good standing
and uncontested. Seller has received no notice of any infringement or unlawful
use of any of the Intangible Property and is not aware of any grounds
therefor.
4.8 Litigation. Except as provided in Schedule 4.8, to the best
of Seller's knowledge there is no action, suit, investigation, complaint, or
other proceeding pending or, to Seller's best knowledge, threatened before the
FCC or any court, agency or governmental authority that could reasonably be
expected to give rise to any claim against the Assets or the Station or to
adversely affect Seller's ability to perform in accordance with the terms of
this Agreement or Buyer's ability to operate the Station, and Seller knows of
no reasonable basis for any such action, suit, investigation, complaint or
other proceeding.
4.9 Financial Statements. Seller has furnished Buyer with the
financial statements listed on Schedule 4.9 (the "Financial Statements"). The
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audited Financial Statements for the years ended December 31, 1995 and
December 31, 1994 have been prepared in accordance with generally accepted
accounting principles consistently applied, and fairly present the financial
position of the Station as of December 31, 1995 and December 31, 1994 and the
results of operations and changes in financial position for the periods
indicated. The Operating Statement for the quarter ended March 31, 1996 fairly
presents the results of operations of the Station for such period, subject to
normal year-end adjustments.
4.10 Organization and Standing. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the State
of Delaware, is qualified to do business in Delaware and at Closing will be
qualified to do business in Kentucky. Seller has full power and authority to
carry on its business and to conduct the operations of the Station and to
enter into and perform this Agreement.
4.11 Authorization. Seller's execution, delivery and performance
of this Agreement and the consummation of the transactions contemplated hereby
have been duly authorized by all necessary corporate action on Seller's part.
4.12 Binding Agreement. This Agreement has been duly executed
and delivered by Seller to Buyer and constitutes the valid and binding
agreement of Seller, enforceable against Seller in accordance with its terms,
except as the enforceability of this Agreement may be affected by bankruptcy,
insolvency or similar laws affecting creditors' rights generally and by
judicial discretion in the enforcement of equitable remedies.
4.13 Insolvency Proceedings. Neither Seller nor the Assets are
the subject of any pending or, to Seller's knowledge, threatened insolvency
proceedings, including without limitation any bankruptcy, receivership,
reorganization, composition or arrangement with creditors, voluntary or
involuntary. Seller has not made an assignment for the benefit of creditors or
taken any action with a view to or that would constitute a valid basis for the
institution of any such insolvency proceedings.
4.14 Absence of Conflicting Agreements. Subject to obtaining the
consents required under Section 9.4 and the regulatory approvals provided
under Section 9.7, the execution, delivery and performance of this Agreement
by Seller (a) to the best of Seller's knowledge, does not require the consent
of any third party, (b) does not and shall not conflict with, result in a
breach of, or constitute a default under any law, judgment, order, ordinance,
decree, rule, regulation, or ruling of any court or governmental
instrumentality which is applicable to Seller, (c) does not and shall not
conflict with, constitute grounds for termination of, result in a breach of,
constitute a default order, or
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accelerate or permit the acceleration of any performance required by any
contract, agreement, instrument, license or permit to which Seller is a party
or by which Seller may be bound and which relates specifically to the Assets,
and (d) does not and shall not create any claim, liability, mortgage, lien,
pledge, condition, charge or encumbrance of any nature whatsoever on the
Assets.
4.15 Other Buyers. No other person has any prior right under
any oral or written agreement or understanding to purchase the Station or any
or all of the Assets from Seller.
4.16 Insurance. Seller shall maintain policies of fire,
casualty, liability and other forms of insurance in such amounts and against
such risks and losses as is comparable to the policies Seller maintains for
its other properties of this type.
4.17 Personnel. Seller has complied in all material respects
with all applicable statutes, regulations and orders relating to employment,
wages, hours, equal employment opportunity, collective bargaining, pension and
welfare plans, and the payment of social security, unemployment, disability
and similar taxes. To Seller's best knowledge, Prism is not liable for or in
arrears with respect to any of such taxes. Neither Prism nor Seller is a party
to any collective bargaining agreement covering any employees at the Station.
4.18 Trade or Barter. Schedule 4.18, to be provided at Closing,
sets forth all of the trade and barter agreements then in effect that relate
to the business or operation of the Station.
4.19 Prism Representations. To the best of Seller's knowledge,
the representations and warranties which Prism has given Seller in the Prism
Asset Purchase Agreement are truthful, and Seller shall provide Buyer with the
benefit of the representations which Prism has given Seller in that agreement.
5. BUYER'S REPRESENTATIONS AND WARRANTIES. Buyer represents and
warrants to Seller that:
5.1 Organization and Standing. Regent Broadcasting of Louisville,
Inc. is a Delaware corporation, duly organized, validly existing and in good
standing under the laws of the State of Delaware and is qualified to do
business in its state of incorporation and in Kentucky. Buyer has full power
and authority to enter into and to perform this Agreement.
5.2 Authorization. The execution, delivery and performance of
this Agreement by Buyer and the consummation of the
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transactions contemplated hereby have been duly authorized by all necessary
action on Buyer's part.
5.3 Binding Agreement. This Agreement has been duly executed and
delivered to Seller and constitutes a valid and binding agreement of Buyer,
enforceable against Buyer in accordance with its terms, except as the
enforceability of this Agreement may be affected by bankruptcy, insolvency or
similar laws affecting creditors' rights generally and by judicial discretion
in the enforcement of equitable remedies.
5.4 Absence of Conflicting Agreements. The execution, delivery
and performance of this Agreement by Buyer (a) does not require the consent of
any third party which will not be obtained by Buyer prior to or as of the
Closing, (b) does not and shall not conflict with, result in a breach of, or
constitute a default under any law, judgment, order, ordinance, decree, rule,
regulation, or ruling of any court or governmental instrumentality which
applicable to Buyer, and (c) does not and shall not conflict with, constitute
grounds for termination of, result in a breach of, constitute a default order,
or accelerate or permit the acceleration of any performance required by any
contract, agreement, instrument, license or permit to which Buyer is a party
or by which Buyer may be bound.
5.5 Litigation. There is no action, suit, investigation or other
proceeding pending or, to Buyer's best knowledge, threatened before any court,
agency or governmental authority that could reasonably be expected to
adversely affect Buyer's ability to perform in accordance with the terms of
this Agreement, and Buyer is not aware of any facts which could reasonably be
expected to result in any such proceeding.
