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Title: |
Asset Purchase Agreement |
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Entities: |
Kzjl License Corp; Union Bank of California, NA; Bank of New York; O’Melveny & Myers; Skadden, Arps, Slate, Meagher & Flom LLP |
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Date: |
2002 |
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Size: |
Preview shows 15KB of 189KB total |
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Price: |
$49 |
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ID: |
#1908246 |
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ASSET PURCHASE AGREEMENT
Among
EL DORADO COMMUNICATIONS, INC.
EL DORADO 108, INC.
KXTJ LICENSE, INC.
LBI HOLDINGS II, INC.
LIBERMAN BROADCASTING OF HOUSTON, INC.
and
LIBERMAN BROADCASTING OF HOUSTON LICENSE CORP.
RELATING TO THE ACQUISITION OF KEYH
Dated as of April 5, 2002
{PAGE}
TABLE OF CONTENTS
{TABLE}
{CAPTION}
Page
{S} {C}
ARTICLE I DEFINITIONS ....................................................... 2
1.1 Definitions ....................................................... 2
1.2 Knowledge ......................................................... 8
ARTICLE II PURCHASE AND SALE OF ASSETS ....................................... 8
2.1 Assets to be Conveyed ............................................. 8
2.2 Excluded Assets and Liabilities ................................... 9
ARTICLE III PURCHASE PRICE; METHOD OF PAYMENT; ESCROW DEPOSIT ................. 10
3.1 Purchase Price .................................................... 10
3.2 Liabilities Assumed ............................................... 11
3.3 Escrow Deposit .................................................... 11
3.4 Buyer's Remedies .................................................. 14
3.5 Allocation ........................................................ 14
3.6 Prorations ........................................................ 15
ARTICLE IV REPRESENTATIONS AND WARRANTIES BY SELLER ........................... 15
4.1 Organization and Standing ......................................... 15
4.2 Authorization ..................................................... 15
4.3 KEYH FCC Licenses, Transmitters and Towers ........................ 15
4.4 Artlite Documents. ................................................ 17
4.5 Purchased Assets .................................................. 19
4.6 Insurance ......................................................... 19
4.7 Litigation ........................................................ 20
4.8 Contracts ......................................................... 20
4.9 Insolvency ........................................................ 20
4.10 Reports ........................................................... 20
4.11 No Defaults ....................................................... 20
4.12 Disclosures ....................................................... 21
4.13 Environmental Compliance .......................................... 21
4.14 Intellectual Property ............................................. 22
4.15 Brokers ........................................................... 22
4.16 Prepaid Expenses .................................................. 23
{/TABLE}
-i-
{PAGE}
TABLE OF CONTENTS
(continued)
{TABLE}
{CAPTION}
Page
{S} {C}
4.17 Sale Proceeds Recipients; Recipient Agreement ..................... 23
ARTICLE V REPRESENTATIONS AND WARRANTIES BY BUYER AND LBI HOLDINGS .......... 23
5.1 Status ............................................................ 23
5.2 No Defaults ....................................................... 23
5.3 Authorization. .................................................... 24
.
5.4 Brokers ........................................................... 24
5.5 Qualification as a Broadcast Licensee ............................. 24
5.6 Litigation ........................................................ 24
5.7 Approvals and Consents ............................................ 24
ARTICLE VI COVENANTS OF SELLER ............................................... 25
6.1 Affirmative Covenants of Seller ................................... 25
6.2 Negative Covenants of Seller ...................................... 27
ARTICLE VII ADDITIONAL AGREEMENTS ............................................. 28
7.1 Purchase of Station KEYH; Inquiry and Maintenance of Station KEYH.. 28
7.2 Application for Commission Consent; Other Consents; Pre-Closing.... 29
7.3 Mutual Right to Terminate ......................................... 31
7.4 Buyer's Right to Terminate ........................................ 31
7.5 Seller's Right to Terminate ....................................... 32
7.6 Risk of Loss ...................................................... 32
7.7 Transfer Taxes and FCC Filings; Expenses; Bulk Sales. ............. 34
7.8 Termination of KEYH Local Marketing Agreement. .................... 35
7.9 Invoices. ......................................................... 35
7.10 Determination of KEYH Closing Date ................................ 35
7.11 Mutual Releases ................................................... 35
7.12 Artlite. .......................................................... 35
7.13 Recipient Agreement. .............................................. 36
7.14 Auxiliary License Application. .................................... 36
7.15 Further Estoppel Certificate. ..................................... 36
ARTICLE VIII CLOSING CONDITIONS ............................................... 36
{/TABLE}
-ii-
{PAGE}
TABLE OF CONTENTS
(continued)
{TABLE}
{CAPTION}
Page
{S} {C}
8.1 Conditions Precedent to Buyer's Obligations ...................... 36
8.2 Conditions Precedent to Seller's Obligations ..................... 38
ARTICLE IX ITEMS TO BE DELIVERED AT THE CLOSING ............................. 39
9.1 Seller's Performance At Closing .................................. 39
9.2 Buyer's Performance at Closing ................................... 42
ARTICLE X INDEMNIFICATION .................................................. 43
10.1 Indemnification by Seller ........................................ 43
