Registration No. 333-91683
SECURITIES AND EXCHANGE COMMISSION
Amendment No. 3
BEASLEY BROADCAST GROUP, INC.
| Delaware | 4832 | 65-0960915 | ||
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(state or other jurisdiction
of incorporation or organization) |
(Primary Standard Industrial
Classification Code Number) |
(I.R.S. Employer Identification No.) |
3033 Riviera Drive, Suite 200
George G. Beasley
Copies to:
|
John D. Watson, Jr., Esq.
Latham & Watkins 1001 Pennsylvania Avenue, N.W., Suite 1300 Washington, DC 20004 (202) 637-2200 |
Jeremy W. Dickens, Esq.
Weil, Gotshal & Manges LLP 767 Fifth Avenue New York, New York 10153 (212) 310-8000 |
Approximate date of commencement of proposed sale to public : As soon as practicable after this Registration Statement becomes effective.
The Registrant hereby amends this Registration Statement on such date or dates as may be necessary to delay its effective date until the Registrant shall file a further amendment which specifically states that this Registration Statement shall thereafter become effective in accordance with Section 8(a) of the Securities Act of 1933 or until this Registration Statement shall become effective on such date as the Commission, acting pursuant to said Section 8(a), may determine.
[BEASLEY LOGO]
BEASLEY BROADCAST GROUP, INC.
Class A Common Stock
Prior to this offering, there has been no public market for our Class A common stock. Our Class A common stock has been approved for listing on The Nasdaq Stock Market’s National Market under the symbol “BBGI.”
The underwriters have an option to purchase a maximum of 1,027,500 additional shares to cover over-allotments of shares.
We have two classes of common stock: Class A common stock and Class B common stock. Holders of each class generally have the same rights, except for differences in voting rights. Holders of Class A common stock have one vote per share while holders of Class B common stock have 10 votes per share. Immediately following this offering, the Class B common stock will represent approximately 95.9% of the combined voting power of our common stock, without giving effect to the exercise of the underwriters’ over-allotment option.
Investing in our Class A common stock involves risks. See “Risk Factors” on page 8.
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| Underwriting | Beasley | |||||||||||
| Price to | Discounts and | Broadcast | ||||||||||
| Public | Commissions | Group | ||||||||||
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| Per Share | $15.50 | $1.046 | $14.454 | |||||||||
| Total | $106,175,000 | $7,165,100 | $99,009,900 | |||||||||
Delivery of the shares of Class A common stock will be made on or about February 16, 2000.
Neither the Securities and Exchange Commission nor any state securities commission has approved or disapproved of these securities or determined if this prospectus is truthful or complete. Any representation to the contrary is a criminal offense.
| Credit Suisse First Boston | Banc of America Securities LLC |
| Deutsche Banc Alex. Brown | Salomon Smith Barney |
The date of this prospectus is February 11, 2000.
[Map of the United States designating the markets in which we operate. The map also identifies the stations that we own and operate as well as those stations that we have agreements to purchase.]
TABLE OF CONTENTS
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| Prospectus Summary | 2 | |
| Risk Factors | 8 | |
| Special Note Regarding Forward-Looking Statements | 13 | |
| Use of Proceeds | 14 | |
| Dividend Policy | 14 | |
| Dilution | 15 | |
| Capitalization | 16 | |
| Selected Historical Combined Financial Data | 17 | |
| Management’s Discussion and Analysis of Financial Condition and Results of Operations | 19 | |
| Recently Completed and Pending Radio Broadcasting Transactions | 28 | |
| Information About Station and Market Data | 29 | |
| Corporate Reorganization | 29 | |
| Business | 31 | |
| Management | 52 | |
| Certain Relationships and Related Party Transactions | 57 | |
| Principal Stockholders | 60 | |
| Description of Capital Stock | 61 | |
| Shares Eligible for Future Sale | 63 | |
| Underwriting | 64 | |
| Notice to Canadian Residents | 67 | |
| U.S. Federal Tax Considerations for Non-U.S. Holders | 68 | |
| Legal Matters | 72 | |
| Experts | 72 | |
| Where You Can Find More Information | 72 | |
| Index to Combined Financial Statements | F-1 |
You should rely only on the information contained in this document or to which we have referred you. We have not authorized anyone to provide you with information that is different. This document may only be used where it is legal to sell these securities. The information in this document may only be accurate on the date of this document.
Dealer Prospectus Delivery Obligation
Until March 7, 2000, all dealers that effect transactions in these securities, whether or not participating in this offering, may be required to deliver a prospectus. This is in addition to the dealer’s obligation to deliver a prospectus when acting as an underwriter and with respect to unsold allotments or subscriptions.
1
PROSPECTUS SUMMARY
This summary only highlights information contained elsewhere in this prospectus. You should read the entire prospectus carefully. Unless we indicate otherwise, information in this prospectus assumes the underwriters will not exercise their over-allotment option. You should refer to the introduction to “— Summary Historical Combined Financial Information” for the meanings of some of the financial terms used in this prospectus. Unless the context requires otherwise, for periods before the corporate reorganization described in this prospectus, “Beasley Broadcast Group,” “we,” “us,” “our” and similar terms refer to Beasley FM Acquisition Corp. and related companies, and after giving effect to the corporate reorganization, those same terms refer to Beasley Broadcast Group, Inc., its consolidated subsidiaries and the stations we have agreed to acquire in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta.
Overview
We were founded in 1961 and are the 16th largest radio broadcasting company in the United States based on 1998 gross revenues. After giving effect to pending acquisitions in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta, we will own and operate 36 stations, 21 FM and 15 AM. Our stations are located in nine large and mid-sized markets in the eastern United States. Twelve of these stations are located in four of the nation’s top 12 radio markets: Atlanta, Philadelphia, Boston and Miami-Ft. Lauderdale. Our station groups rank among the first or second largest clusters, based on gross revenues, in five of our nine markets and, collectively, our radio stations reach approximately three million people on a weekly basis. For the twelve months ended September 30, 1999, giving effect to acquisitions and dispositions completed during the period, as well as the pending acquisitions mentioned above and our recent acquisitions in Atlanta, as if those acquisitions had been completed at the beginning of the period, we had net revenues of $94.7 million, broadcast cash flow of $28.8 million and a net loss of $8.1 million.
We seek to maximize revenues and broadcast cash flow by acquiring and operating clusters of stations in high-growth large and mid-sized markets located primarily in the eastern United States. We have assembled groups of five or more stations in five of our markets. Our radio stations program a variety of formats, including urban, contemporary hit radio and country, which target the demographic groups in each market that we consider the most attractive to our advertisers. The combination of our market clusters and our advertising, sales and programming expertise has enabled us to achieve strong same station revenue and broadcast cash flow growth.
Operating Strategy
In order to maximize revenues and broadcast cash flow at our stations, our operating strategy is to:
| • | secure and maintain a leadership position in current and future markets by creating clusters of multiple stations; | |
| • | conduct in-depth market research in order to refine our programming and enhance our ratings; | |
| • | establish a strong local brand identity through advertising and promotional initiatives; | |
| • | build a relationship-oriented sales force whose goal is to create a strong local and national sales effort; | |
| • | hire, develop and motivate strong local management teams; and | |
| • | enhance broadcast cash flow margins of underutilized AM stations by selling blocks of programming time to providers of health, ethnic, religious and other specialty programming. |
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Acquisition Strategy
Since June 1996, we have acquired or agreed to acquire 25 radio stations. Our future acquisition strategy, which will focus on stations located in the 100 largest radio markets, is to:
| • | acquire additional radio stations in our current markets to further enhance our market position; | |
| • | acquire existing clusters in new markets or establish a presence in new markets where we believe we can build successful clusters over time; | |
| • | pursue swap opportunities with other radio station owners to build or enhance our market clusters; and | |
| • | selectively acquire large-market AM stations serving attractive demographic groups with specialty programming. |
Pending Transactions
We have entered into agreements to purchase the following radio stations:
| • | one AM radio station in Boston for approximately $6 million, subject to an upward adjustment of up to $2 million; | |
| • | two AM radio stations in Miami-Ft. Lauderdale and one AM radio station in West Palm Beach, for a total purchase price of approximately $18 million; and | |
| • | one FM and one AM radio station in Augusta for approximately $800,000. |
We expect the Boston and Miami-Ft. Lauderdale/ West Palm Beach acquisitions to close in the second quarter of 2000. We are unable to predict when the Augusta acquisitions will close due to pending disputes described in “Recently Completed and Pending Radio Broadcasting Transactions.”
We have entered into a non-binding letter of intent to purchase one FM and five AM stations in various markets in the Northeast, including one AM station in Boston, for a total purchase price of approximately $18 million. We have an additional non-binding letter of intent to purchase one AM station in Atlanta for approximately $1.5 million. Because we have not signed definitive purchase agreements for any of these stations, we have not included them in our portfolio as described in this prospectus.
Our Principal Executive Offices
Our principal executive offices are located at 3033 Riviera Drive, Suite 200, Naples, Florida 34103, and our telephone number is (941) 263-5000.
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The Offering
| Class A common stock offered | 6,850,000 shares | |
| Common stock to be outstanding after the offering |
7,252,068 shares of Class A common stock
17,021,373 shares of Class B common stock 24,273,441 shares of common stock |
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| Voting rights | The Class A common stock and the Class B common stock generally vote together as a single class on all matters submitted to a vote of stockholders. Each share of Class A common stock is entitled to one vote and each share of Class B common stock is entitled to 10 votes. The holders of our Class A common stock, voting as a single class, are entitled to elect two directors. Immediately following this offering, the Class B common stock will represent approximately 95.9% of the combined voting power of our common stock, approximately 95.4% if the underwriters exercise their overallotment option in full. All of our Class B common stock is owned by George G. Beasley, our Chairman and Chief Executive Officer, and members of his immediate family. | |
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Conversion and transferability of
Class B common stock |
Shares of Class B common stock are convertible at the option of the holder at any time into shares of Class A common stock on a one-for-one basis. Shares of Class B common stock convert automatically into shares of Class A common stock upon sale or transfer to persons or entities not related to George G. Beasley or members of his immediate family. | |
| Proposed Nasdaq National Market symbol | “BBGI” |
Class A common stock offered and common stock to be outstanding after the offering excludes up to 1,027,500 shares of Class A common stock that may be issued to cover over-allotments of shares.
Common stock to be outstanding after the offering is as of the closing date. It excludes grants under our 2000 equity plan of options to purchase 2,500,000 shares of Class A common stock at the initial public offering price.
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Summary Historical Combined Financial Information
We have derived the summary historical financial information shown below for the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999 from our audited and unaudited combined financial statements included elsewhere in this prospectus.
As you review the information contained in the following table and throughout this prospectus, you should note the following:
| • | During the periods presented, we operated as a series of partnerships and subchapter S corporations under the Internal Revenue Code. Accordingly, we were not liable for federal and some state and local corporate income taxes, as we would have been if we had been treated as a subchapter C corporation. During these periods, our stockholders included our taxable income or loss in their federal and applicable state and local income tax returns. The pro forma amounts shown in the table reflect provisions for federal, state and local income taxes, applied to income (loss) before pro forma income taxes, as if we had been taxed as a subchapter C corporation. On the day prior to the date of this prospectus, our subchapter S status will terminate. On the date of this prospectus, we will reorganize all of our entities under a holding company that is a wholly-owned subsidiary of Beasley Broadcast Group, Inc., the newly formed subchapter C corporation that is issuing the Class A common stock offered by this prospectus. | |
| • | For purposes of our historical financial statements, the term pro forma refers to the adjustments necessary to reflect our status as a subchapter C corporation for income tax purposes rather than a series of subchapter S corporations and partnerships, distributions to equity holders for income taxes of entities comprising Beasley Broadcast Group prior to the reorganization, the distribution of untaxed retained income and subsequent recontribution of the same amounts as additional paid-in capital and the fair value adjustment necessary to record the acquisition of minority shareholder interest using the purchase method of accounting. | |
| • | Broadcast cash flow consists of operating income (loss) before corporate general and administrative expenses, depreciation and amortization, equity appreciation rights expenses and impairment loss on long-lived assets. For the periods shown in the following table, broadcast cash flow is unaffected by fees paid under local management and time brokerage agreements of $1,075,000 for the year ended December 31, 1996 and zero for subsequent periods. The fees are included in other non-operating income (expense). | |
| • | Broadcast cash flow margin represents broadcast cash flow as a percentage of net revenues. | |
| • | EBITDA consists of broadcast cash flow minus corporate general and administrative expenses. | |
| • | Pro forma after-tax cash flow consists of pro forma net income (loss) minus net gains on sale of radio stations plus the following: loss on sale of radio stations, depreciation and amortization, equity appreciation rights expenses, impairment loss on long-lived assets and deferred tax provision (or minus deferred income tax benefit). | |
| • | No expense for equity appreciation rights has been recorded for the periods presented. We expect to record equity appreciation rights expenses of approximately $430,000 in the fourth quarter of 1999 and approximately $1.2 million in the first quarter of 2000. | |
| • | The as adjusted balance sheet data as of September 30, 1999 gives effect to: |
| • | our corporate reorganization and the related reduction of additional paid-in capital by $26,905,000 to establish the net deferred tax liability resulting from the termination of our subchapter S status; | |
| • | the sale of 6,850,000 shares of Class A common stock by us at the initial public offering price of $15.50 per share and the application of the net proceeds as described under “Use of Proceeds” and “Capitalization”; |
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| • | our recent acquisitions in Atlanta and our pending acquisitions in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta for an aggregate purchase price of approximately $34.8 million; and | |
| • | distributions of $3.0 million to equity holders to pay income taxes on income of entities comprising Beasley Broadcast Group for the 1999 tax year. |
Although broadcast cash flow, EBITDA and pro forma after-tax cash flow are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles, we believe that these measures are useful to an investor in evaluating our performance. These measures are widely used in the broadcast industry to evaluate a radio company’s operating performance. However, you should not consider these measures in isolation or as substitutes for operating income, cash flows from operating activities or any other measure for determining our operating performance or liquidity that is calculated in accordance with generally accepted accounting principles. In addition, because broadcast cash flow, EBITDA and pro forma after-tax cash flow are not calculated in accordance with generally accepted accounting principles, they are not necessarily comparable to similarly titled measures employed by other companies.
The comparability of the historical financial information reflected below has been significantly affected by acquisitions and dispositions. You should read the summary financial information together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our combined financial statements and the related notes included elsewhere in this prospectus.
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| Nine months ended | |||||||||||||||||||||||
| Year ended December 31, | September 30, | ||||||||||||||||||||||
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| 1996 | 1997 | 1998 | 1998 | 1999 | |||||||||||||||||||
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| Operating Data: | |||||||||||||||||||||||
| Net revenues | $ | 62,413 | $ | 73,704 | $ | 81,433 | $ | 59,675 | $ | 67,452 | |||||||||||||
| Operating expenses: | |||||||||||||||||||||||
| Station operating expenses | 42,163 | 55,247 | 61,692 | 45,614 | 48,304 | ||||||||||||||||||
| Corporate general and administrative expenses | 2,233 | 2,055 | 2,498 | 1,886 | 1,935 | ||||||||||||||||||
| Depreciation and amortization | 8,317 | 14,174 | 16,096 | 11,942 | 11,824 | ||||||||||||||||||
| Equity appreciation rights expenses | — | — | — | — | — | ||||||||||||||||||
| Impairment loss on long-lived assets | — | 4,124 | — | — | — | ||||||||||||||||||
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| Total operating expenses | 52,713 | 75,600 | 80,286 | 59,442 | 62,063 | ||||||||||||||||||
| Operating income (loss) | 9,701 | (1,896 | ) | 1,147 | 223 | 5,389 | |||||||||||||||||
| Other income (expense): | |||||||||||||||||||||||
| Interest expense | (9,340 | ) | (13,606 | ) | (13,602 | ) | (10,251 | ) | (9,962 | ) | |||||||||||||
| Other non-operating income (expense) | (2,025 | ) | 54 | (160 | ) | (76 | ) | 471 | |||||||||||||||
| Gain (loss) on sale of radio stations | 16,773 | 82,067 | 4,028 | (328 | ) | — | |||||||||||||||||
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| Total other income (expense) | 5,408 | 68,515 | (9,734 | ) | (10,655 | ) | (9,491 | ) | |||||||||||||||
| Income (loss) before pro forma income taxes | 15,108 | 66,619 | (8,587 | ) | (10,422 | ) | (4,102 | ) | |||||||||||||||
| Pro forma current income tax expense (benefit) | 567 | 7,054 | (5,010 | ) | (5,295 | ) | (1,057 | ) | |||||||||||||||
| Pro forma deferred income tax expense(benefit) | 5,318 | 18,741 | 1,760 | 1,320 | (475 | ) | |||||||||||||||||
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| Pro forma net income (loss) | $ | 9,223 | $ | 40,824 | $ | (5,337 | ) | $ | (6,447 | ) | $ | (2,570 | ) | ||||||||||
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| Pro forma basic and diluted net income (loss) per share | $ | 0.53 | $ | 2.34 | $ | (0.31 | ) | $ | (0.37 | ) | $ | (0.15 | ) | ||||||||||
| Weighted average common shares outstanding — basic | 17,423,441 | 17,423,441 | 17,423,441 | 17,423,441 | 17,423,441 | ||||||||||||||||||
| Other Data: | |||||||||||||||||||||||
| Broadcast cash flow | $ | 20,250 | $ | 18,457 | $ | 19,741 | $ | 14,061 | $ | 19,148 | |||||||||||||
| Broadcast cash flow margin | 32 | % | 25 | % | 24 | % | 24 | % | 28 | % | |||||||||||||
| EBITDA | $ | 18,017 | $ | 16,402 | $ | 17,243 | $ | 12,175 | $ | 17,213 | |||||||||||||
| Pro forma after tax cash flow | 6,085 | (4,204 | ) | 8,491 | 7,143 | 8,779 | |||||||||||||||||
| Cash provided by (used in): | |||||||||||||||||||||||
| Operating activities | 5,303 | 1,586 | 4,921 | 5,134 | 7,385 | ||||||||||||||||||
| Investing activities | (66,300 | ) | 18,871 | (12,527 | ) | (9,368 | ) | (2,021 | ) | ||||||||||||||
| Financing activities | 63,152 | (17,052 | ) | 4,689 | 695 | (4,366 | ) | ||||||||||||||||
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| Balance Sheet Data: | |||||||||
| Cash and cash equivalents | $ | 5,758 | $ | 2,758 | |||||
| Intangible assets, net | 141,086 | 184,578 | |||||||
| Total assets | 187,204 | 231,673 | |||||||
| Long-term debt, including current installments | 163,155 | 100,216 | |||||||
| Net stockholders’ equity (deficit) | (2,917 | ) | 82,117 | ||||||
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RISK FACTORS
Investing in our Class A common stock involves risk. You should consider carefully the following risk factors, in addition to the other information contained in this prospectus, before purchasing shares of Class A common stock in this offering.
Our radio stations may not be able to compete effectively in their respective markets for advertising revenues, which could adversely affect our revenue and cash flow.
We operate in a highly competitive business. A decline in our audience share or advertising rates in a particular market may cause a decline in the revenue and cash flow of our stations located in that market. Our radio stations compete for audiences and advertising revenues within their respective markets directly with other radio stations, as well as with other media. These media include newspapers, magazines, network and cable television, outdoor advertising, direct mail and emerging media such as streaming audio delivered over the Internet.
Our stations could suffer a reduction in ratings or advertising revenue and could incur increased promotional and other expenses if:
| • | another radio station in a market were to convert its programming to a format similar to one of our stations; or | |
| • | if a new station were to adopt a comparable format or if an existing competitor were to improve its audience share. |
Other radio broadcasting companies may enter into the markets in which we operate or may operate in the future. These companies may be larger and have more financial resources than we have. Our radio stations may not be able to maintain or increase their current audience ratings and advertising revenues.
A downturn in the performance of our Miami-Ft. Lauderdale or Philadelphia stations could adversely affect our revenue and broadcast cash flow.
A ratings decline or other operating difficulty in the performance of our stations in Miami-Ft. Lauderdale or Philadelphia could have a disproportionately adverse effect on our total revenue and broadcast cash flow. For the nine months ended September 30, 1999, approximately 43% of our net revenues and 41% of our broadcast cash flow came from our stations operating in the Miami-Ft. Lauderdale market. For the same period, approximately 20% of our net revenues and 18% of our broadcast cash flow came from our stations operating in the Philadelphia market. We have greater exposure to adverse events or conditions affecting the economy in these markets than would be the case if we were more geographically diverse.
We may not be successful in consummating future acquisitions, an important element of our business strategy, which could significantly impair our future growth.
Radio broadcasting is a rapidly consolidating industry, with many companies seeking to consummate acquisitions and increase their market share. If we are unable to identify and consummate future acquisitions in markets where we have the opportunity to purchase additional stations, our ability to compete in those markets could be impaired. Moreover, to the extent securities analysts and investors anticipate that we will continue to grow through acquisitions, and we do not do so, our stock price could decline, perhaps substantially.
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We compete and will continue to compete with many other buyers for the acquisition of radio stations. Our acquisition strategy is subject to a number of risks, including:
| • | competitors may be able to outbid us for acquisitions because they have greater financial resources; | |
| • | required regulatory approvals may result in unanticipated delays in completing acquisitions; | |
| • | we may not be successful in integrating acquisitions we may make; and | |
| • | we may be required to raise additional financing to consummate future acquisitions and that financing may not be available to us on acceptable terms. |
Our contracts for radio broadcast rights relating to Florida sports teams may also adversely effect future results.
In 1997, 1998 and the nine months ended September 30, 1999, expenses relating to our contracts to broadcast games played by the Miami Dolphins, Florida Marlins and Florida Panthers exceeded related revenues by $2.9 million, $796,000 and $1.3 million, respectively. Unless we are able to generate significantly more revenues under these contracts in the future, they are likely to have a material adverse effect on our results of operations on a going-forward basis. However, in light of the uncertainty regarding future revenues, the amount of any future loss cannot be determined at this time. The proper accounting treatment for executory contracts such as these is currently the subject of Emerging Issues Task Force 99-14. Depending on the resolution of this issue by the task force, we may be required to record a charge reflecting an impairment of these committed contracts. Such a charge could also have a material adverse effect on future results of operations.
Our Chairman of the Board and Chief Executive Officer effectively controls Beasley Broadcast Group, and members of his immediate family also own a substantial equity interest in Beasley Broadcast Group. Their interests may conflict with yours.
After this offering, George G. Beasley, our Chairman of the Board and Chief Executive Officer, generally will be able to control the vote on all matters submitted to a vote of stockholders. Without the approval of Mr. Beasley, we will be unable to consummate transactions involving an actual or potential change of control, including transactions in which you might otherwise receive a premium for your shares over then current market prices. His shares of Class B Common Stock will represent approximately 82.9% of the total voting power of our common stock. Mr. Beasley also has employee stock options to purchase 487,500 shares of Class A common stock. Members of his immediate family will also own significant amounts of Class B common stock and, through employee stock options, Class A common stock. Mr. Beasley will be able to direct our management and policies, except with respect to those matters requiring a class vote under the provisions of our certificate of incorporation, bylaws or applicable law.
Additionally, future related party transactions may not be on terms as favorable to us as could be obtained from unaffiliated parties. We have entered into significant transactions with George G. Beasley, members of his immediate family and affiliated entities. See “Certain Transactions.” Some of these transactions will be in effect after completion of the offering. For example, before the offering, Beasley Broadcast Group owned a number of radio towers used in the operation of our stations. These towers and related real estate assets are being transferred to a company owned by George G. Beasley and members of his immediate family. We will lease these towers on a going-forward basis, and therefore these operating assets will not be under our direct control.
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We have the ability to incur a significant amount of debt, which may affect how we use our cash flow and impair our ability to respond to changes in competitive and economic conditions.
We have the ability to incur indebtedness that is substantial in relation to our stockholders’ equity. If we incur a substantial amount of indebtedness, it could have several important consequences to the holders of Class A common stock, including, but not limited to, the following:
| • | a substantial portion of our cash flow from operations could be dedicated to debt service; | |
| • | our ability to obtain additional financing for working capital, capital expenditures, acquisitions and general corporate or other purposes could be impaired; | |
| • | our leveraged position and the covenants contained in our credit facility could limit our ability to compete, implement our acquisition strategy, make capital improvements and pay dividends; and | |
| • | our level of indebtedness could make us more vulnerable to economic downturns, limit our ability to withstand competitive pressures and reduce our flexibility in responding to changing business and economic conditions compared to less leveraged companies. |
For a description of our credit facility and amounts available see “Management’s Discussion and Analysis of Financial Condition and Results of Operations — Credit Facility.”
The covenants in our credit facility restrict our financial and operational flexibility, which could have an adverse affect on our results of operations.
Our credit facility contains covenants that restrict, among other things, our ability to borrow money, make particular types of investments or other restricted payments, swap or sell assets, issue equity or merge or consolidate. An event of default under our credit facility could allow the lenders to declare all amounts outstanding immediately due and payable. We have pledged substantially all of our combined assets and the stock of our subsidiaries to secure the debt under our credit facility. If the amounts outstanding under the credit facility were accelerated, the lenders could proceed against that collateral. Any event of default, therefore, could have a material adverse effect on our business.
Our credit facility also requires us to maintain specified financial ratios. A failure to meet these financial ratios could result in an event of default. An event of default under our credit facility could allow the lenders to declare all amounts outstanding immediately due and payable. We also may incur future debt obligations which might subject us to restrictive covenants that could affect our financial and operational flexibility or subject us to other events of default.
Our business depends on the efforts of key personnel and the loss of any one of them could have a material adverse effect on our business.
Our business depends upon the continued efforts, abilities and expertise of our executive officers and other key employees, including George G. Beasley, our Chairman of the Board and Chief Executive Officer. Mr. Beasley is 67 years old. We believe that the unique combination of skills and experience possessed by Mr. Beasley would be difficult to replace and that the loss of Mr. Beasley’s expertise could impair our ability to execute our acquisition and operating strategies.
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Risks Relating to Our Industry
The radio broadcasting industry faces many unpredictable business risks that could have a material adverse effect on our advertising revenues.
Our future operations are subject to many business risks, including those risks that specifically influence the radio broadcasting industry, which could have a material adverse effect on our business including:
| • | shifts in population, demographics or audience tastes; | |
| • | the level of competition for advertising revenues with other radio stations, television stations and other entertainment and communications media; and | |
| • | changes in governmental regulations and policies and actions of federal regulatory bodies, including the Internal Revenue Service, United States Department of Justice, the Federal Trade Commission and the Federal Communications Commission. |
We believe that advertising is a discretionary business expense, meaning that spending on advertising tends to decline disproportionately during economic recession or downturn as compared to other types of business spending. Consequently, a recession or downturn in the United States economy or the economy of an individual geographic market in which we own or operate radio stations would likely adversely affect our advertising revenues and therefore, our results of operations.
We may not remain competitive if we do not respond to the rapid changes in technology, standards and services that characterize our industry.
The radio broadcasting industry is subject to rapid technological change, evolving industry standards and the emergence of new media technologies and services. We may not have the resources to acquire new technologies or to introduce new services that could compete with these new technologies. Several new media technologies and services are being developed or introduced and we describe them in “Business — Competition; Changes in Broadcasting Industry.” Competition arising from new technologies or regulatory change may have a negative effect on the radio broadcasting industry or on our company.
If we are not able to obtain regulatory approval for our acquisitions, our future growth may be impaired.
An important part of our growth strategy is the acquisition of additional radio stations. We may not be able to complete all the acquisitions that we may agree to make. Radio station acquisitions are subject to the approval of the FCC and, potentially, other regulatory authorities. FCC regulations limit the number of radio stations that a licensee can own in a market, which could restrict our ability to consummate future transactions and in certain circumstances could require us to divest some radio stations. Also, the FCC has announced new procedures to review proposed radio broadcasting transactions even if the proposed acquisition otherwise complies with the FCC’s ownership limitations.
Additionally, since the passage of the Telecommunications Act of 1996, the U.S. Department of Justice has become more involved in reviewing proposed acquisitions of radio stations and radio station networks. The Justice Department is particularly concerned when the proposed buyer already owns one or more radio stations in the market of the station it is seeking to buy. Recently, the Justice Department has challenged a number of radio broadcasting transactions. Some of those challenges ultimately resulted in consent decrees requiring, among other things, divestitures of certain stations. In general, the Justice Department has more closely scrutinized radio broadcasting acquisitions that result in local market shares in excess of 40% of radio advertising revenue.
11
A denial in the renewal of any of our federally issued operating licenses could negatively affect our results of operations.
The FCC may not approve our future license renewal applications or those license renewals may include conditions or qualifications that limit our operating flexibility. Historically, our license renewal applications have been renewed without material conditions or qualifications. However, from time to time other industry participants have had licenses revoked, not renewed or renewed only with significant qualifications. The FCC has recently reminded industry participants that the FCC may invoke these penalties under appropriate circumstances involving, for example, deficiencies in licensees’ compliance with the FCC’s equal employment opportunity policies. We have no reason to believe that the FCC will not continue to renew our licenses without material conditions or qualifications, but if the FCC does not do so, our revenue and cash flow would suffer materially.
Risks Relating to the Trading Market for our Class A Common Stock
Future sales of our Class A common stock could adversely affect its market price.
The market price for our Class A common stock could fall substantially if our stockholders who hold restricted shares of common stock sell large amounts of shares of Class A common stock in the public market following this offering. These sales, or the possibility that these sales may occur, could make it more difficult for us to sell equity or equity related securities in the future. See “Shares Eligible for Future Sale.”
It may be difficult to take over Beasley Broadcast Group and that could adversely affect the price of our Class A common stock.
George G. Beasley effectively controls the decision whether a change of control of Beasley Broadcast Group will occur. Moreover, some provisions of our certificate of incorporation, by-laws and Delaware law could make it more difficult for a third party to acquire control of us, even if a change of control could be beneficial to you. In addition, the Communications Act and FCC rules and policies limit the number of stations that one individual or entity can own, directly or by attribution, in a market. FCC approval for transfers of control of FCC licensees and assignments of FCC licenses are also required. Because of the limitations and restrictions imposed on us by these provisions and regulations, the trading price of our Class A common stock could be adversely affected.
There may not be an active market for our Class A common stock, making it difficult for you to sell your stock.
Following our initial public offering, our stock may not be actively traded. An illiquid market for our stock may result in price volatility and poor execution of buy and sell orders for investors. We will determine the offering price of our Class A common stock through negotiations with the underwriters. The initial public offering price may bear no relationship to the price at which the Class A common stock will trade upon completion of this offering.
Historically, stock prices and trading volumes for newly public companies fluctuate widely for a number of reasons, including some reasons that may be unrelated to their businesses or results of operations. This market volatility could depress the price of our Class A common stock without regard to our operating performance. In addition, our operating results may be below the expectations of public market analysts and investors. If this were to occur, the market price of our common stock could decrease, perhaps significantly.
12
SPECIAL NOTE REGARDING FORWARD-LOOKING STATEMENTS
Information included in this prospectus may contain forward-looking statements. Forward-looking statements are not statements of historical facts, but rather reflect our current expectations concerning future results and events. We generally use the words “believes,” “expects,” “intends,” “plans,” “anticipates,” “likely,” “will” and similar expressions to identify forward-looking statements. These forward-looking statements are subject to risks, uncertainties and other factors, some of which are beyond our control. These factors could cause actual results to differ materially from those forecast or anticipated in the forward-looking statements. These risks, uncertainties and factors include, but are not limited to the factors described in “Risk Factors.”
You should not place undue reliance on these forward-looking statements, which reflect our view only as of the date of this prospectus. Except as required by law, we undertake no obligation to update these statements or publicly release the result of any revisions to these statements to reflect events or circumstances after the date of this prospectus.
13
USE OF PROCEEDS
The net proceeds to us, based on the initial public offering price of $15.50 per share, are estimated to be approximately $97.7 million, or approximately $112.6 million if the underwriters exercise their over-allotment option in full. This amount is after deducting underwriting discounts and commissions and estimated offering expenses payable by us.
We estimate that we will use approximately $53.7 million of the net proceeds from the offering to reduce borrowings outstanding under our credit facility. We will also use approximately $44.0 million of the net proceeds from the offering to repay indebtedness we owe to members of the Beasley family and affiliated companies. That $44.0 million payment is net of the repayment to us at the closing of approximately $9.7 million of indebtedness owed to us by members of the Beasley family, including approximately $1.0 million of accrued and unpaid interest.
As of December 31, 1999, we would have had an outstanding balance under our credit facility of approximately $101.2 million and availability under our credit facility of $48.7 million for future acquisitions and other corporate purposes after giving effect to:
| • | the Atlanta acquisitions; | |
| • | the pending acquisitions in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta; | |
| • | the repayment of all indebtedness we owe to members of the Beasley family and affiliated companies and the repayment of all indebtedness affiliates owe to us; and | |
| • | the application of a portion of the net proceeds from the offering to reduce borrowings outstanding under our credit facility. |
On December 31, 1999, the weighted average annual interest rate applicable to our credit facility was approximately 8.625%. The credit facility expires on December 31, 2006.
The obligations we owe to Mr. Beasley and affiliated companies bear interest at rates ranging from zero to 9.25% per year and either mature in 2004 or are payable on demand. For a more detailed description, see “Certain Transactions.”
DIVIDEND POLICY
From time to time, the various subchapter S corporations and partnerships comprising Beasley Broadcast Group have made cash distributions to their equity holders. Following the offering, as a public company, we expect to retain our future earnings, if any, for use in the operation and expansion of our business. We do not anticipate paying any cash dividends in the foreseeable future. Moreover, our credit facility prohibits us from paying dividends, except in limited circumstances.
14
DILUTION
Purchasers of the Class A common stock offered by this prospectus will suffer an immediate and substantial dilution in net tangible book value per share. Dilution is the amount by which the initial public offering price paid by the purchasers of the shares of Class A common stock will exceed the net tangible book value per share of common stock after the offering. The net tangible book value per share of common stock is determined by subtracting total liabilities from the total book value of the tangible assets and dividing the difference by the number of shares of common stock deemed to be outstanding on the date the book value is determined. As of September 30, 1999, we had a deficit in pro forma net tangible book value of $208,708,000 or $11.98 per share after giving effect to the completed and pending acquisitions, our corporate reorganization and distributions to equity holders for income taxes described elsewhere in this prospectus, but excluding this offering. Assuming the sale of 6,850,000 shares at the initial public offering price of $15.50 per share and deducting the underwriting discounts and commissions and estimated offering expenses, our pro forma net tangible book value as of September 30, 1999 would have been a deficit of $102,411,000 or $4.22 per share. This represents an immediate increase in pro forma net tangible book value to existing stockholders of $7.76 per share and an immediate dilution to new investors of $19.72 per share. The following table illustrates this per share dilution:
| Per | ||||||||
| Share | ||||||||
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| Initial public offering price | $ | 15.50 | ||||||
| Pro forma net negative tangible book value before this offering | $ | (11.98 | ) | |||||
| Increase in net tangible book value per share attributable to this offering | 7.76 | |||||||
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| Pro forma net negative tangible book value after this offering | (4.22 | ) | ||||||
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| Dilution to new investors | $ | 19.72 | ||||||
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The following table summarizes, on an as adjusted basis as of September 30, 1999:
| • | the number of shares of common stock purchased from us; | |
| • | the estimated value of the total consideration paid for or attributed to that common stock; and | |
| • | the average price per share paid by or attributable to existing stockholders and the new investors purchasing shares in this offering at the initial offering price of $15.50 per share. |
| Shares of Common | Average Price | ||||||||||||||||||||
| Stock Purchased | Total Consideration | Per Share of | |||||||||||||||||||
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| Number | Percent | Amount | Percent | Stock | |||||||||||||||||
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| Existing Stockholders | 17,423,441 | 71.8 | % | $ | 5,757,000 | 5.1 | % | $ | 0.34 | ||||||||||||
| New Investors | 6,850,000 | 28.2 | 106,175,000 | 94.9 | $ | 15.50 | |||||||||||||||
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| Total | 24,273,441 | 100.0 | % | $ | 111,932,000 | 100.0 | % | ||||||||||||||
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15
CAPITALIZATION
The following table sets forth our capitalization as of September 30, 1999 on an actual basis and on an as adjusted basis giving effect to:
| • | our corporate reorganization and the related reduction of additional paid-in capital by $26,905,000 to establish the net deferred tax liability resulting from the termination of our subchapter S status; | |
| • | the consummation of this offering at the initial public offering price of $15.50 per share and the application of the net proceeds as follows: |
| • | approximately $53.7 million to reduce borrowings under the credit facility; | |
| • | approximately $44.0 million to repay indebtedness to members of the Beasley family and affiliated companies, which is net of approximately $9.7 million of indebtedness owed to us by affiliates, including approximately $1.0 million of accrued and unpaid interest, being repaid to us at closing; |
| • | our recent acquisitions in Atlanta and our pending acquisitions in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta for an aggregate purchase price of approximately $34.8 million; and | |
| • | distributions to equity holders for income taxes on income of entities comprising Beasley Broadcast Group for the 1999 tax year. |
This table should be read in conjunction with the combined financial statements and the related notes included elsewhere in this prospectus. You should also refer to “Use of Proceeds,” “Corporate Reorganization” and “Management’s Discussion and Analysis of Financial Condition and Results of Operations.”
| September 30, 1999 | ||||||||||
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| Actual | As Adjusted | |||||||||
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| (in thousands) | ||||||||||
| Cash and cash equivalents | $ | 5,758 | $ | 2,758 | ||||||
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| Short-term debt to related parties | 6,657 | — | ||||||||
| Long-term debt, including current portion and related party debt | ||||||||||
| Credit facility | 125,880 | 100,216 | ||||||||
| Long-term debt to related parties | 37,276 | — | ||||||||
| Net stockholders’ equity of combined companies | (2,917 | ) | — | |||||||
| Preferred stock | — | — | ||||||||
| Class A common stock | — | 7 | ||||||||
| Class B common stock | — | 17 | ||||||||
| Additional paid-in capital | — | 82,093 | ||||||||
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| Net stockholders’ equity (deficit) | (2,917 | ) | 82,117 | |||||||
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| Total capitalization | $ | 166,896 | $ | 182,333 | ||||||
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16
SELECTED HISTORICAL COMBINED FINANCIAL INFORMATION
We have derived the selected historical financial information shown below for the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999 from our audited and unaudited combined financial statements included elsewhere in this prospectus. We have derived the selected historical financial information shown below for the years ended December 31, 1994 and 1995 from our audited financial statements, which are not included in this prospectus.