5.6 Licensee Qualifications. As of the date the Assignment
Application is filed with the FCC and as of the Closing Date, Buyer and/or
Buyer's permitted assignees (as provided in Section 16 hereof) shall be
legally, financially and otherwise qualified to be the assignee(s) of all of
the FCC Licenses and the owner(s) and operator(s) of all the Station under
applicable federal statutes and rules in effect on such dates, including,
without limitation, the Communications Act of 1934, as amended, and the rules,
regulations and policies of the FCC, including, without limitation, Section
73.3555 of the FCC's Rules pertaining to multiple ownership.
5.7 Ability to Perform. Buyer has the financial capacity to
perform its obligations hereunder.
6. COVENANTS OF SELLER. Seller covenants and agrees that, between
the date of this Agreement and the Closing Date, except as expressly permitted
by this Agreement or with the prior written consent of Buyer:
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6.1 Maintenance of Business and Station Equipment. Seller and
Prism shall conduct the business of the Station and use the Assets only in the
ordinary course of business, consistent with past practices. Seller and Prism
shall maintain all of the Station Equipment in a condition substantially the
same as exists on the date of this Agreement (ordinary wear and tear
excepted). Seller shall not other than in the ordinary course of business or
after receiving Buyer's prior written approval (i) sell or dispose of or
commit to sell or dispose of any of the Station Assets; (ii) grant or agree to
grant any general increases in the rates of salaries or compensation payable
to employees of the Station; (iii) grant or agree to grant any specific bonus
or increase to any executive or management employee of the Station; or (iv)
provide for any new pension, retirement or other employment benefits for
employees of the Station or any increases in any existing benefits. Without
limiting the generality of the foregoing, Seller and Prism shall maintain the
independent identity of the Station and their current formats and call signs;
use all reasonable efforts to retain the services of key employees at the
Station; use all reasonable efforts to preserve its present relationships with
suppliers, advertisers, listeners and other persons having business dealings
with the Station; continue its recent sales and promotional practices; refrain
from discounting receivables; maintain the books, accounts and records
relating to the business of the Station in the usual, regular and ordinary
manner; perform all material obligations relating to the business of the
Station; refrain from changing the Station's frequency except to the extent
required by the rules and regulations of the FCC; and refrain from any
material changes in the broadcast hours or in the percentage or types of
programming broadcast by the Station, except such changes as in the good faith
judgment of Seller are required by the public interest.
6.2 Agreements. Seller may enter into or renew any contract,
agreement, commitment or other understanding or arrangement in the ordinary
course of business, provided, however, that except with respect to contracts
for the sale of time for cash and except for trade agreements, the liability
under any such contract to be assumed by Buyer at Closing shall not exceed
Twenty Thousand Dollars ($20,000), without the prior written approval of the
Buyer, which approval shall not be unreasonably withheld, and further provided
that Seller shall not enter into any new national rep agreement or renew any
existing national rep agreement prior to Closing. At least five (5) days prior
to the Closing Date, Seller shall provide Buyer with a list of all Contracts
entered into between the date hereof and the Closing Date of the type to be
included in the Assumed Contracts pursuant to Section 1.3, together with true
and correct copies of all such Contracts.
6.3 Promotion of Business. Seller and Prism shall spend not less
than one hundred percent (100%) of the cash promotions, advertising and
research expenditures budgeted for the Station in aggregate for the period
from the date of this Agreement through the Closing Date.
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6.4 Compliance With Laws. Seller and Prism shall operate the
Station in all material respects in accordance with FCC Rules and Regulations
and the Station Licenses and with all other laws, regulations, rules and
orders, and shall not cause or permit by any act, or failure to act, any of
the Station Licenses to expire, be surrendered, adversely modified, or
otherwise terminated, or the FCC to institute any proceedings for the
suspension, revocation or adverse modification of any of the Station Licenses,
or fail to prosecute with due diligence any pending applications to the FCC.
6.5 Administrative Violations. If Seller receives an
administrative or other order relating to any violation of the FCC Rules, or
of any other federal, state or local regulatory or administrative body, it
shall promptly notify Buyer in writing of such order, including a copy
thereof, and use its reasonable efforts to remove or correct such violations.
6.6 Liens. Seller shall not create, assume or permit to exist
any Lien upon any of the Assets, except for those listed on Schedule 4.3 which
shall be removed at or prior to Closing.
6.7 Insurance. Seller shall maintain insurance policies on the
Station and the Assets.
6.8 Consents. Seller shall use its reasonable efforts to obtain
the valid and binding consents of third parties necessary for the assignment
of the Assumed Contracts to Buyer as required under Section 9.4.
6.9 Reasonable Efforts/Cooperation. Seller shall use its
reasonable efforts and cooperate with Buyer in good faith to the extent
reasonably required to satisfy fully all of Seller's obligations hereunder and
to accomplish the transactions contemplated by this Agreement in an
expeditious fashion. Seller shall take no action or fail to take any action
within its reasonable control the effect of which would be to hinder or delay
the consummation of the transactions contemplated by this Agreement or
interfere with the performance of Buyer's obligations hereunder.
6.10 Trade Agreements. Seller shall use its reasonable efforts
to complete all obligations owing by Seller under trade agreements prior to
the Closing.
6.11 Sales Reports. Seller shall provide Buyer with sales
reports for the Station on a weekly basis during the term of this Agreement.
Additionally, within twenty-five (25) days of the end of each month, Seller
shall deliver to Buyer an unaudited statement of revenue and expenses of the
Station for the month then ended. The weekly sales reports and the monthly
statements of revenue and expenses shall be true and complete to the best of
Seller's
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knowledge and shall fairly and accurately represent the results of operation
of the Station for the period covered by such reports and statements. Seller
shall also furnish to Buyer any and all other information at such times as
such information is customarily prepared by Seller concerning the financial
condition of the Station as Buyer may reasonably request.
6.12 Access. At the reasonable request of and upon reasonable
notice from Buyer, prior to the Closing Seller shall cause to be given to
Buyer and Buyer's representatives full and reasonable access during normal
business hours to all of Seller's properties, books, contracts, reports and
records, including financial information, in each case relating to the
Station, in order that Buyer may have full opportunity to make such
investigation as it desires of the Station, and Seller shall furnish Buyer
with such information as Buyer may reasonably request in connection therewith.
The rights of Buyer under this paragraph shall not be exercised by Buyer in
such a manner as to interfere unreasonably with the business or operation of
the Station.
6.13 Changes in Representations and Warranties. Seller shall
provide Buyer prompt written notice of any change in any of the information
contained in the representations and warranties made in Section 4 hereof.