10.2 Indemnification by LBI Holdings and Buyer ........................ 44
10.3 Third-Party Claims ............................................... 44
10.4 Cap and Basket ................................................... 45
10.5 Holdback ......................................................... 46
10.6 Survival of Representations and Warranties ....................... 46
ARTICLE XI MISCELLANEOUS PROVISIONS ......................................... 46
11.1 Notices .......................................................... 46
11.2 Benefit and Assignment ........................................... 47
11.3 Other Documents .................................................. 48
11.4 Appendices ....................................................... 48
11.5 Construction ..................................................... 48
11.6 Arbitration ...................................................... 48
11.7 Counterparts ..................................................... 50
11.8 Headings ......................................................... 50
11.9 Entire Agreement ................................................. 50
{/TABLE}
-iii-
{PAGE}
SCHEDULE I Identification of Contracts to be Assumed
SCHEDULE II List of all Permits and KEYH FCC Licenses
SCHEDULE III List of Required Consents; Encumbrances; UCC Financing
Statements; UCC Termination Statements
SCHEDULE IV Identification of Items of Tangible Personal Property Described
in Section 2.1.1
SCHEDULE V Allocation of the Purchase Price
SCHEDULE VI Insurance Coverage on the Purchased Assets
SCHEDULE VII Identification of Intellectual Property
SCHEDULE VIII Schedule of Prepaid Expenses
SCHEDULE IX Sale Proceeds Recipients
SCHEDULE X Information to be Periodically Provided to Buyer
EXHIBIT A Seller Escrow Payment Certificate (AM Only)
EXHIBIT B-1 Opinion of Sellers' Counsel
EXHIBIT B-2 Opinion of Sellers' Texas Counsel
EXHIBIT C Opinion of Sellers' FCC Counsel
EXHIBIT D Opinion of LBI Entities' Counsel
EXHIBIT E Exercise Purchase Right Notice
EXHIBIT F Lessor Estoppel Certificates
EXHIBIT G AM Local Marketing Agreement
EXHIBIT H Forms of Required Consents
EXHIBIT I Recipient Agreement
EXHIBIT J Confidentiality
{PAGE}
AM ASSET PURCHASE AGREEMENT
THIS AM ASSET PURCHASE AGREEMENT is dated as of April 5, 2002, and
made and entered into by and among El Dorado Communications, Inc., a California
corporation ("EDC"), El Dorado 108, Inc., a Texas corporation ("EDC Sub") and
KXTJ License, Inc., a Delaware corporation ("EDC License Sub"), on the one hand,
and LBI Holdings II, Inc., a California corporation ("LBI Holdings"), Liberman
Broadcasting of Houston, Inc., a California corporation ("LBI"), and Liberman
Broadcasting of Houston License Corp., a California corporation ("LBI Sub"), on
the other. EDC, EDC Sub and EDC License Sub are referred to collectively as
"Seller," and LBI and LBI Sub are referred to collectively as "Buyer."
W I T N E S S E T H:
WHEREAS, Seller owns certain assets used or held for use in connection
with the operation of radio station KQQK, 107.9 FM, Beaumont, Texas ("Station
KQQK") and Seller owns, or has the rights to own and as of the KEYH Closing Date
will own, certain assets used or held for use in connection with the operation
of radio station KEYH, 850 AM, Houston, Texas ("Station KEYH") (each a "Station"
and, collectively, the "Stations") and Seller desires to sell and assign to
Buyer the Stations, the businesses of the Stations and their related assets, and
the licenses, permits and other authorizations issued by the Federal
Communications Commission (the "FCC" or "Commission") for or in connection with
the operation of Station KQQK (the "KQQK FCC Licenses") and for or in connection
with the operation of Station KEYH (the "KEYH FCC Licenses"; the KQQK FCC
Licenses and the KEYH FCC Licenses are collectively referred to herein as the
"FCC Licenses"); and
WHEREAS, Seller has a right to purchase Station KEYH from Artlite
Broadcasting Company, a Texas corporation ("Artlite") pursuant to the Extension
of LMA and Purchase Rights Agreement effective as of January 31, 1997 by and
between EDC and Artlite (the "KEYH Extension Agreement"), the Agreement to
Purchase Radio Assets and Enter Into Local Marketing Agreement dated July 23,
1995 by and between EDC and Artlite (the "KEYH Purchase Agreement"), the
Agreement Regarding Deposit by and among Artlite, EDC and David Best (the "KEYH
Deposit Agreement") and Agreement to Extend Due Date for Deposit dated August 5,
1996 by and among Artlite, EDC and David Best (the "KEYH Deposit Extension
Agreement") and currently has the right to operate Station KEYH under the Time
Brokerage (Local Marketing) Agreement dated as of August 1, 1995 by and between
EDC and Artlite, as extended until January 31, 2004 pursuant to the KEYH
Extension Agreement (the "KEYH Local Marketing Agreement"); and
WHEREAS, Seller has exercised such right to purchase Station KEYH from
Artlite pursuant to Section 7.1 of this Agreement so as to be able to sell and
assign to Buyer Station KEYH and Seller shall prior to the KEYH Closing Date use
its efforts as set forth in this Agreement to preserve and cause Artlite to
preserve the businesses of the Stations; and
WHEREAS, LBI Sub desires to acquire the FCC Licenses and LBI desires
to acquire from Seller all the other assets relating to the Stations and
businesses related thereto; and
{PAGE}
WHEREAS, the FCC Licenses may not be assigned to LBI Sub without the
prior written consent of the Commission; and
WHEREAS, Buyer, Seller and LBI Holdings are concurrently entering into
the FM Asset Purchase Agreement of even date herewith (as amended, supplemented
or otherwise modified from time to time, the "FM Asset Purchase Agreement"); and
WHEREAS, Buyer and Seller wish to consummate the transactions
contemplated hereby and the transactions contemplated by the FM Asset Purchase
Agreement concurrently for an aggregate purchase price (prior to adjustments) of
$30,000,001 but are, under certain circumstances, willing to consummate the
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