As you review the information contained in the following table and throughout this prospectus, you should note the following:
| • | During the periods presented, we operated as a series of partnerships and subchapter S corporations under the Internal Revenue Code. Accordingly, we were not liable for federal and some state and local corporate income taxes, as we would have been if we had been treated as a subchapter C corporation. During these periods, our stockholders included our taxable income or loss in their federal and applicable state and local income tax returns. The pro forma amounts shown in the table reflect provisions for federal, state and local income taxes, applied to income (loss) before pro forma income taxes, as if we had been taxed as a subchapter C corporation. On the day prior to the date of this prospectus, our subchapter S status will terminate. On the date of this prospectus, we will reorganize all of our entities under a holding company that is a wholly-owned subsidiary of Beasley Broadcast Group, Inc. This entity is the newly formed subchapter C corporation that is issuing the Class A common stock offered by this prospectus. | |
| • | For purposes of our historical financial statements, the term pro forma refers to the adjustments necessary to reflect our status as a subchapter C corporation for income tax purposes rather than a series of subchapter S corporations and partnerships, distributions to equity holders for income taxes on income of entities comprising Beasley Broadcast Group prior to the reorganization, the distribution of untaxed retained income and subsequent re-contribution of the same amounts as additional paid-in capital and the fair value adjustment necessary to record the acquisition of minority shareholder interest using the purchase method of accounting. | |
| • | Broadcast cash flow consists of operating income (loss) before corporate general and administrative expenses, depreciation and amortization, equity appreciation rights expense and impairment loss on long-lived assets. For the periods shown in the following table, broadcast cash flow is unaffected by local management and time brokerage agreements of $1,075,000 for the fiscal year ended December 31, 1996 and zero for other periods. The fees are included in other non-operating income (expense). | |
| • | Broadcast cash flow margin represents broadcast cash flow as a percentage of net revenues. | |
| • | EBITDA consists of broadcast cash flow minus corporate general and administrative expenses. | |
| • | Pro forma after-tax cash flow consists of pro forma net income (loss) minus net gains on sale of radio stations plus the following: loss on sale of radio stations, depreciation and amortization, equity appreciation rights expenses, impairment loss on long-lived assets and deferred tax provision (or minus deferred income tax benefit). | |
| • | No expense for equity appreciation rights has been recorded for the periods presented other than the year December 31, 1994. We expect to record equity appreciation rights expense of approximately $430,000 in the fourth quarter of 1999 and approximately $1.2 million in the first quarter of 2000. |
Although broadcast cash flow, EBITDA and pro forma after-tax cash flow are not measures of performance or liquidity calculated in accordance with generally accepted accounting principles, we believe that these measures are useful to an investor in evaluating our performance. These measures are widely used in the broadcast industry to evaluate a radio company’s operating performance. However, you should not consider these measures in isolation or as substitutes for operating income, cash flows from operating
17
The comparability of the historical financial information reflected below has been significantly affected by acquisitions and dispositions. You should read the selected financial information together with “Management’s Discussion and Analysis of Financial Condition and Results of Operations” and our combined financial statements and the related notes included elsewhere in this prospectus.
| Nine months ended | |||||||||||||||||||||||||||||||
| Year ended December 31, | September 30, | ||||||||||||||||||||||||||||||
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| 1994 | 1995 | 1996 | 1997 | 1998 | 1998 | 1999 | |||||||||||||||||||||||||
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| (in thousands except per share data, shares outstanding and margin data) | |||||||||||||||||||||||||||||||
| Operating Data: | |||||||||||||||||||||||||||||||
| Net revenues | $ | 25,185 | $ | 47,489 | $ | 62,413 | $ | 73,704 | $ | 81,433 | $ | 59,675 | $ | 67,452 | |||||||||||||||||
| Operating expenses: | |||||||||||||||||||||||||||||||
| Station operating expenses | 19,527 | 33,076 | 42,163 | 55,247 | 61,692 | 45,614 | 48,304 | ||||||||||||||||||||||||
| Corporate general and administrative expenses | 1,243 | 2,124 | 2,233 | 2,055 | 2,498 | 1,886 | 1,935 | ||||||||||||||||||||||||
| Depreciation and amortization | 6,936 | 8,361 | 8,317 | 14,174 | 16,096 | 11,942 | 11,824 | ||||||||||||||||||||||||
| Equity appreciation rights expenses | 10,000 | — | — | — | — | — | — | ||||||||||||||||||||||||
| Impairment loss on long-lived assets | — | — | — | 4,124 | — | — | — | ||||||||||||||||||||||||
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| Total operating expenses | 37,706 | 43,561 | 52,713 | 75,600 | 80,286 | 59,442 | 62,063 | ||||||||||||||||||||||||
| Operating income (loss) | (12,521 | ) | 3,928 | 9,701 | (1,896 | ) | 1,147 | 223 | 5,389 | ||||||||||||||||||||||
| Other income (expense): | |||||||||||||||||||||||||||||||
| Interest expense | (4,107 | ) | (8,345 | ) | (9,340 | ) | (13,606 | ) | (13,602 | ) | (10,251 | ) | (9,962 | ) | |||||||||||||||||
| Other non-operating income (expense) | (31 | ) | (5 | ) | (2,025 | ) | 54 | (160 | ) | (76 | ) | 471 | |||||||||||||||||||
| Gain (loss) on sale of radio stations | 84,458 | 121 | 16,773 | 82,067 | 4,028 | (328 | ) | — | |||||||||||||||||||||||
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| Total other income (expense) | 80,320 | (8,229 | ) | 5,408 | 68,515 | (9,734 | ) | (10,655 | ) | (9,491 | ) | ||||||||||||||||||||
| Income (loss) before pro forma income taxes | 67,799 | (4,301 | ) | 15,108 | 66,619 | (8,587 | ) | (10,422 | ) | (4,102 | ) | ||||||||||||||||||||
| Pro forma current income tax expense (benefit) | 504 | (3,302 | ) | 567 | 7,054 | (5,010 | ) | (5,295 | ) | (1,057 | ) | ||||||||||||||||||||
| Pro forma deferred income tax expense (benefit) | 25,696 | 1,657 | 5,318 | 18,741 | 1,760 | 1,320 | (475 | ) | |||||||||||||||||||||||
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| Pro forma net income (loss) | $ | 41,599 | $ | (2,656 | ) | $ | 9,223 | $ | 40,824 | $ | (5,337 | ) | $ | (6,447 | ) | $ | (2,570 | ) | |||||||||||||
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| Pro forma basic and diluted net income (loss) per share | 2.39 | (0.15 | ) | 0.53 | 2.34 | (0.31 | ) | (0.37 | ) | (0.15 | ) | ||||||||||||||||||||
| Weighted average common shares outstanding — basic | 17,423,441 | 17,423,441 | 17,423,441 | 17,423,441 | 17,423,441 | 17,423,441 | 17,423,441 | ||||||||||||||||||||||||
| Other Data: | |||||||||||||||||||||||||||||||
| Broadcast cash flow | $ | 5,658 | $ | 14,413 | $ | 20,250 | $ | 18,457 | $ | 19,741 | $ | 14,061 | $ | 19,148 | |||||||||||||||||
| Broadcast cash flow margin | 22 | % | 30 | % | 32 | % | 25 | % | 24 | % | 24 | % | 28 | % | |||||||||||||||||
| EBITDA | $ | 4,415 | $ | 12,289 | $ | 18,017 | $ | 16,402 | $ | 17,243 | $ | 12,175 | $ | 17,213 | |||||||||||||||||
| Pro forma after tax cash flow | (227 | ) | 7,241 | 6,085 | (4,204 | ) | 8,491 | 7,143 | 8,779 | ||||||||||||||||||||||
| Cash provided by (used in): | |||||||||||||||||||||||||||||||
| Operating activities | $ | (4,501 | ) | $ | 1,149 | $ | 5,303 | $ | 1,586 | $ | 4,921 | $ | 5,134 | $ | 7,385 | ||||||||||||||||
| Investing activities | 75,111 | 2,462 | (66,300 | ) | 18,871 | (12,527 | ) | (9,368 | ) | (2,021 | ) | ||||||||||||||||||||
| Financing activities | (70,237 | ) | (4,347 | ) | 63,152 | (17,052 | ) | 4,689 | 695 | (4,366 | ) | ||||||||||||||||||||
| As of December 31, | As of | ||||||||||||||||||||||||
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| 1994 | 1995 | 1996 | 1997 | 1998 | 1999 | ||||||||||||||||||||
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| Balance Sheet Data: | |||||||||||||||||||||||||
| Cash and cash equivalents | $ | 2,854 | $ | 2,118 | $ | 4,273 | $ | 7,678 | $ | 4,760 | $ | 5,758 | |||||||||||||
| Intangible assets, net | 40,717 | 38,214 | 100,442 | 145,487 | 151,048 | 141,086 | |||||||||||||||||||
| Total assets | 71,176 | 66,723 | 145,707 | 193,440 | 194,773 | 187,204 | |||||||||||||||||||
| Long-term debt, including current installments | 96,443 | 97,370 | 155,149 | 152,644 | 163,285 | 163,155 | |||||||||||||||||||
| Net stockholders’ equity (deficit) | (33,475 | ) | (42,790 | ) | (25,703 | ) | 19,579 | 6,041 | (2,917 | ) | |||||||||||||||
18
MANAGEMENT’S DISCUSSION AND ANALYSIS OF
You should read the following discussion together with the financial statements and related notes included elsewhere in this prospectus. The results discussed below are not necessarily indicative of the results to be expected in any future periods.
General
A radio broadcasting company derives its revenues primarily from the sale of broadcasting time to local and national advertisers. The advertising rates that a radio station is able to charge and the number of advertisements that can be broadcast without jeopardizing listener levels largely determine those revenues. Advertising rates are primarily based on three factors:
| • | a radio station’s audience share in the demographic groups targeted by advertisers, as measured principally by quarterly reports issued by The Arbitron Ratings Company; | |
| • | the number of radio stations in the market competing for the same demographic groups; and | |
| • | the supply of and demand for radio advertising time. |
For the nine months ended September 30, 1999, we generated 72.9% of our revenues from local advertising, which is sold primarily by each individual local radio station’s sales staff. For that same period, we generated 19.5% of our revenues from national spot advertising, which is purchased through independent, national advertising sales representatives by customers that want to advertise nationwide. We generated the balance of our revenues principally from promotional events and sales to broadcasting networks that purchase commercial airtime.
We include revenues recognized under a time brokerage agreement or similar sales agreement for radio stations operated by us before acquiring the radio stations in net revenues, while we reflect operating expenses associated with these radio stations in station operating expenses. Consequently, there is no difference in the method of revenue and operating expense recognition between a radio station operated by us under a time brokerage agreement or similar sales agreement and a radio station owned and operated by us. For the periods discussed below, revenues and operating expenses under time brokerage agreements or similar sales agreements were not material for years subsequent to 1996. Since 1997, we have not operated any stations under time brokerage agreements or other similar sales agreements.
Several factors may adversely affect a radio broadcasting company’s performance in any given period. In the radio broadcasting industry, seasonal revenue fluctuations are common and are due primarily to variations in advertising expenditures by local and national advertisers. Typically, revenues are lowest in the first calendar quarter of the year. We generally incur advertising and promotional expenses to increase listenership and Arbitron ratings. However, because Arbitron reports ratings quarterly in most of our markets, any increased ratings, and therefore increased advertising revenues, tend to lag behind the incurrence of advertising and promotional spending.
In the broadcasting industry, radio stations often utilize trade or barter agreements to reduce expenses by exchanging advertising time for goods or services. In order to maximize cash revenue from our spot inventory, we minimize our use of trade agreements and during the past five years have held barter revenues under 5% of our gross revenues and barter related broadcast cash flow under 3% of our broadcast cash flow.
We calculate same station results by comparing the performance of radio stations operated by us at the end of a relevant period to the performance of those same stations, whether or not operated by us, in the prior year’s corresponding period, excluding the effect of barter revenues and expenses. Broadcast cash flow consists of operating income (loss) before corporate general and administrative
19
For purposes of the following discussion, pro forma net income represents historical income before income taxes and extraordinary item adjusted as if we were treated as a subchapter C corporation during all relevant periods at an effective tax rate of 38%, applied to income before income taxes and extraordinary items.
Results of Operations
After this offering, several factors are expected to affect our results of operations that have not affected our results of operations during the nine months ended September 30, 1999, the nine months ended September 30, 1998 or the three years ended December 31, 1998. First, before the completion of the offering, we expect to redeem, for cash, equity appreciation rights previously granted to some of our station managers, as we do not believe this form of compensation is well-suited to public companies. In connection with this redemption, we expect to record an expense of approximately $430,000 in the fourth quarter of 1999 and approximately $1.2 million in the first quarter of 2000 when the contingencies are resolved. Second, in connection with the reorganization, our net stockholders’ equity will be reduced by approximately $26.9 million to establish the net deferred tax liability resulting from the termination of our subchapter S status. Finally, corporate general and administrative expenses are likely to increase as we incur the additional reporting and compliance costs of operating as a public company.
In 1997, we entered into contracts for the radio broadcast rights relating to the Miami Dolphins, Florida Marlins and Florida Panthers sports franchises. These contracts grant WQAM-AM the exclusive, English language rights for live radio broadcasts of the sporting events of these franchises for a five year term which began in 1997. The contracts require us to pay fees and to provide commercial advertising and other considerations. As of December 31, 1998, remaining payments of fees are as follows: $7.2 million in 1999, $8.5 million in 2000, $8.8 million in 2001 and $359,000 in 2002. In 1997, 1998 and the nine months ended September 30, 1999, expenses relating to these contracts exceeded related revenues by $2.9 million, $796,000 and $1.3 million, respectively. Unless we are able to generate significantly more revenues under these contracts in the future, they are likely to have a material adverse effect on our results of operations on a going-forward basis. However, in light of the uncertainty regarding future revenues, the amount of any future loss cannot be determined at this time. The proper accounting treatment for executory contracts such as these is currently the subject of Emerging Issues Task Force 99-14. Depending on the resolution of this issue by the task force, we may be required to record a charge reflecting an impairment of these committed contracts. Such a charge could also have a material adverse effect on future results of operations.
Nine Months Ended September 30, 1999 Compared to Nine Months Ended September 30, 1998
Net Revenue. Net revenue increased 13.0% to $67.5 million for the nine months ended September 30, 1999 from $59.7 million for the comparable 1998 period. The increase was mainly attributable to revenue growth at most of our radio stations, especially in the Miami-Ft. Lauderdale market, which resulted primarily from improved selling efforts and radio advertising market growth. In addition, approximately $1.4 million of the increase was attributable to the inclusion, during the entire period, of operating results from the stations we acquired in 1998. On a same station basis, net revenues increased 12.3% to $64.3 million for the nine months ended September 30, 1999 from $57.2 million for the comparable 1998 period.
Station Operating Expenses. Station operating expenses increased 5.6% to $48.3 million for the nine months ended September 30, 1999 from $45.6 million for the comparable 1998 period. The
20
Corporate General and Administrative Expenses. Corporate general and administrative expenses remained constant at $1.9 million for the nine months ended September 30, 1999 and September 30, 1998.
Depreciation and Amortization. Depreciation and amortization decreased 0.9% to $11.8 million for the nine months ended September 30, 1999 from $11.9 million for the comparable 1998 period. The decrease was attributable to the net impact of divestitures and acquisitions of radio stations completed during the periods.
Interest Expense. Interest expense decreased 2.8% to $10.0 million for the nine months ended September 30, 1999 from $10.3 million for the comparable 1998 period. The decrease was attributable to a reduction in interest rates for the period, partially offset by a higher debt balance.
Broadcast Cash Flow. Broadcast cash flow increased 35.4% to $19.1 million for the nine months ended September 30, 1999 from $14.1 million for the comparable 1998 period. The increase was mainly attributable to revenue growth at most of our radio stations, partially offset by increased operating expenses. In addition, approximately $839,000 of the increase was attributable to the inclusion, during the entire period, of operating results from the stations acquired in 1998. On a same station basis, broadcast cash flow increased 39.7% to $19.7 million for the nine months ended September 30, 1999 from $14.1 million for the comparable 1998 period.
Income (Loss) Before Pro Forma Income Taxes. Loss before pro forma income taxes decreased 59.0% to $4.1 million for the nine months ended September 30, 1999 from a $10.4 million loss for the comparable 1998 period. The decreased loss was mainly attributable to revenue growth at most of our stations, partially offset by increased operating expenses.
Pro Forma Net Income (Loss). Pro forma net loss decreased 59.4% to $2.6 million for the nine months ended September 30, 1999 from a $6.4 million loss for the comparable 1998 period. The decreased loss was mainly attributable to revenue growth at most of our stations, partially offset by increased operating expenses.
Year Ended December 31, 1998 Compared to Year Ended December 31, 1997
Net Revenue. Net revenue increased 10.5% to $81.4 million for 1998 from $73.7 million for 1997. Approximately $6.8 million of the increase was attributable to the inclusion, during the entire period, of operating results from the stations acquired in 1998. The increase was also attributable to revenue growth at some of our radio stations, especially in the Miami-Ft. Lauderdale market. On a same station basis, net revenues increased 10.5% to $77.8 million for 1998 from $70.4 million for 1997.
Station Operating Expenses. Station operating expenses increased 11.8% to $61.7 million for 1998 from $55.2 million for 1997. Approximately $5.9 million of the increase was attributable to the inclusion during the entire period of operating results from the radio stations acquired in 1997. The increase was also attributable to the introduction of additional news programming at WWDB-FM, the increased rights fees associated with our contracts to broadcast Miami sports teams and the addition of Neil Rogers, a top ranked personality in the Miami-Ft. Lauderdale market to our programming line-up at WQAM-AM. On a same station basis, station operating expenses increased 11.9% to $57.5 million for 1998 from $51.4 million for 1997.
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Corporate General and Administrative Expenses. Corporate general and administrative expenses increased 21.6% to $2.5 million for 1998 from $2.1 million for 1997. The increase was mainly attributable to higher administrative expenses associated with supporting our growth.
Depreciation and Amortization. Depreciation and amortization increased 13.6% to $16.1 million for 1998 from $14.2 million for 1997. The increase was mainly attributable to radio station acquisitions in 1998.
Interest Expense. Interest expense remained constant at $13.6 million for 1998 and 1997. This was attributable to a reduction in the interest rate charged on our credit facility as a result of more favorable terms, offset by a higher debt balance due to borrowings to fund acquisitions.
Broadcast Cash Flow. Broadcast cash flow increased 7.1% to $19.7 million for 1998 from $18.4 million for 1997. Approximately $900,000 of the increase was attributable to the inclusion, during the entire period, of operating results from the stations acquired in 1997. The increase was also attributable to revenue growth at most of our radio stations, in particular WQAM-AM and WKIS-FM in the Miami-Ft. Lauderdale market. On a same station basis, broadcast cash flow increased 6.8% to $20.3 million for 1998 from $19.0 million for 1997.
Gain (Loss) on Sale of Radio Stations. We recognized a gain on sale of radio stations of $4.0 million for 1998 primarily as a result of the sale of two radio stations, KAAY-AM in Little Rock, Arkansas and WEWO-AM in Fayetteville, North Carolina, for a total of approximately $5.2 million. In 1997, we sold WDAS-AM/ FM in Philadelphia for approximately $100 million, for which we recognized a gain of $82.1 million.
Income (Loss) Before Pro Forma Income Taxes. We experienced a loss before pro forma income taxes of $8.6 million for 1998 versus income of $66.6 million for 1997. The difference between 1998 and 1997 is mainly attributable to the recognition of an $82.1 million gain on sale of radio stations in 1997. Excluding gains on sales of radio stations, loss before pro forma income taxes would have been $12.6 million for 1998 and $15.4 million for 1997.
Pro Forma Net Income (Loss). Pro forma net loss for 1998 was $5.3 million compared to pro forma net income of $40.8 million for 1997. The change was mainly attributable to the reduction of the gain on the sale of radio stations and taking into account pro forma income taxes or tax benefits.
Year Ended December 31, 1997 Compared to Year Ended December 31, 1996
Net Revenue. Net revenue increased 18.1% to $73.7 million for 1997 from $62.4 million for 1996. The increase was partly attributable to revenue growth at some of our radio stations, especially in the Miami-Ft. Lauderdale market, partially offset by a decline in revenues from the Philadelphia market. In addition, approximately $8.3 million of the increase was attributable to the inclusion, during the entire period, of operating results from the stations acquired in 1996. On a same station basis, net revenues increased 15.0% to $68.0 million for 1997 from $59.2 million for 1996.
Station Operating Expenses. Station operating expenses increased 30.8% to $55.2 million for 1997 from $42.2 million for 1996. Approximately $5.2 million of the increase was attributable to the inclusion, during the entire period, of operating results from the stations acquired in 1996. The increase was also attributable to the addition of our contracts to broadcast Miami sports teams. On a same station basis, station operating expenses increased 34.3% to $50.1 million for 1997 from $37.3 million for 1996.
Corporate General and Administrative Expenses. Corporate general and administrative expenses decreased 8.0% to $2.1 million for 1997 from $2.2 million for 1996.
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Depreciation and Amortization. Depreciation and amortization increased 70.4% to $14.2 million for 1997 from $8.3 million for 1996. The increase was mainly attributable to the radio station acquisitions in 1997.
Impairment Loss on Long-Lived Assets. In 1997, we recognized an impairment loss on long-lived assets of $4.1 million, resulting from a write down of our building in the Los Angeles area during that period.
Interest Expense. Interest expense increased 45.7% to $13.6 million for 1997 from $9.3 million for the 1996. This increase was primarily attributable to an increase in borrowings to finance acquisitions.
Broadcast Cash Flow. Broadcast cash flow decreased 10.3% to $18.4 million for 1997 from $20.3 million for 1996. On a same station basis, broadcast cash flow decreased 21.7% to $18.0 million for 1997 from $21.9 million for 1996. The decrease was mainly attributable to the addition of the sports rights fees at WQAM-AM in Miami and the introduction of additional news programming changes at WWDB-FM in Philadelphia and a reduction in ratings and revenues at WXTU-FM in Philadelphia.
Gain (Loss) on Sale of Radio Stations. Net gain on sale of radio stations was $82.1 million for 1997 versus a gain of $16.8 million for 1996. The increase was mainly attributable to the sale of WDAS-AM/ FM in Philadelphia for approximately $100 million in 1997.
Income (Loss) Before Pro forma Income Taxes. Income before pro forma income taxes was $66.6 million for 1997 versus $15.1 million in 1996. The increase was mainly attributable to the gain on sale of WDAS-FM in Philadelphia.
Pro Forma Net Income (Loss). Pro forma net income was $40.8 million for 1997 versus $9.2 million for 1996, which was mainly attributable to the gain on sale of WDAS-FM in Philadelphia.
Liquidity and Capital Resources
Overview. Historically, we have used a significant portion of our liquidity to consummate acquisitions. These acquisitions have been funded from one or a combination of the following sources:
| • | our credit facility; | |
| • | disposing of radio stations in transactions which are intended to qualify as like-kind exchanges under Section 1031 of the Internal Revenue Code; | |
| • | internally-generated cash flow; and | |
| • | advances to us from George G. Beasley, members of his family and affiliated entities. |
Other liquidity needs have been for debt service, working capital, distributions to equity holders and general corporate purposes, including capital expenditures. In the future, we expect that our principal liquidity requirements will be for working capital and general corporate purposes, including acquisitions of additional radio stations. We expect to finance future acquisitions through a combination of bank borrowings and internally generated funds.
We intend to use approximately $53.7 million of the net proceeds from this offering to pay down debt on our credit facility, which will increase the availability of cash to fund future acquisitions, including the pending acquisitions, and other general corporate purposes. We will also use approximately $44.0 million of the proceeds of this offering to repay the indebtedness owed to our Chairman and Chief Executive Officer, George G. Beasley, and affiliated companies. That $44.0 million payment is net of the repayment at the closing of this offering of approximately $9.7 million owed to us by members of the Beasley family.
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As of September 30, 1999, we held $5.8 million in cash and cash equivalents and had $24.8 million in availability under our credit facility. We have four pending acquisitions with an aggregate purchase price of $34.8 million. We believe that the net proceeds from this offering, together with the cash available from operations as well as the availability from our credit facility should be sufficient to permit us to meet our financial obligations for at least the next twelve months. Under our credit facility, we can currently borrow up to $150.0 million, subject to compliance with financial ratios and covenants. After the offering, we intend to re-negotiate our credit facility to obtain additional borrowing capacity to fund future acquisitions and any working capital needs.
Net Cash Provided by (Used in) Operating Activities. Net cash provided by operating activities was $7.4 million and $5.1 million for the nine months ended September 30, 1999 and September 30, 1998, respectively. The increase of approximately $2.3 million was primarily due to the increase in revenues, from $59.7 million to $67.5 million.
Net cash provided by operating activities was $4.9 million and $1.6 million for the year ended December 31, 1998 and 1997, respectively. The increase of approximately $3.3 million from 1997 to 1998 was primarily a result of the increase in revenues, from $73.7 million to $81.4 million.
Net cash provided by operating activities was $1.6 million and $5.3 million for the year ended December 31, 1997 and 1996, respectively. The decrease of approximately $3.7 million from 1996 to 1997 was primarily a result of an increase in program rights paid from $2.8 million in 1996 to $6.3 million in 1997.
Net Cash Provided by (Used in) Investing Activities. Net cash used in investing activities was $2.0 million and $9.4 million for the nine months ended September 30, 1999 and September 30, 1998, respectively. The decrease of $7.4 million of net cash used was primarily a result of the use of $11.0 million for the acquisitions of WJBX-FM and WJST-FM made during the nine month period ended September 30, 1998. No acquisitions were made during the nine month period ended September 30, 1999.
Net cash used in investing activities was $12.5 million for the year ended December 31, 1998 compared with net cash provided by investing activities of $18.9 million for the year ended December 31, 1997. The increase of $31.4 million of net cash used was primarily a result of the use of approximately $19 million for the acquisitions of WJBX-FM, WJST-FM and WTMR-AM in 1998, partially offset by the net proceeds of $5.15 million from the sale of KAAY-AM and WEWO-AM in 1998. In 1997, we used $77.7 million of cash to acquire six stations, which was offset by the proceeds of $103.5 million from the sale of WDAS-AM/FM, WEGX-FM, WDSC-AM and WTSB-AM.
Net cash provided by investing activities was $18.9 million for the year ended December 31, 1997 compared with net cash used in investing activities of $66.3 million for the year ended December 31, 1996. The increase of $85.2 million of net cash provided by investing activities was a result of the sale of WDAS-AM/FM, WEGX-FM and WDSC-AM for $103.5 million, offset by the acquisition of six stations for $77.7 million in 1997. In 1996, we used $79.6 million of cash to acquire six stations in 1996, which was offset by the proceeds of $20.7 million from the sale of one station in 1996.
Net Cash Provided (Used in) by Financing Activities. Net cash used in financing activities was $4.4 million for the nine months ended September 30, 1999 and net cash provided by financing activities was $695,000 for the nine months ended September 30, 1998. This increase of net cash used of $5.1 million was attributable to stockholder distributions of $4.3 million made during the nine month period ended September 30, 1999 that was not offset by additional borrowings. During the same period in 1998, we had stockholder distributions of $6.0 million that were offset by cash from additional borrowings.
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Net cash provided by financing activities was $4.7 million for the year ended 1998 compared to net cash used in financing activities of $17.1 million for 1997. The increase of net cash provided of $21.8 million from 1997 to 1998 was primarily a result of lower stockholder distributions of $6.0 million, offset by cash from additional borrowings during 1998. In 1997, we had stockholder distributions of $20.6 million that were not offset by additional borrowings.
Net cash used in financing activities was $17.1 million for the year ended 1997 compared to net cash provided by financing activities of $63.2 million for 1996. The increase of cash used of $80.3 million from 1996 to 1997 was partially attributable to stockholder distributions of $20.6 million made in 1997 versus $11.6 million in 1996. The like-kind exchange of WJHM-FM for WKIS-FM in 1996 also generated $18.1 million in capital contributions compared to a capital contribution of $2.7 million generated from the like kind exchange of WEGX-FM/WDSC-AM in 1997.
Credit Facility. On August 11, 1999, we entered into an amendment to our credit agreement with the Bank of Montreal, Chicago Branch, as agent, and with our syndicate of commercial lenders. The amendment to our credit agreement provides for a maximum revolving loan and letter of credit commitment of $150.0 million. In accordance with the agreement, the maximum commitment will begin to reduce quarterly on September 30, 2000.
As of December 31, 1999, we would have had an outstanding balance under our credit facility of approximately $101.3 million and availability under our credit facility of $48.7 million for future acquisitions and other corporate purposes. These amounts are after giving effect to:
| • | the Atlanta acquisitions; | |
| • | the pending acquisitions in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta; | |
| • | the repayment of all indebtedness we owe to Mr. Beasley and affiliated companies and the repayment of all indebtedness affiliates owe to us; and | |
| • | the application of a portion of the net proceeds from the offering to reduce borrowings outstanding under our credit facility. |
At December 31, 1999, the weighted average annual interest rate applicable to our credit facility was approximately 8.625%. The credit facility expires on December 31, 2006.
We must pay to Bank of Montreal, Chicago Branch, as agent, on a quarterly basis, an unused commitment fee. The commitment fee is a maximum of 0.5% multiplied by the average of the daily excess of the maximum revolving loan and letter of credit commitment, currently $150.0 million, over the outstanding principal balance and letter of credit usage for the preceding quarter. For the year ended December 31, 1999, our unused commitment fee was approximately $96,000.
The current credit facility prohibits us from paying cash dividends and restricts our ability to make other distributions with respect to our capital stock. The credit facility also contains other customary restrictive covenants. These covenants limit our ability to:
| • | incur additional indebtedness and liens; | |
| • | enter into certain investments or joint ventures; | |
| • | consolidate, merge or effect asset sales; | |
| • | make overhead expenditures; | |
| • | enter sale and lease-back transactions; | |
| • | sell or discount accounts receivable; | |
| • | enter into transactions with affiliates or stockholders; |
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| • | sell, assign, pledge, encumber or dispose of capital stock; or | |
| • | change the nature of our business. |
We are also required to satisfy financial covenants, which require us to maintain specified financial ratios and to comply with financial tests, such as ratios for minimum interest coverage, minimum fixed charges and maximum total debt. These financial covenants include:
| • | Minimum Interest Coverage Test. Our operating cash flow for any four consecutive quarters must be at least twice the amount of our cash interest expense. | |
| • | Minimum Fixed Charges Test. Our operating cash flow for any four consecutive quarters must be at least 1.10 times our fixed charges. | |
| • | Maximum Total Debt Test. For the period through June 30, 2000, our total debt as of the last day of a fiscal quarter must not exceed 5.75 times our operating cash flow for the four quarter period ending on that day. For the period of July 1, 2000 through December 31, 2001, the required maximum ratio is 5.5 times. For each twelve-month period after December 31, 2001, the maximum ratio will decrease by 0.5 times. For all periods after January 1, 2005, the maximum ratio is 3.5 times. |
Pending Acquisitions. The total cash required to fund our pending acquisitions in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta is expected to be approximately $24.8 million. The consummation of the pending transactions is subject to certain conditions, including the approval of the FCC. Although we believe these closing conditions are customary for transactions of this type, these conditions may not be satisfied. For example, a petition to deny the assignment application for the pending acquisitions in Augusta was filed with the FCC on November 5, 1999. Additionally, a lawsuit has been filed seeking to enjoin the consummation of the transaction and other equitable relief. Although we believe that the FCC ultimately will approve the proposed assignment and that no injunction will be granted, the timing and outcome of the resolution of the petition to deny and of the litigation is uncertain. Therefore, we do not know when this acquisition will close. See “Recently Completed and Pending Transactions” for a description of the pending acquisitions.
Qualitative and Quantitative Disclosures about Market Risk . Market risk is the risk of loss arising from adverse changes in market rates and prices such as interest rates, foreign currency exchange rate and commodity prices. Our primary exposure to market risk is interest rate risk associated with our credit facility. Amounts borrowed under the credit facility incur interest at the London Interbank Offered Rate, or LIBOR, plus additional basis points depending on the outstanding principal balance under the credit facility. As of December 31, 1999, $124.7 million was outstanding under our credit facility. We evaluate our exposure to interest rate risk by monitoring changes in interest rates in the market place.
To manage interest rate risk associated with our credit agreement, we have entered into several interest rate collar and swap agreements.
An interest rate collar is the combined purchase and sale of an interest rate cap and an interest rate floor so as to keep interest rate exposure within a defined range. We have purchased three interest rate collars. Under those agreements, our base LIBOR cannot exceed 7.0% and our base LIBOR cannot fall below 4.99%, 5.25% and 5.17%, respectively.
An interest rate swap is a combined series of forward rate agreements calling for exchange of interest payments on a number of specified future dates. We have purchased three interest rate swaps. Under these agreements, we pay a fixed rate of 5.52%, 5.82% and 5.685%, respectively, on the notional amount, and the other party pays to us a variable amount rate equal to the three-month LIBOR on a quarterly basis.
26
Notional amounts are used to calculate the contractual payments to be exchanged under the contract. As of December 31, 1999, the notional amount upon maturity of these collars and swaps was approximately $70 million.
Our collars and swaps agreements are summarized in the following
chart:
Estimated
Notional
Expiration
Fair
Agreement
Amount
Floor
Cap
Swap
Date
Value
Interest rate collar
10,000,000
4.99
%
7
%
—
January 2000
—
Interest rate collar
10,000,000
5.25
%
7
%
—
January 2000
(15,000
)
Interest rate collar
10,000,000
5.17
%
7
%
—
May 2000
(18,000
)
Interest rate swap
10,000,000
—
—
5.52
%
May 2001
(89,000
)
Interest rate swap
10,000,000
—
—
5.82
%
September 2001
(170,000
)
Interest rate swap
20,000,000
—
—
5.685
%
May 2002
(331,000
)
The scheduled reductions of the revised maximum commitment of the
credit facility for the next five years and thereafter are as
follows:
1999
$
—
2000
7,500,000
2001
15,000,000
2002
15,000,000
2003
18,750,000
Thereafter
93,750,000
Total
$
150,000,000
The year 2000 issue is the result of computer-controlled systems using two digits rather than four to define the applicable year. For example, certain computer programs that have time-sensitive software may recognize a date ending in “00” as the year 1900 rather than the year 2000. This could result in system failure or miscalculations causing disruptions of operations including, among other things, a temporary inability to process transactions, send invoices, or engage in similar normal business activities.
As of January 31, 2000, we have experienced no material problems as a result of the year 2000 issue. We do not anticipate experiencing any latent material problems. Costs to ensure that our systems are year 2000 compliant have not been, and are not expected to be, over the course of the current year, material.
In June 1998, the FASB issued SFAS No. 133 entitled “Accounting for Derivative Instruments and Hedging Activities.” SFAS No. 133 establishes accounting and reporting standards for derivative instruments, including certain derivative instruments embedded in other contracts and for hedging activities. It requires that an entity recognize all derivatives as either assets or liabilities in the statement of financial position and measure those instruments at fair value. The accounting for changes in the fair value of a derivative depends on the intended use of the derivative and the resulting designation. In June 1999, the FASB issued SFAS No. 137 which extends the effective date of SFAS No. 133 to fiscal quarters of fiscal years beginning after June 15, 2000 and should not be applied retroactively to financial statements of prior periods. We do not anticipate that the adoption of SFAS No. 133 will have a material impact on our earnings or financial position upon adoption.
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RECENTLY COMPLETED AND PENDING RADIO BROADCASTING TRANSACTIONS
Since January 1, 1998, we have acquired or agreed to acquire twelve radio stations and have sold two radio stations. The information below provides a brief description of each of our recently completed and pending radio station acquisitions and dispositions.
Recently Completed Transactions
Atlanta, Georgia Acquisitions. In January 2000, we acquired WAEC-AM and WWWE-AM for approximately $10 million.
Philadelphia, Pennsylvania Acquisition. In December 1998, we acquired WTMR-AM for approximately $8 million.
Little Rock, Arkansas Disposition. In November 1998, we sold KAAY-AM for $5 million in cash and used the proceeds as part of the purchase price for our December 1998 acquisition of WTMR-AM.
Fayetteville, North Carolina Disposition. In August 1998, we sold WEWO-AM for approximately $150,000.
Ft. Myers, Florida Acquisitions. In February 1998, we acquired WJST-FM for approximately $5 million and WJBX-FM for approximately $6 million.
Dillon, South Carolina Dispositions. In October 1997, we sold WEGX-FM and WDSC-AM for $3.5 million in cash and used the proceeds as part of the purchase price for our February 1998 acquisition of WJBX-FM.
Pending Acquisitions
Boston, Massachusetts Acquisition. In December 1999, we entered into an agreement to acquire WRCA-AM for approximately $6 million, subject to an upward adjustment of up to $2 million if the FCC approves specified increases in the power of the station’s transmitter.
Miami-Ft. Lauderdale/West Palm Beach, Florida Acquisitions. In December 1999, we entered into an agreement to acquire WWNN-AM and WHSR-AM in the Miami-Ft. Lauderdale market and WSBR-AM in the West Palm Beach market for approximately $18 million.
Augusta, Georgia Acquisitions. In September 1999, we entered into an agreement to acquire WRFN-FM and WRDW-AM for approximately $800,000. A petition to deny the application to transfer control of the broadcast license has been filed with the FCC. The petition to deny alleges that an existing shareholder has a greater percentage interest in the selling entity than has been reported to the FCC and requests that the FCC deny the proposed assignment of the broadcast licenses to us. In addition, a lawsuit has been filed by Darrell J. Delly in the Superior Court of Richmond County, Georgia seeking to enjoin the consummation of the transaction and other equitable relief.
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INFORMATION ABOUT STATION AND MARKET DATA
For this prospectus:
| • | We derived our 1998 market revenue share and 1998 market revenue rank data from Miller, Kaplan, Arase & Co. (December 1998 ed.). | |
| • | We derived the 1998 market rank by radio revenue from Duncan’s Radio Market Guide (1999 ed.). | |
| • | We derived our market revenue growth from Miller, Kaplan, Arase & Co. (September 1999 ed.). | |
| • | We derived our radio market average annual revenue growth for the Philadelphia, Miami-Ft. Lauderdale, Ft. Myers-Naples and Fayetteville markets from Miller, Kaplan, Arase & Co., (Equivalent Weeks Market Revenue Report, December 1995 and December 1996 and Year-To-Date Market Performance Summary, December 1997 and December 1998 eds.). Because information was not available from Miller, Kaplan, Arase & Co. for the Atlanta, Boston, West Palm Beach, Greenville/ New Bern/ Jacksonville and Augusta markets, for these markets we used Duncan’s Radio Market Guide (1999 ed.). | |
| • | We derived audience share and audience rank in target demographic data from surveys of persons, listening Monday through Sunday, 6 a.m. to 12 midnight, in the indicated demographic, as set forth in the Spring 1999 radio market reports published by The Arbitron Ratings Company. | |
| • | We derived viable station data for each market from Duncan’s Radio Market Guide (1999 ed.). Duncan’s defines viable stations as stations that are active and viable competitors for advertising dollars in a market. | |
| • | We present radio station and market data assuming the completion of our pending acquisitions. |
CORPORATE REORGANIZATION
We are currently comprised of a series of subchapter S corporations, a general partnership and a series of limited partnerships and limited liability companies. The subchapter S corporations and the general partnership hold the operating assets of our radio stations and the limited partnerships hold the FCC licenses for our radio stations. The subchapter S corporations and partnerships are flow-through entities for federal and some state and local income tax purposes. As a result, our combined net income for federal and some state and local income tax purposes has been reported by and taxed directly to our equity holders, rather than to us. In connection with this offering, our subchapter S corporation status will terminate, and we will become subject to federal and applicable state and local corporate income tax as a subchapter C corporation.
On the date of this prospectus, the various entities comprising our business will become indirect, wholly-owned subsidiaries of Beasley Broadcast Group. To effect this corporate reorganization:
| • | George G. Beasley and members of his immediate family will contribute their equity interests in those entities to Beasley Broadcast Group in exchange for a total of 17,021,373 shares of Class B common stock of Beasley Broadcast Group, the newly formed subchapter C corporation that is making this offering; and | |
| • | two of our general managers will contribute their equity interests in two of the entities to Beasley Broadcast Group in exchange for a total of 402,068 shares of Class A common stock of Beasley Broadcast Group. |
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Immediately after these contribution transactions, Beasley Broadcast Group in turn will contribute the capital stock and partnership interests it acquired to Beasley Mezzanine Holdings, LLC, in exchange for all the membership interests in Beasley Mezzanine Holdings. As a result, Beasley Mezzanine Holdings will become a wholly-owned subsidiary of Beasley Broadcast Group and our radio station assets will be owned by a series of wholly-owned subsidiaries of Beasley Mezzanine Holdings. In the reorganization, the number of shares of common stock being issued to George G. Beasley, members of his immediate family and two of our general managers is based on (1) each person’s respective ownership percentage of the entities that are reorganizing into Beasley Broadcast Group and (2) the relative values of the radio stations owned by these entities, based on their cash flows, allocable debt, working capital and other factors. Therefore, our pre-offering stockholders will own the same percentage of the total value of Beasley Broadcast Group after the reorganization as they did of the overall value of the entities that are becoming Beasley Broadcast Group. The following chart shows the value of the common stock received in the reorganization, based on an initial public offering price of $15.50 for Class A common stock.
| Number of | |||||||||||||||||
| shares of BBGI | |||||||||||||||||
| Pre-offering | common stock | Class A | Value of | ||||||||||||||
| percentage | issued in the | or Class B | ownership | ||||||||||||||
| of BBGI | reorganization | common stock | interests | ||||||||||||||
|
|
|
|
|
||||||||||||||
| George G. Beasley | 60.6 | % | 10,564,413 | Class B Common | $ | 163,748,402 | |||||||||||
| Bruce G. Beasley | 2.0 | 356,736 | Class B Common | 5,529,408 | |||||||||||||
| Brian E. Beasley | 2.4 | 420,265 | Class B Common | 6,514,108 | |||||||||||||
| B. Caroline Beasley | 2.0 | 356,736 | Class B Common | 5,529,408 | |||||||||||||
| Bradley C. Beasley | 4.3 | 741,462 | Class B Common | 11,492,661 | |||||||||||||
| Robert E. Beasley | 2.0 | 356,736 | Class B Common | 5,529,408 | |||||||||||||
| Shirley W. Beasley | 0.2 | 39,835 | Class B Common | 617,443 | |||||||||||||
| J. Daniel Highsmith | 0.4 | 75,246 | Class A Common | 1,166,313 | |||||||||||||
| Gregory J. Reed | 1.9 | 326,822 | Class A Common | 5,065,741 | |||||||||||||
| George Beasley Estate Reduction Trust | 5.7 | 979,513 | Class B Common | 15,182,452 | |||||||||||||
| George Beasley Grantor Retained Annuity Trust | 18.5 | 3,205,677 | Class B Common | 49,687,994 | |||||||||||||
| Total | 100.0 | % | 17,423,441 | — | $ | 270,483,338 | |||||||||||
|
|
|
|
|||||||||||||||
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BUSINESS
Overview
We were founded in 1961 and are the 16th largest radio broadcasting company in the United States based on 1998 gross revenues. After giving effect to the pending acquisitions in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta, we will own and operate 36 stations, 21 FM and 15 AM. Our stations are located in nine large and midsized markets in the eastern United States. Twelve of these stations are located in four of the nation’s top 12 radio markets: Atlanta, Philadelphia, Boston and Miami-Ft. Lauderdale. Our station groups rank among the first or second largest clusters, based on gross revenues, in five of our nine markets and, collectively, our radio stations reach approximately three million people on a weekly basis. For the twelve months ended September 30, 1999, giving effect to acquisitions and dispositions completed during the period, as well as the pending acquisitions mentioned above and our recent acquisitions in Atlanta, as if these acquisitions had been completed at the beginning of the period, we had net revenues of $94.7 million, broadcast cash flow of $28.8 million and a net loss of $8.1 million.
We seek to maximize revenues and broadcast cash flow by acquiring and operating clusters of stations in high-growth large and midsized markets located primarily in the eastern United States. We have assembled groups of five or more stations in five of our markets. Our radio stations program a variety of formats, including urban, contemporary hit radio and country, which target the demographic groups in each market that we consider the most attractive to our advertisers. The combination of our market clusters and our advertising, sales and programming expertise has enabled us to achieve strong same station revenue and broadcast cash flow growth demonstrated as follows:
| • | same station net revenues increased 12.3% for the nine months ended September 30, 1999 compared to the same period in 1998; | |
| • | same station broadcast cash flow increased 39.7% for the nine months ended September 30, 1999 compared to the same period in 1998; and | |
| • | same station after tax cash flow, pro forma for the termination of our subchapter S corporation status, increased 45.9% for the nine months ended September 30, 1999 compared to the same period in 1998. |
For the periods presented above, we calculate same station results by comparing the performance of radio stations operated by us at September 30, 1999 to the performance of those same stations, whether or not operated by us, in the corresponding period of the prior year. These results exclude the effect of barter revenues and expenses. Same station results also exclude the Atlanta stations we recently acquired as well as the Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta stations we have agreed to acquire.