6.14 Notification. Seller shall notify Buyer of any material
litigation, arbitration or administrative proceeding pending or, to its
knowledge, threatened against Seller which challenges the transactions
contemplated hereby.
6.15 Environmental Audit. Buyer may cause a Phase I environmental
audit of the Real Property to be conducted by the company that last conducted
the audit of such Real Property. All costs of such audit shall be paid by
Buyer. If the environmental audit discloses the presence of a hazardous
substance on the Real Property, Seller is obligated to pay the first $70,000
of costs with respect to removal of such hazardous substance. If such costs
will exceed $70,000, Buyer may elect, by written notice to Seller given within
five (5) business days after receipt by Buyer of information indicating that
such costs will exceed $70,000, to terminate this Agreement pursuant to
Section 13 hereof unless Seller elects, in its sole discretion and by written
notice to Buyer given within five (5) business days after receipt of Buyer's
notice, to remove such hazardous substance at Seller's expense.
6.16 Delivery of Financial Statements and Audit. Seller shall
furnish Buyer with copies of the audited financial statements for the Station
for the year ended December 31, 1995 within seven (7) days after the date on
which the audit report is delivered to Seller by Prism's auditors; however,
such statements need not be furnished if Prism's audit report does not
segregate financial information for the Station. Buyer shall have the right at
its expense to have its auditors review the Station's quarterly financial
statements for GAAP
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compliance for any quarterly period ending prior to Closing, and Seller agrees
to cooperate with Buyer and Buyer's auditor in the conduct of such review;
provided, however, that in no event shall such review or procedures delay the
Closing.
7. COVENANTS OF BUYER. Buyer covenants and agrees that, between the
date of this Agreement and the Closing Date, except as expressly permitted by
this Agreement or with the prior written consent of Seller, it shall act in
accordance with the following:
7.1 Administrative Violations. If Buyer (and/or Buyer's
permitted assignees) receives an administrative or other order relating to
Buyer's (and/or Buyer's permitted assignees) ability to be the assignee of the
Station Licenses, it shall promptly notify Seller in writing of such order,
including a copy thereof, and use its reasonable efforts to remove or correct
such violations.
7.2 Reasonable Efforts/Cooperation. Buyer shall use its
reasonable efforts and cooperate with the Seller in good faith to the extent
reasonably required to satisfy fully all of Buyer's obligations hereunder and
to accomplish the transactions contemplated by this Agreement in an
expeditious fashion. Buyer shall take no action or fail to take any action
within its reasonable control the effect of which would be to hinder or delay
the consummation of the transactions contemplated by this Agreement or
interfere with the performance of Seller's obligations hereunder.
7.3 Changes In Representations And Warranties. Buyer shall
provide Seller prompt written notice of any change in any of the information
contained in the representations and warranties made in Section 5 hereof.
7.4 Notification. Buyer shall notify Seller of any material
litigation, arbitration or administrative proceeding pending or, to its
knowledge, threatened against Buyer which challenges the transactions
contemplated hereby.
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8. REGULATORY APPROVALS.
8.1 Application for FCC Consent. Within five (5) days from the
date hereof, Seller and Buyer (and/or Buyer's permitted assignees) shall file
an application with the FCC requesting its written consent to the assignment
from Seller to Buyer (and/or Buyer's permitted assignees) of the Station
Licenses and the Station Applications (the "Assignment Application"). The
parties shall diligently take all steps necessary or desirable and proper to
prosecute the Assignment Application expeditiously and to obtain the FCC's
determination that grant of the Assignment Application shall serve the public
interest, convenience and necessity (the "FCC Consent"). The failure by either
party to diligently prosecute the Assignment Application, or the taking of any
action by either party that reasonably could be expected to delay grant of the
FCC Consent, shall be deemed a material breach of this Agreement.
8.2 Control of Station. Between the date of this Agreement and
the Closing Date, Buyer shall not directly or indirectly control, supervise or
direct, or attempt to control, supervise or direct, the operation of the
Station. Such operation shall remain the sole responsibility of Seller and
Prism.
8.3 Other Notifications. Should any fact which would cause any
governmental regulatory agency to deny its consent to the transactions
contemplated by this Agreement come to either party's attention, such party
shall promptly notify the other party thereof and shall use its reasonable
efforts to take such steps as may be necessary to remove any such impediment
to the transactions contemplated by this Agreement.
9. CONDITIONS TO BUYER'S OBLIGATION. The obligation
of Buyer to consummate the transaction contemplated by this Agreement is
subject to the satisfaction (or written waiver by Buyer) of each of the
following conditions on or prior to the Closing Date:
9.1 Representations and Warranties; No Material Adverse Change.
The representations and warranties of Seller to Buyer contained herein shall
be true and correct in all material respects as of the Closing Date as if made
on and as of the Closing Date. No material adverse change shall have occurred
which impairs the operation of the Station.
9.2 Compliance with Covenants. All of the covenants to be
complied with or performed by Seller on or prior to the Closing Date shall
have been duly complied with and performed in all material respects.
9.3 Closing Documents. Seller shall deliver to Buyer duly
executed closing documents as specified in Section 12.1, all of which shall be
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dated as of the Closing Date and shall be in a form reasonably satisfactory to
Buyer.
9.4 Receipt of Third Party Consents. Seller shall have obtained
all required consents, waivers or approvals of third parties to Buyer's
assumption of the Assumed Contracts, or Seller shall have made alternative
arrangements reasonably acceptable to Buyer so as to ensure that Buyer shall
enjoy all of the rights and privileges of Seller under such Assumed Contracts
on and after the Closing Date.
9.5 Release of Liens. Seller shall have delivered to Buyer
releases or termination statements as to all Liens other than Permitted Liens.
9.6 No Adverse Proceedings. No suit, action, claim or
governmental proceedings shall be pending against, and no order, decree or
judgment of any court, agency or governmental authority shall have been
rendered against any party hereto which seeks to restrain or prohibit the
transactions contemplated by this Agreement or would render it unlawful, as of
the Closing Date, to effect the transactions contemplated by this Agreement in
accordance with its terms, or which would impair the ability of Buyer to
realize the benefits of the transactions contemplated hereunder or which seeks
damages in connection with the transactions contemplated hereby.
9.7 Regulatory Consents. Subject to the provisions of Section
11.1 hereof, the FCC Consent shall have been granted.
9.8 Opinion of Seller's Counsel. Seller shall have delivered to
Buyer an opinion from Seller's counsel, dated as of the Closing Date,
containing the points set forth in Exhibit B.