We are led by our Chairman and Chief Executive Officer, George G. Beasley, who has over 35 years of experience in the radio broadcasting industry. Under Mr. Beasley’s guidance, excluding the stations that we currently own, we have acquired and disposed of a total of 52 radio stations, including stations in Los Angeles, Chicago, New Orleans, Orlando and Cleveland. We acquired these 52 stations for an aggregate acquisition price of approximately $168.0 million and the total consideration that we received upon disposition was valued at approximately $346.1 million. Mr. Beasley is supported by a management team with an average of 16 years of experience in the radio broadcasting industry. Mr. Beasley and our management team have established a track record of acquiring and operating a substantial portfolio of well run radio stations and, in several instances, have demonstrated the ability to reposition and turn around under-performing stations. We believe that we are well positioned to continue to realize cash flow growth from our existing stations and to
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Operating Strategy
The principal components of our operating strategy are to:
| • | Develop Market-Leading Clusters. We seek to secure and maintain a leadership position in the markets we serve by creating clusters of multiple stations in each of our markets. Our station groups rank among the first or second largest clusters, based on gross revenues, in five of our nine markets. We operate our stations in clusters to capture a variety of demographic listener groups, which enhances our stations’ appeal to a wide range of advertisers. In addition, we have been able to achieve operating efficiencies by strategically aligning our sales and promotional efforts and consolidating broadcast facilities where possible to minimize duplicative management positions and reduce overhead expenses. Finally, we believe that strategic acquisitions of additional stations in existing clusters positions us to capitalize on our market expertise and existing relationships with local advertisers to increase revenues of the acquired stations. | |
| • | Conduct Extensive Market Research. We conduct extensive market research to enhance our ratings and in certain circumstances to identify opportunities to reformat a station to reach an underserved demographic group. Our research, programming and marketing strategy combines thorough research with an assessment of our competitors’ vulnerabilities and overall market dynamics in order to identify specific audience and formatting opportunities within each market. Using this research, we tailor our programming, marketing and promotions on each station to maximize its appeal to its target audience and to respond to the changing preferences of our listeners. Since 1996, we have changed formats at six of the 28 radio stations we currently own. Net revenues for those six stations have increased 44.0% on average annually from year-end 1996 to year-end 1998. | |
| • | Establish Strong Local Brand Identity. Our stations pursue a variety of programming and marketing initiatives designed to develop a distinctive identity and to strengthen the stations’ local brand or franchise. In addition, through our research, programming and promotional initiatives, we create a marketable identity for our stations to enhance audience share and listener loyalty. As part of this objective, we promote nationally recognized on-air personalities and local sports programming at a number of our stations. For example, we broadcast nationally-syndicated shows such as “Rush Limbaugh,” “Dr. Laura” and “Howard Stern” and we are the flagship station for the Miami Dolphins, Florida Marlins, Florida Panthers and Miami Hurricanes on our sports station in the Miami-Ft. Lauderdale market. | |
| • | Build Relationship-Oriented Sales Staff and Emphasize Focused Marketing and Promotional Initiatives. We seek to gain advertising revenue share in each of our markets by utilizing our relationship-oriented sales staff to lead local and national marketing and promotional initiatives. We design our sales efforts based on advertiser demand and market conditions. Our stations have an experienced and stable sales force with an average of three years experience with Beasley Broadcast Group. In addition, we provide our sales force with extensive training, competitive compensation and performance based incentives. Our stations also engage in special local promotional activities such as concerts featuring nationally recognized performers, contests, charitable events and special community events. Our experienced sales staff and these promotional initiatives help strengthen our relationship with our advertisers and listening community. |
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| • | Hire, Develop and Motivate Strong Local Management Teams. Our station general managers have been with Beasley Broadcast Group for an average of approximately nine years, and a substantial majority operate under employment contracts. We believe that broadcasting is primarily a locally-based business and much of its success is based on the efforts of local management teams. We believe that our station managers have been able to recruit, develop, motivate and train superior management teams. We offer competitive compensation packages with performance-based incentives for our key employees. In addition, we provided employees with opportunities for personal growth and advancement through extensive training, seminars and other educational initiatives. | |
| • | Enhance Broadcast Cash Flow on Underutilized AM Stations. We seek to selectively acquire and enhance the performance of major-market AM stations serving niche markets. To enhance broadcast cash flows at these radio stations, we sell blocks of time to providers of health, ethnic, religious and other specialty formats. |
Acquisition Strategy
Since June 1996, we have acquired or agreed to acquire 25 radio stations. Our future acquisition strategy, which will focus on stations located in the 100 largest radio markets, is to:
| • | acquire additional radio stations in our current markets to further enhance our market position; | |
| • | acquire existing clusters in new markets or establish a presence in new markets where we believe we can build successful clusters over time; | |
| • | pursue swap opportunities with other radio station owners to build or enhance our market clusters; and | |
| • | selectively acquire large-market AM stations serving attractive demographic groups with specialty programming. |
Internet Strategy
We recently formed a division, Beasley Interactive, that is creating an Internet presence for Beasley Broadcast Group that will complement our existing radio business. In November 1999, we hired a creative director to develop web page content for our radio stations’ web sites that reflects each station’s programming and brand. Our strategy is to create additional revenue streams from advertising, e-commerce and web page development and support for advertisers by capitalizing on the loyalty of our radio station listeners by persuading them to use our stations’ web sites.
From time to time, we expect to make strategic investments in Internet companies that we believe are complementary to our radio broadcasting business and that are available on commercially attractive terms. On January 14, 2000, we purchased 600,000 shares of common stock of FindWhat.com, representing approximately 4.8% of the outstanding capital stock, in exchange for $3.0 million, reflected by a promissory note. The outstanding amount due under the promissory note may be offset by the purchase price of advertisements placed by FindWhat.com with our radio stations. Also, in December 1999, we entered into an agreement to purchase 750,000 shares of preferred stock of eTour, Inc., representing approximately 2.8% of the outstanding capital stock, in exchange for $3.0 million of advertising time from our radio stations.
Station Portfolio
Our stations are clustered in demographically attractive and growing markets located in the eastern United States, including major markets such as Atlanta, Philadelphia, Boston and Miami-Ft. Lauderdale. The following table sets forth information about our portfolio and the markets where
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| 1998 Beasley | ||||||||||||||||||||||||||||
| 1998 | 1995-1998 | Nine Months Ended | Beasley | Market | ||||||||||||||||||||||||
| Radio Market | Radio Market | September 30, 1999 | Stations | Revenue | ||||||||||||||||||||||||
| Revenue | Average Annual | Radio Market |
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| Market | Rank | Revenue Growth | Revenue Growth | FM | AM | Share | Rank | |||||||||||||||||||||
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| Atlanta, GA | 7 | 14.6% | 20.8 | % | — | 2 | — | — | ||||||||||||||||||||
| Philadelphia, PA | 9 | 9.5 | 12.6 | 2 | 2 | 7.5 | % | 5 | ||||||||||||||||||||
| Boston, MA | 10 | 13.2 | * | — | 1 | — | — | |||||||||||||||||||||
| Miami-Ft. Lauderdale, FL | 12 | 15.2 | 11.0 | 2 | 3 | 17.3 | 2 | |||||||||||||||||||||
| West Palm Beach, FL | 48 | 8.9 | 14.1 | — | 1 | — | — | |||||||||||||||||||||
| Ft. Myers-Naples, FL | 74 | 11.2 | ** | 14.0 | 4 | 1 | 37.5 | 1 | ||||||||||||||||||||
| Greenville- New Bern- Jacksonville, NC | 80 | 12.1 | 5.1 | 5 | 1 | 53.6 | 1 | |||||||||||||||||||||
| Fayetteville, NC | 104 | 13.0 | 5.6 | 4 | 2 | 61.6 | 1 | |||||||||||||||||||||
| Augusta, GA | 109 | 3.5 | 9.0 | 4 | 2 | 18.4 | 1 | |||||||||||||||||||||
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| Total | 21 | 15 | ||||||||||||||||||||||||||
| * | Data is unavailable in this market. |
| ** | Radio market average annual revenue growth data is presented from 1996-1998. Data for 1995 is unavailable. |
Further information about our radio stations on a market-by-market basis follows.
ATLANTA, GA
| Target | Audience Share in | Audience Rank in | ||||||||||||||||
| Station Call Letters | Year Acquired | Format | Demographic | Target Demographic | Target Demographic | |||||||||||||
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| WAEC-AM | 2000 | religious | 35-64 | — | — | |||||||||||||
| WWWE-AM | 2000 | Hispanic | 35-64 | — | — | |||||||||||||
Market Overview
Atlanta is the seventh largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Atlanta market have grown from approximately $170 million in 1995 to approximately $256.1 million in 1998 at an average annual rate of 14.6%. Radio market revenue grew 20.8% during the nine month period ended September 30, 1999 and 15.4% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 16 viable stations in the Atlanta market.
Atlanta Stations
On January 6, 2000, we purchased two AM radio stations in Atlanta for $10.0 million.
WAEC-AM is a religious/ talk radio station. WAEC-AM traditionally has broadcast ministers, including Martin Luther King, Sr., targeting the African-American community.
WWWE-AM is a Spanish language radio station targeting the Hispanic community.
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PHILADELPHIA, PA
Target
Audience Share in
Audience Rank in
Station Call Letters
Year Acquired
Format
Demographic
Target Demographic
Target Demographic
WXTU-FM
1983
country
25-54
3.6
%
10
(tie)
WWDB-FM
1997
news/talk
35-64
2.5
13
WWDB-AM
1986
brokered
35-64
*
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WTMR-AM
1998
religious
35-64
*
—
Market Overview
Philadelphia is the ninth largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Philadelphia market have grown from approximately $189.9 million in 1995 to approximately $249.1 million in 1998 at an average annual rate of 9.5%. Radio market revenue grew 12.6% during the nine month period ended September 30, 1999 and 9.5% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 19 viable stations in the Philadelphia market.
Philadelphia Stations
We own and operate four stations, two AM and two FM, in the Philadelphia market. Our four-station cluster is the market’s fifth largest radio cluster, with a 7.5% market revenue share.
WXTU-FM has been the only country music radio station in Philadelphia for the past 15 years. Of the eight counties that make up the Philadelphia metro area, WXTU-FM targets the seven county suburban area that accounts for 70% of the Philadelphia metro population. We believe that WXTU-FM has a loyal audience that produces excellent results for its advertisers. The WXTU-FM morning show featuring Harman & Evans is nationally recognized by country music listeners. In 1997, the station opened a country nightclub called “Club 92.5 — A Music Saloon” to create more awareness of country music in Philadelphia and provide a distinctive source of additional revenue and advertising. In addition, WXTU-FM continues to hold its annual Anniversary Show in June, bringing in performers such as Reba McEntire, Alabama, Brooks & Dunn and LeAnn Rimes.
WWDB-FM is a news/talk radio station broadcasting news from 5 AM to 9 AM and talk for the remainder of the day. In 1975, WWDB-FM became the first commercial FM station in the country to operate as a talk station. WWDB-FM’s programming includes renowned announcer Sid Marks, who has been hosting “Friday with Frank” and “Sunday with Sinatra” for over 40 years. This programming is broadcast by approximately 200 affiliates. Three local talk show hosts have been with the radio station since the format inception in 1975.
WWDB-AM is a brokered radio station that focuses on health, financial, inspirational and other niche programming.
WTMR-AM has been operating as a Christian station since 1976. For the last three fiscal years, WTMR-AM has sold over 90% of its available broadcast time.
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BOSTON, MA
| Target | Audience Share in | Audience Rank in | ||||||||||||||
| Station Call Letters | Year Acquired | Format | Demographic | Target Demographic | Target Demographic | |||||||||||
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| WRCA-AM | pending | Hispanic | 25-54 | — | — | |||||||||||
Market Overview
Boston is the tenth largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Boston market have grown from approximately $171.0 million in 1995 to approximately $247.9 million in 1998 at an average annual rate of 13.2%. Radio market revenue grew 13.2% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 19.5 viable stations in the Boston market.
Boston Station
We have entered into an agreement to purchase one AM radio station in Boston for approximately $6 million, subject to an upward adjustment of up to $2 million if the FCC approves specified increases in the power of the station’s transmitter. We expect this transaction to close in the second quarter of 2000.
WRCA-AM is a brokered radio station that focuses on Hispanic programming, reaching many ethnic and religious groups in the Boston area.
MIAMI-FT. LAUDERDALE, FL
| Target | Audience Share in | Audience Rank in | ||||||||||||||
| Station Call Letters | Year Acquired | Format | Demographic | Target Demographic | Target Demographic | |||||||||||
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| WPOW-FM | 1986 | dance CHR | 18-34 | 10.7 | % | 2 | ||||||||||
| WQAM-AM | 1996 | sports/talk | 25-54 men | 6.4 | 2 | |||||||||||
| WKIS-FM | 1996 | country | 25-54 | 4.0 | 9 | |||||||||||
| WWNN-AM | pending | health | 35+ | — | — | |||||||||||
| WHSR-AM | pending | foreign language | 25-54 | — | — | |||||||||||
Market Overview
Miami-Ft. Lauderdale is the twelfth largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Miami-Ft. Lauderdale market have grown from approximately $136.3 million in 1995 to approximately $206.6 million in 1998 at an average annual rate of 15.2%. Radio market revenue grew 11.0% during the nine months ended September 30, 1999 and 6.7% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 24.5 viable stations in the Miami-Ft. Lauderdale market.
Miami-Ft. Lauderdale Stations
We currently own and operate three stations, one AM and two FM, in the Miami-Ft. Lauderdale market. Our three-station cluster is the market’s second largest radio cluster with a 17.3% market revenue share. Of our three stations, two rank in the top two for their respective target demographic audience. In addition, we have agreed to acquire two AM stations in the Miami-
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WPOW-FM has a current hit radio/dance (top 40) format. It ranks second in both target demographic and total market with a 10.7% audience share in its target demographic and a 5.1% total audience share. It is also the fourth highest billing station in the Miami-Ft. Lauderdale market. This station targets young Hispanic women in the 18 to 34 age group. It has a listening audience that is 65% Hispanic.
WQAM-AM is the only AM station in South Florida that covers the Miami metro area with a full, non-directional signal day and night. The station is currently ranked second in its target demographic. WQAM-AM broadcasts play-by-play sports and is the flagship station for Miami Dolphins football, Florida Marlins baseball, Florida Panthers hockey and the University of Miami sports. In 1997, 1998 and the nine months ended September 30, 1999, expenses relating to the station’s contracts to broadcast the Dolphins, the Marlins and the Panthers exceeded related revenues by $2.9 million, $796,000 and $1.3 million, respectively. WQAM-AM has high profile sports/ talk personalities such as Neil Rogers, a top ranked air personality in Miami, and Hank Goldberg, who is also featured on ESPN.
WKIS-FM is the only country music station in the Miami-Ft. Lauderdale market. The listening audience of WKIS-FM is 87% non-ethnic. WKIS-FM is the second rated non-ethnic station in its target demographic with a 9.4% audience share. This station is licensed in Boca Raton, Florida and its primary coverage area reaches Dade and Broward counties, which are located in the Miami-Ft. Lauderdale market.
WWNN-AM is a brokered station that focuses on health talk, featuring programs that discuss medical information, vitamins and traditional and non-traditional medicines.
WHSR-AM is a brokered station that focuses on international programming.
WEST PALM BEACH, FL
| Target | Audience Share in | Audience Rank in | ||||||||||||||
| Station Call Letters | Year Acquired | Format | Demographic | Target Demographic | Target Demographic | |||||||||||
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| WSBR-AM | pending | financial | 40+ men | — | — | |||||||||||
Market Overview
West Palm Beach is the 48th largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the West Palm Beach market have grown from approximately $33.7 million in 1995 to approximately $43.5 million in 1998 at an average annual rate of 8.9%. Radio market revenue grew 14.1% during the nine month period ended September 30, 1999 and 13.7% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 14.5 viable stations in the West Palm Beach market.
West Palm Beach Stations
We have entered into an agreement to purchase one AM radio station in West Palm Beach, along with two AM radio stations in the Miami-Ft. Lauderdale market, for a total purchase price of approximately $18 million. We expect this transaction to close in the second quarter of 2000.
WSBR-AM is a brokered station that focuses on financial topics, including investment strategies and financial services. It also delivers news, traffic and weather information.
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FT. MYERS-NAPLES, FL
| Target | Audience Share in | Audience Rank in | ||||||||||||||||
| Station Call Letters | Year Acquired | Format | Demographic | Target Demographic | Target Demographic | |||||||||||||
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| WJBX-FM | 1998 | alternative rock | 18-34 men | 19.4 | % | 1 | ||||||||||||
| WRXK-FM | 1986 | classic rock | 25-54 men | 15.4 | 1 | |||||||||||||
| WXKB-FM | 1995 | adult CHR | 18-49 women | 14.8 | 1 | |||||||||||||
| WJST-FM | 1998 | nostalgia | 55+ | 11.7 | 2 | |||||||||||||
| WWCN-AM | 1987 | sports/talk | 25-54 men | 2.5 | 13 | (tie) | ||||||||||||
Market Overview
Ft. Myers-Naples is the 74th largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Ft. Myers-Naples market have grown from approximately $18.4 million in 1996 to approximately $22.8 million in 1998 at an average annual rate of 11.2%. Radio market revenue grew 14.0% during the nine months ended September 30, 1999 and 11.3% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 16.5 viable stations in the Ft. Myers-Naples market.
Ft. Myers-Naples Stations
We own and operate five stations, four FM and one AM, in the Ft. Myers-Naples market. Our five-station cluster is the market’s largest radio cluster with a 37.5% market revenue share. Of our five stations, three currently rank first and one currently ranks second for their respective target demographic audience. WJBX-FM and WJST-FM are co-located in Ft. Myers-Naples. We plan to co-locate all of our radio stations in the Ft. Myers-Naples market by the fourth quarter of 2000, which we expect will lower our operating expenses for this market.
WJBX-FM is an alternative rock radio station. The station currently ranks first in its target demographic with a 19.4% audience share. We acquired this station in February 1998 and since then have upgraded the local sales staff and have increased advertising rates.
WRXK-FM is a classic rock radio station. This station currently ranks first in its target demographic with a 15.4% audience share. WRXK-FM broadcasts the Howard Stern Morning Show, the number one rated morning show in the market.
WXKB-FM is an adult top 40 radio station. WXKB-FM currently ranks first in its target demographic with a 14.8% audience share.
WJST-FM has a nostalgia radio format and currently ranks second in its target demographic with an 11.7% audience share. We purchased WJST-FM in February 1998. Since then, the station has created a local morning show, increased the number of sales people, raised advertising rates and increased its promotional efforts. After the local morning show, the station joins the Music of Your Life syndicated network for the remainder of the day. Under our management, we have secured a Class C3 license for this station, which will enable WJST-FM to broadcast with 50 kW of power. The new license will allow full market coverage. Currently, the station operates at 6 kW.
WWCN-AM is a sports/talk radio station. It simulcasts with WQAM-AM daily beginning with the Neil Rogers show. WWCN-AM also simulcasts sports events with WQAM-AM.
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GREENVILLE-NEW BERN-JACKSONVILLE, NC
Target
Audience Share in
Audience Rank in
Station Call Letters
Year Acquired
Format
Demographic
Target Demographic
Target Demographic
WSFL-FM
1991
classic rock
25-54 men
17.4
%
1
WXNR-FM
1996
alternative rock
18-34 men
16.6
1(tie
)
WIKS-FM
1996
urban
25-54
10.7
3
WMGV-FM
1996
adult contemporary
25-54 women
7.4
3
WNCT-FM
1996
oldies
35-64
7.3
4
WNCT-AM
1996
Hispanic brokered
25-54
*
—
Market Overview
Greenville-New Bern-Jacksonville is the 80th largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Greenville-New Bern-Jacksonville market have grown from approximately $14.6 million in 1995 to approximately $20.5 million in 1998 at an average annual rate of 12.1%. Radio market revenue grew 5.1% during the nine months ended September 30, 1999 and 9.1% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 11.5 viable stations in the Greenville-New Bern-Jacksonville market.
Greenville-New Bern-Jacksonville Stations
We own and operate six stations, five FM and one AM, in the Greenville-New Bern-Jacksonville market. Our six-station cluster is the market’s largest radio cluster with a 53.6% market revenue share. Of our five FM stations, all rank in the top four for their respective target demographic audience. WSFL-FM, WIKS-FM, WXNR-FM and WMGV-FM are co-located in New Bern, North Carolina. WNCT-FM and WNCT-AM are co-located in Greenville, North Carolina.
WSFL-FM is a classic rock radio station that currently ranks first in its target demographic with a 17.4% audience share. The station is anchored by the popular John Boy and Billy Big Show, which originates in Charlotte, North Carolina.
WXNR-FM programs alternative rock music. This alternative rock format complements WSFL-FM’s classic rock format. WXNR-FM currently ranks first in its target demographic with a 16.6% audience share.
WIKS-FM is the only urban contemporary station in the Greenville-New Bern-Jacksonville market. It currently ranks third in its target demographic with a 10.7% audience share. WIKS-FM broadcasts the nationally syndicated Tom Joyner Morning Show, which consistently ranks as one of the top three morning shows in the market.
WMGV-FM is an adult contemporary radio station. It currently ranks third in its target demographic with a 7.4% audience share.
WNCT-FM programs an oldies format and currently ranks fourth in its target demographic with a 7.3% audience share.
WNCT-AM has recently changed its format. In 1999, WNCT-AM began brokering 50% of its airtime to a group that provided the market’s first Hispanic programming. In the year 2000, 100% of WNCT-AM’s programming will be Hispanic. There are an estimated 30,000 Hispanics in the metro and an additional 30,000 Hispanics in the total survey area.
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FAYETTEVILLE, NC
Target
Audience Share in
Audience Rank in
Station Call Letters
Year Acquired
Format
Demographic
Target Demographic
Target Demographic
WZFX-FM
1997
urban
18-49
17.6
%
1
WKML-FM
1983
country
25-54
15.0
1
WFLB-FM
1996
oldies
35-64
10.6
2
WUKS-FM
1997
urban/adult
25-54
4.3
6
(tie)
contemporary
WAZZ-AM
1997
nostalgia
55+
2.3
8
(tie)
WTEL-AM
1997
religious
35-64
*
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Market Overview
Fayetteville is the 104th largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Fayetteville market have grown from approximately $11.5 million in 1995 to approximately $16.4 million in 1998 at an average annual rate of 13.0%. Radio market revenue grew 5.6% during the nine months ended September 30, 1999 and 26.3% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 9.5 viable stations in the Fayetteville market.
Fayetteville Stations
We own and operate six stations, two AM and four FM, in the Fayetteville market. Our six-station cluster is the market’s largest radio cluster with a 61.6% market revenue share. Of our six stations, three rank in the top two for their respective target demographic audience.
WZFX-FM currently ranks first in its target demographic audience, with a 17.6% audience share. The radio station has consistently been the second highest billing station in the market over the past several years. We have been successful in positioning WZFX-FM as the dominant urban radio station in the market. The radio station emphasizes its continuing community involvement, including its annual birthday party with a salute to the military of Fort Bragg. Approximately 10,000 listeners attended this event last year.
WKML-FM currently ranks first in its target demographic audience with a 15.0% audience share. WKML is the only significant country radio station in the Fayetteville market. WKML-FM broadcasts selected NASCAR races, including races from the Motor Racing Network and the Professional Racing Network. WKML-FM has consistently been the highest billing radio station in the market.
WFLB-FM ranks second in its target demographic audience, with a 10.6% audience share. WFLB-FM is the market’s exclusive broadcaster of the University of North Carolina football and basketball games. In 1997, we relocated this station’s antenna, giving WFLB-FM a highly desirable signal in the Fayetteville market.
In 1997, WUKS-FM changed its format from young urban, with a target demographic audience of 12-24, to a format of urban/ adult contemporary with a target demographic audience of 25-54. WUKS-FM broadcasts the nationally syndicated Tom Joyner Morning Show. While there is shared listening between WUKS-FM and WZFX-FM, WUKS-FM attracts an older audience. The radio station is currently tied for sixth in its target demographic audience with a 4.3% audience share.
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WAZZ-AM is the second oldest station in the market and has a nostalgia format. WAZZ-AM’s morning show is anchored by forty-year local radio veteran, Curt Nunnery. WAZZ-AM is Fayetteville’s exclusive broadcaster of the Charlotte Hornets and the Atlanta Braves. WAZZ-AM also carries a select group of Busch Garden National and Winston Cup Series races from the Motor Racing Network.
WTEL-AM is a religious format station targeted to the African-American community. In 1999, WTEL-AM sold 90% of its available broadcast time.
AUGUSTA, GA
| Target | Audience Share in | Audience Rank in | ||||||||||||||||
| Station Call Letters | Year Acquired | Format | Demographic | Target Demographic | Target Demographic | |||||||||||||
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| WCHZ-FM | 1997 | alternative rock | 18-34 men | 14.5 | % | 2 | ||||||||||||
| WGOR-FM | 1992 | oldies | 35-64 | 6.6 | 3 | |||||||||||||
| WGAC-AM | 1993 | news/talk/sports | 35-64 | 6.2 | 4 | (tie) | ||||||||||||
| WAJY-FM | 1994 | nostalgia | 55+ | 6.1 | 5 | |||||||||||||
| WRDW-AM | pending | sports/talk | 25-54 men | — | — | |||||||||||||
| WRFN-FM | pending | sports/talk | 25-54 men | — | — | |||||||||||||
Market Overview
Augusta is the 109th largest radio market in the United States based on 1998 radio market revenue. Radio market revenues in the Augusta market have grown from approximately $13.9 million in 1995 to approximately $15.4 million in 1998 at an average annual rate of 3.5%. Radio market revenue grew 9.0% during the nine months ended September 30, 1999 and declined 1.3% during the year ended December 31, 1998, as compared to the same period of the prior year. There are currently 13 viable stations in the Augusta market.
Augusta Stations
We will own and operate six stations, two AM and four FM, in the Augusta market, after completing our pending acquisition of two stations. This six-station cluster will be the market’s largest radio cluster with a 18.4% market revenue share. Of these six stations, four rank in the top five for their respective target demographic audience.
WCHZ-FM is the only alternative rock radio station in Augusta. WCHZ-FM currently ranks second in its target demographic audience with a 14.5% audience share. The station broadcasts the Lex and Terry syndicated morning show, which has gone from 0.8% of market share in the Spring of 1998 to 13.8% of the market share in the Spring of 1999.
WGOR-FM is Augusta’s only oldies radio station. WGOR-FM currently ranks third in its target demographic audience, with a 6.6% audience share. It has a long tradition of hosting well known local air talent, including Harley Drew, featured during middays, with over 40 years of experience. Ron Jones, the afternoon host, has 13 years of experience.
WGAC-AM is Augusta’s oldest radio station still in operation. It has a news/talk/sports format and is currently tied for fourth in its target demographic audience with a 6.2% audience share. Currently, WGAC-AM’s morning show is hosted by 40 year Augusta veteran, Harley Drew. Middays feature the nationally syndicated shows of Dr. Laura and Rush Limbaugh. Afternoons feature local talk celebrity, Austin Rhodes. WGAC-AM broadcasts the Atlanta Braves baseball and the University of Georgia Bulldogs football and basketball games. We have agreed to acquire WGAC-AM’s only
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WAJY-FM has been Augusta’s only nostalgia radio station since February 1995. The radio station’s limited coverage and proximity to Aiken, South Carolina have made nostalgia an attractive programming format. Aiken, South Carolina, has been rated as one of the top 10 places to retire in America. WAJY-FM focuses on local news and community service programming. WAJY-FM broadcasts the Westwood One “AM Only” format.
WRDW-AM is a sports/ talk radio station. WRDW-AM broadcasts the Atlanta Hawks, Atlanta Falcons and Georgia Tech football and basketball games. WRDW-AM also broadcasts nationally-syndicated shows such as Don Imus during the mornings and G. Gordon Liddy during middays.
WRFN-FM is a sports/talk radio station and simulcasts 100% of its time with WRDW-AM.
Competition; Changes in Broadcasting Industry
The radio broadcasting industry is highly competitive. The success of each of our stations depends largely upon its audience ratings and its share of the overall advertising revenue within its market. Our stations compete for listeners and advertising revenue directly with other radio stations within their respective markets. Radio stations compete for listeners primarily on the basis of program content that appeals to a particular demographic group. By building a strong listener base consisting of a specific demographic group in each of our markets, we are able to attract advertisers seeking to reach those listeners.
The following are some of the factors that are important to a radio station’s competitive position:
| • | management experience; | |
| • | the station’s local audience rank in its market; | |
| • | transmitter power; | |
| • | assigned frequency; | |
| • | audience characteristics; | |
| • | local program acceptance; and | |
| • | the number and characteristics of other radio stations and other advertising media in the market area. |
In addition, we attempt to improve our competitive position with promotional campaigns aimed at the demographic groups targeted by our stations and by sales efforts designed to attract advertisers. Recent changes in the Communications Act and the FCC’s policies and rules permit increased ownership and operation of multiple local radio stations.
Despite the competitiveness within the radio broadcasting industry, some barriers to entry exist. The operation of a radio broadcast station requires a license from the FCC. The number of radio stations that can operate in a given market is limited by strict AM interference criteria and availability of FM radio frequencies allotted by the FCC to communities in that market. The number of stations that a single entity may operate in a market is further limited by the FCC’s multiple ownership rules that regulate the number of stations serving the same area that may be owned and controlled by a single entity.
Our stations also compete for audiences and advertising revenues within their respective markets directly with other radio stations, as well as with other media such as newspapers, magazines, network and cable television, outdoor advertising and direct mail. In addition, the radio broadcasting industry
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| • | satellite delivered audio radio service, which could result in the introduction of new satellite radio services with sound quality equivalent to that of compact discs; | |
| • | audio programming by cable systems, direct broadcast satellite systems, Internet content providers, personal communications services and other digital audio broadcast formats; and | |
| • | in-band on-channel digital radio, which could provide multi-channel, multi-format digital radio services in the same bandwidth currently occupied by traditional AM and FM radio services. |
The FCC has adopted proposals for the establishment of low-powered FM stations that would be designed to serve small localized areas. The radio broadcasting industry historically has grown despite the introduction of new technologies for the delivery of entertainment and information, such as television broadcasting, cable television, audio tapes and compact discs. A growing population and greater availability of radios, particularly car and portable radios, have contributed to this growth. We cannot assure you, however, that this historical growth will continue or that the development or introduction in the future of any new media technology will not have an adverse effect on the radio broadcasting industry.
The FCC has adopted licensing and operating rules for satellite delivered audio and in April 1997 awarded two licenses for this service. Satellite delivered audio may provide a medium for the delivery by satellite or terrestrial means of multiple new audio programming formats to local and/ or national audiences. Digital technology also may be used in the future by terrestrial radio broadcast stations either on existing or alternate broadcasting frequencies, and the FCC has stated that it will consider making changes to its rules to permit AM and FM radio stations to offer digital sound following industry analysis of technical standards. In addition, the FCC has authorized an additional 100 kHz of bandwidth for the AM band and has allotted frequencies in this new band to certain existing AM station licensees that applied for migration to the expanded AM band, subject to the requirement that at the end of a transition period, those licensees return to the FCC either the license for their existing AM band station or the license for the expanded AM band station.
We cannot predict what other matters might be considered in the future by the FCC, nor can we assess in advance what impact, if any, the implementation of any of these proposals or changes might have on our business.
We employ a number of on-air personalities and generally enter into employment agreements with these personalities to protect our interests in those relationships that we believe to be valuable. The loss of some of these personalities could result in a short-term loss of audience share, but we do not believe that the loss would have a material adverse effect on our business.
Federal Regulation Of Radio Broadcasting
The radio broadcasting industry is subject to extensive and changing regulation of, among other things, program content, advertising content, technical operations and business and employment practices. The ownership, operation and sale of radio stations are subject to the jurisdiction of the FCC. Among other things, the FCC:
| • | assigns frequency bands for broadcasting; | |
| • | determines the particular frequencies, locations and operating power of stations; | |
| • | issues, renews, revokes and modifies station licenses; | |
| • | determines whether to approve changes in ownership or control of station licenses; |
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| • | regulates equipment used by stations; and | |
| • | adopts and implements regulations and policies that directly affect the ownership, operation and employment practices of stations. |
The FCC has the power to impose penalties for violations of its rules or the Communications Act, including the imposition of monetary forfeitures, the issuance of short-term licenses, the imposition of a condition on the renewal of a license, non-renewal of licences and the revocation of operating authority.
The following is a brief summary of some provisions of the Communications Act and of specific FCC regulations and policies. The summary is not a comprehensive listing of all of the regulations and policies affecting radio stations. For further information concerning the nature and extent of federal regulation of radio stations, you should refer to the Communications Act, FCC rules and FCC public notices and rulings.
FCC Licenses. Radio stations operate pursuant to renewable broadcasting licenses that are ordinarily granted by the FCC for maximum terms of eight years. A station may continue to operate beyond the expiration date of its license if a timely filed license renewal application is pending. During the periods when renewal applications are pending, petitions to deny license renewals can be filed by interested parties, including members of the public. The FCC is required to hold hearings on a station’s renewal application if a substantial or material question of fact exists as to whether the station has served the public interest, convenience and necessity. If, as a result of an evidentiary hearing, the FCC determines that the licensee has failed to meet certain requirements and that no mitigating factors justify the imposition of a lesser sanction, then the FCC may deny a license renewal application. Historically, FCC licenses have generally been renewed. We have no reason to believe that our licenses will not be renewed in the ordinary course, although there can be no assurance to that effect. The non-renewal of one or more of our licenses could have a material adverse effect on our business.
The FCC classifies each AM and FM station. An AM station operates on either a clear channel, regional channel or local channel. A clear channel is one on which AM stations are assigned to serve wide areas. Clear channel AM stations are classified as either: Class A stations, which operate on an unlimited time basis and are designated to render primary and secondary service over an extended area; Class B stations, which operate on an unlimited time basis and are designed to render service only over a primary service area; or Class D stations, which operate either during daytime hours only, during limited times only or on an unlimited time basis with low nighttime power. A regional channel is one on which Class B and Class D AM stations may operate and serve primarily a principal center of population and the rural areas contiguous to it. A local channel is one on which AM stations operate on an unlimited time basis and serve primarily a community and the immediately contiguous suburban and rural areas. Class C AM stations operate on a local channel and are designed to render service only over a primary service area that may be reduced as a consequence of interference.
The minimum and maximum facilities requirements for an FM station are determined by its class. FM class designations depend upon the geographic zone in which the transmitter of the FM station is located. In general, commercial FM stations are classified as follows, in order of increasing power and antenna height: Class A, B1, C3, B, C2, C1 and C.
The following table sets forth the metropolitan market served, call letters, FCC license classification, frequency, power and FCC license expiration date of each of the stations that we will own or operate upon the purchase of radio stations in Boston, Miami-Ft. Lauderdale, West Palm Beach and Augusta. In many cases, our licenses are held by wholly-owned subsidiaries. Pursuant to FCC rules and regulations, many AM radio stations are licensed to operate at a reduced power during the nighttime broadcasting hours, which results in reducing the radio station’s coverage during
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| FCC | Power in | Expiration Date | ||||||||||||||||
| Market | Station | Class | Frequency | Kilowatts | of FCC License | |||||||||||||
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| Atlanta, GA | WAEC-AM | B | 860 kHz | 5 kW day/.5 kW night | 04/01/2004 | |||||||||||||
| WWWE-AM | D | 1100 kHz | 5 kW day | 04/01/2004 | ||||||||||||||
| Philadelphia, PA | WXTU-FM | B | 92.5 MHz | 15.5 kW | 08/01/2006 | |||||||||||||
| WWDB-FM | B | 96.5 MHz | 17.0 kW | 08/01/2006 | ||||||||||||||
| WTMR-AM | B | 800 kHz | 5 kW day/.5 kW night | 06/01/2006 | ||||||||||||||
| WWDB-AM | D | 860 kHz | 10 kW day | 08/01/2006 | ||||||||||||||
| Boston, MA | WRCA-AM | B | 1330 kHz | 5 kW | 04/01/2006 | |||||||||||||
| Miami-Ft. Lauderdale, FL | WQAM-AM | B | 560 kHz | 5 kW day/1 kW night | 02/01/2004 | |||||||||||||
| WPOW-FM | C | 96.5 MHz | 100 kW | 02/01/2004 | ||||||||||||||
| WKIS-FM | C | 99.9 MHz | 100 kW | 02/01/2004 | ||||||||||||||
| WWNN-AM | B | 1470 kHz | 50 kW day/2.5 kW night | 02/01/2004 | ||||||||||||||
| WHSR-AM | B | 980 kHz | 5 kW day/1 kW night | 02/01/2004 | ||||||||||||||
| West Palm Beach, FL | WSBR-AM | B | 740 kHz | 2.5 kW day/.94 kW night | 02/01/2004 | |||||||||||||
| Ft. Myers-Naples, FL | WXKB-FM | C1 | 103.9 MHz | 100 kW | 02/01/2004 | |||||||||||||
| WRXK-FM | C | 96.1 MHz | 100 kW | 02/01/2004 | ||||||||||||||
| WJBX-FM | C2 | 99.3 MHz | 50 kW | 02/01/2004 | ||||||||||||||
| WJST-FM | A | 106.3 MHz | 6 kW | 02/01/2004 | ||||||||||||||
| WWCN-AM | B | 770 kHz | 10 kW day/1 kW night | 02/01/2004 | ||||||||||||||
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Greenville-New Bern-
Jacksonsville, NC |
WSFL-FM | C1 | 106.5 MHz | 100 kW | 12/01/2003 | |||||||||||||
| WIKS-FM | C1 | 101.9 MHz | 100 kW | 12/01/2003 | ||||||||||||||
| WNCT-AM | B | 1070 kHz | 10 kW day/night | 12/01/2003 | ||||||||||||||
| WNCT-FM | C | 107.9 MHz | 100 kW | 12/01/2003 | ||||||||||||||
| WXNR-FM | C2 | 99.5 MHz | 16.5 kW | 12/01/2003 | ||||||||||||||
| WMGV-FM | C1 | 103.3 MHz | 100 kW | 12/01/2003 | ||||||||||||||
| Fayetteville, NC | WZFX-FM | C1 | 99.1 MHz | 100 kW | 12/01/2003 | |||||||||||||
| WKML-FM | C | 95.7 MHz | 100 kW | 12/01/2003 | ||||||||||||||
| WFLB-FM | C | 96.5 MHz | 100 kW | 12/01/2003 | ||||||||||||||
| WUKS-FM | C3 | 107.7 MHz | 5.2 kW | 12/01/2003 | ||||||||||||||
| WAZZ-AM | C | 1490 kHz | 1 kW day/night | 12/01/2003 | ||||||||||||||
| WTEL-AM | B | 1160 kHz | 5 kW day/.25 kW night | 12/01/2003 | ||||||||||||||
| Augusta, GA | WGAC-AM | B | 580 kHz | 5 kW day/1 kW night | 04/01/2004 | |||||||||||||
| WGOR-FM | C3 | 93.9 MHz | 13 kW | 04/01/2004 | ||||||||||||||
| WCHZ-FM | C3 | 95.1 MHz | 5.7 kW | 04/01/2004 | ||||||||||||||
| WAJY-FM | A | 102.7 MHz | 3 kW | 12/01/2003 | ||||||||||||||
| WRFN-FM | A | 93.1 MHz | 4.1 kW | 04/01/2004 | ||||||||||||||
| WRDW-AM | B | 1480 kHz | 5 kW day/night | 04/01/2004 | ||||||||||||||
Transfers or Assignment of License. The Communications Act prohibits the assignment of broadcast licenses or the transfer of control of a broadcast licensee without the prior approval of the FCC. In determining whether to grant such approval, the FCC considers a number of factors pertaining to the licensee and proposed licensee, including:
| • | compliance with the various rules limiting common ownership of media properties in a given market; |
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| • | the character of the licensee and those persons holding attributable interests in the licensee; and | |
| • | compliance with the Communications Act’s limitations on alien ownership as well as compliance with other FCC regulations and policies. |
To obtain FCC consent to assign or transfer control of a broadcast license, appropriate applications must be filed with the FCC. If the application involves a substantial change in ownership or control, the application must be placed on public notice for not less than 30 days during which time petitions to deny or other objections against the application may be filed by interested parties, including members of the public. These types of petitions are filed from time to time with respect to proposed acquisitions. For example, a petition to deny the assignment of the FCC licenses involved in our pending acquisition of two radio stations in Augusta has been filed, with the result that we are unable to predict when the transaction will be completed. If the FCC grants an assignment or transfer application, interested parties have 30 days from public notice of the grant to seek reconsideration of that grant. The FCC usually has an additional ten days to set aside the grant on its own motion. If the application does not involve a substantial change in ownership or control, it is a pro forma application. The pro forma application is nevertheless subject to having informal objections filed against it. When passing on an assignment or transfer application, the FCC is prohibited from considering whether the public interest might be served by an assignment or transfer of the broadcast license to any party other than the assignee or transferee specified in the application.
Multiple Ownership Rules. The Communications Act and FCC rules impose specific limits on the number of commercial radio stations an entity can own in a single market. These rules may preclude us from acquiring certain stations we might otherwise seek to acquire. The rules also effectively prevent us from selling stations in a market to a buyer that has reached its ownership limit in the market unless that buyer divests other stations. The local radio ownership rules are as follows:
| • | in markets with 45 or more commercial radio stations, ownership is limited to eight commercial stations, no more than five of which can be either AM or FM; | |
| • | in markets with 30 to 44 commercial radio stations, ownership is limited to seven commercial stations, no more than four of which can be either AM or FM; | |
| • | in markets with 15 to 29 commercial radio stations, ownership is limited to six commercial stations, no more than four of which can be either AM or FM; and | |
| • | in markets with 14 or fewer commercial radio stations, ownership is limited to five commercial stations or no more than 50% of the market’s total, whichever is lower, and no more than three of which can be either AM or FM. |
The FCC is also reportedly considering proposing a policy that would give special review to a proposed transaction if it would enable a single owner to attain a high degree of revenue concentration in a market. In connection with this, the FCC has invited comment on the impact of concentration in public notices concerning proposed transactions, and has delayed or refused its consent in some cases because of revenue concentration.
The FCC recently revised its radio/television cross-ownership rule to allow for greater common ownership of television and radio stations. The revised radio/television cross-ownership rule permits a single owner to own up to two television stations, consistent with the FCC’s rules on common ownership of television stations, together with one radio station in all markets. In addition, an owner will be permitted to own additional radio stations, not to exceed the local ownership limits for the market, as follows:
| • | in markets where 20 media voices will remain, an owner may own an additional 5 radio stations, or, if the owner only has one television station, an additional 6 radio stations; and |
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| • | in markets where 10 media voices will remain, an owner may own an additional 3 radio stations. |
A media voice includes each independently-owned, full power television and radio station and each daily newspaper, plus one voice for all cable television systems operating in the market.
In addition to the limits on the number of radio stations and radio/ television combinations that a single owner may own, the FCC’s broadcast/newspaper cross-ownership rule prohibits the same owner from owning a broadcast station and a daily newspaper in the same geographic market.