9.9 Prism Acquisition. Seller shall have acquired the Station
pursuant to the consummations of the transactions contemplated by the Prism
Asset Purchase Agreement.
10. CONDITIONS TO SELLERS' OBLIGATION. The obligation of
Seller to consummate the transaction contemplated by this Agreement is subject
to the satisfaction (or written waiver by Seller) of each of the following
conditions on or prior to the Closing Date:
10.1 Representations and Warranties. The representations and
warranties of Buyer to Seller contained herein shall be true and correct in
all material respects as of the Closing Date as if made on and as of the
Closing Date.
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10.2 Compliance with Covenants. All of the covenants to be
complied with or performed by Buyer on or before the Closing Date shall have
been duly complied with and performed in all material respects.
10.3 Closing Documents. Buyer shall deliver to Seller duly
executed closing documents as specified in Section 12.2, all of which shall be
dated as of the Closing Date and shall be in a form reasonably satisfactory to
Seller.
10.4 Regulatory Consents. Subject to the provisions of Section
11.1 hereof, the FCC Consent shall have been granted.
10.5 Payment. Buyer shall pay Seller the Purchase Price as
provided in Section 3, subject to the provisions of Section 12.1.
10.6 Prism Acquisition. Seller shall have acquired the Station
pursuant to the consummation of the transactions contemplated by the Prism
Asset Purchase Agreement.
11. CLOSING.
11.1 Closing Date; Closing Place. The closing of the purchase
and sale of the Assets contemplated hereunder (the "Closing") shall take place
on a date mutually agreed upon by the parties but in no event later than five
(5) days after the FCC Consent is granted (such date shall be the "Closing
Date"). The Closing shall commence at 10:00 a.m. on the Closing Date at such
place as is agreed upon by the parties (the "Closing Place"). Notwithstanding
the foregoing, if the FCC licenses for the Station have not all been renewed
by order of the FCC as of the Closing Date for a full regular renewal term,
then Buyer may delay the Closing until five (5) days after those licenses have
all been so renewed.
11.2 Delivery of Closing Documents. On the Closing Date at the
Closing Place, Seller shall deliver to Buyer the closing documents listed in
Section 12.1 ("Seller's Closing Documents"), and Buyer shall deliver to Seller
the closing documents listed in Section 12.2 ("Buyer's Closing Documents").
12. CLOSING DOCUMENTS.
12.1 Closing Documents To Be Delivered By Seller. On the Closing
Date at the Closing Place, Seller shall deliver to Buyer:
(a) One or more assignments transferring to Buyer the
Station Licenses;
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(b) One or more bills of sale conveying to Buyer all of the
Station Equipment, free and clear of Liens, except for Permitted Liens;
(c) One or more assignments assigning the Assumed
Contracts to Buyer;
(d) One or more assignments conveying to Buyer the
Intangible Property and Business Records;
(e) One or more general warranty deeds conveying to
Buyer the Seller's interest in the owned Real Property and one or more
assignments assigning the leases to the leased Real Property to Buyer, in both
cases free and clear of any Liens, except for Permitted Liens.
(f) A certificate executed by a duly authorized officer of
Seller, certifying as to satisfaction of the conditions set forth in Sections
9.1 and 9.2; and
(g) An opinion of Seller's corporate counsel relating to
matters set forth in Exhibit B.
12.2 Closing Documents To Be Delivered By Buyer. On the Closing
Date at the Closing Place, Buyer shall deliver to Seller:
(a) One or more agreements by which Buyer assumes the
Assumed Liabilities and agrees to perform, from and after the Closing Date,
all of the Assumed Liabilities;
(b) The Purchase Price, subject to the provisions of Section
11.1;
(c) A certificate executed by Buyer's Chief Executive
Officer, certifying as to satisfaction of the conditions set forth in Sections
10.1 and 10.2; and
12.3 Other Closing Documents and Acts. The parties shall also
execute such other documents and perform such other acts, before and after
Closing, as may be necessary for the implementation and consummation of this
Agreement.
13. TERMINATION.
13.1Absence of Consent. If the FCC Consent has not been granted
with respect to the Station within nine (9) months after the date the
Assignment Application is filed, this Agreement and the transactions
contemplated
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hereby may be terminated at the option of either party upon written notice to
the other; provided, however, that neither party may terminate this Agreement
pursuant to this Section 13.1 (a) in the event of an Event of Default by such
party (as defined below), or (b) if a delay in any decision or determination
by the FCC with respect to the Assignment Application has been caused or
materially contributed to by (i) any failure on the part of such party to
furnish, file or make available information within its control, (ii) the
willful furnishing by such party of incorrect, inaccurate or incomplete
information, or (iii) any action taken by such party for the purpose of
delaying any decision or determination by the FCC respecting the Assignment
Application.
13.2 Events of Default. This Agreement and the transactions
contemplated by this Agreement may be terminated by either party at any time
prior to the Closing upon expiration of the "Cure Period" (as defined below)
if the other party breaches this Agreement in any material respect and fails
to cure such breach within the Cure Period (such uncured breach being referred
to herein as an "Event of Default" by such party). An Event of Default shall
not be deemed to have occurred until ten (10) business days after the
non-defaulting party has provided the other party with written notice
specifying the event or events that if not cured would constitute an Event of
Default and specifying the actions necessary to cure within such ten (10) day
period (the "Cure Period"), and such cure has not been effected within such
Cure Period; provided that, if the claimed default cannot be cured within such
ten (10) day period but the party claimed to be in default has commenced to
cure the default within such ten (10) day period and thereafter diligently
continues to attempt to cure the default, then the Cure Period shall be
extended for such time (not to exceed sixty (60) days) as is reasonably
necessary to cure the default. In the event of an Event of Default by one of
the parties, or if a delay in any decision or determination by the FCC with
respect to the Assignment Application has been caused or materially
contributed to by any failure on the part of such party to furnish, file or to
make available information within its control or by the willful furnishing by
such party of incorrect, inaccurate or incomplete information or by any such
action taken by such party for the purposes of delaying any decision or
determination respecting the Assignment Application, such party shall not be
entitled to terminate this Agreement.
13.3 Damage or Loss.
(a) The risk of loss or damage to the Assets shall be upon
Seller at all times prior to the completion of the Closing. In the event of
such loss or damage Seller shall promptly notify Buyer and shall use its
reasonable efforts to repair, replace or restore the lost or damaged Assets to
their former condition as soon as possible. If material damage has occurred
that precludes the operation of the Station within the terms of the Station
Licenses and the FCC Rules, and the Assets have not been repaired or restored
prior to the Closing Date, Buyer may, at its option:
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(i) elect to consummate the Closing and accept the
Station "as is," in which event Seller shall pay over to Buyer any proceeds of
insurance received by Seller and attributable to damage to the Station or the
Assets and thereafter Seller shall have no further obligation to repair,
replace or restore the damaged property; or
(ii) elect to postpone the Closing Date for a period
of up to sixty (60) days, with prior consent of the FCC if necessary (which
the parties shall use their reasonable efforts to obtain), to permit Seller to
make such repair, replacement or restoration as is required to restore the
lost or damaged property to the equivalent of its former condition in all
material respects. If Seller cannot complete such repair, replacement or
restoration within such sixty (60) day extension period, Buyer may terminate
this Agreement by giving written notice to Seller and the parties shall be
released and discharged from any further obligation hereunder. If the parties
disagree whether the property has been adequately repaired, replaced or
restored, or whether the Station can be operated within the terms of the
Station Licenses, the matter shall be referred to a mutually-acceptable
qualified consulting communications engineer, who shall be a member of the
Association of Federal Communications Consulting Engineers, whose decision
shall be final, and whose fees and expenses shall be shared equally by Buyer
and Seller.
(b) Notwithstanding the foregoing, if any event occurs which
prevents broadcast transmissions or other operation of the Station in a normal
and usual manner in accordance with the terms of the Station Licenses and the
FCC Rules for a period of more than five (5) consecutive days, then Buyer
shall have the right to terminate this Agreement at any time within fifteen
(15) days after Buyer becomes aware of such event without further liability
hereunder, or Buyer may proceed in the manner set forth in Section 13.3(a);
otherwise, Buyer shall remain fully obligated to consummate the transactions
contemplated hereunder (except to the extent Seller has failed to fulfill its
obligations hereunder).
13.4 Effect of Termination. Upon termination of this Agreement,
the parties shall be released and discharged from any further obligation
hereunder (except for the indemnification requirements of Section 14 and the
confidentiality requirements of Section 17); provided, however, that
termination of this Agreement pursuant to Section 13.1 or 13.2 shall not
relieve either party of any liability for such party's breach of this
Agreement prior to the date of termination. In the event that termination of
this Agreement is attributable to an Event of Default by Buyer, the liquidated
damages provided for below shall be paid to Seller and such payment shall
conclusively demonstrate that Seller has elected as its sole remedy the
termination of the Agreement and the recovery of the liquidated damages, it
being agreed that in light of the nature of the Assets, damages are impossible
to calculate with any precision. In such event, Buyer
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shall pay to Seller as liquidated damages and not as a penalty an amount equal
to One Million Dollars ($1,000,000) ("Liquidated Damages"), payable by Buyer
within ten (10) business days after the date Seller notifies Buyer of the
termination of this Agreement by virtue of such default, by certified check or
by wire transfer of immediately available Federal funds to an account
designated by Seller.
14. INDEMNIFICATION; SURVIVAL.
14.1 Seller's Indemnities. Seller shall indemnify, defend by
counsel reasonably acceptable to Buyer, and hold harmless Buyer, its officers,
directors, affiliates, employees, agents, successors, and permitted assigns
(the "Buyer Indemnitees") from and against all demands, claims, actions, and
causes of action ("Claims") and assessments, losses, costs, damages,
liabilities, interest, penalties, court costs, and reasonable accounting,
consulting, engineering and attorneys' fees ("Losses") asserted against,
imposed upon or incurred by any of the Buyer Indemnitees, directly or
indirectly, resulting from or arising out of (i) the ownership or operation of
the Station or the Assets prior to the Closing Date, (ii) the failure of
Seller to pay, perform or discharge any of Seller's obligations or liabilities
not expressly assumed by Buyer pursuant to this Agreement, or (iii) the breach
by Seller of any of its representations and warranties contained in Section 4
hereof.
14.2 Buyer's Indemnities. Buyer shall indemnify, defend by
counsel reasonably acceptable to Seller, and hold harmless Seller, its
partners, affiliates, employees, agents, successors and permitted assigns (the
"Seller Indemnitees") from and against all Claims and Losses asserted against,
imposed upon or incurred by any of the Seller Indemnitees, directly or
indirectly, resulting from or arising out of (i) the ownership or operation of
the Station or the Assets by Buyer from and after the Closing Date, (ii) the
failure of Buyer to pay, perform or discharge any of Buyer's obligations,
including any obligations expressly assumed by Buyer pursuant to this
Agreement, or (iii) the breach by Buyer of any of its representations and
warranties contained in Section 5 hereof.
14.3 Limitation. Notwithstanding the foregoing, (i) each party
shall be liable for Losses incurred as a result of any breach, failure or
inaccuracy of any representation, warranty, covenant or agreement made by it
herein only if the aggregate of such Losses exceeds $70,000; provided,
however, that the $70,000 limitation shall not apply if such $70,000 threshold
is exceeded, and (ii) the aggregate liability of Seller for Losses incurred as
a result of any breach, failure or inaccuracy of any representation, warranty,
covenant or agreement made by Seller herein shall not exceed $850,000.
14.4 Notice and Opportunity to Defend.
(a) As soon as is reasonably practicable after any Seller
Indemnitee or any Buyer Indemnitee becomes aware of any Claim or Loss
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with respect to which it is entitled to indemnification under Sections 14.1 or
14.2 hereof, such Seller Indemnitee or Buyer Indemnitee, as the case may be
(the "Indemnified Party"), shall give written notice thereof (a "Claims
Notice") to the party from which indemnity is claimed (the "Indemnifying
Party"). A Claims Notice shall describe the Claim or Loss in reasonable
detail, and shall indicate the amount (estimated, if necessary and to the
extent feasible) of the Claim or Loss that has been or may be suffered by the
Indemnified Party. Prior to delivering any Claims Notice, the Indemnified
Party shall take all reasonable means necessary to preserve its defenses and
rights regarding such Claim or Loss. The failure of any Indemnified Party to
promptly give any Indemnifying Party a Claims Notice shall not preclude such
Indemnified Party from obtaining indemnification under this Section 14, except
to the extent that such Indemnified Party's failure has materially prejudiced
the Indemnifying Party's rights or materially increased its liabilities and
obligations hereunder.
(b) With respect to any Claim or Loss that involves legal
proceedings ("Legal Claims"), the Indemnifying Party shall have the right by
written notice to the Indemnified Party not later than thirty (30) days after
receipt of a Claims Notice to assume the control of the defense, compromise or
settlement of such Legal Claim, provided that such assumption shall, by its
terms, be without cost to the Indemnified Party.