The FCC generally applies its ownership limits to attributable interests held by an individual, corporation, partnership or other association. In the case of corporations controlling broadcast licenses, the interests of officers, directors and those who, directly or indirectly, have the right to vote 5% or more of the corporation’s voting stock are generally attributable. In addition, certain passive investors are attributable if they hold 20% or more of the corporation’s voting stock. If a single individual or entity controls more than 50% of a corporation’s voting stock, however, the interests of other stockholders are generally not attributable unless the stockholders are also officers or directors of the corporation.
The FCC recently adopted a new rule, known as the equity-debt-plus rule, that causes certain creditors or investors to be attributable owners of a station, regardless of whether there is a single majority stockholder. Under this new rule, a major programming supplier or a same-market owner will be an attributable owner of a station if the supplier or owner holds debt or equity, or both, in the station that is greater than 33% of the value of the station’s total debt plus equity. A major programming supplier includes any programming supplier that provides more than 15% of the station’s weekly programming hours. A same-market owner includes any attributable owner of a media company, including broadcast stations, cable television and newspapers, located in the same market as the station, but only if the owner is attributable under an FCC attribution rule other than the equity-debt-plus rule. If attribution under the equity-debt-plus rule results in a violation of the FCC’s multiple ownership rules, each affected party must come into compliance with those rules, by reducing or eliminating the party’s interest in the affected media outlets or obtaining a waiver from the FCC, no later than August 5, 2000. The attribution rules limit the number of radio stations we may acquire or own in any market.
Alien Ownership Rules. The Communications Act prohibits the issuance or holding of broadcast licenses by persons who are not U.S. citizens, whom the FCC rules refer to as “aliens,” including any corporation if more than 20% of its capital stock is owned or voted by aliens. In addition, the FCC may prohibit any corporation from holding a broadcast license if the corporation is controlled by any other corporation of which more than 25% of the capital stock is owned of record or voted by aliens, if the FCC finds that the prohibition is in the public interest. Our certificate of incorporation prohibits the ownership, voting and transfer of our capital stock in violation of the FCC restrictions, and prohibits the issuance of capital stock or the voting rights such capital stock represents to or for the account of aliens or corporations otherwise subject to domination or control by aliens in excess of the FCC limits. The certificate of incorporation authorizes our board of directors to enforce these prohibitions. For example, the certificate of incorporation provides for the redemption of shares of our capital stock by action of the board of directors to the extent necessary to comply with these alien ownership restrictions.
Time Brokerage Agreements. Over the past few years, a number of radio stations have entered into what have commonly been referred to as time brokerage agreements. While these agreements may take varying forms, under a typical time brokerage agreement, separately owned and licensed radio stations agree to enter into cooperative arrangements of varying sorts, subject to compliance with the requirements of antitrust laws and with FCC’s rules and policies. Under these arrangements,
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The FCC’s rules provide that a radio station that brokers more than 15% of the weekly broadcast time on another station serving the same market will be considered to have an attributable ownership interest in the brokered station for purposes of FCC’s local radio ownership limits. As a result, in a market where we own a radio station, we would not be permitted to enter into a time brokerage agreement with another radio station in the same market if we could not own the brokered station under the multiple ownership rules, unless our programming on the brokered station constituted 15% or less of the brokered station’s programming time on a weekly basis. FCC rules also prohibit a broadcast station from duplicating more than 25% of its programming on another station in the same broadcast service, that is AM-AM or FM-FM through a time brokerage agreement where the brokered and brokering stations which it owns or programs serve substantially the same area.
Programming and Operations. The Communications Act requires broadcasters to serve the public interest. The FCC gradually has relaxed or eliminated many of the more formalized procedures it had developed in the past to promote the broadcast of certain types of programming responsive to the needs of a station’s community of license. A licensee continues to be required, however, to present programming that is responsive to issues of the station’s community of license and to maintain records demonstrating this responsiveness. Complaints from listeners concerning a station’s programming often will be considered by the FCC when it evaluates renewal applications of a licensee, although listener complaints may be filed at any time, are required to be maintained in the station’s public file and generally may be considered by the FCC at any time. Stations also must pay regulatory and application fees and follow various rules promulgated under the Communications Act. Those rules regulate, among other things, political advertising, sponsorship identifications, the advertisement of contests and lotteries, obscene and indecent broadcasts and technical operations, including limits on human exposure to radio frequency radiation.
On January 20, 2000, the FCC adopted new rules prohibiting employment discrimination by broadcast stations on the basis of race, religion, color, national origin, and gender; and requiring broadcasters to implement programs to promote equal employment opportunities at their stations. The rules generally require broadcast stations to disseminate information about job openings widely so that all qualified applicants, including minorities and women, have an adequate opportunity to compete for the job. Broadcasters may fulfill this requirement by sending the station’s job vacancy information to organizations that request it, participating in community outreach programs, or designing an alternative recruitment program. Broadcasters with five or more full-time employees must place in their public files annually a report detailing their recruitment efforts and must file a statement with the FCC certifying compliance with the rules every two years. Broadcasters with ten or more full-time employees must file their annual reports with the FCC midway through their license term. Broadcasters also must file employment information with the FCC annually for statistical purposes. These new equal employment opportunity rules are designed to replace the FCC’s prior rules, some of which were ruled unconstitutional by the U.S. Court of Appeals for the District of Columbia Circuit.
The FCC recently issued a decision holding that a broadcast station may not deny a candidate for federal political office a request for broadcast advertising time solely on the grounds that the
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Proposed and Recent Changes. Congress and the FCC may in the future consider and adopt new laws, regulations and policies regarding a wide variety of matters that could affect, directly or indirectly, the operation, ownership and profitability of our radio stations, including the loss of audience share and advertising revenues for our radio stations, and an inability to acquire additional radio stations or to finance those acquisitions. Such matters may include:
| • | changes in the FCC’s cross-interest, multiple ownership and attribution policies. | |
| • | regulatory fees, spectrum use fees or other fees on FCC licenses; | |
| • | foreign ownership of broadcast licenses; | |
| • | restatement in revised form of FCC’s equal employment opportunity rules and revisions to the FCC’s rules relating to political broadcasting; | |
| • | technical and frequency allocation matters; and | |
| • | proposals to restrict or prohibit the advertising of beer, wine and other alcoholic beverages on radio. |
The FCC currently is considering standards for evaluating, authorizing, and implementing terrestrial digital audio broadcasting technology, including In-Band On-Channel™ technology for FM radio stations. Digital audio broadcasting’s advantages over traditional analog broadcasting technology include improved sound quality and the ability to offer a greater variety of auxiliary services. In-Band On-Channel technology would permit an FM station to transmit radio programming in both analog and digital formats, or in digital only formats, using the bandwidth that the radio station is currently licensed to use. It is unclear what regulations the FCC will adopt regarding Digital Audio Broadcasting or In-Band On-Channel technology and what effect such regulations would have on our business or the operations of its radio stations.
On January 20, 2000, the FCC voted to adopt rules creating a new low power FM radio service. The new low power stations will operate at a maximum power of between 10 and 100 watts in the existing FM commercial and non-commercial band. Low power stations may be used by governmental and non-profit organizations to provide noncommercial educational programming or public safety and transportation radio services. No existing broadcaster or other media entity, including Beasley, will be permitted to have an ownership interest or enter into any program or operating agreement with any low power FM station. During the first two years of the new service, applicants must be based in the area that they propose to serve. Applicants will not be permitted to own more than one station nationwide during the initial two year period. After the initial two year period, entities will be allowed to own up to five stations nationwide, and after three years, the limit will be raised to ten stations nationwide. A single person or entity may not own two low power stations whose transmitters are less than seven miles from each other. The authorizations for the new stations will not be transferable. The FCC has stated that it intends to begin accepting applications for new stations during the next several months.
At this time, it is difficult to assess the competitive impact of these new stations. The new low power stations must comply with certain technical requirements aimed at protecting existing FM radio stations from interference, although we cannot be certain of the level of interference that low power stations will cause after they begin operating. Moreover, if low power FM stations are licensed in the markets which Beasley operates its stations, the low power stations may compete for listeners and advertisers. The low power stations may also limit the ability of Beasley to obtain new
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Finally, the FCC has adopted procedures for the auction of broadcast spectrum in circumstances where two or more parties have filed for new or major change applications which are mutually exclusive. Such procedures may limit our efforts to modify or expand the broadcast signals of our stations.
We cannot predict what other matters might be considered in the future by the FCC or Congress, nor can we judge in advance what impact, if any, the implementation of any of these proposals or changes might have on our business.
Federal Antitrust Laws. The agencies responsible for enforcing the federal antitrust laws, the Federal Trade Commission or the Department of Justice, may investigate certain acquisitions. We cannot predict the outcome of any specific FTC or Department of Justice investigation. Any decision by the FTC or the Department of Justice to challenge a proposed acquisition could affect our ability to consummate the acquisition or to consummate it on the proposed terms.
For an acquisition meeting certain size thresholds, the Hart-Scott-Rodino Act requires the parties to file Notification and Report Forms concerning antitrust issues with the FTC and the Department of Justice and to observe specified waiting period requirements before consummating the acquisition. If the investigating agency raises substantive issues in connection with a proposed transaction, then the parties frequently engage in lengthy discussions or negotiations with the investigating agency concerning possible means of addressing those issues, including restructuring the proposed acquisition or divesting assets. In addition, the investigating agency could file suit in federal court to enjoin the acquisition or to require the divestiture of assets, among other remedies. Acquisitions that are not required to be reported under the Hart-Scott-Rodino Act may be investigated by the FTC or the Department of Justice under the antitrust laws before or after consummation. In addition, private parties may under certain circumstances bring legal action to challenge an acquisition under the antitrust laws.
As part of its increased scrutiny of radio station acquisitions, the Department of Justice has stated publicly that it believes that local marketing agreements, joint sales agreements, time brokerage agreements and other similar agreements customarily entered into in connection with radio station transfers could violate the Hart-Scott-Rodino Act if such agreements take effect prior to the expiration of the waiting period under the Hart-Scott-Rodino Act. Furthermore, the Department of Justice has noted that joint sales agreements may raise antitrust concerns under Section 1 of the Sherman Act and has challenged joint sales agreements in certain locations. The Department of Justice also has stated publicly that it has established certain revenue and audience share concentration benchmarks with respect to radio station acquisitions, above which a transaction may receive additional antitrust scrutiny. However, to date, the Department of Justice has also investigated transactions that do not meet or exceed these benchmarks and has cleared transactions that do exceed these benchmarks.
Employees
On December 31, 1999, we had a staff of 418 full-time employees and 127 part-time employees. We are a party to a collective bargaining agreement with the American Federation of Television and Radio Artists. This agreement applies only to some employees at WXTU-FM in Philadelphia. The provisions of the collective bargaining agreement remain in full force until March 31, 2000 and continue thereafter for one-year periods unless notice of proposed termination is given by either party at least 60 days before the termination date. We believe that our relations with our employees are good.
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Environmental
As the owner, lessee or operator of various real properties and facilities, we are subject to various federal, state and local environmental laws and regulations. Historically, compliance with these laws and regulations has not had a material adverse effect on our business. There can be no assurance, however, that compliance with existing or new environmental laws and regulations will not require us to make significant expenditures of funds.
Properties And Facilities
The types of facilities required to support each of our radio stations include offices, studios and transmitter and antenna sites. We typically lease our studio and office space with lease terms that expire in six months to ten years, although we do own some of our facilities. Our principal executive offices are located at 3033 Riviera Drive, Suite 200, Naples, Florida. We lease that building from an affiliated company. We currently have a month to month lease and we pay approximately $7,400 per month. After the reorganization, we intend to enter into a long-term lease for the same offices at a market rent. We lease a majority of our main transmitter and antenna sites. The transmitter and antenna site for each station is generally located so as to provide maximum market coverage, consistent with the station’s FCC license.
No one facility is material to us. We believe that our facilities are generally in good condition and suitable for our operations. However, we continually look for opportunities to upgrade our facilities and may do so in the future. Substantially all of our properties and equipment serve as collateral for our obligations under our credit facility.
Legal Proceedings
We currently and from time to time are involved in litigation incidental to the conduct of our business, but we are not a party to any lawsuit or proceeding which, in the opinion of management, is likely to have a material adverse effect on us.
On December 29, 1998, we filed a lawsuit in the Circuit Court of the Eleventh Judicial Circuit, Miami-Dade County, against the Florida Marlins Inc., Florida Marlins Baseball Team, Ltd., and Front Row Communications for breach of contract and other related claims. The lawsuit is based on actions taken by the Florida Marlins major league baseball team to trade or release key players of the Marlins after the 1997 season, thereby transforming the Marlins into a non-competitive team. On January 14, 2000, the court dismissed the Marlins’ motion for summary judgment. On May 22, 1999, the Marlins countersued for breach of contract. We intend to pursue our legal action against the Marlins and seek dismissal of their countersuit. We cannot yet determine the outcome of these lawsuits.
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MANAGEMENT
The following table provides information concerning our directors
and executive officers.
Name
Age
Position
George G. Beasley
67
Chairman and Chief Executive Officer
Bruce G. Beasley
42
President, Chief Operating Officer and Director
B. Caroline Beasley
37
Vice President, Chief Financial Officer, Secretary, Treasurer and
Director
Brian E. Beasley
40
Vice President of Operations and Director
Joe B. Cox
60
Nominee for Director
Mark S. Fowler
58
Nominee for Director
George G. Beasley founded Beasley Broadcast Group in 1961 and has served since inception as our Chairman and Chief Executive Officer. Mr. Beasley served on the North Carolina Association of Broadcasters’ Board of Directors for eight years and has served that Association as President and Vice President. Mr. Beasley was awarded the Distinguished Broadcaster of North Carolina Award in 1998. Mr. Beasley has a B.A. and M.A. from Appalachian State University. George G. Beasley is the father of Bruce G. Beasley, B. Caroline Beasley and Brian E. Beasley.
Bruce G. Beasley has served as our President and Chief Operating Officer since 1997 and as one of our directors since 1980. He began his career in the broadcasting business with Beasley Broadcast Group in 1975 and since that time has served in various capacities including General Sales Manager of a radio station, General Manager of a radio station and Vice President of Operations of Beasley. Currently, Mr. Beasley oversees the operation of all radio stations. Mr. Beasley serves on the Boards of Directors of the North Carolina Association of Broadcasters and the Radio Advertising Bureau. Mr. Beasley has a B.S. from East Carolina University. Mr. Beasley is the son of George G. Beasley and the brother of B. Caroline Beasley and Brian E. Beasley.
B. Caroline Beasley has served as our Vice President, Chief Financial Officer and Secretary since 1994 and as one of our directors since 1983. She joined Beasley Broadcast Group in 1983 and since that time has served in various capacities including Business Manager, Assistant Controller and Corporate Controller. Ms. Beasley is a member of the Broadcast and Cable Financial Management Association. Ms. Beasley has a B.S. from the University of North Carolina at Chapel Hill. Ms. Beasley is the daughter of George G. Beasley and the sister of Bruce G. Beasley and Brian E. Beasley.
Brian E. Beasley has served as our Vice President of Operations since 1997 and as one of our directors since 1982. He began his career in broadcasting during high school in 1977. He joined Beasley full-time in 1982 as General Manager of the previously-owned cable TV division. In 1985, he became Senior Account Executive to a radio station. Since that time, Mr. Beasley has served as General Manager to three different radio stations and most recently has been named Vice President of Operations. Mr. Beasley has a B.S. from East Carolina University. Mr. Beasley is the son of George G. Beasley and the brother of Bruce G. Beasley and B. Caroline Beasley.
Joe B. Cox has been nominated to serve as director of Beasley Broadcast Group. Mr. Cox is a partner at the law firm of Cummings and Lockwood. Mr. Cox has practiced law for 33 years, primarily in the tax, corporate and estate law areas. Mr. Cox is a director of Citizens National Bank.
Mark S. Fowler has been nominated to serve as director of Beasley Broadcast Group. Mr. Fowler currently is counsel at the law firm of Latham & Watkins, where he has been employed since 1987. Mr. Fowler has served as Chairman of UniSite, Inc. since 1994 and Chairman of Assure Sat, Inc.
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Committees Of The Board Of Directors
Our board of directors has established an audit committee and a compensation committee.
Audit Committee. Immediately after the offering, the audit committee will consist of Joe B. Cox and Mark S. Fowler. The responsibilities of the audit committee include:
| • | recommending to the board of directors independent public accountants to conduct the annual audit of our financial statements; | |
| • | reviewing the proposed scope of the audit and approving the audit fees to be paid; | |
| • | reviewing our accounting and financial controls with the independent public accountants and our financial and accounting staff; and | |
| • | reviewing and approving transactions, other than compensation matters, between us and our directors, officers and affiliates. |
Compensation Committee. Immediately after the offering, our compensation committee will consist of Joe B. Cox and Mark S. Fowler. The compensation committee provides a general review of our compensation plans to ensure that they meet corporate objectives. The responsibilities of the compensation committee also include administering and interpreting our 2000 equity plan.
Director Compensation
Directors are not paid any cash fees or additional compensation for services as members of the board of directors or any committee of the board. All directors will be reimbursed any expenses incurred, where appropriate. Independent directors, including our director nominees, will automatically receive grants of options to purchase Class A common stock under our 2000 equity plan.
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Executive Officer Compensation
Currently, all executive officers of Beasley Broadcast Group are compensated by Beasley Broadcasting Management Corp. and receive no direct compensation from Beasley Broadcast Group. The following table provides summary information concerning compensation paid to or earned by our Chief Executive Officer and our other most highly compensated executive officers for services rendered during the year ended December 31, 1999. No stock options or stock appreciation rights were granted to our Chief Executive Officer or the other executive officers listed in the table below for the year ended December 31, 1999.
| Annual Compensation | All | ||||||||||||
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Other | ||||||||||||
| Name and Principal Position | Year | Salary | Compensation | ||||||||||
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| George G. Beasley | |||||||||||||
| Chairman and Chief Executive Officer | 1999 | $ | 434,094 | $ | 399,840 | * | |||||||
| Bruce G. Beasley | |||||||||||||
| President and Chief Operating Officer | 1999 | $ | 300,365 | — | |||||||||
| B. Caroline Beasley | |||||||||||||
| Chief Financial Officer | 1999 | $ | 222,599 | — | |||||||||
| Brian E. Beasley | |||||||||||||
| Vice President of Operations | 1999 | $ | 266,259 | — | |||||||||
| * | Amounts attributable to the term portion of split-dollar life insurance policies. |
Employment Agreements
George G. Beasley Employment Agreement. We are entering into a three year employment agreement with George G. Beasley pursuant to which he will serve as our Chief Executive Officer and Chairman of our board of directors. Mr. Beasley will receive an annual base salary of $500,000 effective upon the completion of the corporate reorganization contemplated by this offering, subject to an annual increase of not less than 5%, and an annual cash bonus at the discretion of the board of directors. Mr. Beasley will also receive an option to purchase 487,500 shares of our Class A common stock under our 2000 equity plan at an exercise price equal to the initial public offering price. This option vests over the term of the employment agreement. We could incur severance obligations under the expected terms of the employment agreement in the event that Mr. Beasley’s employment is terminated without cause or if he resigns for good reason.
Bruce G. Beasley Employment Agreement. We are entering into a three year employment agreement with Bruce G. Beasley pursuant to which he will serve as our President and Chief Operating Officer. Mr. Beasley will receive an annual base salary of $325,000 effective upon the completion of the corporate reorganization contemplated by this offering, subject to an annual increase of not less than 5%, and an annual cash bonus at the discretion of the board of directors. Mr. Beasley will also receive an option to purchase 487,500 shares of our Class A common stock under our 2000 equity plan at an exercise price equal to the initial public offering price. This option vests over the term of the employment agreement. We could incur severance obligations under the expected terms of the employment agreement in the event that Mr. Beasley’s employment is terminated without cause or if he resigns for good reason.
B. Caroline Beasley Employment Agreement . We are entering into a three year employment agreement with B. Caroline Beasley pursuant to which she will serve as our Chief Financial Officer. Ms. Beasley will receive an annual base salary of $275,000 effective upon the completion of the
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Brian E. Beasley Employment Agreement. We are entering into a three year employment agreement with Brian E. Beasley pursuant to which he will serve as our President of Operations. Mr. Beasley will receive an annual base salary of $300,000 effective upon the completion of the corporate reorganization contemplated by this offering, subject to an annual increase of not less than 5%, and an annual cash bonus at the discretion of the board of directors. Mr. Beasley will also receive an option to purchase 487,500 shares of our Class A common stock under our 2000 equity plan at an exercise price equal to the initial public offering price. This option vests over the term of the employment agreement. We could incur severance obligations under the expected terms of the employment agreement in the event that Mr. Beasley’s employment is terminated without cause or if he resigns for good reason.
2000 Equity Plan
On the date of this prospectus, we will adopt The 2000 Equity Plan of Beasley Broadcast Group. This equity plan will be our first plan under which employee stock options will be granted. The principal purpose of the equity plan will be to attract, retain and motivate selected officers, employees, consultants and directors through the granting of stock-based compensation awards. The equity plan will provide for a variety of compensation awards, including non-qualified stock options, incentive stock options that are within the meaning of Section 422 of the Internal Revenue Code, stock appreciation rights, restricted stock, deferred stock, dividend equivalents, performance awards, stock payments and other stock-related benefits. A total of 3,000,000 shares of Class A common stock will be reserved for issuance under the equity plan, of which 2,500,000 shares will be subject to stock options that will be granted on the date of this prospectus. These options will have an exercise price per share equal to the initial public offering price.
On the date of this prospectus, our board of directors will administer the equity plan with respect to all awards. Following the offering, a committee of independent directors, each of whom is a non-employee director for purposes of Rule 16b-3 under the Exchange Act and an outside director under Section 162(m) of the Internal Revenue Code, will administer grants to officers, employees and consultants. The full board will administer the equity plan with respect to options granted to independent directors.
The equity plan will provide that the committee has the authority to select the employees and consultants to whom awards are to be made, to determine the number of shares to be subject to those awards and their terms and conditions, and to make all other determinations and to take all other actions necessary or advisable for the administration of the equity plan with respect to employees or consultants.
The equity plan will also provide that as of the date of this prospectus, each of our independent director nominees will automatically be granted options to purchase 20,000 shares of our Class A common stock. These options will have an exercise price per share equal to the initial public offering price and will be exercisable with respect to 10,000 shares as of the date of grant and will become exercisable with respect to an additional 5,000 shares on each of the first two anniversaries of the date of grant. Independent directors who are initially elected to our board of directors following the
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The committee and the board is authorized to adopt, amend and rescind rules relating to the administration of the equity plan, and to amend, suspend and terminate the equity plan. We have attempted to structure the equity plan in a manner such that remuneration attributable to stock options and other awards will not be subject to the deduction limitation contained in Section 162(m) of the Internal Revenue Code.
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CERTAIN RELATIONSHIPS AND RELATED PARTY TRANSACTIONS
Indebtedness to Affiliates
From time to time we have incurred indebtedness to related parties and affiliated entities. As of December 31, 1999, our aggregate outstanding indebtedness to all related parties and affiliated entities was $51,103,052, including $4,116,428 of accrued and unpaid interest. As of September 30, 1999, our aggregate outstanding indebtedness was $52,964,440, including $5,968,349 of accrued and unpaid interest. The aggregate outstanding indebtedness was $48,870,870 and $50,131,992, including $2,462,806 and $3,287,592 of accrued and unpaid interest, as of December 31, 1997 and 1998, respectively. We intend to use a portion of the net proceeds from this offering to repay all indebtedness to related parties and affiliated entities outstanding at the completion of the offering. As of December 31, 1999, this indebtedness consisted of the following:
| • | Our outstanding indebtedness to an affiliated entity owned by George G. Beasley, Shirley Beasley (the wife of George G. Beasley), B. Caroline Beasley, Bruce G. Beasely, Brian E. Beasley, Bradley C. Beasley and Robert E. Beasley was $25,976,006, including $276,477 of accrued and unpaid interest, as of December 31, 1999. As of September 30, 1999, our aggregate outstanding indebtedness was $27,354,912, including $1,655,383 of accrued and unpaid interest. The outstanding indebtedness was $25,788,038 and $25,876,547, including $88,509 and $177,018 of accrued and unpaid interest, as of December 31, 1997 and 1998, respectively. We incurred this indebtedness in August 1994 in connection with our purchase of WXTU-FM, in Philadelphia, from the affiliated entity. This indebtedness bears interest at a rate of 7.67% per year. | |
| • | Our outstanding indebtedness to another affiliated entity, wholly owned by George G. Beasley, was $11,611,038, including $34,946 of accrued and unpaid interest, as of December 31, 1999. As of September 30, 1999, our aggregate outstanding indebtedness to this entity was $12,266,275, including $689,950 of accrued and unpaid interest. The outstanding indebtedness was $11,594,363 and $11,600,359, including $18,038 and $24,034 of accrued and unpaid interest, as of December 31, 1997 and 1998, respectively. We incurred this indebtedness in August 1994 in connection with our purchase of WPOW-FM, in the Miami-Ft. Lauderdale market, from the affiliated entity. This indebtedness bears interest at a rate of 7.67% per year. | |
| • | In addition to the indebtedness specifically described above, from time to time we have borrowed funds from George G. Beasley and an affiliated entity wholly owned by George G. Beasley and Brian E. Beasley, to finance acquisitions, operations and other liquidity requirements. As of December 31, 1999, this other outstanding indebtedness was $13,516,008, including $3,805,005 of accrued and unpaid interest, at a weighted average interest rate of 7.34%. As of September 30, 1999, our aggregate outstanding indebtedness to this entity was $13,343,253, including $3,623,016 of accrued and unpaid interest. The outstanding indebtedness was $11,488,469 and $12,655,086, including $2,356,259 and $3,086,540 of accrued and unpaid interest, as of December 31, 1997 and 1998, respectively. The interest rate on this indebtedness ranges from zero to 9.25% per year. |
Indebtedness from Affiliates
From time to time George G. Beasley, members of his immediate family or entities affiliated with them have borrowed funds from us. As of December 31, 1999, the aggregate indebtedness to us was $9,420,093, including $1,175,065 of accrued and unpaid interest. As of September 30, 1999, the aggregate indebtedness to us was $9,230,601, including $993,972 of accrued and unpaid interest. The outstanding indebtedness was $8,640,062 and $8,680,491, including $983,257 and $467,062 of accrued and unpaid interest, as of December 31, 1997 and 1998, respectively. These notes bear interest at a rate of 9.25% per year, with the exception of two loans totaling approximately $550,000,
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Distribution to Affiliates
Distributions to Mr. Beasley and members of his immediate family in their capacity as equity holders in the various entities comprising Beasley Broadcast Group during the periods ended December 31, 1997, 1998 and 1999 were approximately $20.7 million, $6.0 million and $4.3 million, respectively. Before the reorganization, an additional distribution of approximately $3.0 million will be made to members of the Beasley family for taxes payable by them on the income of the entities comprising Beasley Broadcast Group for the 1999 tax year.
Corporate Reorganization
Currently, we exist as several separate subchapter S corporations and partnerships. In connection with this offering, our subchapter S corporation status will be terminated and all former subchapter S corporations and partnerships will become indirect, wholly-owned subsidiaries of Beasley Broadcast Group, Inc., through the exchange by our equity holders of their interests in the subchapter S corporations and partnerships for interests in Beasley Broadcast Group. Beasley Broadcast Group in turn will contribute those interests to Beasley Mezzanine Holdings. For a more detailed description of this transaction, see “Corporate Reorganization.”
Radio Towers Sale and Leaseback
In connection with the offering, we intend to sell all of the radio towers and related real estate assets owned by Beasley Broadcast Group to Beasley Family Towers, Inc., which is owned by George G. Beasley, B. Caroline Beasley, Bruce G. Beasley, Brian E. Beasley, Bradley C. Beasley and Robert E. Beasley for approximately $3.7 million. We anticipate that the purchase price will be paid with an unsecured note payable to us from Beasley Family Towers bearing interest at the applicable federal rate in effect for the month in which the transaction occurs, although not less than 6%. In connection with this transaction, we expect to enter into twenty-year lease agreements to lease the radio towers from Beasley Family Towers. Annual rent under these leases is expected to be approximately $334,000. We believe that the sale/ leaseback transaction, taken as a whole, will be on terms at least as favorable to us as could have been obtained from an unaffiliated party. We may not own or operate radio towers as part of our business in the future and, to the extent we do not, we will not realize revenues from leasing towers to third parties. To the extent that we make future acquisitions, these transactions may be structured so that the radio towers, if any, and related real estate are acquired by Beasley Family Towers and the other station operating assets and FCC licenses are acquired by us. In this event, we would lease the towers back under lease arrangements similar to the current lease.
Office and Studio Leases
We lease office and studio broadcasting space for radio stations WRXK-FM and WXKB-FM in Ft. Myers, Florida from George G. Beasley. The current annual rent for this space is approximately $95,000. We believe that these lease agreements are on terms at least as favorable to us as could have been obtained from an unaffiliated party.
We lease office space in Naples, Florida from Beasley Broadcasting Management Corp., which is wholly-owned by George G. Beasley. The current annual rent for the office space is approximately $90,000. We believe that the lease agreement are on terms at least as favorable to us as could have been obtained from an unaffiliated party.
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Augusta Radio Tower Lease
Our Augusta radio station, WCHZ-FM, leases its radio tower from Wintersrun Communications, Inc., which is owned by George G. Beasley and Brian E. Beasley. The current annual rent for the tower is approximately $21,000. We believe that the lease agreement is on terms at least as favorable to us as could have been obtained from an unaffiliated party.
Management Agreement
Beasley Broadcasting Management Corp. provides management services to Beasley Broadcast Group pursuant to a management services arrangement. The fees are reallocated annually based on prior year station revenues and are paid to BBMC on a monthly basis. Aggregate management fees paid to BBMC were $2,233,161, $2,055,211 and $2,498,411 for the years ended December 31, 1996, 1997 and 1998 respectively. The management arrangement will terminate in connection with the closing of this offering. We are not aware of a readily available market for radio broadcasting management services. Because the relationship between BBMC and Beasley Broadcast Group is not comparable to relationships that those entities could have obtained with an unaffiliated party, we are uncertain whether the management services agreement was on terms as favorable as could have been obtained with an unaffiliated party. It is possible that the management services agreement was on terms less favorable than could have been obtained with an unaffiliated party, assuming that Beasley Broadcast Group could have obtained a similar agreement with an unaffiliated party.
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PRINCIPAL STOCKHOLDERS
The following tables set forth certain information as of December 31, 1999 regarding the beneficial ownership of our common stock after giving effect to the corporate reorganization and this offering, but without giving effect to the exercise of the underwriters’ over-allotment option, by:
| • | each person known by us to beneficially own more than 5% percent of any class of our common stock; | |
| • | each of our directors and our four executive officers; and | |
| • | all of our directors, director nominees and executive officers as a group. |
Each stockholder possesses sole voting and investment power with respect to the shares listed, unless otherwise noted. Shares of Class B common stock are convertible into shares of Class A common stock on a one-for-one basis. The number of Class B shares owned by George G. Beasley consists of 10,564,413 shares owned individually by him, 3,205,677 shares owned by the George Beasley Grantor Retained Annuity Trust dated November 16, 1999 and 39,835 shares owned by Shirley W. Beasley, Mr. Beasley’s spouse. The number of Class B shares owned by Bruce G. Beasley and B. Caroline Beasley each include 356,736 owned individually by each of them and 979,513 shares owned by the George Beasley Estate Reduction Trust dated June 7, 1999 as to which they share voting and dispositive power as trustees. Messrs. Cox and Fowler’s ownership consists of 10,000 immediately exercisable options to purchase Class A shares at the initial public offering price that will be granted on the date of this prospectus. Unless otherwise indicated, the address of the beneficial owner is c/ o Beasley Broadcasting Group, Inc., 3033 Riviera Drive, Suite 200, Naples, Florida 34103.
| Common Stock | ||||||||||||||||||||||||
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| Class A | Class B | Percent of | Percent of | |||||||||||||||||||||
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total | total | |||||||||||||||||||||
| Number | Percent | Number | Percent | economic | voting | |||||||||||||||||||
| Name of | of | of class | of | of class | interest | power | ||||||||||||||||||
| Beneficial Owner | shares | post offering | shares | post offering | post offering | post offering | ||||||||||||||||||
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| George G. Beasley | — | — | 13,809,925 | 81.1% | 56.8% | 77.8% | ||||||||||||||||||
| Bruce G. Beasley | — | — | 1,336,249 | 7.9 | 5.5 | 7.5 | ||||||||||||||||||
| B. Caroline Beasley | — | — | 1,336,249 | 7.9 | 5.5 | 7.5 | ||||||||||||||||||
| Brian E. Beasley | — | — | 420,265 | 2.5 | 1.7 | 2.4 | ||||||||||||||||||
| Joe B. Cox | 20,000 | * | — | — | — | — | ||||||||||||||||||
| Mark S. Fowler | 11,000 | * | — | — | — | — | ||||||||||||||||||
| All directors, director nominees and executive officers as a group | 31,000 | * | 15,923,175 | 93.5% | 65.5% | 89.7% | ||||||||||||||||||
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DESCRIPTION OF CAPITAL STOCK
The following description of our capital stock gives effect to the consummation of the corporate reorganization described elsewhere in this prospectus as well as transactions contemplated under “Capitalization,” which will occur before or at the same time as this proposed offering of Class A common stock by Beasley Broadcast Group. Our capital stock consists of:
| • | 225,000,000 authorized shares of common stock, $0.001 par value per share, which consists of (1) 150,000,000 shares of Class A common stock, of which 7,252,068 shares will be outstanding immediately after the offering, and 8,279,568 shares will be outstanding assuming the underwriters overallotment option is exercised in full, and (2) 75,000,000 shares of Class B common stock, of which 17,021,373 shares will be outstanding immediately after the offering; and | |
| • | 10,000,000 authorized shares of preferred stock, par value $0.001 per share, none of which is outstanding. |
The following is summary of the material provisions of our certificate of incorporation, which is filed as an exhibit to the registration statement of which this prospectus is a part.
Class A Common Stock
The holders of Class A common stock are entitled to one vote for each share held on all matters voted upon by stockholders, including the election of directors and any proposed amendment to the certificate of incorporation. The holders of Class A common stock are entitled to vote as a class to elect two directors to the board of directors. The holders of Class A common stock will be entitled to such dividends as may be declared at the discretion of the board of directors out of funds legally available for that purpose. No dividend may be declared or paid in cash or property on any share of any class of common stock unless simultaneously the same dividend is declared or paid on each share of that and every other class of common stock, provided that, in the event of stock dividends, holders of a specific class of common stock shall be entitled to receive only additional shares of that class. The holders of Class A common stock will be entitled to share ratably with all other classes of common stock in the net assets of Beasley Broadcast Group upon liquidation after payment or provision for all liabilities. The shares of Class A common stock are not convertible and are not subject to sinking fund or redemption provisions.
Our Class A common stock has been approved for listing on The Nasdaq National Market under the symbol “BBGI.”
Class B Common Stock
All of our Class B common stock is owned by George G. Beasley, our Chairman and Chief Executive Officer, and members of his immediate family. As holders of Class B common stock, they are entitled to the same rights, privileges, benefits and notices as the holders of Class A common stock, except that they will be entitled to ten votes per share. Subject to any necessary approval of the FCC, all shares of Class B common stock may be converted at any time into a like number of shares of Class A common stock at the option of the holder. A Class B common stock holder may transfer shares of Class B common stock held by it only to Class B Permitted Transferees, and Class B Permitted Transferees may transfer shares of Class B common stock only to other Class B Permitted Transferees. If any shares of Class B common stock are transferred to any person or entity other than a Class B Permitted Transferee, such shares will automatically be converted into a like number of shares of Class A common stock. Class B Permitted Transferees include George G. Beasley and his lineal descendents, their respective estates, spouses, former spouses, parents or grandparents, or lineal descendants thereof, and certain trusts and other entities for the benefit of, or
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Preferred Stock
We are authorized to issue 10,000,000 shares of preferred stock, par value $.001 per share. Our board of directors, in its sole discretion, may designate and issue one or more series of preferred stock from the authorized and unissued shares of preferred stock. Subject to limitations imposed by law or our certificate of incorporation, the board of directors is empowered to determine:
| • | the designation of and the number of shares constituting a series of preferred stock; | |
| • | the dividend rate, if any, for the series; | |
| • | the terms and conditions of any voting and conversion rights for the series, if any; | |
| • | the number of directors, if any, which the series shall be entitled to elect; | |
| • | the amounts payable on the series upon our liquidation, dissolution or winding-up; and | |
| • | the redemption prices and terms applicable to the series, if any. |
Such rights, preferences, privileges and limitations of preferred stock could adversely affect the rights of holders of common stock. There are currently no shares of preferred stock outstanding.
Foreign Ownership
Beasley Broadcast Group’s certificate of incorporation restricts the ownership, voting and transfer of our capital stock, including the Class A common stock, in accordance with the Communications Act and the rules of the FCC, which prohibit the issuance of more than 25% of our outstanding capital stock, or more than 25% of the voting rights such stock represents, to or for the account of aliens, as defined by the FCC, or corporations otherwise subject to domination or control by aliens. Our certificate of incorporation prohibits any transfer of our capital stock that would cause a violation of this prohibition. The certificate of incorporation authorizes the board of directors to take action to enforce these prohibitions, including restricting the transfer of shares of capital stock to aliens and placing a legend restricting foreign ownership on the certificates representing the Class A common stock. In addition, the certificate of incorporation provides for the redemption of shares of our capital stock by action of the board of directors to the extent necessary to comply with alien ownership restrictions.
Limitations on Directors’ and Officers’ Liability
Beasley Broadcast Group’s certificate of incorporation limits the liability of directors to the maximum extent permitted by Delaware law, which specifies that a director of a company adopting such a provision will not be personally liable for monetary damages for breach of fiduciary duty as a director, except for the liability for:
| • | any breach of the director’s duty of loyalty to Beasley Broadcast Group or its stockholders; | |
| • | acts or omissions not in good faith or which involve intentional misconduct or a knowing violation of law; | |
| • | unlawful payments of dividends or unlawful stock repurchases or redemptions as provided in Section 174 of the Delaware General Corporation Law; or | |
| • | any transaction from which the director derived an improper personal benefit. |
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Beasley Broadcast Group’s certificate of incorporation provides for mandatory indemnification of directors and officers and authorizes indemnification for employees and agents in such manner, under such circumstances and to the fullest extent permitted by the Delaware General Corporation Law. The Delaware General Corporate Law generally authorizes indemnification as to all expenses incurred or imposed as a result of actions, suits or proceedings if the indemnified parties act in good faith and in a manner they reasonably believe to be in or not opposed to the best interests of Beasley. We believe these provisions are necessary and useful to attract and retain qualified persons as directors. Beasley Broadcast Group maintains directors and officers insurance for the benefit of its directors and officers. There is no pending litigation or proceeding involving a director or officer as to which indemnification is being sought.
Transfer Agent and Registrar
American Stock Transfer & Trust Company is our transfer agent and registrar.
SHARES ELIGIBLE FOR FUTURE SALE
Upon completion of the offering, we will have 7,252,068 shares of Class A common stock and 17,021,373 shares of Class B common stock issued and outstanding, assuming no exercise of the underwriter’s over-allotment option. Of these shares, the 6,850,000 shares of Class A common stock sold in this offering, plus any shares issued upon exercise of the underwriters’ over-allotment option, will be freely transferable without restriction in the public market, except to the extent that our affiliates acquired any of these shares. Resales of shares acquired by affiliates are subject to restrictions under Rule 144 of the Securities Act. The remaining shares of Class A common stock and all shares of Class B common stock were issued in reliance on exemptions from the registration requirements of the Securities Act, and these shares are restricted securities under Rule 144. The holding period for purposes of Rule 144 of these securities begins on the date of this prospectus. The number of restricted shares available for sale in the public market is limited by the restrictions under Rule 144, as described below.
All of our directors, officers and each of our current stockholders have agreed pursuant to lock-up agreements not to sell or otherwise dispose of shares representing approximately 402,068 shares of Class A common stock and 17,021,373 shares of Class B common stock for a period of 180 days after the date of this prospectus without the prior written consent of Credit Suisse First Boston Corporation. The restricted securities will generally be available for sale in the open market, subject to the lock-up agreements and the applicable requirements of Rule 144.
Under Rule 144 a stockholder or stockholders whose shares are aggregated who has beneficially owned restricted securities for at least one year, including persons who may be deemed affiliates under Rule 144, is generally entitled to sell a number of shares within any three-month period that does not exceed the greater of 1% of the then outstanding shares of the class of common stock or the average weekly trading volume of such stock during the four calendar weeks preceding such sale, subject to certain manner of sale limitations. A stockholder who is deemed not to have been an affiliate for at least three months prior to the date of sale and who has beneficially owned restricted securities for at least two years would be entitled to sell such shares under Rule 144 without regard to the volume or manner of sale limitations described above.
63
UNDERWRITING
Under the terms and subject to the conditions contained in an underwriting agreement dated February 11, 2000, we have agreed to sell to the underwriters named below, for whom Credit Suisse First Boston Corporation, Banc of America Securities LLC, Deutsche Bank Securities Inc. and Salomon Smith Barney Inc. are acting as representatives, the following respective numbers of shares of Class A common stock:
| Number | |||||
| Underwriter | of Shares | ||||
|
|
|
||||
| Credit Suisse First Boston Corporation | 1,555,000 | ||||
| Banc of America Securities LLC | 1,555,000 | ||||
| Deutsche Bank Securities Inc. | 1,555,000 | ||||
| Salomon Smith Barney Inc. | 1,555,000 | ||||
| E*Offering Corp. | 90,000 | ||||
| FleetBoston Robertson Stephens Inc. | 90,000 | ||||
| Invemed Associates LLC | 90,000 | ||||
| Lazard Freres & Co. LLC | 90,000 | ||||
| Schroder & Co. Inc. | 90,000 | ||||
| TD Securities (USA) Inc. | 90,000 | ||||
| Wasserstein Perella Securities, Inc. | 90,000 | ||||
|
|
|||||
| Total | 6,850,000 | ||||
|
|
|||||
The underwriting agreement provides that the underwriters are obligated to purchase all of the shares of Class A common stock in the offering if any are purchased, other than those shares covered by the over-allotment option described below. The underwriting agreement also provides that if an underwriter defaults, the purchase commitments of non-defaulting underwriters may be increased or the offering of the Class A common stock may be terminated.