(c) Upon the assumption of control by the
Indemnifying Party as provided in Section 14.4(b), the Indemnifying Party
shall, at its expense, diligently proceed with the defense, compromise or
settlement of the Legal Claim at Indemnifying Party's sole expense, including
employment of counsel reasonably satisfactory to the Indemnified Party and, in
connection therewith, the Indemnified Party shall cooperate fully, but at the
expense of the Indemnifying Party, to make available to the Indemnifying Party
all pertinent information and witnesses under the Indemnified Party's control,
and take such other steps as in the opinion of counsel for the Indemnifying
Party are necessary to enable the Indemnifying Party to conduct such defense.
(d) The final determination of any Legal Claim, including
all related costs and expenses, shall be binding and conclusive upon
Indemnifying Party and Indemnified Party; provided, however, that in the
Indemnifying Party's defense of such Legal Claim, except with the written
consent of the Indemnified Party, the Indemnifying Party shall not consent to
entry of any judgment or enter into any settlement, which does not include as
an unconditional term thereof the provision by the claimant to the Indemnified
Party of a release from all liability in respect of such Legal Claim.
(e) Should the Indemnifying Party fail to give notice to the
Indemnified Party as provided in Section 14.4(b), the Indemnified Party shall
be entitled, at the Indemnifying Party's expense, to defend, settle or
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compromise the Legal Claim as in its sole discretion may appear advisable, and
such final determination, settlement or compromise of the Legal Claim shall be
binding upon the Indemnifying Party.
14.5 Survival. The representations and warranties of Seller and
Buyer pursuant to Sections 4 and 5 hereof, respectively, shall continue in
force for a period of four (4) months following the Closing Date, after which
time the indemnification obligations of Seller and Buyer under Sections
14.1(iii) and 14.2(iii), respectively, shall be limited to claims asserted
during such four (4) month period. The indemnification obligations of Seller
and Buyer pursuant to Sections 14.1(i) and (ii) and 14.2(i) and (ii),
respectively, shall continue in force for a period of eighteen (18) months
following the Closing Date, after which time the parties' obligations to make
payments hereunder shall be limited to the payment of claims asserted during
such eighteen (18) month period; provided, however, that the foregoing time
limitation shall not apply to any taxes attributable to the ownership or
operation of the Station prior to the Closing Date and to the obligations and
liabilities of Buyer arising under any Assumed Contracts having a term
extending beyond such eighteen (18) month period.
14.6Arbitration of Disputes. In the event the parties are unable
to resolve a dispute regarding the amount of a Claim or whether a Claim is
covered by this Section 14, or if any other dispute arises with respect to
this Agreement, except as otherwise provided herein, such dispute shall be
decided by arbitration. Arbitration shall be initiated by either party giving
written notice to arbitrate to the other party, stating the question to be
arbitrated and the name of the arbitrator selected by that party. Within ten
(10) days of the date of said notice, the other party shall select and give
written notice of its arbitrator to the initiating party. The two arbitrators
so selected shall select a third arbitrator and give written notice thereof to
the parties within five (5) days after the second arbitrator is chosen. The
arbitration shall be conducted solely by the third arbitrator, who shall hear
evidence and make an award within twenty (20) days after the notice of
selection of the third arbitrator is given to the parties, which award, when
signed by the third arbitrator, shall be final. If either party shall refuse
or neglect to appoint an arbitrator within ten (10) days after the other shall
have appointed an arbitrator and given written notice to arbitrate to the
other, requiring such party to appoint an arbitrator, then the arbitrator so
appointed by the first party shall have power to proceed to arbitrate and
determine the matters of disagreement as if he were an arbitrator appointed by
both the parties hereto for that purpose, and his award in writing signed by
him shall be final; provided, however, that such award shall be made within
fifteen (15) days after such refusal or neglect of the other party to appoint
an arbitrator. The party against which such award is made shall pay all costs
and expenses of the arbitration.
15. TRANSFER TAXES, FEES AND EXPENSES.
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15.1 Transfer Taxes and Similar Charges. All costs of
transferring the Assets from Seller to Buyer in accordance with this
Agreement, including all costs of recordation, documentary filing and transfer
fees, and any stamp, sales, excise, use and transfer taxes, shall be paid
one-half by Seller and one-half by Buyer.
15.2 FCC Filing and Grant Fees. Any filing or grant fees for the
Assignment Application shall be paid one-half by Seller and one-half by Buyer.
15.3 Expenses. Except as set forth above in this Section 15,
each party shall be solely responsible for all costs and expenses, including
legal fees and related costs, incurred by it in connection with the
negotiation, preparation and performance of and compliance with the terms of
this Agreement (including the preparation of the Assignment Application).
16. ASSIGNABILITY. This Agreement may not be assigned by either party
without the prior written consent of the other party. Notwithstanding the
foregoing, Buyer shall have the right to assign certain of its rights
hereunder to assignees who, to the reasonable satisfaction of Seller, meet the
qualifications specified in Section 5.6 hereof, provided that such assignment
must be made prior to the filing of the Assignment Application with the FCC,
and further provided that Buyer shall remain liable for all of its obligations
hereunder.
17. CONFIDENTIALITY. The existence and terms of this Agreement shall
be kept confidential by both parties prior to the filing of the Assignment
Application with the FCC. Except as necessary for the consummation of the
transactions contemplated hereunder, Buyer and Seller shall keep confidential
all information obtained by them with respect to the other party in connection
with this Agreement and the transactions contemplated hereunder, and if the
transactions contemplated hereunder are not consummated for any reason, each
shall return to the other, without retaining a copy thereof, or destroy any
confidential schedules, documents or other written information obtained from
the other in connection with this Agreement and the transactions contemplated
hereunder and any work papers, notes, memoranda or other internally generated
documentation that memorializes information provided by the other party,
except where such information is generally known or readily available through
other lawful sources or where such party is advised by counsel in writing that
its disclosure is required in accordance with the law. Buyer and Seller agree
to provide access to information obtained by them with respect to the other
party only to those responsible officers, employees or agents who are directly
involved in the transactions contemplated by this Agreement. Because the
breach or threatened breach of the covenants contained in this Section 17
would result in irreparable injury to the non-breaching party for which such
party shall not have an adequate remedy at law, the non-breaching party shall
be entitled to equitable remedies, including a decree of specific performance
and temporary and
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permanent injunctive relief, to enforce this Section 17, as well as any and
all other remedies to which such party may be entitled pursuant to this
Agreement.