We have granted to the underwriters a 30-day option to purchase on a pro rata basis up to 1,027,500 additional shares of Class A common stock from us at the initial public offering price less underwriting discounts and commissions. The options may be exercised only to cover any over-allotments of Class A common stock.
The underwriters propose to offer the shares of Class A common stock initially at the public offering price on the cover page of this prospectus and to selling group members at that price less a concession of $0.628 per share. The underwriters and selling group members may allow a discount of $0.10 per share on sales to other broker/ dealers. After the initial public offering, the public offering price and concession and discount to broker/ dealers may be changed by the representatives.
A copy of this prospectus in electronic format will be made available on the Internet by E*OFFERING Corp. on a Web site hosted by E*TRADE Securities, Inc. Customers seeking to submit conditional offers to purchase shares online must meet certain eligibility requirements promulgated by these institutions.
64
The following table summarizes the compensation and estimated expenses of $1.3 million we will pay:
| Per Share | Total | |||||||||||||||
|
|
|
|||||||||||||||
| Without | With | Without | With | |||||||||||||
| Over-allotment | Over-allotment | Over-allotment | Over-allotment | |||||||||||||
|
|
|
|
|
|||||||||||||
| Underwriting discounts and commissions paid by us | $ | 1.046 | $ | 1.046 | $ | 7,165,100 | $ | 7,585,663 | ||||||||
| Expenses payable by us | $ | 0.19 | $ | 0.165 | $ | 1,300,000 | $ | 1,300,000 | ||||||||
The underwriters have informed us that they do not expect discretionary sales to exceed 5% of the shares of Class A common stock being offered.
We and our directors, officers and members of senior management and each of our current stockholders have agreed not to offer, sell, contract to sell, pledge or otherwise dispose of, directly or indirectly, or file with the Securities and Exchange Commission a registration statement under the Securities Act relating to, any shares of our common stock or securities convertible into or exchangeable or exercisable for any shares of our capital stock or publicly disclose the intention to make an offer, sale, pledge, disposition or filing without the prior written consent of Credit Suisse First Boston Corporation for a period of 180 days after the date of this prospectus, except (1) with respect to us, pursuant to or in connection with employee stock option or employee stock purchase plans or other employee or non-employee director or key advisor compensation arrangements or agreements, in effect on the date of this prospectus and (2) in connection with the conversion of shares of Class B common stock solely into shares of Class A common stock.
The underwriters have reserved for sale, at the initial public offering price, up to 460,075 shares of the Class A common stock for employees, directors and certain other persons associated with us who have expressed an interest in purchasing Class A common stock in the offering. The number of shares available for sale to the general public in the offering will be reduced to the extent those persons purchase the reserved shares. Any reserved shares that are not purchased will be offered by the underwriters to the general public on the same terms as the other shares.
We have agreed to indemnify the underwriters against liabilities under the Securities Act or contribute to payments which the underwriters may be required to make in that respect.
Our Class A common stock has been approved for listing on The Nasdaq National Market under the symbol “BBGI.”
Prior to this offering, there has been no public market for the Class A common stock. The initial public offering price for the Class A common stock has been negotiated by us and the representatives. Among the principal factors considered in determining the initial public offering price were:
| • | market conditions for initial public offerings; | |
| • | the history of and prospects for our business, our past and present operations; | |
| • | our past and present earnings and current financial position; | |
| • | an assessment of our management; | |
| • | the market of securities of companies in businesses similar to ours; and | |
| • | the general condition of the securities markets. |
65
There can be no assurance that the initial public offering price will correspond to the price at which the Class A common stock will trade in the public market subsequent to the offering or that an active trading market will develop and continue after the offering.
The representatives may engage in over-allotment, stabilizing transactions and syndicate covering transactions and penalty bids in accordance with Regulation M under the Exchange Act.
| • | Over-allotment involves syndicate sales in excess of the offering size, which creates a syndicate short position. | |
| • | Stabilizing transactions permit bids to purchase the underlying security so long as the stabilizing bids do not exceed a specified maximum. | |
| • | Syndicate covering transactions involve purchases of the Class A common stock in the open market after the distribution has been completed in order to cover syndicate short positions. | |
| • | Penalty bids permit the representatives to reclaim a selling concession from a syndicate member when the shares of Class A common stock originally sold by that syndicate member are purchased in a syndicate covering transaction to cover syndicate short positions. |
These stabilizing transactions, syndicate covering transactions and penalty bids may cause the price of the Class A common stock to be higher than it would otherwise be in the absence of such transactions. These transactions may be effected on The Nasdaq National Market or otherwise and, if commenced, may be discontinued at any time.
66
NOTICE TO CANADIAN RESIDENTS
Resale Restrictions
The distribution of the Class A common stock in Canada is being made only on a private placement basis exempt from the requirement that we prepare and file a prospectus with the securities regulatory authorities in each province where trades of shares of Class A common stock are effected. Accordingly, any resale of the Class A common stock in Canada must be made in accordance with applicable securities laws which will vary depending on the relevant jurisdiction, and which may require resales to be made in accordance with available statutory exemptions or pursuant to a discretionary exemption granted by the applicable Canadian securities regulatory authority. Purchasers are advised to seek legal advice prior to any resale of the Class A common stock.
Representations Of Purchasers
Each purchaser of Class A common stock in Canada who receives a purchase confirmation will be deemed to represent to us and the dealer from whom such purchase confirmation is received that:
| • | the purchaser is entitled under applicable provincial securities laws to purchase such shares of Class A common stock without the benefit of a prospectus qualified under such securities laws; | |
| • | where required by law, that the purchaser is purchasing as principal and not as agent; and | |
| • | the purchaser has reviewed the text above under “Resale Restrictions.” |
Rights Of Action (Ontario Purchasers)
The securities being offered are those of a foreign issuer and Ontario purchasers will not receive the contractual right of action prescribed by Ontario securities law. As a result, Ontario purchasers must rely on other remedies that may be available, including common law rights of action for damages or rescission or rights of action under the civil liability provisions of the U.S. federal securities laws.
Enforcement Of Legal Rights
All of the issuer’s directors and officers as well as the experts named herein may be located outside of Canada and, as a result, it may not be possible for Canadian purchasers to effect service of process within Canada upon the issuer or these persons. All or a substantial portion of the assets of the issuer and these persons may be located outside of Canada and, as a result, it may not be possible to satisfy a judgment against the issuer or these persons in Canada or to enforce a judgment obtained in Canadian courts against the issuer or these persons outside of Canada.
Notice To British Columbia Residents
A purchaser of Class A common stock to whom the Securities Act (British Columbia) applies is advised that the purchaser is required to file with the British Columbia Securities Commission a report within ten days of the sale of any shares of Class A Common Stock acquired by the purchaser pursuant to this offering. The report must be in the form attached to British Columbia Securities Commission Blanket Order (BOR) #95/ 17, a copy of which may be obtained from Beasley Broadcast Group, Inc. Only one report must be filed in respect of Class A Common Stock acquired on the same date and under the same prospectus exemption.
67
Taxation And Eligibility For Investment
Canadian purchasers of Class A common stock should consult their own legal and tax advisers with respect to the tax consequences of an investment in the shares of Class A common stock in their particular circumstances and with respect to the eligibility of the shares of Class A common stock for investment by the purchaser under relevant Canadian legislation.
U.S. FEDERAL TAX CONSIDERATIONS FOR NON-U.S. HOLDERS
The following is a general discussion of the material United States federal income and estate tax consequences of the ownership and disposition of Class A common stock by a non-U.S. holder. As used herein, the term non-U.S. holder means a holder that for United States federal income tax purposes is an individual or entity other than:
| • | a citizen or individual resident of the United States; | |
| • | a corporation or partnership created or organized in or under the laws of the United States or of any state thereof or in the District of Columbia, unless in the case of a partnership, U.S. Treasury regulations promulgated in the future provide otherwise; | |
| • | an estate the income of which is subject to U.S. federal income taxation regardless of its source; or | |
| • | a trust if a U.S. court is able to exercise primary supervision over the administration of the trust and one or more U.S. persons have the authority to control all substantial decisions of the trust. |
In general, an individual may be deemed to be a resident alien, as opposed to a nonresident alien, by virtue of being present in the United States for at least 31 days in the calendar year and for an aggregate of at least 183 days during a three-year period ending in the current calendar year, counting for these purposes all of the days present in the current year, one-third of the days present in the immediately preceding year and one-sixth of the days present in the second preceding year. Resident aliens are subject to U.S. federal tax as if they were U.S. citizens.
This discussion does not address all aspects of United States federal income and estate taxes that may be relevant to non-U.S. holders in light of their personal circumstances, including the fact that in the case of a non-U.S. holder that is a partnership, the U.S. tax consequences of holding and disposing of shares of common stock may be affected by determinations made at the partner level, or that may be relevant to various types of non-U.S. holders which may be subject to special treatment under United States federal income tax laws, including, for example, insurance companies, tax-exempt organizations, financial institutions, dealers in securities and holders of securities held as part of a straddle, hedge, or conversion transaction, and does not address U.S. state or local or foreign tax consequences. Furthermore, this discussion is based on provisions of the Internal Revenue Code of 1986, existing and proposed regulations promulgated thereunder and administrative and judicial interpretations thereof, all as of the date of this prospectus, and all of which are subject to change, possibly with retroactive effect. The following summary is included herein for general information. Accordingly, prospective investors may wish to consult their tax advisers regarding the United States federal, state, local and non-U.S. income and other tax consequences of acquiring, holding and disposing of shares of common stock.
Dividends
We do not anticipate declaring or paying cash dividends on our Class A common stock in the near future. However, if dividends are paid on shares of our Class A common stock, dividends paid to a non-U.S. holder of common stock generally will be subject to withholding of United States federal
68
Dividends that are effectively connected with a non-U.S. holder’s conduct of a trade or business in the United States or, if an income tax treaty applies, attributable to a permanent establishment or, in the case of an individual, a fixed base in the United States, are generally subject to U.S. federal income tax on a net income basis at regular graduated rates, but are not generally subject to the 30% withholding tax if the non-U.S. holder files the appropriate U.S. Internal Revenue Service form with the payor, which form under U.S. Treasury regulations generally requires the non-U.S. holder to provide a U.S. taxpayer identification number. Any U.S. trade or business income received by a non-U.S. holder that is a corporation may also be subject to an additional branch profits tax at a 30% rate or the lower rate specified by an applicable income tax treaty.
Under currently applicable U.S. Treasury regulations, dividends paid to an address in a foreign country are presumed, absent actual knowledge to the contrary, to be paid to a resident of that country for purposes of the withholding discussed above and for purposes of determining the applicability of a tax treaty rate. Under U.S. Treasury regulations generally effective for payments made after December 31, 2000, however, a non-U.S. holder of our Class A common stock who wishes to claim the benefit of an applicable treaty rate generally will be required to satisfy applicable certification and other requirements.
A non-U.S. holder of our Class A common stock that is eligible for a reduced rate of U.S. withholding tax under an income tax treaty may obtain a refund of any excess amounts withheld by filing an appropriate claim for a refund with the Internal Revenue Service.
Gain on disposition of common stock
A non-U.S. holder generally will not be subject to U.S. federal income tax in respect of gain recognized on a disposition of our Class A common stock unless:
| • | the gain is effectively connected with a trade or business of the non-U.S. holder in the United States, where a tax treaty is attributable to a United States permanent establishment or, in the case of an individual, a fixed base of the non-U.S. holder; | |
| • | the non-U.S. holder is an individual who holds our common stock as a capital asset within the meaning of Section 1221 of the Internal Revenue Code, is present in the United States for 183 or more days in the taxable year of the disposition and meets other requirements; | |
| • | we are or have been a U.S. real property holding corporation for federal income tax purposes at any time during the shorter of the five-year period preceding the disposition or the period that the non-U.S. holder held our Class A common stock; or | |
| • | the non-U.S. holder is subject to tax under provisions applicable to certain former citizens or residents of the United States. |
Generally, a corporation is a U.S. real property holding corporation if the fair market value of its U.S. real property interests equals or exceeds 50% of the sum of the fair market value of its worldwide real property interests plus its other assets used or held for use in a trade or business. We believe that we have not been, are not currently, and do not anticipate becoming, a U.S. real property holding corporation for U.S. federal income tax purposes. The tax with respect to stock in a U.S. real property holding corporation does not apply to a non-U.S. holder whose holdings, direct and indirect, at all times during the applicable period, constituted 5% or less of our common stock, provided that our common stock was regularly traded on an established securities market.
69
If a non-U.S. holder who is an individual is subject to tax under the first bullet point above, the individual generally will be taxed on the net gain derived from a sale of common stock under regular graduated United States federal income tax rates. If an individual non-U.S. holder is subject to tax under the second bullet point above, the individual generally will be subject to a flat 30% tax on the gain derived from a sale, which may be offset by particular United States capital losses, notwithstanding the fact that the individual is not considered a resident alien of the United States. Thus, individual non-U.S. holders who have spent, or expect to spend, more than a de minimis period of time in the United States in the taxable year in which they contemplate a sale of common stock are urged to consult their tax advisers prior to the sale concerning the U.S. tax consequences of that sale.
If a non-U.S. holder that is a foreign corporation is subject to tax under the first bullet point above, it generally will be taxed on its net gain under regular graduated United States federal income tax rates and, in addition, will be subject to the branch profits tax equal to 30% of its effectively connected earnings and profits, within the meaning of the Internal Revenue Code for the taxable year, as adjusted for certain items, unless it qualifies for a lower rate under an applicable tax treaty.
Federal estate tax
Common stock owned or treated as owned by an individual non-U.S. holder at the time of death will be included in the individual’s gross estate for United States federal estate tax purposes, unless an applicable estate tax or other treaty provides otherwise and, therefore, maybe subject to United States federal estate tax.
Information reporting and backup withholding tax
Under United States Treasury regulations, we must report annually to the Internal Revenue Service and to each non-U.S. holder the amount of dividends paid to that holder and the tax withheld with respect to those dividends. Copies of the information returns reporting dividends and withholding may also be made available to the tax authorities in the country in which the non-U.S. holder is a resident under the provisions of an applicable income tax treaty or agreement.
United States backup withholding, which generally is a withholding tax imposed at the rate of 31% on payments to persons that fail to furnish information under the United States information reporting requirements, generally will not apply:
| • | to dividends paid to non-U.S. holders that are subject to the 30% withholding discussed above or that are not so subject because a tax treaty applies that reduces or eliminates such 30% withholding; or | |
| • | before January 1, 2001, to dividends paid to a non-U.S. holder at an address outside of the United States unless the payor has actual knowledge that the payee is a U.S. holder. |
Backup withholding and information reporting generally will apply to dividends paid to addresses inside the United States on shares of our common stock to beneficial owners that are not exempt recipients and that fail to provide identifying information in the manner required.
The payment of the proceeds of the disposition of our common stock by a holder to or through the U.S. office of a broker or through a non-U.S. branch of a U.S. broker generally will be subject to information reporting and backup withholding at a rate of 31% unless the holder either certifies its status as a non-U.S. holder under penalties of perjury or otherwise establishes an exemption. The payment of the proceeds of the disposition by a non-U.S. holder of common stock to or through a non-U.S. office of a non-U.S. broker will not be subject to backup withholding or information reporting unless the non-U.S. broker has particular types of U.S. relationships. In the case of the payment of proceeds from the disposition of our common stock effected by a foreign office of a
70
| • | a controlled foreign corporation for U.S. federal income tax purposes; or | |
| • | a foreign person 50% or more of whose gross income for a certain period is derived from activities that are effectively connected with the conduct of a U.S. trade or business. |
The U.S. Treasury regulations, which are generally effective for payment made after December 31, 2000, alter the foregoing rules in certain respects. Among other things, these regulations provide presumptions under which a non-U.S. holder is subject to backup withholding at the rate of 31% and information reporting unless we receive certification from the holder of non-U.S. status. Depending on the circumstances, this certification will need to be provided:
| • | directly by the non-U.S. holder; | |
| • | in the case of a non-U.S. holder that is treated as a partnership or other fiscally transparent entity, by the partners, stockholders or other beneficiaries of that entity; or | |
| • | by particular qualified financial institutions or other qualified entities on behalf of the non-U.S. holder. |
Any amounts withheld under the backup withholding rules from a payment to a non-U.S. holder will be refunded or credited against the holder’s U.S. federal income tax liability, if any, provided that the required information is furnished to the Internal Revenue Service.
71
LEGAL MATTERS
Latham & Watkins, Washington, DC, will opine upon the validity of the Class A common stock offered by this prospectus and other matters specified in the underwriting agreement for Beasley Broadcast Group. Mark S. Fowler, one of our director nominees who is purchasing 1,000 shares of Class A common stock in the offering, and on the date of this prospectus will receive an option to purchase 20,000 shares of Class A common stock, is of counsel to Latham & Watkins. Weil, Gotshal & Manges LLP, New York, New York has represented the underwriters in connection with this offering.
EXPERTS
The combined financial statements of Beasley FM Acquisition Corp. and related companies as of December 31, 1997, 1998 and September 30, 1999 and for each of the years in the three-year period ended December 31, 1998 and the nine month period ended September 30, 1999, have been included herein and in the registration statement in reliance upon the report of KPMG LLP, independent certified public accountants, appearing elsewhere herein, and upon the authority of said firm as experts in accounting and auditing.
WHERE YOU CAN FIND MORE INFORMATION
We have filed with the Commission a Registration Statement on Form S-1 regarding this offering. This prospectus, which is part of the registration statement, does not contain all of the information included in the registration statement, and you should refer to the registration statement and its exhibits to read that information. You may read and copy the registration statement, the related exhibits and the other material we file with the Commission at the Commission’s public reference room in Washington, D.C. and at the Commission’s regional offices in Chicago, Illinois and New York, New York. You can also request copies of those documents, upon payment of a duplicating fee, by writing to the Commission. Please call the Commission at 1-800-SEC-0330 for further information on the operation of the public reference rooms. The Commission also maintains an Internet site that contains reports, proxy and information statements and other information regarding issuers that file with the Commission. The site’s address is www.sec.gov. You may also request a copy of these filings, at no cost, by writing or telephoning us as follows: 3033 Riviera Drive, Suite 200, Naples, Florida 34103, (941) 263-5000, Attention: Chief Financial Officer.
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BEASLEY FM ACQUISITION CORP.
| Page | |||||
|
|
|||||
| Combined Financial Statements | |||||
| Independent Auditor’s Report | F-2 | ||||
| Combined Balance Sheets as of December 31, 1997 and 1998 and September 30, 1999 | F-3 | ||||
| Combined Statements of Operations for the Years Ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 (unaudited) and 1999 | F-4 | ||||
| Combined Statements of Stockholders’ Equity for the Years Ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1999 | F-5 | ||||
| Combined Statements of Cash Flows for the Years Ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 (unaudited) and 1999 | F-6 | ||||
| Notes to Combined Financial Statements | F-7 | ||||
| Financial Statement Schedule — Valuation and Qualifying Accounts | F-24 | ||||
F-1
INDEPENDENT AUDITORS’ REPORT
The Board of Directors
We have audited the accompanying combined balance sheets of Beasley FM Acquisition Corp. and Related Companies as of December 31, 1997, 1998 and September 30, 1999, and the related combined statements of operations, stockholders’ equity and cash flows for each of the years in the three-year period ended December 31, 1998 and for the nine month period ended September 30, 1999. In connection with our audits of the combined financial statements, we have also audited the accompanying financial statement schedule as listed in the accompanying index. These combined financial statements and the accompanying financial statement schedule are the responsibility of the management of Beasley FM Acquisition Corp. and Related Companies. Our responsibility is to express an opinion on these combined financial statements and the accompanying financial statement schedule based on our audits.
We conducted our audits in accordance with generally accepted auditing standards. Those standards require that we plan and perform the audit to obtain reasonable assurance about whether the financial statements are free of material misstatement. An audit includes examining, on a test basis, evidence supporting the amounts and disclosures in the financial statements. An audit also includes assessing the accounting principles used and significant estimates made by management, as well as evaluating the overall financial statement presentation. We believe that our audits provide a reasonable basis for our opinion.
In our opinion, the combined financial statements referred to above present fairly, in all material respects, the financial position of Beasley FM Acquisition Corp. and Related Companies as of December 31, 1997, 1998 and September 30, 1999, and the results of their operations and their cash flows for each of the years in the three-year period ended December 31, 1998 and for the nine month period ended September 30, 1999, in conformity with generally accepted accounting principles. Also in our opinion, the related financial statement schedule, when considered in relation to the basic combined financial statements taken as a whole, presents fairly, in all material respects, the information set forth therein.
/s/ KPMG LLP
Tampa, Florida
F-2
BEASLEY FM ACQUISITION CORP.
December 31,
Pro forma
September 30,
September 30,
1997
1998
1999
1999
(Unaudited)
ASSETS
Current assets:
Cash and cash equivalents
$
7,677,863
$
4,759,598
$
5,757,663
$
2,757,663
Restricted cash
1,250,000
—
—
—
Accounts receivable, less allowance for doubtful accounts of
$1,092,000 in 1997, $589,352 in 1998 and $550,155 in 1999
16,093,254
16,452,751
17,368,120
17,368,120
Trade sales receivable
1,263,616
1,744,225
1,176,045
1,176,045
Other receivables
959,932
894,319
665,102
665,102
Prepaid expenses and other
814,064
1,292,333
2,609,545
2,609,545
Deferred tax asset
—
—
—
4,027,000
Total current assets
28,058,729
25,143,226
27,576,475
28,603,475
Property and equipment, net
18,338,317
16,504,051
16,113,766
16,113,766
Notes receivable from related parties
540,471
556,796
556,796
556,796
Intangibles, net
145,487,608
151,048,465
141,085,688
149,727,688
Other assets
1,015,237
1,520,515
1,871,727
1,871,727
Total assets
$
193,440,362
$
194,773,053
$
187,204,452
$
196,873,452
LIABILITIES AND STOCKHOLDERS’ EQUITY
Current liabilities:
Current installments of long-term debt
$
648,754
$
161,048
$
3,915,150
$
3,915,150
Notes payable to related parties
9,643,489
10,303,427
10,356,687
10,356,687
Accounts payable
3,983,940
6,291,719
3,444,060
3,444,061
Accrued expenses
6,039,644
7,474,126
11,925,001
11,925,001
Trade sales payable
1,296,672
1,378,116
1,240,997
1,240,997
Total current liabilities
21,612,499
25,608,436
30,881,895
30,881,896
Long-term debt, less current installments
114,719,660
125,847,961
121,964,417
121,964,417
Long-term debt to related parties
37,275,622
37,275,622
37,275,622
37,275,622
Minority interest
253,993
—
—
—
Deferred tax liability
—
—
—
30,932,000
Total liabilities
173,861,774
188,732,019
190,121,934
221,053,935
Commitments and contingencies (note 7)
Common stock
4,530,352
4,530,352
4,530,352
4,530,352
Additional paid-in capital
30,428,164
32,010,375
32,010,375
(19,488,432
)
Accumulated deficit
(7,280,337
)
(21,827,398
)
(30,235,806
)
—
Treasury stock
—
(548,600
)
(548,600
)
(548,600
)
Stockholders’ equity (deficit)
27,678,179
14,164,729
5,756,321
(15,506,680
)
Notes receivable from stockholders
(8,099,591
)
(8,123,695
)
(8,673,803
)
(8,673,803
)
Net stockholders’ equity (deficit)
19,578,588
6,041,034
(2,917,482
)
(24,180,483
)
Total liabilities and stockholders’ equity
$
193,440,362
$
194,773,053
$
187,204,452
$
196,873,452
F-3
BEASLEY FM ACQUISITION CORP.
Nine months ended
Year ended December 31,
September 30,
1996
1997
1998
1998
1999
(Unaudited)
Net revenues
$
62,413,627
$
73,703,506
$
81,433,406
$
59,675,181
$
67,452,508
Costs and expenses:
Program and production
15,019,794
22,760,517
25,116,151
19,399,145
19,813,572
Sales and advertising
16,683,541
19,526,240
23,110,566
16,934,090
18,449,906
Station general and administrative
10,459,900
12,959,606
13,464,792
9,281,200
10,041,276
Corporate general and administrative
2,233,161
2,055,211
2,498,411
1,886,040
1,934,979
Depreciation and amortization
8,316,212
14,173,650
16,096,653
11,941,860
11,823,892
Impairment loss on long-lived assets
—
4,124,249
—
—
—
Total costs and expenses
52,712,608
75,599,473
80,286,573
59,442,335
62,063,625
Operating income (loss)
9,701,019
(1,895,967
)
1,146,833
232,846
5,388,883
Other income (expense):
Interest expense
(9,339,956
)
(13,605,937
)
(13,601,867
)
(10,250,510
)
(9,962,346
)
Other non-operating expenses
(3,706,972
)
(2,003,745
)
(1,580,554
)
(1,450,201
)
(243,071
)
Interest income
378,378
887,904
817,567
734,498
714,477
Other non-operating income
1,133,879
93,191
348,890
305,690
—
Gain (loss) on sale of radio stations
16,772,760
82,067,223
4,028,013
(328,000
)
—
Minority interest
169,318
1,076,689
253,993
334,143
—
Net income (loss)
$
15,108,426
$
66,619,358
$
(8,587,125
)
$
(10,421,534
)
$
(4,102,057
)
Pro forma income tax expense (benefit) (unaudited)
$
5,885,000
$
25,795,000
$
(3,250,000
)
$
(3,975,000
)
$
(1,532,000
)
Pro forma net income (loss) (unaudited)
$
9,223,426
$
40,824,358
$
(5,337,125
)
$
(6,446,534
)
$
(2,570,057
)
Pro forma basic and diluted net income (loss) per share
(unaudited)
$
0.53
$
2.34
$
(0.31
)
$
(0.37
)
$
(0.15
)
Pro forma basic and diluted common shares outstanding (unaudited)
17,423,441
17,423,441
17,423,441
17,423,441
17,423,441
See accompanying notes to combined financial statements.
F-4
BEASLEY FM ACQUISITION CORP.
Notes
Net
Receivable
Stockholders’
Stockholders’
From
Equity
Equity
Stockholders
(deficit)
Balances at December 31, 1995
$
(42,651,786
)
$
(137,504
)
$
(42,789,290
)
Common stock issued
20
—
20
Net income
15,108,426
—
15,108,426
Capital contributions
18,123,790
—
18,123,790
Stockholders distributions
(11,601,989
)
—
(11,601,989
)
Loans to stockholders
—
(4,542,752
)
(4,542,752
)
Balances at December 31, 1996
(21,021,539
)
(4,680,256
)
(25,701,795
)
Net income
66,619,358
—
66,619,358
Capital contributions
2,764,553
—
2,764,553
Stockholders distributions
(20,684,193
)
—
(20,684,193
)
Loans to stockholders
—
(3,419,335
)
(3,419,335
)
Balances at December 31, 1997
27,678,179
(8,099,591
)
19,578,588
Net loss
(8,587,125
)
—
(8,587,125
)
Capital contributions
1,582,211
—
1,582,211
Stockholders distributions
(5,959,936
)
—
(5,959,936
)
Purchase of common stock
(548,600
)
—
(548,600
)
Loans to stockholders
—
(1,206,446
)
(1,206,446
)
Payment of notes receivable from stockholders
—
1,182,342
1,182,342
Balances at December 31, 1998
14,164,729
(8,123,695
)
6,041,034
Net loss
(4,102,057
)
—
(4,102,057
)
Stockholders distributions
(4,306,351
)
—
(4,306,351
)
Loans to stockholders
—
(550,108
)
(550,108
)
Balances at September 30, 1999
$
5,756,321
$
(8,673,803
)
$
(2,917,482
)
See accompanying notes to combined financial statements
F-5
BEASLEY FM ACQUISITION CORP.
Nine months ended
Year ended December 31,
September 30,
1996
1997
1998
1998
1999
(Unaudited)
Cash flows from operating activities:
Net income (loss)
$
15,108,426
$
66,619,358
$
(8,587,125
)
$
(10,421,534
)
$
(4,102,057
)
Adjustments to reconcile net income (loss) to net cash
provided by operating activities:
Depreciation and amortization
8,316,212
14,173,650
16,096,653
11,941,860
11,823,892
(Gain) loss on sale of radio stations
(16,772,760
)
(82,067,223
)
(4,028,013
)
328,000
—
Impairment loss on long-lived assets
—
4,124,249
—
—
—
Minority interest
1,330,682
(1,076,689
)
(253,993
)
(334,143
)
—
Change in assets and liabilities net of effects of acquisitions
and dispositions of radio stations:
Increase in receivables
(4,500,133
)
(2,230,690
)
(782,146
)
(1,056,536
)
(117,972
)
Increase in prepaid expense and other
(159,001
)
(600,293
)
(476,296
)
(528,361
)
(1,317,212
)
Increase in intangibles
(14,258
)
(100,000
)
(267,331
)
(256,239
)
—
Increase in other assets
(253,902
)
(233,426
)
(506,431
)
(341,049
)
(351,212
)
Increase (decrease) in payables and accrued expenses
2,247,921
2,977,086
3,725,220
5,802,389
1,449,628
Net cash provided by operating activities
5,303,187
1,586,022
4,920,538
5,134,387
7,385,067
Cash flows from investing activities:
Capital expenditures for property and equipment
(2,860,624
)
(2,307,214
)
(1,586,933
)
(913,219
)
(1,470,830
)
Proceeds from sale of property
—
—
1,700,000
1,700,000
—
Proceeds from sale of stations
20,715,570
103,525,000
5,150,000
150,000
—
Payments for purchase of radio stations
(79,612,320
)
(77,677,895
)
(19,000,000
)
(11,000,000
)
—
(Increase) decrease in restricted cash
—
(1,250,000
)
1,250,000
1,250,000
—
Loans to related parties
—
—
(16,325
)
(16,325
)
—
Loans to stockholders
(4,542,752
)
(3,419,335
)
(1,206,446
)
(538,293
)
(550,108
)
Payments from stockholders
—
—
1,182,342
—
—
Net cash provided by (used in) investing activities
(66,300,126
)
18,870,556
(12,527,362
)
(9,367,837
)
(2,020,938
)
Cash flows from financing activities:
Proceeds from issuance of indebtedness
118,767,544
1,068,900
135,040,061
132,016,299
69,729
Proceeds from issuance of related party notes
224,823
3,390,920
663,538
593,338
—
Principal payments on indebtedness
(61,673,905
)
(3,578,525
)
(124,463,715
)
(123,780,713
)
(129,442
)
Payments of loan fees
(688,231
)
(13,428
)
(1,625,000
)
(1,625,000
)
—
Capital contributions
18,123,790
2,764,553
1,582,211
—
—
Stockholder distributions
(11,601,989
)
(20,684,193
)
(5,959,936
)
(5,959,936
)
(4,306,351
)
Purchase of common stock
20
—
(548,600
)
(548,600
)
—
Net cash provided by (used in) financing activities
63,152,052
(17,051,773
)
4,688,559
695,388
(4,366,064
)
Net increase (decrease) in cash and cash equivalents
2,155,113
3,404,805
(2,918,265
)
(3,538,062
)
998,065
Cash and cash equivalents at beginning of year
2,117,945
4,273,058
7,677,863
7,677,863
4,759,598
Cash and cash equivalents at end of year
$
4,273,058
$
7,677,863
$
4,759,598
$
4,139,801
$
5,757,663
Cash paid for interest
$
9,566,000
$
13,034,000
$
13,017,000
$
7,682,000
$
6,799,000
Cash paid for state taxes
$
5,000
$
18,000
$
22,000
$
22,000
$
25,000
Supplement disclosure of non-cash investing and financing
activities:
Note payable issued in conjunction with the purchase of a radio
station
$
1,000,000
$
—
$
—
$
—
$
—
Transfer of land and improvements to an affiliate in exchange for
a note receivable
$
540,471
$
—
$
—
$
—
$
—
Note payable reclassified to accrued expenses
$
350,000
—
—
—
—
Note receivable taken in conjunction with the sale of a radio
station
$
300,000
$
50,000
$
—
$
—
$
—
Financed purchases of property and equipment
$
—
$
—
$
35,649
$
35,649
$
—
See accompanying notes to combined financial statements.
F-6
BEASLEY FM ACQUISITION CORP.
December 31, 1997, 1998 and September 30, 1999
(1) Summary of Significant Accounting Policies
(a) Basis of Presentation and Corporate Reorganization
Beasley FM Acquisition Corp. and related companies (the “Company”) consists of subchapter S corporations and partnerships related to one another through common ownership and control. The Company operates 28 radio stations with its primary source of revenue generated from the sale of advertising time to local and national spot advertisers and national network advertisers. All significant inter-company balances and transactions have been eliminated in presenting the Company’s combined financial statements.
The number of shares authorized, issued and outstanding for
Beasley FM Acquisition Corp. and Related Companies for all
periods is as follows:
Common
Stock
Outstanding
Beasley FM Acquisition Corp. common stock, no par value;
authorized 1,000 shares; issued and outstanding 1,000
shares
$
4,464,099
Beasley Broadcasting of Eastern North Carolina, Inc. common
stock, $1 par value; authorized 100,000 shares; issued and
outstanding 50,000 shares
50,000
CSRA Broadcasters, Inc. common stock, $100 par value; authorized
600 shares; issued and outstanding 100 shares
10,000
W&B Media, Inc. common stock, $1 par value; authorized
100,000 shares; issued and outstanding 2,223 shares
2,223
Beasley Broadcasting of Arkansas, Inc. common stock, $1 par
value; authorized 10,000 shares; issued and outstanding 1,000
shares
1,000
Beasley Broadcasting of Eastern Pennsylvania, Inc. common stock,
$1 par value; authorized 10,000 shares; issued and outstanding
1,000 shares
1,000
Beasley Broadcasting of Southwest Florida, Inc. common stock, $1
par value; authorized 10,000 shares; issued and outstanding 1,000
shares
1,000
Beasley Radio, Inc. common stock, $1 par value; authorized 10,000
shares; issued and outstanding 1,000 shares
1,000
Beasley Broadcasting of Coastal Carolina, Inc. common stock, $.01
par value; authorized 1,000 shares; issued and outstanding 1,000
shares
10
Beasley Broadcasting of Augusta, Inc. common stock, $.01 par
value; authorized 1,000 shares; issued and outstanding 1,000
shares
10
Beasley Communications, Inc. common stock, $.01 par value;
authorized 1,000 shares; issued and outstanding 1,000 shares
10
$
4,530,352
The Company is contemplating an initial public offering of common stock. Immediately prior to the proposed initial public offering, pursuant to a corporate reorganization, stockholders of the various S corporations and George G. Beasley as limited partner in the various license limited partnerships will contribute their interests in those entities to Beasley Broadcast Group, Inc., a newly formed holding company, in exchange for common stock. Immediately after these transactions, Beasley
F-7
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
Broadcast Group, Inc. will contribute the capital stock and partnership interests acquired to Beasley Mezzanine Holdings, LLC with Beasley Mezzanine Holdings, LLC becoming a wholly-owned subsidiary of Beasley Broadcast Group, Inc. All S corporation elections will be terminated and the resulting entities will become C corporations. The proposed reorganization and contribution of capital stock and partnership interests will be accounted for in a manner similar to a pooling of interests as to the majority owners, and as an acquisition of minority interest using the purchase method of accounting.
The Company will have two classes of common stock and one or more series of preferred stock. In addition, the Company will adopt an equity participation plan providing various stock based compensation awards. Class B common shares will be held by majority stockholders of the S corporations. Class A common shares will be issued in the initial public offering including shares to current minority-interest stockholders. No shares of preferred stock will be issued in the offering. The only difference between the proposed Class A and Class B common stock would be that Class A would be entitled to one vote per share and Class B would be entitled to ten votes per share. Class B would be convertible into Class A shares on a one for one share basis under certain circumstances.
(b) Pro Forma Information
The pro forma balance sheet as of September 30, 1999 reflects the capital structure of the Company immediately prior to the effectiveness of the proposed initial public offering. Common stock represents Class A and Class B common shares. It reflects the establishment of deferred tax assets and liabilities upon conversion from a subchapter S to a subchapter C corporation which will result in a charge to operations at the time of effectiveness (see note 11), distributions to equity holders for income taxes on income of entities comprising Beasley Broadcast Group prior to the Reorganization, the distribution of untaxed retained income and subsequent re-contribution of the same amounts as additional paid-in capital and the fair value adjustment necessary to record the acquisition of minority shareholder interest using the purchase method of accounting as follows:
| Net stockholders’ (deficit) — actual | $ | (2,917,482 | ) | |
| Deferred tax assets and liabilities | (26,905,000 | ) | ||
| Fair value adjustment to minority interests | 8,641,999 | |||
| Distributions to stockholders | (3,000,000 | ) | ||
|
|
||||
| Net stockholders’ (deficit) — pro-forma | $ | (24,180,483 | ) | |
|
|
The pro forma balance sheet does not include any proceeds from the proposed initial public offering. Pro forma earnings per share, for all periods presented, is based on the assumed number of common shares expected to be issued immediately prior to the effectiveness of the proposed initial public offering.
For all periods presented, the unaudited pro forma income tax information included on the face of the statements of operations and in note 11 is presented in accordance with SFAS No. 109, Accounting for Income Taxes, as if the Company had been subject to Federal and state income taxes for the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999.
F-8
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
(c) Interim Information
The accompanying unaudited combined financial statements for the nine months ended September 30, 1998 reflect, in the opinion of management, all adjustments (which include only normal recurring adjustments) necessary to fairly state the financial position and the results of operations for the periods presented and the disclosures herein are adequate to make the information presented not misleading. Operating results for the interim periods presented are not necessarily indicative of the results that can be expected for a full year.
(d) Revenue Recognition
Revenue is recognized as advertising air time is broadcast and is net of advertising agency commissions.
(e) Cash and Cash Equivalents
Cash and cash equivalents include demand deposits and short-term investments with an original maturity of three months or less.
(f) Restricted Cash
Restricted cash represents cash held in escrow pending the outcome of binding arbitration relating to a dispute over the purchase price of WWDB-FM radio. The dispute was resolved subsequent to year end and these funds were released to the seller.
(g) Program Rights
The total fixed cost of the contracts for the radio broadcast rights relating to the Miami Dolphins, Florida Marlins and Florida Panthers sports contracts is expensed on a straight-line basis in the quarters in which the programs are broadcast. Other payments are expensed when additional contract elements, such as post-season games, are paid for and broadcast.
(h) Property and Equipment
Property and equipment are stated at cost. Depreciation is calculated on the straight-line method over the estimated useful lives of the assets.
(i) Intangibles
Intangibles consist primarily of FCC broadcasting licenses, goodwill, advertising base, loan fees, noncompete agreements, and other intangibles which are amortized straight-line over their estimated useful lives.
F-9
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
(j) Impairment
The Company assesses the recoverability of intangibles and other long-lived assets on an ongoing basis based on estimates of related future undiscounted cash flows compared to net book value. If the future undiscounted cash flow estimate is less than net book value, the net book value is reduced to the estimated fair value. The Company also evaluates the amortization and depreciation periods of intangibles and other long-lived assets to determine whether events or circumstances warrant revised estimates of useful lives.
(k) Derivative Financial Instruments
The Company has only limited involvement with derivative financial instruments and does not use them for trading purposes. The Company uses interest rate cap, collar and swap agreements to specifically hedge against the potential impact of increases in interest rates on the revolving credit loan. Interest differentials are recorded as adjustments to interest expense in the period they occur.
(l) Barter Transactions
Trade sales are recorded at the fair value of the products or services received. For the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999, trade sales were approximately $2,855,000, $3,488,000, $4,018,000, $2,914,000 and $3,061,000, respectively. For the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999, trade expenses were approximately $3,060,000, $2,643,000, $3,481,000, $2,478,000 and $3,345,000, respectively.
(m) Income Taxes
The Company has elected to be treated as a subchapter S Corporation under provisions of the Internal Revenue Code. Under this corporate status, the stockholders of the Company are individually responsible for reporting their share of taxable income or loss. Accordingly, no provision for federal or certain state income taxes has been reflected in the accompanying combined financial statements. The Company intends to convert to a regular C Corporation and become subject to Federal and state corporate income taxes in conjunction with its proposed initial public offering.
(n) Defined Contribution Plan
The Company has a defined contribution plan that conforms with Section 401(k) of the Internal Revenue Code. Under this plan, employees may contribute a minimum of 1% of their compensation (no maximum) to the Plan. The Internal Revenue Code, however, limited contributions to $9,500 in 1996 and 1997 and $10,000 in 1998 and 1999. There are no employer matching contributions.
(o) Use of Estimates
The preparation of financial statements in conformity with generally accepted accounting principles requires management to make estimates and assumptions that affect the reported amounts of assets and liabilities and disclosure of contingent assets and liabilities at the date of the financial statements, and the reported amount of revenues and expenses during the reporting period. Actual results could differ from these estimates. To the extent management’s estimates prove to be incorrect, financial results for future periods may be adversely affected.
F-10
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
(p) Recent Accounting Pronouncements
In June 1998, the FASB issued SFAS No. 133, Accounting for Derivative Instruments and Hedging Activities . SFAS 133 establishes accounting and reporting standards for derivative instruments, including derivative instruments embedded in other contracts, and for hedging activities. SFAS 133 was amended by SFAS 137 in June 1999 and is effective, as amended, for all fiscal quarters of fiscal years beginning after June 15, 2000. The Company has not completed its evaluation of SFAS 133; however, management does not anticipate that the adoption of SFAS 133 will have a material impact on the Company’s earnings or financial position upon adoption.
(q) Segment Reporting
As of September 30, 1999 the Company operates two reportable segments comprised of 28 separate radio stations in the eastern United States. The reportable segments are in the radio broadcasting industry, providing a similar product to similar customers. Net revenues, consisting primarily of national and local advertising, are derived from external sources. The Company does not rely on any major customer as a source of net revenue. The Company identifies its reportable segments based on the operating management responsibility for the segment. The chief operating decision maker uses net revenues and broadcast cash flow as measures of profitability to assess segment profit or loss and to allocate resources between the two segments. The accounting policies of the segments are the same as those described in the summary of significant accounting policies.