18. COVENANT NOT TO SOLICIT PERSONNEL. For a period
commencing on the date hereof and ending one (1) year following the Closing
Date, Seller shall not in any manner whatsoever (i) induce or attempt to
induce any person employed in providing services for the Station to terminate
his or her employment at the Station, (ii) solicit any such employee for
employment by Seller, or (iii) hire any person who within the preceding one
(1) year was employed (by Buyer or Seller) in providing services for the
Station.
19. COVENANT NOT TO COMPETE. For a one (1) year period
commencing on the Closing Date, Seller shall not directly or indirectly engage
in, whether as an owner, operator, partner, consultant, advisor or otherwise,
or assist any other person or entity in engaging in, the radio broadcasting
business within a 75-mile radius of any of the Station.
20. NOTICES. All necessary notices required to be given under this
Agreement shall be in writing addressed as follows:
If to Seller, to:
SFX Broadcasting, Inc.
150 East 58th Street-19th Floor
New York, New York 10155
Attn: Robert F.X. Sillerman
Executive Chairman
with a copy to:
SFX Broadcasting, Inc.
150 East 58th Street-19th Floor
New York, New York 10155
Attn: Richard A. Liese
Vice President and Assistant Secretary
-25-
<PAGE>
If to Buyer, to:
Regent Broadcasting of Louisville, Inc.
50 E. RiverCenter Blvd., Suite 180
Covington, Kentucky 41011
Attention: Terry S. Jacobs
Facsimile: 606-292-0352
with a copy to:
Wyatt, Tarrant & Combs
Citizens Plaza
Louisville, Kentucky 40202
Attention: Patrick W. Mattingly
Facsimile: 502-589-0309
Notices shall be deemed given three (3) business days after being mailed by
certified mail, return receipt requested, or on the first business day after
being sent, prepaid, by nationally recognized overnight courier which requires
a return receipt. Any party may change the address to which notices under this
Agreement are to be sent to it by giving written notice of a change of address
in the manner provided in this Agreement for giving notice.
21. ENTIRE AGREEMENT. This Agreement supersedes all prior agreements
between the parties and contains all of the terms agreed upon with respect to
the subject matter hereof. This Agreement may not be altered or amended except
by an instrument in writing signed by the party against whom enforcement of
any such change is sought.
22. COUNTERPARTS. This Agreement may be signed in any
number of counterparts with the same effect as if the signature on each such
counterpart were on the same instrument.
23. HEADINGS. The headings of the Sections of this Agreement are
for convenience only and in no way modify, interpret or construe the meaning of
specific provisions of the Agreement.
24. EXHIBITS. The Exhibit and Schedules to this Agreement are a
material part of this Agreement.
25. SEVERABILITY. In case any one or more of the provisions
contained in this Agreement should be held invalid, illegal or unenforceable
in any respect, the validity, legality, and enforceability of the remaining
provisions shall not in any way be affected or impaired.
-26-
<PAGE>
26. CHOICE OF LAW. This Agreement is to be construed and
governed by the laws of the Commonwealth of Kentucky.
27. BROKER. The parties represent to each other that no broker,
finder or agent has been engaged in connection with this Agreement and the
transactions contemplated hereunder, and the parties agree to indemnify and
hold each other harmless against any claim from any broker, finder or agent
based upon any agreement, arrangement or understanding alleged to have been
made by the indemnifying party.
28. WAIVER. No waiver by any party of any of the provisions hereof
shall be effective unless explicitly set forth in writing and executed by the
party so waiving. The waiver by any party hereto of a breach of any provision
of this Agreement shall not operate of be construed as a waiver of any
subsequent breach.
29. ATTORNEY'S FEES. In the event of a dispute between the parties
hereto arising out of or related to this Agreement or the interpretation or
enforcement of this Agreement, the prevailing party shall be entitled to
recover reasonable attorney's fees, costs and expenses from the other party.
-27-
<PAGE>
IN WITNESS WHEREOF, the parties have executed this Agreement as of
the date first written above.
SFX ACQUISITION CORPORATION
By: /s/ Robert F.X. Sillerman
Title: Executive Chairman
REGENT BROADCASTING OF LOUISVILLE, INC.
By: /s/ Terry S. Jacobs
Title: President and Chief Executive Officer
-28-
<PAGE>
Guarantee:
Clear Channel Radio, Inc., a Nevada Corporation, hereby guarantees the
performance of Buyer under this Asset Purchase Agreement.
CLEAR CHANNEL RADIO, INC.
By: /s/ Randall T. Mays
Randall T. Mays
Vice-President
Guarantee:
SFX Broadcasting, Inc., a Delaware Corporation, hereby guarantees the
performance of Seller under this Asset Purchase Agreement.
SFX BROADCASTING, INC.
By: /s/ Robert F.X. Sillerman
Robert F.X. Sillerman
Executive Chairman
-29-
<PAGE>
EXHIBIT A
Opinion of Seller's Counsel
1. Seller is a corporation duly formed, validly existing and in good
standing under the laws of the State of Delaware, and is qualified to do
business in the State of Delaware and Commonwealth of Kentucky.
2. Seller has full power and authority under Delaware law to enter into and
to perform its obligations under the Asset Purchase Agreement.
3. The execution, delivery and performance of the Asset Purchase Agreement
by Seller and the consummation by Seller of the transactions contemplated
thereby have been duly authorized by all necessary partnership action on
Seller's part.
4. The Asset Purchase Agreement has been duly executed and delivered by
Seller and constitutes a valid and binding agreement of Seller,
enforceable against Seller in accordance with its terms.
5. The execution and delivery of the Asset Purchase Agreement by Seller and
the purchase of the Station by Seller pursuant to the Asset Purchase
Agreement do not: (i) to our best knowledge, violate any United States
federal or Delaware statute, rule or regulation applicable to Seller,
(ii) violate the provisions of Seller's governing documents, or (iii) to
our best knowledge, require any consents, approvals, authorizations,
registrations, declarations or filings by Seller under any United States
federal or Delaware statute, rule or regulation applicable to Seller,
except for the FCC Consent.
[Usual exceptions shall apply to opinion.]
[Such counsel shall not opine as to FCC matters.]
<PAGE>
SFX Broadcasting, Inc.