(2) Property and Equipment
Property and equipment, at cost, is comprised of the following:
| December 31, | Estimated | ||||||||||||||||
|
|
September 30, | useful lives | |||||||||||||||
| 1997 | 1998 | 1999 | (years) | ||||||||||||||
|
|
|
|
|
||||||||||||||
| Land, buildings and improvements | $ | 5,855,151 | $ | 4,319,379 | $ | 4,456,617 | 31.5 | ||||||||||
| Broadcast equipment | 18,783,364 | 19,551,560 | 19,773,265 | 5 | |||||||||||||
| Transportation equipment | 646,894 | 814,127 | 826,031 | 5 | |||||||||||||
| Office equipment and other | 3,770,387 | 4,109,181 | 4,298,813 | 5–7 | |||||||||||||
| Construction in progress | 625,405 | 118,439 | 1,020,236 | — | |||||||||||||
|
|
|
|
|
||||||||||||||
| 29,681,201 | 28,912,686 | 30,374,962 | |||||||||||||||
| Less accumulated depreciation | (11,342,884 | ) | (12,408,635 | ) | (14,261,196 | ) | |||||||||||
|
|
|
|
|||||||||||||||
| $ | 18,338,317 | $ | 16,504,051 | $ | 16,113,766 | ||||||||||||
|
|
|
|
|||||||||||||||
In 1997, property and equipment includes certain land, a building, and building improvements with a net book value of $5,824,249 associated with the Company’s former ownership of a radio station in Los Angeles, California. This property was leased under an operating lease agreement until it was sold for $1,700,000 on April 20, 1998. The Company recognized an impairment loss of $4,124,249 on this property for the period ended December 31, 1997.
F-11
NOTES TO COMBINED FINANCIAL
STATEMENTS — (Continued)
(3) Intangibles
Intangibles, at cost, is comprised of the following:
December 31,
Estimated
September 30,
useful lives
1997
1998
1999
(years)
FCC broadcasting licenses
$
140,517,195
$
157,700,379
$
157,700,379
10–15
Goodwill
16,669,333
16,763,990
16,763,990
15
Advertising base
4,139,251
4,139,251
4,139,251
5
Loan fees
1,230,199
2,975,681
2,975,681
7
Noncompete agreements
1,120,000
1,120,000
1,120,000
2–8
Other intangibles
5,666,932
5,666,932
5,666,932
5–15
169,342,910
188,366,233
188,366,233
Less accumulated amortization
(23,855,302
)
(37,317,768
)
(47,280,545
)
$
145,487,608
$
151,048,465
$
141,085,688
(4) Long-Term Debt
Long-term debt consists of the following:
F-12
NOTES TO COMBINED FINANCIAL
STATEMENTS — (Continued)
December 31,
September 30,
1997
1998
1999
Note payable to Georgia Bank and Trust, payable in monthly
payments of $1,134, including interest at 9.25% per annum,
maturing on December 22, 2001
44,908
35,044
27,027
Note payable to Myer Feldman, payable in monthly payments of
$527, including interest at 12% per annum, maturing on
April 1, 2013
44,305
43,245
42,363
Note payable to Pontiac Master-GMC Truck, payable in monthly
payments of $565, including interest at 3.9% per annum, maturing
on November 15, 1999
12,494
6,091
1,121
Note payable to Georgia Bank and Trust, payable in monthly
payments of $648, including interest at 8% per annum, maturing on
January 25, 2002
—
21,269
16,588
Capital lease obligations, payable in monthly payments ranging
from $399 to $532, including interest ranging from 8% to 20% per
annum, maturing on various dates through April 27, 2003. The
leases are secured by the leased property
8,393
38,012
30,330
115,368,414
126,009,009
125,879,567
Less current installments of long-term debt
(648,754
)
(161,048
)
(3,915,150
)
Long-term debt, less current installments
$
114,719,660
$
125,847,961
$
121,964,417
On August 11, 1999, the Company increased the maximum commitment under the revolving credit loan to $150 million. The loan bears interest at either the base rate or LIBOR plus a margin which is determined by the Company’s debt to cash flow ratio. The base rate is equal to the higher of the prime rate or the overnight federal funds effective rate plus 0.5%. At December 31, 1998 and September 30, 1999, the revolving credit loan carried interest at an average rate of 7.47% and 7.56% respectively. Interest is generally payable monthly. The amount available under the revolving credit loan will be reduced quarterly beginning September 30, 2000 through its maturity on December 31, 2006. The quarterly reductions in the amount available under the revolving credit loan may require principal repayments if the outstanding balance at the end of each quarter exceeds the new maximum available amount under the revolving credit loan. The Company has entered into interest rate hedge agreements as discussed in note 9. The loan agreement includes restrictive covenants and requires the Company to maintain certain financial ratios. The loan is secured by equity interests held by the borrowers in their subsidiaries and substantially all assets of the Company.
F-13
NOTES TO COMBINED FINANCIAL
STATEMENTS — (Continued)
The scheduled reductions of the revised maximum commitment of the
revolving credit line for the next five years and
thereafter are as follows:
1999
$
—
2000
7,500,000
2001
15,000,000
2002
15,000,000
2003
18,750,000
Thereafter
93,750,000
Total
$
150,000,000
As of December 31, 1998, scheduled repayments of long-term
debt, excluding the revolving credit line (see note 12), for the
next five years and thereafter are as follows:
(5) Long-Term Debt to Related Parties
1999
$
161,048
2000
166,319
2001
199,905
2002
574,039
2003
114,811
Thereafter
112,467
Total
$
1,328,589
Long-term debt to related parties consists of the following:
| December 31, | ||||||||||||
|
|
September 30, | |||||||||||
| 1997 | 1998 | 1999 | ||||||||||
|
|
|
|
||||||||||
| 7.67% notes payable to affiliate Beasley Broadcasting of Philadelphia, Inc., interest-only payments are due annually, principal and any unpaid interest due August 11, 2004 | $ | 25,699,530 | $ | 25,699,530 | $ | 25,699,530 | ||||||
| 7.67% notes payable to affiliate Beasley-Reed Broadcasting of Miami, Inc., interest-only payments are due annually, principal and any unpaid interest due August 11, 2004 | 11,576,092 | 11,576,092 | 11,576,092 | |||||||||
|
|
|
|
||||||||||
| $ | 37,275,622 | $ | 37,275,622 | $ | 37,275,622 | |||||||
|
|
|
|
||||||||||
For each of the years ended December 31, 1996, 1997 and 1998, interest expense on long-term debt to related parties was approximately $2,859,000 and for each of the nine months ended September 30, 1998 and 1999, interest expense on long-term debt to related parties was approximately $2,144,000.
F-14
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
(6) Related Party Transactions
The Company has a management agreement with Beasley Broadcasting Management Corp., an affiliate of the Company’s principal stockholder, George G. Beasley. For the years ended December 31, 1996, 1997 and 1998 and the unaudited nine months ended September 30, 1998 and 1999, management fee expense under the agreement was approximately $2,233,000, $2,055,000, $2,498,000, $1,886,000 and $1,935,000, respectively. Management fee expense is reported as corporate general and administrative in the accompanying combined statements of operations.
The Company leases certain office space from its principal stockholder, George G. Beasley. For the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999, rental expense paid to Mr. Beasley was approximately $195,000 $111,000, $77,000 $73,000 and $85,000, respectively.
Distributions to stockholders of the S corporations during the periods ended December 31, 1996, 1997 and 1998, and the nine months ended September 30, 1999 were $11,601,989, $20,684,193, $5,959,936 and $4,306,351, respectively.
Notes receivable from related parties are due on demand.
Notes payable to related parties bear interest at 7.67% to 9.25% and are due on demand. For the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999, interest expense on notes payable to related parties was approximately $376,000, $279,000, $365,000 $547,000 and $453,000, respectively.
Notes receivable from stockholders bear interest at 9.25% and are due on demand. For the years ended December 31, 1996, 1997 and 1998 and the nine months ended September 30, 1998 and 1999, interest income on notes receivable from related parties was approximately $314,000, $551,000, $618,000 $600,000 and $585,000, respectively.
(7) Acquisitions and Dispositions
Station acquisitions, including tax-deferred exchange were accounted for by the purchase method for financial statement purposes, and accordingly, the purchase price has been allocated to the assets acquired based on their estimated fair market values at the date of the acquisition. A substantial portion of each purchase price was allocated to intangible assets to reflect the FCC broadcasting licenses acquired. These FCC broadcasting licenses are being amortized over 15 years using the straight-line basis. The excess of the purchase price over the fair value of the net assets acquired has been recorded as goodwill and is being amortized over 15 years using the straight-line basis. No liabilities were assumed by the Company as a result of these acquisitions. Operations of acquired stations have been included in the combined results of the Company since the acquisition date of each such station.
(a) 1999 Acquisitions and Dispositions
There were no acquisitions or dispositions during 1999.
(b) 1998 Acquisitions and Dispositions
| • | On February 11, 1998, BFMA acquired the assets of WJBX-FM for approximately $6,000,000. |
F-15
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
| • | On February 11, 1998, BRI acquired the assets of WJST-FM for approximately $5,000,000. | |
| • | On December 1, 1998, BBA acquired the assets of WTMR-AM for approximately $8,000,000. | |
| • | BBA sold substantially all of the assets of KAAY-AM to Citadel Broadcasting Company on November 17, 1998. Net proceeds from the sale were approximately $5,000,000, which resulted in a gain of approximately $4,356,000. | |
| • | BFMA sold substantially all of the assets of WEWO-AM to Service Media, Inc. on August 1, 1998. Net proceeds from the sale were approximately $150,000, which resulted in a loss of approximately $328,000. |
For tax purposes, the sale of KAAY-AM and the acquisition of WTMR-AM were treated as a tax-deferred exchange under Section 1031 of the Internal Revenue Code to a substantial extent.
For tax purposes, the sale of WEGX-FM and WDSC-AM and the acquisition of WJBX-FM were treated as a tax-deferred exchange under Section 1031 of the Internal Revenue Code.
(c) 1997 Acquisitions and Dispositions
| • | On January 22, 1997, BCI acquired the assets of WCHZ-FM for approximately $1,200,000. BCI had operated this station under an LMA since December 9, 1996. | |
| • | On January 31, 1997, BFMA acquired the assets of WFLB-AM (subsequently changed to WAZZ-AM) for approximately $228,000. | |
| • | On May 19, 1997, BFMA acquired the assets of WZFX-FM for approximately $11,500,000. | |
| • | On May 9, 1997, BFMA acquired the assets of WWDB-FM for approximately $63,250,000. | |
| • | On July 29, 1997, BFMA acquired the assets of WLRD-FM (subsequently changed to WUKS-FM) and WYRU-AM (subsequently changed to WTEL-AM) for $1,500,000. | |
| • | On June 30, 1997, BFMA entered into a time brokerage agreement (TBA) with Root Communications, Ltd. (Root) to operate WEGX-FM and WDSC-AM. BFMA subsequently completed the sale of substantially all assets of WEGX-FM and WDSC-AM to Root on October 7, 1997. Net proceeds from the sale were approximately $3,500,000, which resulted in a gain of approximately $2,232,000. | |
| • | BFMA sold substantially all of the assets of WDAS-AM/ FM to Evergreen Media Corporation of Los Angeles on May 1, 1997. Net proceeds from the sale were approximately $100,000,000, which resulted in a gain of approximately $79,831,000. | |
| • | BBENC sold substantially all of the assets of WTSB-AM to Lumberton Christian Radio, Inc. on August 1, 1997. Net proceeds from the sale were approximately $75,000, which resulted in a gain of approximately $5,000. |
F-16
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
For tax purposes, the sale of WDAS-FM and the acquisitions of WZFX-FM, WWDB-FM, WLRD-FM and WYRU-AM were treated as a tax-deferred exchange under Section 1031 of the Internal Revenue Code to a substantial extent.
(d) 1996 Acquisitions and Dispositions
| • | On March 11, 1996, BFMA entered into a local marketing agreement (LMA) with OmniAmerica Group (OAG) to operate WJHM-FM. BFMA subsequently completed the sale of substantially all assets of WJHM-FM to OAG on August 22, 1996. Net proceeds from the sale were approximately $20,715,000, which resulted in a gain of approximately $16,773,000. | |
| • | On June 4, 1996, Beasley Broadcasting of Coastal Carolina, Inc. acquired the assets of WNCT-AM/ FM for approximately $3,000,000. | |
| • | On July 30, 1996, BFMA acquired the assets of WAZZ-FM and WEWO-AM for approximately $4,200,000. | |
| • | On October 8, 1996, BFMA completed the acquisition of WKIS-FM for approximately $46,000,000. BFMA and the seller also entered into a $1,000,000 noncompete agreement which was paid in 1997 and 1998. BFMA had operated this station under an LMA since February 16, 1996. | |
| • | On October 8, 1996, Beasley-Reed Acquisition Partnership completed the acquisition of WQAM-AM for approximately $10,000,000. BFMA had operated this station under an LMA since February 16, 1996. | |
| • | On November 1, 1996, BFMA acquired the assets of WIKS-FM for $10,692,000, WMGV-FM for approximately $3,308,000 and WXNR-FM for approximately $2,000,000. |
For tax purposes, the sale of WJHM-FM and the acquisition of WKIS-FM were treated as a tax-deferred exchange under Section 1031 of the Internal Revenue Code to a substantial extent.
Acquisitions for the years ended December 31, 1996, 1997, 1998 are summarized as follows:
| Years ended | ||||||||||||
| December 31, | ||||||||||||
|
|
||||||||||||
| 1996 | 1997 | 1998 | ||||||||||
|
|
|
|
||||||||||
| Property and equipment | $ | 8,512,826 | $ | 3,348,028 | $ | 1,499,641 | ||||||
| Other assets | 16,837 | 6,289 | 2,142 | |||||||||
| FCC broadcasting licenses | 70,670,337 | 72,116,204 | 17,226,517 | |||||||||
| Goodwill | — | 2,207,374 | 271,700 | |||||||||
|
|
|
|
||||||||||
| Payments for purchase of radio stations | $ | 79,200,000 | $ | 77,677,895 | $ | 19,000,000 | ||||||
|
|
|
|
||||||||||
F-17
NOTES TO COMBINED FINANCIAL
STATEMENTS — (Continued)
Dispositions for the years ended December 31, 1996, 1997,
1998 are summarized as follows:
Years ended
December 31,
1996
1997
1998
Proceeds from sale of stations
$
21,015,570
$
103,525,000
$
5,150,000
Accounts receivable, net
—
—
(5,720
)
Prepaid expenses and other
—
(101,844
)
—
Property and equipment, net
(519,795
)
(4,012,539
)
(797,915
)
Intangibles, net
(3,723,015
)
(17,261,967
)
(193,755
)
Trade sales, net
—
(81,427
)
—
Selling expenses
—
—
(124,597
)
Gain on sale of radio stations
$
16,772,760
$
82,067,223
$
4,028,013
Under a TBA or LMA, the Company operating a station generally receives all broadcast revenues and provides the necessary programming, technical, sales and marketing, and other support. The Company then pays a monthly fee to the owner of the station for the use of the station assets. The broadcast revenues and operating expenses of stations operated by the Company under TBAs and LMAs have been included in the Company’s operations since the dates of such agreements.
(e) Unaudited Pro Forma Results of Operations
The following unaudited pro forma information presents the results of operations for the years ended December 31, 1996, 1997 and 1998 and for the nine months ended September 30, 1998 and 1999, with pro forma adjustments as if the acquisitions of the stations in 1996, 1997 and 1998, had occurred prior to January 1 in the prior year.
F-18
NOTES TO COMBINED FINANCIAL
STATEMENTS — (Continued)
This unaudited pro forma information is not necessarily
indicative of what would have occurred had the acquisitions
occurred prior to January 1 in the prior year or of results
that may occur in the future.
Years ended
December 31,
1996
1997
1998
Revenues
$
88,677,000
$
80,204,000
$
82,550,000
Costs and expenses:
Program and production
22,468,000
24,061,000
25,253,000
Sales and advertising
23,100,000
21,431,000
23,268,000
General and administrative
14,000,000
13,980,000
13,628,000
Corporate general and administrative
2,996,000
2,295,000
2,604,000
Depreciation and amortization
19,298,000
17,468,000
16,692,000
Impairment loss on long lived
assets
—
4,124,000
—
Total costs and expenses
$
81,862,000
$
83,359,000
$
81,445,000
Operating income (loss)
6,815,000
(3,155,000
)
1,105,000
Other income (expense):
Interest expense
(11,647,000
)
(14,037,000
)
(13,649,000
)
Other non-operating expenses
(3,707,000
)
(2,004,000
)
(1,581,000
)
Interest income
378,000
888,000
818,000
Other non-operating income
1,134,000
93,000
349,000
Gain on sale of radio stations
16,772,000
82,067,000
4,028,000
Minority interest
169,000
1,077,000
254,000
Net income (loss) before pro forma income tax expense (benefit)
$
9,914,000
$
64,929,000
$
(8,676,000
)
Pro forma income tax expense (benefit)
3,861,000
25,142,000
(3,284,000
)
Net income (loss)
6,053,000
39,787,000
(5,392,000
)
Pro forma basic and diluted net income (loss) per share
$
0.35
$
2.28
$
(0.31
)
Pro forma basic and diluted common shares outstanding
17,423,441
17,423,441
17,423,441
(f) Pending Acquisitions
| • | In August 1999, the Company entered into an agreement to acquire WAEC-AM and WWWE-AM for approximately $10,000,000. | |
| • | In September 1999, the Company entered into an agreement to acquire WRFN-FM and WRDW-AM for approximately $800,000. |
F-19
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
(8) Commitments and Contingencies
In 1997, the Company entered into contracts for the radio broadcast rights relating to the Miami Dolphins, Florida Marlins and Florida Panthers sports franchises. These contracts grant WQAM-AM the exclusive, English language rights for live radio broadcasts of the sporting events of these franchises for a five year term which began in 1997. The contracts require the Company to pay certain fees and to provide commercial advertising and other considerations. As of December 31, 1998, remaining payments of fees are as follows: $7,171,000 in 1999, $8,500,000 in 2000, $8,844,000 in 2001 and $359,000 in 2002. In 1997, 1998 and the nine months ended September 30, 1999 expenses relating to these contracts exceeded related revenues by $2,882,000, $796,000 and $1,290,000, respectively. Unless the Company is able to generate significantly more revenues under these contracts in future periods, the contracts are likely to have a material adverse effect on the Company’s results of operations on a going-forward basis. However, in light of the uncertainty regarding future revenues, the amount of any future loss cannot be determined at this time. The proper accounting treatment for executory contracts such as these is currently the subject of Emerging Issues Task Force 99-14. Depending on the resolution of this issue by the task force, the Company may be required to record a charge reflecting an impairment of these committed contracts. Such a charge could also have a material adverse effect on future results of operations.
The Company leases facilities under one- to ten-year operating
leases and towers under 5 to 40 year operating leases. For
the years ended December 31, 1996, 1997 and 1998 and the
nine months ended September 30, 1998 and 1999, lease expense
was approximately $1,405,000, $1,530,000, $1,503,000, $1,256,000
and $1,313,000, respectively. As of December 31, 1998,
future minimum lease payments for the next five years and
thereafter are summarized as follows:
1999
$
1,504,000
2000
1,445,000
2001
1,276,000
2002
1,053,000
2003
992,000
Thereafter
6,385,000
Total
$
12,655,000
Employment agreements with three radio station managers contain provisions that allow the station manager to participate in the gain on the sale of the station managed in the event it is sold, and while the station manager is still employed by the Company. In addition, these agreements provide that upon the occurrence of certain liquidity events the station manager will be paid a percentage of the increase in value of the station managed upon completion of the offering. As of September 30, 1999 payments that would be due to the station manager upon completion of the proposed initial public offering amounted to $1.6 million. After September 30, 1999, and prior to the completion of the offering, the Company will amend one of these agreements as part of a relocation package for the station manager resulting in payment of $430,000. At September 30, 1999 no amounts have been recognized in the combined financial statements.
In the normal course of business, the Company is party to various legal matters. The ultimate disposition of these matters will not, in management’s judgment, have a material adverse effect on the Company’s financial position.
F-20
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
(9) Derivative Financial Instruments
The Company uses interest rate cap, collar and swap agreements to hedge against the potential impact of increases in interest rates on the revolving credit loan. For the years ended December 31, 1996 and the nine months ended September 30, 1999, the Company paid additional interest of approximately $122,000 and $126,000, respectively. For the years ended December 31, 1997 and 1998 and the unaudited nine months ended September 30, 1998, the Company received additional interest of approximately $9,000, $11,000 and $7,000, respectively. The amount paid is based on the differential between the specified rate of the swap agreements and the variable interest rate of the revolving credit loan. There was no additional interest paid or received under the cap and collar agreements.
(10) Fair Value of Financial Instruments
The Company’s significant financial instruments and the methods used to estimate their fair values are as follows:
| • | Revolving credit loan — The fair value approximates carrying value due to the interest rate being based on current market rates. | |
| • | Notes payable to affiliates — It is not practicable to estimate the fair value of notes payable to affiliates due to their related party nature. | |
| • | Non-interest bearing note payable — The fair value is estimated using the present value of discounted cash flows at rates currently available to the Company for borrowings with similar terms and remaining maturities. The fair value of this note approximates its carrying value due to its short-term maturity. | |
| • | Hedge agreements — The Company has entered into various agreements to hedge against the potential impact of increases in interest rates on the revolving credit loan. These agreements at December 31, 1998 are summarized as follows: |
| Estimated | ||||||||||||||||||||||
| Notional | Expiration | Fair | ||||||||||||||||||||
| Agreement | Amount | Floor | Cap | Swap | Date | Value | ||||||||||||||||
|
|
|
|
|
|
|
|
||||||||||||||||
| Interest rate cap | $ | 3,100,000 | — | 7.5 | % | — | September 1999 | $ | — | |||||||||||||
| Interest rate collar | 10,000,000 | 4.99% | 7 | % | — | January 2000 | — | |||||||||||||||
| Interest rate collar | 10,000,000 | 5.25% | 7 | % | — | January 2000 | (15,000 | ) | ||||||||||||||
| Interest rate collar | 10,000,000 | 5.17% | 7 | % | — | May 2000 | (18,000 | ) | ||||||||||||||
| Interest rate swap | 10,000,000 | — | — | 5.52 | % | May 2001 | (89,000 | ) | ||||||||||||||
| Interest rate swap | 10,000,000 | — | — | 5.82 | % | September 2001 | (170,000 | ) | ||||||||||||||
| Interest rate swap | 20,000,000 | — | — | 5.685 | % | May 2002 | (331,000 | ) | ||||||||||||||
The Company is exposed to credit loss in the event of nonperformance by the other parties to the agreements. The Company, however, does not anticipate nonperformance by the counterparties. The fair value of the interest rate swap agreements is estimated using the difference between the present value of discounted cash flows using the base rate stated in the swap agreement and the present value of discounted cash flows using the LIBOR rate at December 31, 1998. The fair values
F-21
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
of the interest rate cap agreement and the interest rate collar agreements are estimated based on the amounts the Company would expect to receive or pay to terminate the agreement.
(11) Pro Forma Income Taxes
Pro forma income tax expense (benefit) differs from the amounts that would result from applying the federal statutory rate of 34% to the Company’s net income (loss), as follows:
| December 31, | September 30, | |||||||||||||||||||
|
|
|
|||||||||||||||||||
| 1996 | 1997 | 1998 | 1998 | 1999 | ||||||||||||||||
|
|
|
|
|
|
||||||||||||||||
| Expected pro forma tax expense (benefit) | $ | 5,137,000 | $ | 22,651,000 | $ | (2,920,000 | ) | $ | (3,543,000 | ) | $ | (1,395,000 | ) | |||||||
| State income taxes, net of federal benefit | 698,000 | 3,078,000 | (397,000 | ) | (481,000 | ) | (189,000 | ) | ||||||||||||
| Other | 50,000 | 66,000 | 67,000 | 49,000 | 52,000 | |||||||||||||||
|
|
|
|
|
|
||||||||||||||||
| $ | 5,885,000 | $ | 25,795,000 | $ | (3,250,000 | ) | $ | (3,975,000 | ) | $ | (1,532,000 | ) | ||||||||
|
|
|
|
|
|
||||||||||||||||
Temporary differences that give rise to the components of pro forma deferred tax assets and liabilities, are as follows:
| December 31, | September 30, | ||||||||||||||||||||
|
|
|
||||||||||||||||||||
| 1996 | 1997 | 1998 | 1998 | 1999 | |||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||
| Allowance for doubtful accounts | $ | 2,645,000 | $ | 2,747,000 | $ | 2,660,000 | $ | 2,682,000 | $ | 2,635,000 | |||||||||||
| Accrued interest on notes receivable from related parties | 816,000 | 994,000 | 1,222,000 | 1,165,000 | 1,392,000 | ||||||||||||||||
| Notes receivable from related parties | 478,000 | 478,000 | 478,000 | 478,000 | 478,000 | ||||||||||||||||
| Property and equipment | — | 531,000 | — | — | — | ||||||||||||||||
|
|
|
|
|
|
|||||||||||||||||
| Gross deferred tax assets | 3,939,000 | 4,750,000 | 4,360,000 | 4,325,000 | 4,505,000 | ||||||||||||||||
| Intangibles | (9,713,000 | ) | (30,370,000 | ) | (30,541,000 | ) | (30,498,000 | ) | (30,293,000 | ) | |||||||||||
| Property and equipment | (1,105,000 | ) | — | (1,199,000 | ) | (767,000 | ) | (1,117,000 | ) | ||||||||||||
|
|
|
|
|
|
|||||||||||||||||
| Gross deferred tax liabilities | (10,818,000 | ) | (30,370,000 | ) | (31,740,000 | ) | (31,265,000 | ) | (31,410,000 | ) | |||||||||||
| Net deferred tax liabilities | $ | (6,879,000 | ) | $ | (25,620,000 | ) | $ | (27,380,000 | ) | $ | (26,940,000 | ) | $ | (26,905,000 | ) | ||||||
|
|
|
|
|
|
|||||||||||||||||
F-22
NOTES TO COMBINED FINANCIAL STATEMENTS — (Continued)
(12) Subsequent Event
Prior to the completion of the proposed offering, the Company will sell radio towers and related real estate assets owned by the Company to Beasley Family Towers, Inc. (BFT) for approximately $3,400,000. No gain or loss is expected been reported in the accompanying combined statements of operations. In conjunction with this sale, the Company intends to enter into long-term agreements to leaseback the towers from BFT.
(13) Segment Information
Segment information, in thousands of dollars for the years ended December 31, 1996, 1997 and 1998, and the nine month periods ended September 30, 1998 and 1999 are as follows:
| December 31 | September 30 | |||||||||||||||||||||
|
|
|
|||||||||||||||||||||
| 1996 | 1997 | 1998 | 1998 | 1999 | ||||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||
| Total assets: | ||||||||||||||||||||||
| Radio Group One | $ | 104,629 | $ | 97,282 | $ | 97,530 | — | $ | 97,725 | |||||||||||||
| Radio Group Two | 41,078 | 96,158 | 97,243 | — | 89,479 | |||||||||||||||||
|
|
|
|
|
|||||||||||||||||||
| Total | $ | 145,707 | $ | 193,440 | $ | 194,773 | — | $ | 187,204 | |||||||||||||
|
|
|
|
|
|||||||||||||||||||
| Net revenues: | ||||||||||||||||||||||
| Radio Group One | $ | 31,491 | $ | 44,755 | $ | 50,825 | $ | 37,284 | $ | 42,952 | ||||||||||||
| Radio Group Two | 30,923 | 28,948 | 30,608 | 22,391 | 24,501 | |||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||
| Total | 62,414 | 73,703 | 81,433 | 59,675 | 67,453 | |||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||
| Broadcast cash flow: | ||||||||||||||||||||||
| Radio Group One | $ | 6,935 | $ | 8,924 | $ | 10,922 | $ | 7,517 | $ | 13,065 | ||||||||||||
| Radio Group Two | 13,315 | 9,533 | 8,820 | 6,543 | 6,083 | |||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||
| Total | 20,250 | 18,457 | 19,742 | 14,060 | 19,148 | |||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||
| Reconciliation to net income (loss): | ||||||||||||||||||||||
| Corporate general and administrative expenses | $ | (2,233 | ) | $ | (2,055 | ) | $ | (2,498 | ) | $ | (1,886 | ) | $ | (1,935 | ) | |||||||
| Depreciation and amortization | (8,316 | ) | (14,173 | ) | (16,097 | ) | (11,942 | ) | (11,824 | ) | ||||||||||||
| Impairment loss on long-lived assets | — | (4,124 | ) | — | — | — | ||||||||||||||||
| Interest expense | (9,339 | ) | (13,606 | ) | (13,602 | ) | (10,251 | ) | (9,962 | ) | ||||||||||||
| Other non-operating income (expense) | (2,027 | ) | 53 | (160 | ) | (75 | ) | 471 | ||||||||||||||
| Gain (loss) on sale of radio stations | 16,773 | 82,067 | 4,028 | (328 | ) | — | ||||||||||||||||
|
|
|
|
|
|
||||||||||||||||||
| Net income (loss) | $ | 15,108 | $ | 66,619 | $ | (8,587 | ) | $ | (10,422 | ) | $ | (4,102 | ) | |||||||||
|
|
|
|
|
|
||||||||||||||||||
Radio Group One includes radio stations located in Miami-Ft. Lauderdale, Ft. Myers-Naples, Fl, and Greenville-New Bern-Jacksonville, NC. Radio Group Two includes radio stations located in Philadelphia, PA, Fayetteville, NC and Augusta, GA.
Broadcast cash flow consists of operating income (loss) before corporate general and administrative expenses, depreciation and amortization, equity appreciation rights expenses and impairment loss on long-lived assets.
F-23
BEASLEY FM ACQUISITION CORP.
Years ended December 31, 1996, 1997 and 1998
Column B
Column C
Column E
Balance at
Provision
Balance at
Column A
Beginning
for Bad
Column D
End
Description
of Period
Debts
Charge Offs
of Period
Year ended December 31, 1996:
Allowance for doubtful accounts
$572,816
$766,681
$745,026
$594,471
Year ended December 31, 1997:
Allowance for doubtful accounts
594,471
1,218,755
721,226
1,092,000
Year ended December 31, 1998:
Allowance for doubtful accounts
1,092,000
1,129,211
1,631,859
589,352
Nine months ended September 30, 1999:
Allowance for doubtful accounts
589,352
536,851
57,048
550,155
F-24
[BEASLEY LOGO]
PART II
Item 13.
Other Expenses Of Issuance And
Distribution.
The following table sets forth fees payable to the Securities and
Exchange Commission and the National Association of Securities
Dealers, Inc., and other estimated expenses expected to be
incurred in connection with the issuance and distribution of
securities being registered. All such fees and expenses shall be
paid by the Registrant.
Item 14.
Indemnification Of Directors And
Officers.
Section 145 of the General Corporation Law of the State of
Delaware (“Section 145”) permits a Delaware
corporation to indemnify and person who was or is a party or is
threatened to be made a party to any threatened, pending, or
completed action, suit, or proceeding, whether civil, criminal,
administrative, or investigative (other than an action by or in
the right of the corporation) by reason of the fact that such
person is or was a director, officer, employee, or agent of the
corporation, or is or was serving at the request of the
corporation as a director, officer, employee, or agent of another
corporation, partnership, joint venture, trust, or other
enterprise, against expenses (including attorneys’ fees),
judgments, fines, and amounts paid in settlement actually and
reasonably incurred by such person in connection with such
action, suit, or proceeding if such person acted in good faith
and in a manner such person reasonably believed to be in or not
opposed to the best interests of the corporation, and, with
respect to any criminal action or proceeding, had no reasonable
cause to believe such person’s conduct was unlawful.
In the case of an action by or in the right of the corporation,
Section 145 permits the corporation to indemnify any person who
was or is a party or is threatened to be made a party to any
threatened, pending, or completed action or suit by or in the
right of the corporation to procure a judgment in its favor by
reason of the fact that such person is or was a director,
officer, employee or agent of the corporation, or is or was
serving at the request of the corporation as a director, officer,
employee or agent of another corporation, partnership, joint
venture, trust or other enterprise against expenses (including
attorneys’ fees) actually and reasonably incurred by such
person in connection with the defense or settlement of such
action or suit if he acted in good faith and in a manner such
person reasonably believed to be in or not opposed to the best
interest of the corporation. No indemnification may be made in
respect of any claim, issue, or matter as to which such person
shall have been adjudged to be liable to the corporation unless
and only to the extent that the Court of Chancery or the court in
which such action or suit was brought shall determine upon
application that, despite the adjudication of liability but in
view of all the circumstances of the case, such person is fairly
and reasonably entitled to indemnity for such expenses which the
Court of Chancery or such other court shall deem proper.
II-1
To the extent that a director, officer, employee or agent of a
corporation has been successful on the merits of otherwise in
defense of any action, suit or proceeding referred to in the
proceeding two paragraphs, Section 145 requires that such
person be indemnified against expenses (including attorneys’
fees) actually and reasonably incurred by such person in
connection therewith.
Section 145 provides that expenses (including
attorneys’ fees) incurred by a director or officer in
defending any civil, criminal, administrative, or investigative
action, suit or proceeding may be paid by the corporation in
advance of the final disposition of such action, suit or
proceeding upon receipt of an undertaking by or on behalf of such
director or officer to repay such amount if it shall ultimately
be determined that such person is not entitled to be indemnified
by the corporation as authorized in Section 145.
The Company’s restated certificate of incorporation provides
for mandatory indemnification of directors and officers to the
fullest extent permitted by the General Corporation Law of the
State of Delaware.
The Underwriting Agreement filed herewith as Exhibit 1.1
provides for indemnification of the directors, certain officers
and controlling persons of the Company by the Underwriters
against certain civil liabilities, including liabilities under
the Securities Act.
Item 15.
Recent Sales Of Unregistered
Securities.
Pursuant to the Beasley Broadcast Group, Inc. Contribution
Agreement dated as of November 23, 1999, the registrant
agreed to issue shares of its Class A common stock to Reed
Miami Holdings, Inc. and J. Daniel Highsmith in exchange for
all of their interests held in Beasley-Reed Acquisition
Partnership and Beasley Broadcasting of Eastern North Carolina,
Incorporated. Under this agreement, Reed Miami Holdings, Inc. and
Mr. Highsmith will receive, on the effective date of this
registration statement, a total of 402,068 shares of Class A
common stock, which is the number of shares having the value of
their pre-offering interest in the entities that will become
Beasley Broadcast Group, Inc. Therefore, based on an initial
public offering price of $15.50, Beasley Broadcast Group will
receive approximately $6.2 million of value for the
interests in Beasley-Reed Acquisition Partnership and Beasley
Broadcasting of Eastern North Carolina, Incorporated in exchange
for approximately $6.2 million of shares of its Class A
common stock. These transactions are being effected without
registration under the Securities Act in reliance upon the
exemptions from registration contained in Section 4(2) of
the Securities Act. Section 4(2) exempts transactions by an
issuer not involving a public offering from the provisions of
Securities Act Section 5. The registrant offered
Class A common stock to these individuals, each of whom is
an accredited investor under Rule 501 under the Securities Act
and each of whom is actively involved in the management of radio
stations owned by the registrant, on a private basis not
involving a public offering.
Pursuant to the Beasley Broadcast Group, Inc. Contribution
Agreement dated as of November 23, 1999, the registrant
agreed to issue shares of its Class B common stock to George
G. Beasley, members of his immediate family and affiliated
trusts in exchange for all the interests held by these persons in
the companies the registrant will hold upon completion of its
initial public offering. Under this agreement, the Beasley family
members and affiliated trusts will receive on the effective date
of this registration statement a total of 17,021,373 shares of
Class B common stock, which is the number of shares having
the value of their pre-offering interest in the entities that
will become Beasley Broadcast Group, Inc. Therefore, based
on an initial public offering price of $15.50 for Class A
common stock, Beasley Broadcast Group will receive approximately
$263.8 million of value for the interests in the entities
that will become Beasley Broadcast Group in exchange for
approximately $263.8 million of shares of Class B
common stock. These transactions are being effected without
registration under the Securities Act in reliance upon the
exemptions from registration contained in Section 4(2) of
the Securities Act. Section 4(2) exempts transactions by an
II-2
Item 16.
Exhibits And Financial Statement
Schedules.
(a) The following exhibits are filed as part of this
registration statement:
II-3
(b) The financial statement schedule “Valuation and
Qualifying Accounts” is set forth on page F-20 of the
prospectus.
Item 17.
Undertakings.
The undersigned Registrant hereby undertakes to provide to the
underwriter at the closing specified in the Underwriting
Agreement, certificates in such denominations and registered in
such names as may be required by the underwriter to permit prompt
delivery to each purchaser.
Insofar as indemnification for liabilities arising under the
Securities Act may be permitted to directors, officers and
controlling persons of the Registrant pursuant to the provisions
described under Item 14 of this Registration Statement, or
otherwise, the Registrant has been advised that in the opinion of
the Securities and Exchange Commission such indemnification is
against public policy as expressed in the Securities Act and is,
therefore, unenforceable. If a claim for indemnification against
such liabilities (other than the payment by the Registrant of
expenses incurred or paid by a director, officer or controlling
person of the Registrant in the successful defense of any action,
suit or proceeding) is asserted by such director, officer or
controlling person in connection with the securities being
registered, the Registrant will, unless in the opinion of its
counsel the matter has been settled by controlling precedent,
submit to a court of appropriate jurisdiction the question
whether such indemnification by it is against public policy as
expressed in the Securities Act and will be governed by the final
adjudication of such issue.
II-4
The undersigned Registrant hereby undertakes that:
II-5
Securities and Exchange Commission Registration Fee
$
41,700
Nasdaq National Market Listing Fee
66,875
NASD Fee
15,500
Printing and Engraving Expenses
350,000
Accounting Fees and Expenses
250,000
Legal Fees and Expenses
572,425
Transfer Agent Fees and Expenses
3,500
Miscellaneous
—
Total
$
1,300,000
Table of Contents
Table of Contents
Exhibit
Number
Description
1.1*
Form of Underwriting Agreement.
2.1*
Asset Purchase Agreement of Radio Stations WAEC-AM and WWWE-AM in
Atlanta and Hapeville, Georgia, respectively, dated
August 26, 1999.
2.2*
Asset Purchase Agreement of Radio Station WRCA-AM in Waltham,
Massachusetts, dated December 31, 1999.
2.3*
Asset Purchase Agreement of Radio Stations WWNN-AM and WHSR-AM in
Pompano Beach, Florida and WSBR-AM in Boca Raton, Florida, dated
December 30, 1999.
3.1
Amended Certificate of Incorporation of the Registrant.
3.2
Amended and Restated Bylaws of the Registrant.
4.1
Form of Certificate of Class A Common Stock of the Registrant.
5.1
Opinion of Latham & Watkins.
10.1
George G. Beasley Executive Employment Agreement with Beasley
Mezzanine Holdings, LLC, dated January 31, 2000.
10.2
Bruce G. Beasley Executive Employment Agreement with Beasley
Mezzanine Holdings, LLC, dated January 31, 2000.
10.3
B. Caroline Beasley Executive Employment Agreement with Beasley
Mezzanine Holdings, LLC, dated January 31, 2000.
10.4
Brian E. Beasley Executive Employment Agreement with Beasley
Mezzanine Holdings, LLC, dated January 31, 2000.
10.5*
Credit Agreement between Beasley FM Acquisition Corp. and
affiliated entities and the Bank of Montreal, Chicago Branch, as
agent dated March 30, 1998.
10.6*
First Amendment to the Credit Facility between Beasley FM
Acquisition Corp. and affiliated entities and the Bank of
Montreal, Chicago Branch, as agent dated August 11, 1999.
10.7*
Second Amendment to the Credit Facility between Beasley FM
Acquisition Corp. and affiliated entities and the Bank of
Montreal, Chicago Branch, as agent dated December 30, 1999.
10.8*
Beasley Broadcast Group Contribution Agreement, dated as of
November 23, 1999 between Beasley Broadcast Group, Inc.,
George G. Beasley, Bruce G. Beasley, Brian E. Beasley, B.
Caroline Beasley, Bradley C. Beasley, Robert E. Beasley, Shirley
W. Beasley, J. Daniel Highsmith, Reed Miami Holdings, Inc.,
Beasley FM Acquisition Corp. and affiliated entities.
10.9*
Note of Indebtedness Issued to Beasley Broadcasting of
Philadelphia, Inc., in the Principal Amount of $24,545,566.53,
dated August 11, 1994.
10.10
*
Note of Indebtedness Issued to Beasley-Reed Broadcasting of
Miami, Inc., in the Principal Amount of $11,498,147.97, dated
August 11, 1994.
10.11
Third Amendment to Credit Facility between Beasley FM Acquisition
Corp. and affiliated entities and Bank of Montreal, Chicago
Branch, as agent, dated February 8, 2000.
Table of Contents
Exhibit
Number
Description
10.12
Form of Notes of Indebtedness by and between Beasley Broadcast
Group, Inc. and affiliates, dated January 31, 2000
10.13
The 2000 Equity Plan of Beasley Broadcast Group, Inc.
10.14
Form of Agreement of Sale of Four Communications Towers between
Beasley FM Acquisition Corp. and Beasley Family Towers, Inc.
10.15
Form of Agreement of Sale of a Communications Tower between
Beasley Broadcasting of Eastern North Carolina, Inc. and Beasley
Family Towers, Inc.
10.16
Form of Agreement of Sale of a Communications Tower between
Beasley Broadcasting of New Jersey, Inc. and Beasley Family
Towers, Inc.
10.17
Form of Agreement of Sale of a Communications Tower between
Beasley Broadcasting of Eastern Pennsylvania, Inc. and Beasley
Family Towers, Inc.
10.18
Form of Agreement of Sale of a Communications Tower between
Beasley Broadcasting of Coastal Carolina, Inc. and Beasley Family
Towers, Inc.
10.19
Form of Agreement of Sale of a Communications Tower between
Beasley Reed Acquisition Partnership and Beasley Family Towers,
Inc.
10.20
Form of Agreement of Sale of Three Communications Towers between
Beasley FM Acquisition Corp. and Beasley Family Towers, Inc.
21.1
Subsidiaries of the Company.
23.1
Consent of KPMG LLP
24.1*
Power of Attorney (see page II-5).
27.1
Restated Financial Data Schedule.
99.1*
Consent of Directors About to be Named
*
Filed previously.
Table of Contents
(1)
For purposes of determining any liability under the Securities
Act, the information omitted from the form of prospectus filed as
part of this Registration Statement in reliance upon Rule 430A
and contained in the form of prospectus filed by the Registrant
pursuant to Rule 424(b)(1) or (4) or 497(h) under the
Securities Act shall be deemed to be part of this Registration
Statement as of the time it was declared effective.
(2)
For the purpose of determining any liability under the Securities
Act, each post-effective amendment that contains a form of
prospectus shall be deemed to be a new registration statement
relating to the securities offered therein, and the offering of
such securities at that time shall be deemed to be the initial
bona fide offering thereof.
Table of Contents
SIGNATURES
Pursuant to the requirements of the Securities Act, the
registrant has duly caused this registration statement to be
signed on its behalf by the undersigned, thereunto duly
authorized, in Naples, Florida, on February 11, 2000.
Pursuant to the requirements of the Securities Act, this
registration statement has been signed by the following persons
in the capacities and on the dates indicated.
By:
/s/ B. CAROLINE BEASLEY
_______________________________________
B. Caroline Beasley
Vice President, Chief Financial Officer
Signature
Capacity
Date
*
George G. Beasley
Chairman of the Board, Chief Executive Officer (principal
executive officer)
February 11, 2000
*
Bruce G. Beasley
President, Chief Operating Officer and Director
February 11, 2000
*
Brian E. Beasley
Vice President of Operations and Director
February 11, 2000
/s/ B. CAROLINE BEASLEY
B. Caroline Beasley
Vice President, Chief Financial Officer, Secretary, Treasurer and
Director (principal financial officer and principal accounting
officer)
February 11, 2000
* By: /s/ B. CAROLINE BEASLEY
B. Caroline Beasley
Attorney-in-fact
II-6
EXHIBIT 3.1
RESTATED CERTIFICATE OF INCORPORATION
OF
BEASLEY BROADCAST GROUP, INC.
The undersigned, being the Chief Financial Officer, Vice President, Secretary and Treasurer of Beasley Broadcast Group, Inc., a corporation organized and existing under the laws of the State of Delaware, does hereby certify as follows:
1. The name of the corporation is Beasley Broadcast Group, Inc. The date of filing of its original Certificate of Incorporation, under the sane name, with the Secretary of State of Delaware was November 12, 1999.
2. Beasley Broadcast Group, Inc. has not received any payment for any of its stock.
3. This Restated Certificate of Incorporation, which restates, integrates and further amends the Certificate of Incorporation of Beasley Broadcast Group, Inc. has been duly adopted in accordance with the provisions of Sections 241 and 245 of the General Corporation Law of the State of Delaware.
4. The text of the Certificate of Incorporation of the Corporation is hereby amended and restated, in full, to read as follows:
ARTICLE I - Name
The name of the corporation is Beasley Broadcast Group, Inc. (hereinafter referred to as the "Corporation").
ARTICLE II - Registered Office
The post office address of the registered office of the Corporation in the State of Delaware is 1013 Centre Road, Wilmington, New Castle County, Delaware 19805. The name of the registered agent of the Corporation at that address is Corporation Service Company.
ARTICLE III - Purpose
The purpose of the Corporation is to engage in any lawful act or activity for which corporations may be organized under the General Corporation Law of the State of Delaware (the "DGCL").
ARTICLE IV - Capital Stock
Section 4.1 Authorized Shares. The total number of shares of capital stock which the Corporation has authority to issue is 235,000,000 shares, consisting of: (a) 10,000,000 shares of Preferred Stock, par value $.001 per share (the "Preferred Stock"), (b) 150,000,000 shares of Class A Common Stock, par value $.001 per share (the "Class A Common") and (c) 75,000,000 shares of Class B Common Stock, par value $.001 per share (the "Class B Common" and together with the Class A Common, the "Common Stock"). The Preferred Stock and the Common Stock are hereinafter sometimes collectively referred to as "Capital Stock."
Section 4.2 Preferred Stock. The Preferred Stock may be issued from time to time in one or more series. The Board of Directors of the Corporation shall have authority to fix by resolution or resolutions the designations and powers, preferences and relative participating, optional or other special rights and qualifications, limitations or restrictions thereof, including, without limitation, the voting rights, dividend rate, purchase or sinking funds, provisions for redemption, conversion rights, redemption price and liquidation preference, of any series of shares of Preferred Stock, to fix the number of shares constituting any such series and to increase or decrease the number of shares of any such series (but not below the number of shares thereof then outstanding). In case the number of shares of any such series shall be so decreased, the shares constituting such decrease shall resume the status which they had prior to the adoption of the resolution or resolutions originally fixing the number of shares of such series. The number of authorized shares of Preferred Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of shares representing a majority of the voting power of the Common Stock, without a vote of the holders of the Preferred Stock, or of any series thereof, unless a vote of any such holders is required pursuant to the terms of any Preferred Stock Certificate of Designations.
Section 4.3 Common Stock. Except as otherwise provided in Section 4.3 of this ARTICLE IV or as otherwise required by applicable law, all shares of Class A Common and Class B Common shall be identical in all respects and shall entitle the holders thereof to the same rights and privileges and shall be subject to the same qualifications, limitations and restrictions.
(a) Voting Rights. At every meeting of the stockholders, except as specifically otherwise required by law or provided below, the holders of Class A Common shall be entitled to one (1) vote per share, and the holders of Class B Common shall be entitled to ten (10) votes per share, on all matters presented for a vote of the stockholders of the Corporation; provided that, except as otherwise required by law, holders of Common Stock shall not be entitled to vote on any amendment to this Restated Certificate of Incorporation (including any Certificate of Designations relating to any series of Preferred Stock) that relates solely to the terms of one or more outstanding series of Preferred Stock if the holders of such affected series are entitled, either separately or together as a class with the holders of one or more other such series, to vote thereon by law or pursuant to this Restated Certificate of Incorporation (including any Certificate of Designations relating to any series of Preferred Stock). At every meeting of the stockholders called for the election of directors that occurs after the closing date of the initial public offering of the Corporation's Class A Common Stock, the holders of Class A Common, voting separately as a class, shall be entitled to elect two of the directors to be elected at such meeting. The holders of Class A Common and Class B Common, voting together as a class, shall be entitled to elect the remaining number of directors to be elected at such meeting. Directors elected by the holders of a class or classes of Common Stock may be removed without cause only by a vote of the holders of a majority of the voting power represented by the shares of such class or classes of Common Stock then outstanding. If, during the interval between annual meetings of stockholders for the election of directors, the number of directors who have been elected by the holders of any class or classes of Common Stock shall, by reason of resignation, death or removal, be reduced, the vacancy or vacancies in the directors elected by the holders of such class or classes of Common Stock may be filled by a majority vote of the remaining directors elected by the holders of such class or classes of Common Stock then in office. If there are no Class A Directors in office, then only the holders of the Class A Common Stock may fill such vacancies. Any director elected to fill any vacancy by the remaining directors then in office may be removed from office without cause by a vote of the holders of a majority of the voting power represented by the shares of such class or classes of Common Stock then outstanding. Any election of directors need not be by written ballot unless the Bylaws of the Corporation shall so provide. Except as otherwise required by law, the holders of the Class A Common and the holders of the Class B Common shall in all matters not specified in this Section 4.3(a) vote together as a single class, provided that the holders of shares of the Class A Common shall be entitled to one (1) vote per share and the holders of shares of the Class B Common shall be entitled to ten (10) votes per share. The number of authorized shares of Class A Common Stock may be increased or decreased (but not below the number of shares thereof then outstanding) by the affirmative vote of the holders of shares representing a majority of the voting power of the Common Stock, without a separate vote of the holders of the Class A Common.
(b) Dividends. As and when dividends are declared or paid with respect to shares of Common Stock, whether in cash, property or securities of the Corporation, the holders of Class A Common and the holders of Class B Common shall be entitled to receive such dividends pro rata
at the same rate per share for each such class of Common Stock; provided that if dividends are declared or paid in shares of Common Stock (or rights to subscribe for or purchase shares of Common Stock or securities or indebtedness convertible into or exchangeable for shares of Common Stock), the dividends payable to the holders of Class A Common shall be payable in shares of Class A Common (or rights to subscribe for or purchase shares of Class A Common or securities or indebtedness convertible into or exchangeable for shares of Class A Common) and the dividends payable to the holders of Class B Common shall be payable in shares of Class B Common (or rights to subscribe for or purchase shares of Class B Common or securities or indebtedness convertible into or exchangeable for shares of Class B Common). The rights of the holders of Common Stock to receive dividends are subject to the provisions of the Preferred Stock, including any resolution or resolutions adopted pursuant to the provisions of Section 4.2.
(c) Reservation. The Corporation shall at all times reserve and keep available out of its authorized but unissued shares of Common Stock Class A Common in a quantity sufficient to provide for the conversion of all outstanding shares of the Class B Common.
(d) Conversion of Class B Common. Subject to any necessary approval of the FCC (as hereinafter defined), the shares of Class B Common shall be convertible in whole or in part at any time at the option of the holder or holders thereof, into an equal number of fully paid and non-assessable shares of Class A Common. Such right shall be exercised by delivering to the office of the Corporation (i) the certificate or certificates representing the shares of Class B Common to be converted, duly endorsed in blank or accompanied by duly executed proper instruments of transfer, and (ii) written notice to the Corporation stating that such holder or holders elect(s) to convert such share or shares and stating the name and address in which each certificate for shares of Class A Common issued upon conversion is to be issued. Conversion shall be deemed to have been effected as of the date as of which the conversion is recorded on the books of the Corporation; provided, however, that to the extent a conversion shall require the approval of the FCC, the conversion shall become effective at such time and date as the order of the FCC approving such event shall be granted. The Corporation shall cause the transfer agent to deliver a certificate or certificates for the Class A Common as promptly as reasonably practicable after the conversion has been recorded on the books of the Corporation.
(e) Listing. If the shares of Class A Common required to be reserved for the purpose of conversion hereunder require listing on any national securities exchange or automated interdealer quotation system, before such shares are issued upon conversion, the Corporation will, at its expense and as expeditiously as possible, use its commercially reasonable best efforts to cause such shares to be so listed or duly approved for listing.
(f) No Charge. The issuance of certificates representing Class A Common upon conversion of Class B Common, as hereinabove set forth shall be made without charge or any expense or issuance tax in respect thereof; provided, however, that the Corporation shall not be required to pay any taxes which may be payable in respect of any transfer involved in the issuance and delivery of any certificate in a name other than that of the holder of the shares converted.
(g) Transfer of Class B Common.
(i) A Beneficial Owner (as hereinafter defined) of shares of Class B Common (herein referred to as a "Class B Stockholder") may transfer, directly or indirectly, shares of Class B Common, whether by sale, assignment, gift or otherwise, only to a Class B Permitted Transferee (as hereinafter defined) and no Class B Stockholder may otherwise transfer Beneficial Ownership (as hereinafter defined) of any shares of Class B Common. In the event of any attempted transfer of the Beneficial Ownership of any shares of Class B Common in violation of the limitation provided in the preceding sentence, the shares of Class B Common with respect to which the transfer of such Beneficial Ownership has been attempted shall be deemed to have been converted automatically, without further deed or action by or on behalf of any person, into shares of Class A Common. A "Class B Permitted Transferee" shall be, if the Class B Stockholder is an individual:
(A) the estate of the Class B Stockholder or any legatee, heir or distributees thereof;
(B) the spouse or former spouse of the Class B Stockholder;
(C) any parent or grandparent of the Class B Stockholder and any lineal descendant (including any adopted child) of the Class B Stockholder or of the Class B Stockholder's spouse or former spouse;
(D) any guardian or custodian (including a custodian for purposes of the Uniform Gift to Minors Act or Uniform Transfers to Minors Act) for, or any executor, administrator, conservator and/or other legal representative of, the Class B Stockholder and/or any Class B Permitted Transferee or Class B Permitted Transferees thereof;
(E) a trust (including a voting trust), and any savings or retirement account, such as an individual retirement account for purposes of federal income tax laws, whether or not involving a trust, principally for the benefit of such Class B Stockholder and/or any Class B Permitted Transferee or Class B Permitted Transferees thereof, including any trust in respect of which such Class B Stockholder and/or any Class B Permitted Transferee or Class B Permitted Transferees thereof has any general or special power of appointment or general or special non-testamentary power or special testamentary power of appointment limited to any Class B Permitted Transferee or Class B Permitted Transferees; and
(F) any corporation, partnership or other business entity if Substantial Beneficial Ownership thereof is held by such Class B Stockholder and/or any Class B Permitted Transferee or Class B Permitted Transferees thereof; provided, however, that if such Class B Stockholder, and all Class B Permitted Transferees thereof, cease, for whatever reason, to hold Substantial Beneficial Ownership of such corporation, partnership or other business entity, then any and all shares of Class B Common that such corporation, partnership or other business entity is the Beneficial Owner of shall be deemed to be converted automatically, without further deed or action by or on behalf of any person, into shares of Class A Common; and
(G) the Corporation.
A "Class B Permitted Transferee" shall be, if the Class B Stockholder is a corporation, partnership or other business entity:
(A) any employee benefit plan, or trust thereunder or therefor, sponsored by the Class B Stockholder;
(B) any trust (including any voting or liquidating trust)
principally for the benefit of the Class B Stockholder and/or any Class B
Permitted Transferee or Class B Permitted Transferees thereof;
(C) any corporation, partnership or other business entity if Substantial Beneficial Ownership thereof is held by such Class B Stockholder and/or any Class B Permitted Transferee or Class B Permitted Transferees thereof; provided, however, that if such Class B Stockholder, and all Class B Permitted Transferees thereof, cease, for whatever reason, to hold Substantial Beneficial Ownership of such corporation, partnership or other business entity, then any and all shares of Class B Common that such corporation, partnership or other business entity is the Beneficial Owner of shall convert automatically, without further deed or action by or on behalf of any person, into shares of Class A Common;
(D) the stockholders of the corporation, partners of the partnership
or other owners of equity interests in any other business entity, who receive
such shares, by way of dividend or distribution (upon dissolution, liquidation
or otherwise), provided that such transfer will not result in Beneficial
Ownership of any of such shares by any person who did not have the power to
control such corporation, partnership or business entity at the time such
corporation, partnership or business entity first acquired Beneficial Ownership
of such shares of Class B Common (other than by any person who qualifies as a
Class B Permitted Transferee pursuant to any other provision of this paragraph
(i) of this Section 4.3(g)); and
(E) the Corporation.
(ii) Any person who holds shares of Class B Common for the Beneficial Ownership of another, including (A) any broker or dealer in securities; (B) any clearing house; (C) any bank, trust company, savings and loan association or other financial institution; (D) any other nominee; and (E) any savings plan or account or related trust, such as an individual retirement account, principally for the benefit of any individual, may transfer such shares to the person or persons for whose benefit it holds such shares. Notwithstanding anything to the contrary set forth herein, any holder of Class B Common may pledge such shares to a pledgee pursuant to a bona fide pledge of such shares as collateral security for indebtedness due to the pledgee, provided that such shares may not be transferred to or registered in the name of the pledgee unless such pledgee is a Class B Permitted Transferee. In the event of foreclosure or other similar action by the pledgee, such pledged shares shall automatically, without any act or deed on the part of the Corporation or any other person, be converted into shares of Class A
Common unless within five business days after such foreclosure or similar event such pledged shares are returned to the pledgor or transferred to a Class B Permitted Transferee. The foregoing provisions of this paragraph shall not be deemed to restrict or prevent any transfer of such shares by operation of law upon incompetence, death, dissolution or bankruptcy of any Class B Stockholder or any provision of law providing for, or judicial order of, forfeiture, seizure or impoundment; provided that any shares so transferred by operation of law other than to a Class B Permitted Transferee shall convert automatically into shares of Class A Common.
(iii) Any transferee of shares of Class B Common pursuant to a transfer made in violation of paragraphs (i) and (ii) of this Section 4.3(g) shall have no rights as a stockholder of the Corporation and no other rights against or with respect to the Corporation except the right to receive, in accordance with paragraph (ii) of Section 4.3(d) or paragraphs (i) and (ii) of this Section 4.3(g), as applicable, shares of Class A Common upon the conversion of such transferred shares. Notwithstanding any other provision of this Restated Certificate of Incorporation, the Corporation shall, to the full extent permitted by law, be entitled to issue shares of Class B Common to any person from time to time.
(iv) The Corporation and any transfer agent of Class B Common may as a condition to the transfer or the registration of any transfer of shares of Class B Common permitted by paragraphs (i) and (ii) of this Section 4.3(g) require the furnishing of such affidavits or other proof as they deem necessary to establish that such transferee is a Class B Permitted Transferee.
(h) No Interference. Except as otherwise provided in ARTICLE IX of this Restated Certificate of Incorporation, the Corporation will not close its books against the transfer of any share of Common Stock or of any of the shares of Common Stock issued or issuable upon the conversion of such shares of Common Stock in any manner which interferes with the timely conversion of any of such shares.
(i) Mergers, Consolidations. In the case of a merger or consolidation which reclassifies or changes the shares of Common Stock, or in the case of the consolidation or merger of the Corporation with or into another corporation or corporations or the transfer of all or substantially all of the assets of the Corporation to another corporation or corporations, each share of Class B Common shall thereafter be convertible into the number of shares of stock or other securities or property to which a holder of shares of Class A Common would have been entitled upon such reclassification, change, consolidation, merger or transfer, and, in any such case, appropriate adjustment (as determined in good faith by the Corporation's Board of Directors) shall be made in the application of the provisions herein set forth with respect to the rights and interests thereafter of the holders of the Class B Common to the end that the provisions set forth herein shall thereafter be applicable, as nearly as reasonably may be practicable, in relation to any shares of stock or other securities on property thereafter deliverable upon the conversion of shares of Class B Common. In case of any such merger or consolidation, the resulting or surviving corporation (if not the Corporation) shall expressly assume the obligation to deliver, upon conversion of the Class B Common, such stock or other securities or property as the holders of the Class B Common remaining outstanding shall be entitled to receive pursuant to the
provisions hereof, and to make provisions for the protection of the conversion rights provided for in this ARTICLE IV.
(j) Liquidation, Dissolution or Winding Up. Subject to the provisions of the Preferred Stock, including any resolution or resolutions adopted pursuant to the provisions of Section 4.2, in the event of any Liquidation of the Corporation, all remaining assets of the Corporation shall be distributed to holders of the Common Stock pro rata at the same rate per share of each class of Common Stock according to their respective holdings of shares of the Common Stock.
(k) Stock Splits. The Corporation shall not in any manner subdivide or combine (by any stock split, stock dividend, reclassification, recapitalization or otherwise) the outstanding shares of one class of Common Stock unless the outstanding shares of all classes of Common Stock shall be proportionately subdivided or combined.
Section 4.4 Definitions. The following terms shall have the following meanings:
"Advance of Expenses" has the meaning set forth in Section 8.2.
"Affiliate" means, with respect to any Person, any other Person directly or indirectly controlling, controlled by or under common control with such Person (it being understood that for purposes of this definition, the term "control" (including with correlative meaning the terms "controlling," "controlled by" and "under common control with"), as used with respect to any Person, shall mean the possession, directly or indirectly, of the power to direct or cause the direction of the management and policies of such Person, whether through the ownership of voting securities or by contract or otherwise).
"Alien" has the meaning set forth in Section 9.1(a).
"Alien Ownership Restrictions" has the meaning set forth in Section 9.1(d).
"Beneficial Owner" in respect of shares of Class B Common shall mean the person or persons who possess Beneficial Ownership.
"Beneficial Ownership" in respect of shares of Class B Common shall mean possession of the power and authority, either singly or jointly with another, to vote or dispose of or to direct the voting or disposition of such shares.
"Capital Stock" has the meaning set forth in Section 4.1.
"Class A Common" has the meaning set forth in Section 4.1.
"Class B Common" has the meaning set forth in Section 4.1.
"Class B Permitted Transferee" has the meaning set forth in Section 4.3(g).
"Class B Stockholder" has the meaning set forth in Section 4.3(g).
"Common Stock" has the meaning set forth in Section 4.1.
"Communications Act" has the meaning set forth in Section 9.1.
"Corporation" has the meaning set forth in Article I.
"DGCL" has the meaning set forth in Article III.
"FCC" has the meaning set forth in Section 9.1.
"Final Adjudication" has the meaning set forth in Section 8.2.
"Indemnitee" has the meaning set forth in Section 8.2.
"Person" means an individual, a partnership, a joint venture, a corporation, an association, a joint stock company, a limited liability company, a trust, an unincorporated association and any other entity or organization.
"Preferred Stock" has the meaning set forth in Section 4.1.
"Proceeding" has the meaning set forth in Section 8.2.
"Redemption Date" has the meaning set forth in Section 9.1(e).
"Subsidiary" means any corporation with respect to which another specified corporation has the power to vote or direct the voting of sufficient securities to elect directors having a majority of the voting power of the board of directors of such corporation.
"Substantial Beneficial Ownership" in respect of any corporation, partnership or other business entity shall mean possession of the power and authority, either singly or jointly with another, to vote or dispose of or to direct the voting or disposition of at least 80% of each class of equity ownership interest in such corporation, partnership or other business entity.
"Undertaking" has the meaning set forth in Section 8.2.
ARTICLE V - Existence
The Corporation is to have a perpetual existence.
ARTICLE VI - General Provisions
Section 6.1 Board of Directors. Subject to Section 4.3(a) hereof, the Board of Directors shall be comprised of the number of directors specified in the Corporation's Bylaws, and such directors shall be elected in the manner contemplated by such Bylaws.
Section 6.2 The Board of Directors of the Corporation shall have concurrent power with the holders of Class A Common and Class B Common to adopt, amend or repeal the Bylaws of the Corporation.
ARTICLE VII - Amendments
The Corporation reserves the right to amend, alter, change or repeal any provision contained in this Restated Certificate of Incorporation in the manner now or hereinafter prescribed herein and by the laws of the State of Delaware, and all rights conferred upon stockholders herein are granted subject to this reservation.
ARTICLE VIII - Liability
Section 8.1 Limitation of Liability.
(a) To the fullest extent permitted by the DGCL as it now exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide broader indemnification rights than permitted as of the date this Restated Certificate of Incorporation is filed with the State of Delaware), no director of the Corporation shall be liable to the Corporation or its stockholders for monetary damages arising from a breach of fiduciary duty owed to the Corporation or its stockholders.
(b) Any repeal or modification of the foregoing paragraph by the stockholders of the Corporation shall not adversely affect any right or protection of a director of the Corporation existing at the time of such repeal or modification.
Section 8.2 Right to Indemnification. Each person who was or is made party or is threatened to be made a party to or is otherwise involved (including involvement as a witness) in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "proceeding"), by reason of the fact that he or she is or was a director or officer of the Corporation or, while a director or officer of the Corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter, an "indemnitee"), whether the basis of such proceeding is alleged action in an official capacity as a director or officer or in any other capacity while serving as a director or officer, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the DGCL, as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide for broader indemnification rights than permitted as of the date this Restated Certificate of Incorporation is filed with the State of Delaware), against all expense, liability and loss (including attorneys' fees, judgments, fines, excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith and such indemnification shall continue as to an indemnitee who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the indemnitee's heirs, executors and
administrators; provided, however, that except as provided in Section 8.3 of this ARTICLE VIII with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the Board of Directors of the Corporation. The right to indemnification conferred in this Section 8.2 of this ARTICLE VIII shall be a contract right and shall include the obligation of the Corporation to pay the expenses incurred in defending any such proceeding in advance of its final disposition (hereinafter an "advance of expenses"); provided, however, that if and to the extent that the Board of Directors of the Corporation requires, an advance of expenses incurred by an indemnitee in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by such indemnitee, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking (hereinafter an "undertaking"), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a "final adjudication") that such indemnitee is not entitled to be indemnified for such expenses under this Section 8.2 or otherwise. The Corporation may provide indemnification to employees and agents of the Corporation with the same or lesser scope and effect as the foregoing indemnification of directors and officers.
Section 8.3 Procedure for Indemnification. Any indemnification of a director or officer of the Corporation or advance of expenses under Section 8.2 of this ARTICLE VIII shall be made promptly, and in any event within forty-five days (or, in the case of an advance of expenses, twenty days) upon the written request of the director or officer. If a determination by the Corporation that the director or officer is entitled to indemnification pursuant to this ARTICLE VIII is required, and the Corporation fails to respond within sixty days to a written request for indemnity, the Corporation shall be deemed to have approved the request. If the Corporation denies a written request for indemnification or advance of expenses, in whole or in part, or if payment in full pursuant to such request is not made within forty-five days (or, in the case of an advance of expenses, twenty days), the right to indemnification or advances as granted by this ARTICLE VIII shall be enforceable by the director or officer in any court of competent jurisdiction. Such person's costs and expenses incurred in connection with successfully establishing his or her right to indemnification, in whole or in part, in any such action shall also be indemnified by the Corporation. It shall be a defense to any such action (other than an action brought to enforce a claim for the advance of expenses where the undertaking required pursuant to Section 8.2 of this ARTICLE VIII, if any, has been tendered to the Corporation) that the claimant has not met the standards of conduct which make it permissible under the DGCL for the Corporation to indemnify the claimant for the amount claimed, but the burden of such defense shall be on the Corporation. Neither the failure of the Corporation (including its directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its directors, independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct.
Section 8.4 Insurance. The Corporation may purchase and maintain insurance on its own behalf and on behalf of any person who is or was a director, officer, employee or agent of the Corporation or was serving at the request of the Corporation as a director, officer, employee or agent of another Corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss asserted against him or her and incurred by him or her in any such capacity, whether or not the Corporation would have the power to indemnify such person against such expenses, liability or loss under the DGCL.
Section 8.5 Service for Subsidiaries. Any person serving as a director, officer, employee or agent of another Corporation, partnership, limited liability company, joint venture or other enterprise, at least 50% of whose equity interests are owned by the Corporation (hereinafter a "subsidiary" for this ARTICLE VIII) shall be conclusively presumed to be serving in such capacity at the request of the Corporation.
Section 8.6 Reliance. Persons who after the date of the adoption of this provision become or remain directors or officers of the Corporation or who, while a director or officer of the Corporation, become or remain a director, officer, employee or agent of a subsidiary, shall be conclusively presumed to have relied on the rights to indemnity, advance of expenses and other rights contained in this ARTICLE VIII in entering into or continuing such service. The rights to indemnification and to the advance of expenses conferred in this ARTICLE VIII shall apply to claims made against an indemnitee arising out of acts or omissions which occurred or occur both prior and subsequent to the adoption hereof.
Section 8.7 Non-Exclusivity of Rights. The rights to indemnification and to the advance of expenses conferred in this ARTICLE VIII shall not be exclusive of any other right which any person may have or hereafter acquire under this Restated Certificate of Incorporation or under any statute, Bylaw, agreement, vote of stockholders or disinterested directors or otherwise.
Section 8.8 Merger or Consolidation. For purposes of this ARTICLE VIII, references to "the Corporation" shall include any constituent corporation (including any constituent of a constituent) absorbed into the Corporation in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same position under this ARTICLE VIII with respect to the resulting or surviving corporation as he or she would have with respect to such constituent corporation if its separate existence had continued.
ARTICLE IX - Alien Ownership of Stock
Section 9.1 General. The following provisions are included for the purpose of ensuring that the control and management of the Corporation remain with citizens of the United States
and/or corporations formed under the laws of the Unites States or any of the states of the United States, as required by the Communications Act of 1934, as amended, and the rules and regulations promulgated thereunder, as the same may be amended from time to time (collectively, the "Communications Act"):
(a) Definition of Alien. "Alien" shall mean: (i) a person who is a citizen of a country other than the United States; (ii) any entity organized under the laws of a government other than the government of the United States or any state, territory, or possession of the United States; (iii) a government other than the government of the United States or of any state, territory, or possession of the United States; or (iv) a representative of, or an individual or entity controlled by, any of the foregoing.
(b) Restrictions on Issuances and Transfer. The Corporation shall not issue
any shares of capital stock of the Corporation if such issuance would result in
the total number of shares of such capital stock held or voted by Aliens (or for
or by the account of Aliens) to exceed 25% of: (i) the total number of all
shares of such capital stock outstanding at any time and from time to time, or
(ii) the total voting power of all shares of such capital stock outstanding and
entitled to vote at any time and from time to time. The Corporation shall not
permit the transfer on the books of the Corporation of any capital stock to any
Alien that would result in the total number of shares of such capital stock held
or voted by Aliens (or for or by the account of Aliens) exceeding such 25%
limits.
(c) Restrictions on Ownership by Aliens. No Alien or Aliens, individually or collectively, shall be entitled to vote or direct or control the vote of more than 25% of: (i) the total number of all shares of capital stock of the Corporation outstanding at any time and from time to time, or (ii) the total voting power of all shares of capital stock of the Corporation outstanding and entitled to vote at any time and from time to time, and issuances and transfers of capital stock of the Corporation in violation of this subsection (c) shall be prohibited.
(d) Powers of the Board of Directors to Implement Alien Ownership Restrictions. The Board of Directors shall have all powers necessary to implement the provisions of this Article IX and to ensure compliance with the alien ownership restrictions (the "Alien Ownership Restrictions") of the Communications Act, including, without limitation, the power to prohibit the transfer of any shares of capital stock of the Corporation to any Alien, to prohibit the vote by any Alien, and to take or cause to be taken such action as it deems appropriate to implement such prohibition, including placing a legend regarding restrictions on foreign ownership of the capital stock on certificates representing such capital stock.
(e) Redemption. Without limiting the generality of the foregoing and notwithstanding any other provision of this Restated Certificate of Incorporation to the contrary, any shares of capital stock of the Corporation determined by the Board of Directors to be owned by an Alien or Aliens shall always be subject to redemption by the Corporation by action of the Board of Directors, pursuant to Section 151(b)(2) of the DGCL, or any other applicable provision of law, to the extent necessary in the judgment of the Board of Directors to comply with the Alien Ownership Restrictions. The terms, conditions and procedures of such redemption shall be as
follows: (i) the redemption price of the shares to be redeemed pursuant to this Article IX shall be equal to the fair market value of the shares to be redeemed, as determined by the Board of Directors in good faith; (ii) the redemption price of such shares may be paid in cash, securities or any combination thereof; (iii) if the aggregate redemption price for all of the Alien-owned shares to be redeemed exceeds $5 million in the aggregate during any one year period consisting of any twelve (12) consecutive calendar months, then the Corporation may elect to pay the balance of any redemption price after the Corporation has paid $5 million in any such period in installments not to exceed $5 million per year in the aggregate, with interest payable semi-annually at a rate equal to the six-month LIBOR rate for such six-month period from time to time as determined by the Board of Directors in good faith; (iv) if less than all the shares held by Aliens are to be redeemed, the shares to be redeemed shall be selected in any manner determined by the Board of Directors to be fair and equitable; (v) at least 10 days' prior written notice of the redemption, which notice shall specify the date the redemption is to be effective (the "Redemption Date"), shall be given to the holders of record of the shares selected to be redeemed (unless waived in writing by any such holder), provided that the Redemption Date may be the date on which written notice shall be given to holders if the cash or securities necessary to effect the redemption shall have been deposited in trust for the benefit of such holders and such cash and securities are subject to immediate withdrawal by them upon surrender of the stock certificates for their shares to be redeemed duly endorsed in blank or accompanied by duly executed proper instruments of transfer; (vi) from and after the Redemption Date, the shares to be redeemed shall cease to be regarded as outstanding and any and all rights of the holders in respect of the shares to be redeemed or attaching to such shares of whatever nature (including without limitation any rights to vote or participate in dividends declared on capital stock of the same class or series as such shares excepting only payment of dividends declared prior to the Redemption Date for which the record date precedes the Redemption Date) shall cease and terminate, and the holders thereof thereafter shall be entitled only to receive the cash or securities payable upon redemption; and (vii) such other terms and conditions as the Board of Directors shall determine.
ARTICLE X - Section 203 Election
The Corporation expressly elects not to be governed by Section 203 of Title 8 of the DGCL.
IN WITNESS WHEREOF, said Beasley Broadcast Group, Inc. has caused this Restated Certificate of Incorporation to be signed by B. Caroline Beasley, Vice President, Chief Financial Officer, Secretary and Treasurer this 9th day of February, 2000.
BEASLEY BROADCAST GROUP, INC.
By: /s/ B. Caroline Beasley
-----------------------------------------
Name: B. Caroline Beasley
Title: Vice President, Chief Financial
Officer, Secretary and Treasurer
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EXHIBIT 3.2
AMENDED AND RESTATED
BYLAWS
OF
BEASLEY BROADCAST GROUP, INC.
TABLE OF CONTENTS
PAGE
ARTICLE I - OFFICES 1
Section 1. Registered Office 1
Section 2. Other Offices 1
ARTICLE II - MEETINGS OF STOCKHOLDERS 1
Section 1. Place and Time of Meetings 1
Section 2. Notice 1
Section 3. Stockholders List 2
Section 4. Quorum 2
Section 5. Vote Required 3
Section 6. Voting Rights 3
Section 7. Proxies 3
ARTICLE III - DIRECTORS 4
Section 1. Number, Election and Term of Office 4
Section 2. Removal and Resignation 4
Section 3. Vacancies 4
Section 4. Annual Meetings 5
Section 5. Other Meetings and Notice 5
Section 6. Quorum 5
Section 7. Committees 5
Section 8. Committee Rules 6
Section 9. Communications Equipment 6
Section 10. Action by Written Consent 6
ARTICLE IV - OFFICERS 6
Section 1. Number 6
Section 2. Election and Term of Office 7
Section 3. Removal 7
Section 4. Vacancies 7
Section 5. Compensation 7
Section 6. Chairman of the Board 7
Section 7. The Chief Executive Officer 8
Section 8. The President 8
Section 9. Vice Presidents 9
Section 10. The Secretary and Assistant Secretaries 9
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Section 11. The Treasurer and Assistant Treasurer 9 Section 12. Other Officers, Assistant Officers and Agents 10 ARTICLE V - INDEMNIFICATION OF OFFICERS, DIRECTORS AND OTHERS 10 Section 1. Right to Indemnification 10 Section 2. Procedure for Indemnification 12 Section 3. Insurance 13 Section 4. Service of Subsidiaries 13 Section 5. Reliance 13 Section 6. Non-Exclusivity of Rights 14 Section 7. Merger or Consolidation 14 ARTICLE VI - CERTIFICATES OF STOCK 14 Section 1. Form 14 Section 2. Lost Certificates 15 Section 3. Fixing a Record Date 15 ARTICLE VII - GENERAL PROVISIONS 16 Section 1. Dividends 17 Section 2. Checks, Drafts or Orders 17 Section 3. Contracts 17 Section 4. Loans 17 Section 5. Fiscal Year 18 Section 6. Corporate Seal 18 Section 7. Voting Securities Owned by Corporation 18 Section 8. Inspection of Books and Records 18 Section 9. Section Headings 18 Section 10. Inconsistent Provisions 19 ARTICLE VII - AMENDMENTS 19 |
ARTICLE I - OFFICES
Section 1. The registered office of Beasley Broadcast Group, Inc. (the "Corporation") shall be in the City of Wilmington, County of New Castle, State of Delaware.
Section 2. The Corporation may also have offices at such other places both within and without the State of Delaware as the Board of Directors may from time to time determine or the business of the Corporation may require.
ARTICLE II - MEETINGS OF STOCKHOLDERS
Section 1. Place and Time of Meetings. An annual meeting of the stockholders shall be held each year on a date and time designated by the Board of Directors. At such meeting, the stockholders shall elect the directors of the corporation and conduct such other business as may come before the meeting. The time and place of the annual meeting shall be determined by the Board of Directors. Special meetings of the stockholders, for any purpose, or purposes, unless otherwise prescribed by statute or by the Restated Certificate of Incorporation, may be called by the President and shall be called by the President or the Secretary at the request in writing of a majority of the Board of Directors, or at the request in writing of stockholders owning a majority in amount of the entire voting power of the issued and outstanding capital stock of the Corporation, provided, however, that if there are two vacancies in the offices for the Class A Directors (as defined in Article III, Section 1 below), then holders of a majority of the Class A Common Stock outstanding shall have the right to call a special meeting of stockholders for the purpose of electing Class A Directors to fill such vacancies. Such request shall state the purpose or purposes of the proposed meeting. Business transacted at any special meeting of stockholders shall be limited to the purposes stated in the notice.
Section 2. Notice. Whenever stockholders are required or permitted to take action
at a meeting, written or printed notice of every annual or special meeting of the stockholders, stating the place, date, time, and, in the case of special meetings, the purpose or purposes, of such meeting, shall be given to each stockholder entitled to vote at such meeting not less than l0 nor more than 60 days before the date of the meeting. All such notices shall be delivered, either personally or by mail, by or at the direction of the Board of Directors, the Chairman of the Board, the Chief Executive Officer, the President or the Secretary, and if mailed, such notice shall be deemed to be delivered when deposited in the United States mail with postage prepaid and addressed to the stockholder at his or her address as it appears on the records of the corporation.
Section 3. Stockholders List. The officer having charge of the stock ledger of the corporation shall make, at least l0 days before every meeting of the stockholders, a complete list arranged in alphabetical order of the stockholders entitled to vote at such meeting, specifying the address of and the number of shares registered in the name of each stockholder. Such list shall be open to the examination of any stockholder, for any purpose germane to the meeting, during ordinary business hours, for a period of at least l0 days prior to the meeting, either at a place within the city where the meeting is to be held, which place shall be specified in the notice of the meeting or, if not so specified, at the place where the meeting is to be held. The list shall also be produced and kept at the time and place of the meeting during the whole time thereof, and may be inspected by any stockholder who is present.
Section 4. Quorum. The presence of stockholders entitled to cast at least a majority of the votes that all stockholders are entitled to cast on a matter to be acted upon at a meeting of the stockholders shall constitute a quorum for the purposes of consideration and action on the matter, except as otherwise provided by statute or by the Restated Certificate of Incorporation. If a quorum is not present, the holders of the shares present in person or represented by proxy at the meeting and entitled to vote thereat shall
have the power, by the affirmative vote of the holders of a majority of the voting power represented by such shares, to adjourn the meeting to another time or place. Unless the adjournment is for more than thirty days or unless a new record date is set for the adjourned meeting, no notice of the adjourned meeting need be given to any stockholder, provided that the time and place of the adjourned meeting were announced at the meeting at which the adjournment was taken. At the adjourned meeting, the corporation may transact any business which might have been transacted at the original meeting.
Section 5. Vote Required. When a quorum is present or represented by proxy at any meeting, the vote of a majority of the votes cast by all stockholders entitled to vote and, if any stockholders are entitled to vote as a class, the vote of a majority of the votes cast by the stockholders entitled to vote as a class, whether such stockholders are present in person or represented by proxy at the meeting, shall be the act of the stockholders, unless the question is one upon which by express provisions of an applicable statute or of the Restated Certificate of Incorporation a different vote is required, in which case such express provision shall govern and control the decision of such question.
Section 6. Voting Rights. Except as otherwise provided by the Delaware General Corporation Law or by the Restated Certificate of Incorporation of the Corporation or any amendments thereto and subject to Section 3 of ARTICLE VI hereof, each holder of Class A Common Stock shall at every meeting of the stockholders be entitled to one vote in person or by proxy for each share of Class A held by such stockholder, and each holder of Class B Common Stock shall at every meeting of the stockholders shall be entitled to ten votes in person or by proxy for each share of Class B Common Stock held by such stockholder.
Section 7. Proxies. Each stockholder entitled to vote at a meeting of stockholders or to express consent or dissent to corporate action in writing without a meeting may authorize another person or persons to act for him or her by proxy, but no such proxy
shall be voted or acted upon after three years from its date, unless the proxy provides for a longer period.
ARTICLE III - DIRECTORS
Section 1. Number, Election and Term of Office. The number of directors which shall constitute the whole Board shall be not less than one (1) and not more than nine (9). The exact number of directors shall be determined by resolution of the Board, and the initial number of directors shall be four (4), and, effective upon the closing of the initial public offering of the Corporation's Class A Common Stock, the number of directors shall be increased to six (6). The directors need not be stockholders. The directors shall be elected at the annual meeting of the stockholders, except as provided in Section 2 of this Article, and each director elected shall hold office until his successor is elected and qualified or until his or her death, resignation or removal. From and after the first annual meeting of stockholders that occurs after the closing date of the initial public offering of the Corporation's Class A Common Stock, the Board of Directors shall include two directors elected by the holders of the Class A Common Stock by class vote pursuant to the Restated Certificate of Incorporation of the Corporation (the "Class A Directors").
Section 2. Removal and Resignation. Any director or the entire board of directors may be removed at any time, with or without cause, by the vote of a majority of the votes cast by all stockholders entitled to vote at an election of directors, except that the Class A Directors may be removed without cause only by the vote of the holders of a majority of the shares of Class A Common Stock, and except as otherwise provided by statute. Any director may resign at any time upon written notice to the corporation.
Section 3. Vacancies. Vacancies and newly created directorships resulting from any increase in the authorized number of directors may be filled only by the vote of a majority of the votes cast by all stockholders then entitled to vote at an election of directors at an annual or special meeting of stockholders, and each director so chosen shall hold office until the next annual meeting of stockholders and until a successor is duly elected and qualified or until his or her earlier death, resignation or removal as
hereinafter provided; provided, however, that any vacancy resulting from the resignation or removal of a Class A Director shall be filled by the remaining Class A Director, or, if there is no remaining Class A Director, by the vote of the holders of a majority of the shares of Class A Common Stock.
Section 4. Annual Meetings. The annual meeting of each newly elected board of directors shall be held without other notice than this bylaw immediately after, and at the same place as, the annual meeting of stockholders.
Section 5. Other Meetings and Notice. Regular meetings, other than the annual meeting, of the board of directors may be held without notice at such time and at such place as shall from time to time be determined by resolution of the board. Special meetings of the board of directors may be called by or at the request of the chairman, the chief executive officer or the president on at least 24 hours notice to each director, either personally, by telephone, by mail, or by telegraph; in like manner and on like notice the secretary must call a special meeting on the written request of a majority of directors.
Section 6. Quorum. A majority of the total number of directors shall constitute a quorum for the transaction of business. The vote of a majority of directors present at a meeting at which a quorum is present shall be the act of the board of directors. If a quorum shall not be present at any meeting of the board of directors, the directors present thereat may adjourn the meeting from time to time, without notice other than announcement at the meeting, until a quorum shall be present.