150 East 58th Street
New York, New York 10155
212-407-9191
212-753-3188 FAX
FOR IMMEDIATE RELEASE: For further information:
Cynthia A. Bond
Director, Investor Relations
(212) 407-9126
SFX BROADCASTING PRICES $600 MILLION OF NEW SECURITIES
NEW YORK, May 23, 1996 -- SFX Broadcasting, Inc. ("SFX") (NASDAQ: SFXBA)
announced that yesterday it priced a series of transactions that will
restructure its balance sheet and provide financing for all previously
announced transactions as well as provide liquidity for additional
acquisitions.
The details of the financings are as follows:
- - Over fifty per cent of the holders of the company's presently
outstanding 11 3/8% Senior Subordinated Notes have tendered in
response to an offer earlier this month. The offer is scheduled to
expire on May 30, 1996. Having received tenders of over fifty per
cent the company may now proceed to consummate the new financings.
- - $450 million Senior Subordinated Notes due 2006 will bear interest
at the rate of 10 3/4% and will be sold at their par value of $1,000.
- $130 million of Cumulative Convertible Exchangeable Preferred Stock
due 2003 ($150 million in the event of the exercise of the
over-allotment option) will pay dividends at the rate of 6 1/2%
Cumulative, and will be sold at a price per share of $50.
In addition, the company recently received a commitment for an increase in its
senior secured bank facility to $150 million underwritten by The Bank of New
York. The company will use the proceeds for future acquisitions and working
capital.
The company intends to use the net proceeds of the offering to repay all notes
tendered by May 30, 1996; repay existing indebtedness, and complete all
previously announced acquisitions, which include the stations owned by HOW
Communications; all of the capital stock of Liberty Broadcasting Corporation;
the assets of Prism Radio Partners, L.P.; Multi-Market Radio,
- more -
<PAGE>
Inc. (NASDAQ: RDIOA); and several other individual transactions.
Additionally, the company will make certain payments with respect to the
repurchase of securities and modification of employment of the company's
outgoing chief executive officer and new chief operating officer.
Robert F. X. Sillerman, Executive Chairman of SFX Broadcasting, said, "We
are pleased to have completed this important step in our financing, which not
only provides funds to close our new acquisitions, but provides funds for
additional acquisitions. The company is now well positioned for the future."
The private offering has been made to qualified institutional buyers pursuant
to Rule 144A under the Securities Act of 1933 and to certain other
institutional investors.
The initial purchasers of the debt offering are BT Securities Corporation
with Goldman, Sachs & Co. and Lehman Brothers. The initial purchasers of the
preferred offering are be Goldman, Sachs & Co. with Lehman Brothers and BT
Securities Corporation.
The 10 3/4% Senior Subordinated Notes due 2006 and the 6 1/2% Series D
Cumulative Convertible Exchangeable Preferred Stock due 2007 have not been
registered under the Securities Act and may not be offered or sold in the
United States absent registration under the Securities Act or an exemption
from such registration. This press release shall not constitute an offer to
sell or the solicitation of an offer to buy nor shall there be any sale of the
securities in any state in which such offer, solicitation or sale would be
unlawful prior to registration or qualification under the securities laws of
any such state.
With the anticipated consummation of all previously announced transactions,
SFX will own and operate or provide services to the following radio stations:
- list of stations follows -
<PAGE>
KKRW(FM) Houston, TX WGNA(FM) Albany, NY
KODA(FM) Houston, TX WPYX(FM) Albany, NY
KQUE(FM) Houston, TX WGNA-AM Albany, NY
KNUZ-AM Houston, TX WTRY-AM Albany, NY
WHFS(FM) Wash., DC/Baltimore, MD WYSR(FM) Albany, NY*
WHFM(FM) Long Island, NY WMYI(FM) Greenville-Spartanburg, SC
WBAB(FM) Long Island, NY WGVL-AM Greenville-Spartanburg, SC
WBLI(FM) Long Island, NY WSSL(FM) Greenville-Spartanburg, SC
WGBB-AM Long Island, NY WROQ(FM) Greenville-Spartanburg, SC*
KMKX(FM) San Diego, CA KWFM(FM) Tuscon, AZ
KYXY(FM) San Diego, CA KRQQ(FM) Tuscon, AZ
WSNE(FM) Providence, RI KNST-AM Tuscon, AZ
WHJY(FM) Providence, RI KCEE-AM Tuscon, AZ
WHJJ(FM) Providence, RI WHMP(FM) Springfield/Northampton, MA
WHCN(FM) Hartford, CT WHMP-AM Springfield/Northampton, MA
WMRQ(FM) Hartford, CT WPKX(FM) Springfield/Northampton, MA
WKSS(FM) Hartford, CT KRZZ(FM) Wichita, KS
WPOP-AM Hartford, CT KKRD(FM) Wichita, KS
WTCK-AM Greensboro, NC* KNSS-AM Wichita, KS
WMAG(FM) Greensboro, NC* WPLR(FM) New Haven, CT
WHSL(FM) Greensboro, NC** WYBC(FM) New Haven, CT*
WMFR-AM Greensboro, NC* WGNE(FM) Daytona Beach, FL
WSIX(FM) Nashville, TN WCHZ(FM) Augusta, GA*
WRVW(FM) Nashville, TN WAEG(FM) Augusta, GA**
WIVY(FM) Jacksonville, FL WAEJ(FM) Augusta, GA***
WPDG-AM Jacksonville, FL WJDS-AM Jackson, MS
WOKV-AM Jacksonville, FL WKTF(FM) Jackson, MS
WKQL(FM) Jacksonville, FL WMSI(FM) Jackson, MS
WLYT(FM) Charlotte, NC WSTZ(FM) Jackson, MS*
WTDR(FM) Charlotte, NC WZRX-AM Jackson, MS
WDCG(FM) Raleigh, NC WJDX(FM) Jackson, MS**
WRDU(FM) Raleigh, NC WKNN(FM) Biloxi, MS
WTRG(FM) Raleigh, NC WMJY(FM) Biloxi, MS
WZZU(FM) Raleigh, NC WVCO(FM) Myrtle Beach, SC***
WMXB(FM) Richmond, VA WYAK(FM) Myrtle Beach, SC***
WMYB(FM) Myrtle Beach, SC***
* Joint Selling Agreement (JSA)
** JSA with option to buy
*** Local Marketing Agreement
Under contract to be sold or swapped by SFX are the Texas State Networks, a
group of regional radio networks; KRLD-AM and KTCK-AM in Dallas; WXTR(FM),
WXVR(FM) and WQSI-AM in Washington, DC; WVEZ(FM), WWKY-AM, and WTFX(FM) in
Louisville, KY; KOLL(FM) in Little Rock, AR; and WRXR(FM) and WKBG(FM) in
Augusta, GA.