Section 7. Committees. The board of directors may, by resolution passed by a majority of the whole board, designate one or more committees. Each committee shall consist of one or more of the directors of the corporation, which, to the extent provided in such resolution and not otherwise limited by statute, shall have and may exercise the powers of the board of directors in the management and affairs of the Corporation including without limitation the power to declare a dividend and to authorize the issuance
of stock. The board of directors may designate one or more directors as alternate members of any committee, who may replace any absent or disqualified member at any meeting of the committee. Such committee or committees shall have such name or names as may be determined from time to time by resolution adopted by the board of directors. Each committee shall keep regular minutes of its meetings and report the same to the directors when required.
Section 8. Committee Rules. Each committee of the board of directors may fix its own rules of procedure and shall hold its meetings as provided by such rules, except as may otherwise be provided by the resolution of the board of directors designating such committee, but in all cases the presence of at least a majority of the members of such committee shall be necessary to constitute a quorum. In the event that a member and that member's alternate, if alternates are designated by the board of directors as provided in Section 7 of this ARTICLE III, of such committee is/are absent or disqualified, the member or members thereof present at any meeting and not disqualified from voting, whether or not such member or members constitute a quorum, may unanimously appoint another member of the board of directors to act at the meeting in place of any such absent or disqualified member.
Section 9. Communications Equipment. Members of the board of directors or any committee thereof may participate in and act at any meeting of such board or committee through the use of a conference telephone or other communications equipment by means of which all persons participating in the meeting can hear each other, and participation in the meeting pursuant to this section shall constitute presence in person at the meeting.
Section 10. Action by Written Consent. Any action required or permitted to be taken at any meeting of the board of directors, or of any committee thereof, may be taken without a meeting if all members of the board or committee, as the case may be, consent thereto in writing, and the writing or writings are filed with the minutes of proceedings of
the board of directors or committee.
ARTICLE IV - OFFICERS
Section 1. Number. The officers of the Corporation shall be elected by the board of directors and shall consist of a chairman of the board (if the board of directors so deems advisable and elects), a president (who shall perform the functions of the chairman of the board if none be elected), one or more vice-presidents, a secretary, a treasurer, and such other officers and assistant officers as may be deemed necessary or desirable by the board of directors. Any number of offices may be held by the same person. In its discretion, the board of directors may choose not to fill any office for any period as it may deem advisable, except the offices of president and secretary.
Section 2. Election and Term of Office. The officers of the Corporation shall be elected annually by the board of directors at the meeting of the board of directors held after each annual meeting of stockholders. If the election of officers shall not be held at such meeting, such election shall be held as soon thereafter as conveniently may be. Vacancies may be filled or new offices created and filled at any meeting of the board of directors. Each officer shall hold office until the next annual meeting of the board of directors and until a successor is duly elected and qualified or until his or her earlier death, resignation or removal as hereinafter provided.
Section 3. Removal. Any officer or agent elected by the board of directors may be removed by the board of directors whenever in its judgment the best interest of the Corporation would be served thereby, but such removal shall be without prejudice to the contract rights, if any, of the person so removed.
Section 4. Vacancies. A vacancy in any office because of death, resignation, removal, disqualification or otherwise, may be filled by the board of directors for the unexpired portion of the term by the board of directors then in office.
Section 5. Compensation. Compensation of all officers shall be fixed by the board
of directors, and no officer shall be prevented from receiving such compensation by virtue of the fact that he or she is also a director of the corporation.
Section 6. Chairman of the Board. The chairman shall preside at all meetings of the board of directors and all meetings of the stockholders and shall have such other powers and perform such duties as may from time to time be assigned to him by the board of directors.
Section 7. The Chief Executive Officer. The chief executive officer of the Corporation shall have such powers and perform such duties as are specified in these bylaws and as may from time to time be assigned to him by the board of directors. The chief executive officer shall have overall management of the business of the Corporation and its subsidiaries and shall see that all orders and resolutions of the boards of directors of the Corporation and its subsidiaries are carried into effect. The chief executive officer shall execute bonds, mortgages and other contracts requiring a seal, under the seal of the corporation, except where required or permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the board of directors to some other officer or agent of the corporation. The chief executive officer shall have general powers of supervision and shall be the final arbitrator of all differences among officers of the Corporation and its subsidiaries, and such decision as to any matter affecting the Corporation and its subsidiaries subject only to the boards of directors.
Section 8. The President. The president shall have such powers and perform such duties as are specified in these bylaws and as may from time to time be assigned to him by the board of directors. The president shall have general and active management of the business of the Corporation and shall see that all orders and resolutions of the board of directors are carried into effect. The president shall execute bonds, mortgages and other contracts requiring a seal, under the seal of the corporation, except where required or
permitted by law to be otherwise signed and executed and except where the signing and execution thereof shall be expressly delegated by the board of directors to some other officer or agent of the corporation. The president shall have general powers of supervision and shall be the final arbitrator of all differences between officers of the corporation, and such decision as to any matter affecting the Corporation subject only to the board of directors.
Section 9. Vice Presidents. The vice-president, or if there shall be more than one, the vice-presidents in the order determined by the board of directors, shall, in the absence or disability of the president, perform the duties and exercise the powers of the president and shall perform such other duties and have such other powers as the board of directors may, from time to time, determine or these bylaws may prescribe.
Section 10. The Secretary and Assistant Secretaries. The secretary shall attend all meetings of the board of directors and all meetings of the stockholders and record all the proceedings of the meetings of the Corporation and the board of directors in a book to be kept for that purpose and shall perform like duties for the standing committees when required. The secretary shall give, or cause to be given, notice of all meetings of the stockholders and special meetings of the board of directors; perform such other duties as may be prescribed by the board of directors or president, under whose supervision he or she shall be; shall have custody of the corporate seal of the Corporation and the secretary, or an assistant secretary, shall have authority to affix the same to any instrument requiring it and when so affixed, it may be attested by his or her signature or by the signature of such assistant secretary. The board of directors may give general authority to any other officer to affix the seal of the Corporation and to attest the affixing by his or her signature. The assistant secretary, or if there be more than one, the assistant secretaries in the order determined by the board of directors, shall, in the absence or disability of the secretary, perform the duties and exercise the powers of the secretary and shall perform
such other duties and have such other powers as the board of directors may from time to time prescribe.
Section 11. The Treasurer and Assistant Treasurer. The treasurer shall have the custody of the corporate funds and securities; shall keep full and accurate accounts of receipts and disbursements in books belonging to the corporation; shall deposit all monies and other valuable effects in the name and to the credit of the Corporation as may be ordered by the board of directors, taking proper vouchers for such disbursements; and shall render to the president and the board of directors, at its regular meeting or when the board of directors so requires, an account of the corporation. If required by the board of directors, the treasurer shall give the Corporation a bond (which shall be rendered every six years) in such sums and with such surety or sureties as shall be satisfactory to the board of directors for the faithful performance of the duties of the office of treasurer and for the restoration to the corporation, in case of death, resignation, retirement, or removal from office, of all books, papers, vouchers, money, and other property of whatever kind in the possession or under the control of the treasurer belonging to the corporation. The assistant treasurer, or if there shall be more than one, the assistant treasurers in the order determined by the board of directors, shall in the absence or disability of the treasurer, perform the duties and exercise the powers of the treasurer and shall perform such other duties and have such other powers as the board of directors may from time to time prescribe.
Section 12. Other Officers, Assistant Officers and Agents. Officers, assistant officers and agents, if any, other than those whose duties are provided for in these bylaws, shall have such authority and perform such duties as may from time to time be prescribed by resolution of the board of directors.
ARTICLE V - INDEMNIFICATION OF OFFICERS, DIRECTORS AND OTHERS
Section 1. Right to Indemnification. Each person who was or is made party or is
threatened to be made a party to or is otherwise involved (including involvement as a witness) in any action, suit or proceeding, whether civil, criminal, administrative or investigative (hereinafter a "proceeding"), by reason of the fact that he or she is or was a director or officer of the Corporation or, while a director or officer of the corporation, is or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation or of a partnership, joint venture, trust or other enterprise, including service with respect to an employee benefit plan (hereinafter, an "indemnitee"), whether the basis of such proceeding is alleged action in an official capacity as a director or officer or in any other capacity while serving as a director or officer, shall be indemnified and held harmless by the Corporation to the fullest extent authorized by the Delaware General Corporation Law ("DGCL"), as the same exists or may hereafter be amended (but, in the case of any such amendment, only to the extent that such amendment permits the Corporation to provide for broader indemnification rights than permitted as of the date of these bylaws), against all expense, liability and loss (including attorneys' fees, judgments, fines, excise taxes or penalties and amounts paid in settlement) reasonably incurred or suffered by such indemnitee in connection therewith and such indemnification shall continue as to an indemnitee who has ceased to be a director, officer, employee or agent and shall inure to the benefit of the indemnitee's heirs, executors and administrators; provided, however, that except as provided in Section 2 of this ARTICLE V with respect to proceedings to enforce rights to indemnification, the Corporation shall indemnify any such indemnitee in connection with a proceeding (or part thereof) initiated by such indemnitee only if such proceeding (or part thereof) was authorized by the board of directors of the corporation. The right to indemnification conferred in this Section 1 of this ARTICLE V shall be a contract right and shall include the obligation of the Corporation to pay the expenses incurred in defending any such proceeding in advance of its final disposition (hereinafter an "advance of expenses");
provided, however, that if and to the extent that the board of directors of the Corporation requires, an advance of expenses incurred by an indemnitee in his or her capacity as a director or officer (and not in any other capacity in which service was or is rendered by such indemnitee, including, without limitation, service to an employee benefit plan) shall be made only upon delivery to the Corporation of an undertaking (hereinafter an "undertaking"), by or on behalf of such indemnitee, to repay all amounts so advanced if it shall ultimately be determined by final judicial decision from which there is no further right to appeal (hereinafter a "final adjudication") that such indemnitee is not entitled to be indemnified for such expenses under this Section 1 or otherwise. The Corporation may, by action of its board of directors, provide indemnification to employees and agents of the Corporation with the same or lesser scope and effect as the foregoing indemnification of directors and officers.
Section 2. Procedure for Indemnification. Any indemnification of a director or officer of the Corporation or advance of expenses under Section 1 of this ARTICLE V shall be made promptly, and in any event within forty-five days (or, in the case of an advance of expenses, twenty days) upon the written request of the director or officer. If a determination by the Corporation that the director or officer is entitled to indemnification pursuant to this ARTICLE V is required, and the Corporation fails to respond within sixty days to a written request for indemnity, the Corporation shall be deemed to have approved the request. If the Corporation denies a written request for indemnification or advance of expenses, in whole or in part, or if payment in full pursuant to such request is not made within forty-five days (or, in the case of an advance of expenses, twenty days), the right to indemnification or advances as granted by this ARTICLE V shall be enforceable by the director or officer in any court of competent jurisdiction. Such person's costs and expenses incurred in connection with successfully establishing his or her right to indemnification, in whole or in part, in any such action shall also be indemnified by the
corporation. It shall be a defense to any such action (other than an action brought to enforce a claim for the advance of expenses where the undertaking required pursuant to Section 1 of this ARTICLE V, if any, has been tendered to the corporation) that the claimant has not met the standards of conduct which make it permissible under the DGCL for the Corporation to indemnify the claimant for the amount claimed, but the burden of such defense shall be on the corporation. Neither the failure of the Corporation (including its board of directors, independent legal counsel, or its stockholders) to have made a determination prior to the commencement of such action that indemnification of the claimant is proper in the circumstances because he or she has met the applicable standard of conduct set forth in the DGCL, nor an actual determination by the Corporation (including its board of directors, independent legal counsel, or its stockholders) that the claimant has not met such applicable standard of conduct, shall be a defense to the action or create a presumption that the claimant has not met the applicable standard of conduct. The procedure for indemnification of other employees and agents for whom indemnification is provided pursuant to Section 1 of this ARTICLE V shall be the same procedure set forth in this Section 2 for directors or officers, unless otherwise set forth in the action of the board of directors of the Corporation providing for indemnification for such employee or agent.
Section 3. Insurance. The Corporation may purchase and maintain insurance on its own behalf and on behalf of any person who is or was a director, officer, employee or agent of the Corporation or was serving at the request of the Corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise against any expense, liability or loss asserted against him or her and incurred by him or her in any such capacity, whether or not the Corporation would have the power to indemnify such person against such expenses, liability or loss under the DGCL.
Section 4. Service for Subsidiaries. Any person serving as a director, officer,
employee or agent of another corporation, partnership, limited liability company, joint venture or other enterprise, at least 50% of whose equity interests are owned by the Corporation (hereinafter a "subsidiary" for purposes of this ARTICLE V) shall be conclusively presumed to be serving in such capacity at the request of the corporation.
Section 5. Reliance. Persons who after the date of the adoption of these bylaws become or remain directors or officers of the Corporation or who, while a director or officer of the corporation, become or remain a director, officer, employee or agent of a subsidiary, shall be conclusively presumed to have relied on the rights to indemnity, advance of expenses and other rights contained in this ARTICLE V in entering into or continuing such service. The rights to indemnification and to the advance of expenses conferred in this ARTICLE V shall apply to claims made against an indemnitee arising out of acts or omissions which occurred or occur both prior and subsequent to the adoption hereof.
Section 6. Non-Exclusivity of Rights. The rights to indemnification and to the advance of expenses conferred in this ARTICLE V shall not be exclusive of any other right which any person may have or hereafter acquire under these bylaws or the corporation's Restated Certificate of Incorporation or under any statute, agreement, vote of stockholders or disinterested directors or otherwise.
Section 7. Merger or Consolidation. For purposes of this ARTICLE V, references to "the corporation" shall include any constituent corporation (including any constituent of a constituent) absorbed into the corporation in a consolidation or merger which, if its separate existence had continued, would have had power and authority to indemnify its directors, officers, and employees or agents, so that any person who is or was a director, officer, employee or agent of such constituent corporation, or is or was serving at the request of such constituent corporation as a director, officer, employee or agent of another corporation, partnership, joint venture, trust or other enterprise, shall stand in the same
position under this ARTICLE V with respect to the resulting or surviving corporation as he or she would have with respect to such constituent corporation if its separate existence had continued.
ARTICLE VI - CERTIFICATES OF STOCK
Section 1. Form. Subject to the Restated Certificate of Incorporation, every holder of stock in the Corporation shall be entitled to have a certificate, signed by, or in the name of the Corporation by the president or a vice-president, and the secretary or an assistant secretary of the corporation, certifying the number of shares owned by him or her in the corporation. Where a certificate is signed (l) by a transfer agent or an assistant transfer agent other than the Corporation or its employee or (2) by a registrar, other than the Corporation or its employee, the signature of any such president, vice-president, secretary, or assistant secretary may be facsimile. In case any officer or officers have signed a certificate or certificates, or whose facsimile signature or signatures have been used on certificate or certificates, shall cease to be such officer or officers of the Corporation whether because of death, resignation or otherwise before such certificate or certificates have been delivered by the corporation, such certificate or certificates may nevertheless be issued and delivered as though the person or persons who signed such certificate or certificates or whose facsimile signature or signatures have been used on such certificate or certificates had not ceased to be such officer or officers of the corporation. All certificates for shares shall be consecutively numbered or otherwise identified. The name of the person to whom the shares represented thereby are issued, with the number of shares and date of issue, shall be entered on the books of the corporation. All certificates surrendered to the Corporation for transfer shall be canceled, and no new certificate shall be issued in replacement until the former certificate for a like number of shares shall have been surrendered or canceled, except as otherwise provided in Section 2 with respect to lost, stolen or destroyed certificates.
Section 2. Lost Certificates. The board of directors may direct a new certificate or certificates to be issued in place of any certificate or certificates theretofore issued by the Corporation alleged to have been lost, stolen, or destroyed, upon the making of an affidavit of that fact by the person claiming the certificate of stock to be lost, stolen, or destroyed. When authorizing such issue of a new certificate or certificates, the board of directors may, in its discretion and as a condition precedent to the issuance thereof, require the owner of such lost, stolen, or destroyed certificate or certificates, or his or her legal representative, to give the Corporation a bond in such sum as it may direct as indemnity against any claim that may be made against the Corporation with respect to the certificate alleged to have been lost, stolen or destroyed.
Section 3. Fixing a Record Date. The board of directors may fix in
advance a record date for the determination of stockholders entitled to notice
of, and to vote at, any meeting of stockholders and any adjournment thereof;
stockholders entitled to consent to corporate action in writing without a
meeting; stockholders entitled to receive payment of any dividend or other
distribution or allotment of rights or entitled to exercise any rights in
respect to any change, conversion or exchange of stock; or, for the purpose of
any other lawful action, which record date may not precede the date on which the
resolution fixing such record date is adopted by the board of directors. The
record date for the determination of stockholders entitled to notice of, and to
vote at, a meeting of stockholders shall not be more than 60 days nor less than
10 days before the date of such meeting. The record date for the determination
of stockholders entitled to consent to corporate action in writing without a
meeting shall not be more than 10 days after the date upon which the resolution
fixing the record date is adopted by the board of directors. The record date for
the determination of stockholders with respect to any other action shall not be
more than 60 days before the date of such action. If no record date is fixed:
the record date for determining stockholders entitled to notice of, and to vote
at, a meeting of
stockholders shall be at the close of business on the day next preceding the day on which notice is given, or if notice is waived, at the close of business on the day next preceding the day on which the meeting is held; the record date for determining stockholders entitled to consent to corporate action in writing without a meeting when no prior action by the board of directors is required by the Delaware General Corporation Law, shall be the first date on which a signed written consent setting forth the action taken or proposed to be taken is delivered to the Corporation by delivery to its registered office in the State of Delaware, its principal place of business, or an officer or agent of the Corporation having custody of the book in which proceedings of meetings of stockholders are recorded; and, the record date for determining stockholders with respect to any other action shall be the close of business on the day on which the board of directors adopts the resolution relating thereto.
ARTICLE VII - GENERAL PROVISIONS
Section 1. Dividends. Dividends upon the capital stock of the corporation, subject to the provisions of the Restated Certificate of Incorporation, if any, may be declared by the board of directors at any regular or special meeting, pursuant to law. Dividends may be paid in cash, in property, or in shares of the capital stock, subject to the provisions of the Restated Certificate of Incorporation. Before payment of any dividend, there may be set aside out of any funds of the Corporation available for dividends such sum or sums as the directors from time to time, in their absolute discretion, think proper as a reserve or reserves to meet contingencies, equalize dividends, repair or maintain any property of the corporation, or for any other purpose, and the directors may modify or abolish any such reserve in the manner in which it was created.
Section 2. Checks, Drafts or Orders. All checks, drafts, or other orders for the payment of money by or to the Corporation and all notes and other evidences of indebtedness issued in the name of the Corporation shall be signed by such officer or
officers, agent or agents of the corporation, and in such manner, as shall be determined by resolution of the board of directors or a duly authorized committee thereof.
Section 3. Contracts. The board of directors may authorize any officer or officers, or any agent or agents, of the Corporation to enter into any contract or to execute and deliver any instrument in the name of and on behalf of the corporation, and such authority may be general or confined to specific instances.
Section 4. Loans. The Corporation may lend money to, or guarantee any obligation of, or otherwise assist any officer or other employee of the Corporation or of its subsidiary, including any officer or employee who is a director of the Corporation or its subsidiary, whenever, in the judgment of the directors, such loan, guaranty or assistance may reasonably be expected to benefit the corporation. The loan, guaranty or other assistance may be with or without interest, and may be unsecured, or secured in such manner as the board of directors shall approve, including, without limitation, a pledge of shares of stock of the corporation. Nothing contained in this section shall be deemed to deny, limit or restrict the powers of guaranty or warranty of the Corporation at common law or under any statute.
Section 5. Fiscal Year. The fiscal year of the Corporation shall be the calendar year unless otherwise fixed by resolution of the board of directors.
Section 6. Corporate Seal. The board of directors shall provide a corporate seal which shall be in the form of a circle and shall have inscribed thereon the name of the Corporation and the words "Corporate Seal, Delaware." The seal may be used by causing it or a facsimile thereof to be impressed or affixed or reproduced or otherwise.
Section 7. Voting Securities Owned by Corporation. Voting securities in any other corporation held by the Corporation shall be voted by the president or the vice president, unless the board of directors specifically confers authority to vote with respect thereto upon some other person or officer. Any person authorized to vote securities shall have the
power to appoint proxies, with general power of substitution.
Section 8. Inspection of Books and Records. Any stockholder of record, in person or by attorney or other agent, shall, upon written demand upon oath stating the purpose thereof, have the right during the usual hours of business to inspect for any proper purpose the corporation's stock ledger, a list of its stockholders, and its other books and records, and to make copies or extracts therefrom. A proper purpose shall mean any purpose reasonably related to such person's interest as a stockholder. In every instance where an attorney or other agent shall be the person who seeks the right to inspection, the demand under oath shall be accompanied by a power of attorney or such other writing which authorizes the attorney or other agent to so act on behalf of the stockholder. The demand under oath shall be directed to the Corporation at its registered office in the State of Delaware or at its principal place of business.
Section 9. Section Headings. Section headings in these bylaws are for convenience of reference only and shall not be given any substantive effect in limiting or otherwise construing any provision herein.
Section 10. Inconsistent Provisions. In the event that any provision of these bylaws is or becomes inconsistent with any provision of the Restated Certificate of Incorporation, the Delaware General Corporation Law or any other applicable law, the provision of these bylaws shall not be given any effect to the extent of such inconsistency but shall otherwise be given full force and effect.
ARTICLE VIII - AMENDMENTS
These bylaws may be amended, altered or repealed and new bylaws adopted at any meeting of the board of directors by a majority vote. The fact that the power to adopt, amend, alter or repeal the bylaws has been conferred upon the board of directors shall not divest the stockholders of the same powers.
EXHIBIT 4.1
[LOGO]
[SEAL] BEASLEY BROADCAST GROUP, INC. [SEAL]
INCORPORATED UNDER THE LAWS OF THE STATE OF DELAWARE
CLASS A COMMON STOCK CUSIP 074014 10 1
SEE REVERSE FOR CERTAIN DEFINITIONS
This Certifies that
is the record holder of
FULLY PAID AND NONASSESSABLE SHARES OF CLASS A COMMON STOCK PAR VALUE $.001 PER
SHARE OF
Beasley Broadcast Group, Inc. transferable on the books of the Corporation by the holder hereof in person or by duly authorized attorneys upon the surrender of this Certificate properly endorsed. This Certificate is not valid unless countersigned by the Transfer Agent and registered by the Registrar.
Witness the facsimile seal of the Corporation and the facsimile signatures of its duly authorized officers.
Dated: [SEAL]
/s/ CAROLINE BEASLEY /s/ GEORGE G. BEASLEY
Vice President, Chief Financial Chairman & Chief Executive Officer
Officer, Secretary, & Treasurer
|
Countersigned and Registered:
American Stock Transfer & Trust Company
Transfer Agent
and Registrar
By
Authorized Signature
BEASLEY BROADCAST GROUP, INC.
THE CORPORATION WILL FURNISH WITHOUT CHARGE TO EACH STOCKHOLDER WHO SO REQUESTS THE POWERS, DESIGNATIONS, PREFERENCES, AND RELATIVE, PARTICIPATING, OPTIONAL OR OTHER SPECIAL RIGHTS OF EACH CLASS OF STOCK OR SERIES THEREOF AND THE QUALIFICATIONS, LIMITATIONS OR RESTRICTIONS OF SUCH PREFERENCES AND/OR RIGHTS. ANY SUCH REQUEST SHOULD BE ADDRESSED TO THE SECRETARY OF THE CORPORATION.
RESTRICTIONS ON TRANSFER AND VOTING: The Restated Certificate of
Incorporation of the Corporation provide that, to the extent prohibited by law
(i) the Corporation shall not issue in excess of 25% of its capital stock
outstanding at any time to or for the account of any Alien or Aliens; (ii) the
Corporation shall not permit the transfer on its books of any of its capital
stock to or for the account of any Alien if, after giving effect to such
transfer, the capital stock held by or for the account of any Alien or Aliens
would exceed 25% of the Corporation's capital stock outstanding at any time; and
(iii) no Alien or Aliens shall be entitled to vote or direct or control the vote
of more than 25% of (A) the total number of shares of capital stock of the
Corporation outstanding and entitled to vote at any time and from time to time,
or (B) the total voting power of all the shares of capital stock of the
Corporation outstanding and entitled to vote at any time and from time to time.
The term "Alien" means any person who is a citizen of a country other than the
United States; any entity organized under the laws of a government other than
the government of the United States, or any state, territory or possession
thereof; a government other than the government of the United States, or any
state, territory or possession thereof; or a representative of, or an
individual or entity controlled by, any of the foregoing. The Company's Board of
Directors is authorized to take such action, including requiring redemption of
shares of Common Stock, to ensure the Company's compliance with Alien ownership
restrictions in effect from time to time.
The following abbreviations, when used in the inscription on the face of this certificate, shall be construed as though they were written out in full according to applicable laws or regulations.
TEN COM - as tenants in common UNIF GIFT MIN ACT- Custodian
TEN ENT - as tenants by the entireties ----------------- -----------------
JT TEN - as joint tenants with right of (Cust) (Minor)
survivorship and not as tenants under Uniform Gifts to Minors
in common Act
--------------------
(State)
|
Additional abbreviations may also be used though not in the above list.
Common Stock represented by the within Certificate and do hereby irrevocably
constitute and appoint
transfer the said stock on the books of the within-named Corporation, with full
power of substitution in the premises.
AFFIX MEDALLION SIGNATURE
GUARANTEE IMPRINT BELOW
THE SIGNATURES(S) MUST BE GUARANTEED BY
AN ELIGIBLE GUARANTOR INSTITUTION SUCH
AS A SECURITIES BROKER/DEALER,
COMMERCIAL BANK, TRUST COMPANY, SAVINGS
ASSOCIATION OR A CREDIT UNION
PARTICIPATING IN A MEDALLION PROGRAM
APPROVED BY THE SECURITIES TRANSFER
ASSOCIATION, INC.
Notice: The signature to this assignment must correspond with the name(s) as written upon the face of the certificate in every particular, without
alteration or enlargement, or any change whatever.
EXHIBIT 5.1
[LATHAM & WATKINS LETTERHEAD]
February 9, 2000
Beasley Broadcast Group, Inc.
3033 Riviera Drive, Suite 200
Naples, Florida 34103
Re: Registration Statement No. 333-91683; 7,877,500 shares of Class A Common Stock, par value $0.001 per share
Ladies and Gentlemen:
In connection with the registration of 7,877,500 shares of Class A common stock of Beasley Broadcast Group, Inc., a Delaware corporation (the "Company"), par value $0.001 per share (the "Shares"), under the Securities Act of 1933, as amended, by the Company on Form S-1 filed with the Securities and Exchange Commission (the "Commission") on November 24, 1999 (File No. 333-91683), as amended by Amendment No. 1 filed with the Commission on January 12, 2000, as amended by Amendment No. 2 filed on January 31, 2000 and as amended by Amendment No. 3 filed on February 9, 2000 (as so amended, the "Registration Statement"), you have requested our opinion with respect to the matters set forth below.
In our capacity as your counsel in connection with such registration, we are familiar with the proceedings taken by the Company in connection with the authorization, issuance and sale of the Shares. In addition, we have made such legal and factual examinations and inquiries, including an examination of originals or copies certified or otherwise identified to our satisfaction of such documents, corporate records and instruments, as we have deemed necessary or appropriate for purposes of this opinion.
In our examination, we have assumed the genuineness of all signatures, the authenticity of all documents submitted to us as originals, and the conformity to authentic original documents of all documents submitted to us as copies.
LATHAM & WATKINS
February 9, 2000
We are opining herein as to the effect on the subject transaction only of the General Corporation Law of the State of Delaware, including statutory and reported decisional law thereunder and we express no opinion with respect to the applicability thereto, or the effect thereon, of any other laws.
Subject to the foregoing, it is our opinion that the Shares have been duly authorized, and, upon issuance, delivery and payment therefor in the manner contemplated by the Registration Statement, will be validly issued, fully paid and nonassessable.
We consent to your filing this opinion as an exhibit to the Registration Statement and to the reference to our firm contained under the heading "Legal Matters."
Very truly yours,
/s/ Latham & Watkins |
EXHIBIT 10.1
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") dated as of January 31, 2000, is made by and between Beasley Mezzanine Holdings, LLC, a Delaware limited liability company (together with any successor thereto, the "Company") and George G. Beasley (the "Executive").
WHEREAS, the Company desires to assure itself of the services of the Executive, and the Executive desires to commit himself to serve the Company, on the terms herein provided;
NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below the parties hereto agree as follows:
1. CERTAIN DEFINITIONS.
(a) "Annual Base Salary" shall have the meaning set forth in Section 4.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cause" for the Company to terminate the Executive's employment hereunder shall exist upon the Executive's:
(i) failure substantially to perform his duties hereunder, other than any such failure resulting from the Executive's Disability, after notice and reasonable opportunity for cure, all as determined by the Board;
(ii) conviction of a felony or a crime involving moral turpitude; or
(iii) fraud or personal dishonesty involving Company assets.
(d) "Company" shall have the meaning set forth in the preamble hereto.
(e) "Compensation Committee" means the compensation committee of the Board.
(f) "Contract Year" shall mean each twelve month period beginning on the Effective Date hereof or an annual anniversary thereof.
(g) "Date of Termination" shall mean (i) if the Executive's employment is terminated by his death, the date of his death; and (ii) if the Executive's employment is terminated pursuant to any of Sections 5(a)(ii) through 5(a)(vi), the date specified in the Notice of Termination.
(h) "Disability" shall mean the absence of the Executive from the Executive's duties to the Company on a full-time basis for a period of 180 consecutive days as a result of incapacity due to mental or physical illness.
(i) "Effective Date" of this Agreement shall mean the date of effectiveness of the registration statement registering the initial public offering of shares of Class A common stock of the Company.
(j) "Executive" shall have the meaning set forth in the preamble hereto.
(k) "Good Reason" for the Executive to terminate his employment shall exist in the event that the Company fails to make any payment or provide any benefit hereunder or commits a material breach of this Agreement and does not cure such failure or breach after notice and a reasonable opportunity to cure.
(l) "Notice of Termination" shall have the meaning set forth in
Section 5(b).
(m) "Term of Employment" shall have the meaning set forth in Section 2(b).
2. EMPLOYMENT.
(a) Initial Term. The Company shall employ the Executive and the Executive shall enter the employ of the Company, for the period set forth in this Section 2, in the position set forth in Section 3 and upon the other terms and conditions herein provided. The initial term of employment under this Agreement (the "Initial Term") shall be for the period beginning on the Effective Date of this Agreement and shall expire on the third anniversary thereof, unless earlier terminated as provided in Section 5.
(b) Extension. The employment term hereunder shall automatically be extended for successive one-year periods ("Extension Terms" and, collectively with the Initial Term, the "Term of Employment") unless either party gives notice of non-extension to the other no later than 90 days prior to the expiration of the then-applicable Term of Employment.
3. POSITION AND DUTIES.
(a) Generally. The Executive shall serve as the Chairman of the Board ("Chairman") and Chief Executive Officer ("CEO") of the Company. Subject to reasonable modification from time to time by the Board, Executive shall supervise, control and have responsibility for the strategic direction and general and active day-to-day leadership and management of the business and affairs of the Company and its subsidiaries and shall have all of the powers, authority, duties and responsibilities usually incident to the positions and offices of Chairman and CEO. Executive will, on a full-time basis, apply all of his skill and experience to the performance of his duties in such employment and will not, without the prior consent of the Board, devote substantial amounts of time to outside business activities. Notwithstanding the foregoing, Executive may devote a reasonable amount of his time to civic, community, charitable or passive investment activities.
(b) Subsidiaries. If elected or appointed thereto, and only for the duration of such elected term or appointment, the Executive shall serve as a director of the Company and any of its subsidiaries and/or in one or more executive offices of any of such subsidiaries, provided that the Executive is indemnified for serving in any and all such capacities on a basis consistent with that provided by the Company to other directors of the Company or similarly situated executive officers of any such subsidiaries.
4. COMPENSATION AND RELATED MATTERS.
(a) Annual Base Salary. The Executive shall receive a base salary at a rate of $500,000 per annum during the first 12 months of the Initial Term, increased by five percent per annum on each anniversary of the Contract Year during the Term of Employment. In its sole discretion, the Compensation Committee may review the Annual Base Salary with a view toward consideration of merit increases as the Compensation Committee deems appropriate. The Annual Base Salary shall be paid in arrears in substantially equal installments at monthly or more frequent intervals, in accordance with the normal payroll practices of the Company.
(b) Bonus. Executive shall be eligible to receive an annual bonus for each fiscal year of the Company ending during the Term of Employment at the sole discretion of the Board.
(c) Benefits. The Executive shall be eligible to participate in the 2000 Equity Plan of Beasley Broadcasting Group, Inc. and such other equity based or incentive compensation plans or programs as may be adopted by the Company from time to time (collectively, the "Equity Plan") for its senior executives, at such level and in such amounts as may be determined by the Board in its sole discretion, subject to the terms and conditions of the Equity Plan and any applicable award agreements; provided, however, that in the event Executive violates Section 7 or Section 8 of this Agreement, all stock options or other equity based or incentive compensation awards granted under the Equity Plan or otherwise (whether or not vested) shall, immediately upon the time of the first such violation, cease to be exercisable and shall thereupon be cancelled and be of no further force and effect. At the expense of the Company, the Executive shall be entitled to participate in the other employee benefit plans, programs and arrangements of the Company (including, without limitation, health insurance, long-term disability coverage and vacation for Executive and his eligible dependents) now (or, to the extent determined by the Board, hereafter) in effect which are applicable to the senior officers of the Company, subject to and on a basis consistent with the terms, conditions and overall administration thereof.
(d) Expenses. The Company shall reimburse the Executive for all reasonable travel and other business expenses incurred by him in the performance of his duties to the Company, in accordance with the Company's documentation and other policies with respect thereto.
(e) Automobile Allowance. During the Term of Employment, Executive shall be entitled to an automobile allowance of $1,000 per month. Executive may use the automobile allowance for lease payments, insurance, towards the purchase of an automobile or in any other manner at Executive's discretion.
5. TERMINATION.
The Executive's employment hereunder may be terminated by the Company or the Executive, as applicable, without any breach of this Agreement only under the following circumstances:
(a) Circumstances.
(i) Death. The Executive's employment hereunder shall terminate upon his death. In the event of the death of the Executive during the Term of this Agreement, Company shall pay to Executive's widow, if surviving, otherwise to his estate or legal representative, compensation at the Annual Base Salary rate then being received by Executive for a period of one year following Executive's death.
(ii) Disability. If the Company determines in good faith that the Executive has incurred a Disability, the Company may give the Executive written notice of its intention to terminate the Executive's employment. In such event, the Executive's employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of his duties. The Executive shall continue to receive his Annual Base Salary until the Date of Termination.
(iii) Termination for Cause. The Company may terminate the Executive's employment hereunder for Cause.
(iv) Termination without Cause. The Company may terminate the Executive's employment hereunder without Cause.
(v) Resignation for Good Reason. The Executive may terminate his employment for Good Reason.
(vi) Resignation without Good Reason. The Executive may resign his employment without Good Reason upon 90 days written notice to the Company.
(b) Notice of Termination. Any termination of the Executive's employment by the Company or by the Executive under this Section 5 (other than termination pursuant to Section 5(a)(i)) shall be communicated by a written notice to the other party hereto indicating the specific termination provision in this Agreement relied upon, setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated, and specifying a Date of Termination which, except in the case of termination for Cause, shall be at least fourteen days following the date of such notice (a "Notice of Termination"), or thirty days if termination is pursuant to Section 5(a)(ii).
6. SEVERANCE PAYMENTS.
(a) Entitlement to Severance Payments. If the Executive's employment shall terminate without Cause (pursuant to Section 5(a)(iv)) or for Good Reason (pursuant to Section 5(a)(v)), the Company shall:
(i) Pay to the Executive, in accordance with its regular payroll practice, following the Date of Termination, an amount equal to his then Annual Base Salary for the longer of one year or the remainder of the Initial Term (the "Severance Period").
(ii) At the expense of the Company continue for one year the Executive's coverage under all Company benefit plans and programs in which the Executive was entitled to participate immediately prior to the Date of Termination, to the extent permitted thereunder until the earlier of (A) the expiration of the Severance Period or (B) the date the Executive has commenced new employment and has thereby become eligible for comparable medical benefits. In the event that the Executive's participation in any such plan or program is not permitted, the Company shall arrange to provide the Executive with benefits substantially similar to those which the Executive would otherwise have been entitled to receive under such plans and programs.
(iii) Notwithstanding the terms or conditions of the Equity Plan or any stock option or other award agreement between the Company and the Executive, all such stock options or other awards shall become fully vested and exercisable as of the Date of Termination and shall remain exercisable until the earlier to occur of (A) the expiration of such stock option or other award pursuant to its terms or (B) the expiration of 90 days following the Date of Termination.
(b) Survival. The expiration or termination of the Term of Employment shall not impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such expiration.
(c) Mitigation of Damages. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amount payable to the Executive under any of the provisions of this
Agreement and such amounts shall not be reduced (except as provided in Section
6(a)(ii)) whether or not the Executive obtains other employment. Neither the
Executive nor the Company shall be liable to the other party for any damages in
addition to the amounts payable under Section 6 arising out of the termination
of the Executive's employment prior to the end of the Term of Employment (except
as provided in Section 9).
7. COMPETITION.
(a) Conduct of Executive. The term of Non-Competition (herein so called) shall be for a term beginning on the date hereof and continuing until the first anniversary of the Date of Termination; provided, however, that if the Executive's employment is terminated by the
Company other than for Cause or by the Executive for Good Reason the term of Non-Competition shall expire upon the earlier of the first anniversary of the Date of Termination or the date that the Executive waives his entitlement to any further payments under Section 6(a)(i) hereunder. During the term of Non-Competition, the Executive shall not, without the prior written consent of the Board, directly or indirectly engage in, or have any equity interest in, or manage or operate any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes with any business of the Company or any entity owned by it that is within 75 miles of any transmission site on which the Company or any entity owned by it operates a radio station at the Date of Termination provided, however, that the Executive shall be permitted to acquire a stock interest in such a corporation provided such stock is publicly traded and the stock so acquired is not more than five percent (5%) of the outstanding shares of such corporation.
(b) Construction of this Section. In the event the terms of this
Section 7 shall be determined by any court of competent jurisdiction to be
unenforceable by reason of its extending for too great a period of time or over
too great a geographical area or by reason of its being too extensive in any
other respect, it will be interpreted to extend only over the maximum period of
time for which it may be enforceable, and/or over the maximum geographical area
as to which it may be enforceable and/or to the maximum extent in all other
respects as to which it may be enforceable, all as determined by such court in
such action.
8. NONDISCLOSURE OF PROPRIETARY INFORMATION.
(a) Confidentiality. Except as required in the faithful performance of the Executive's duties hereunder or pursuant to subsection (c), the Executive shall, in perpetuity, maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for his benefit or the benefit of any person, firm, corporation or other entity any confidential or proprietary information or trade secrets of or relating to the Company, including, without limitation, information with respect to the Company's operations, processes, products, inventions, business practices, finances, principals, vendors, suppliers, customers, potential customers, marketing methods, costs, prices, contractual relationships, regulatory status, compensation paid to employees or other terms of employment, or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such confidential or proprietary information or trade secrets. The parties hereby stipulate and agree that as between them the foregoing matters are important, material and confidential proprietary information and trade secrets and affect the successful conduct of the businesses of the Company (and any successor or assignee of the Company).
(b) Return of Materials. Upon termination of the Executive's employment with Company for any reason and upon the Company's request, the Executive will promptly deliver to the Company all correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the Company's customers, business plans, marketing strategies, products or processes and/or which contain proprietary information or trade secrets.
(c) Response to Legal Process. The Executive may respond to a lawful and valid subpoena or other legal process but shall give the Company the earliest possible notice thereof, and shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought and shall assist such counsel in resisting or otherwise responding to such process.
9. INJUNCTIVE RELIEF.
It is recognized and acknowledged by the Executive that a breach of the covenants contained in Sections 7 and 8 will cause irreparable damage to Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Executive agrees that in the event of a breach of any of the covenants contained in Sections 7 and 8, in addition to any other remedy which may be available at law or in equity, the Company will be entitled to specific performance and injunctive relief.
10. BINDING ON SUCCESSORS.
This Agreement shall be binding upon and inure to the benefit of the Company, the Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable.
11. GOVERNING LAW.
This Agreement shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the State of Florida.
12. VALIDITY.
The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.
13. NOTICES.
Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by telex, telecopy, or certified or registered mail, postage prepaid, as follows:
(a) If to the Company:
Beasley Mezzanine Holdings, LLC 3033 Riviera Drive, Suite 200 Naples, Florida 34103
Attn: B. Caroline Beasley Fax: (941) 263-8191 |
With a copy to:
Latham & Watkins
1001 Pennsylvania Avenue, NW, Suite 1300
Washington, DC 20004
Attn: Joseph D. Sullivan
Fax: (202) 637-2201
(b) If to the Executive, to him at the address set forth below under his signature; or at any other address as any party shall have specified by notice in writing to the other parties.
14. COUNTERPARTS.
This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement.
15. ENTIRE AGREEMENT.
The terms of this Agreement are intended by the parties to be the final expression of their agreement with respect to the employment of the Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement. The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.
16. AMENDMENTS; WAIVERS.
This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by the Executive and the Chief Financial Officer. By an instrument in writing similarly executed, the Executive or the Company may waive compliance by the other party or parties with any provision of this Agreement that such other party was or is obligated to comply with or perform, provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
17. NO INCONSISTENT ACTIONS.
The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action inconsistent with the provisions or essential intent of this Agreement. Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement.
18. ARBITRATION.
Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted before a panel of three arbitrators in Washington, D.C. in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator's award in any court having jurisdiction; provided, however, that the Company shall be entitled to seek a restraining order or injunction in any court of competent jurisdiction to prevent any continuation of any violation of the provisions of Sections 7 or 8 of this Agreement and the Executive hereby consents that such restraining order or injunction may be granted without the necessity of the Company's posting any bond. The fees and expense of the arbitrator shall be borne by the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date and year first above written.
THE COMPANY
Beasley Mezzanine Holdings, LLC
By: /s/ B. CAROLINE BEASLEY
--------------------------------------
Name: B. Caroline Beasley
Title: Chief Financial Officer
|
THE EXECUTIVE
/s/ GEORGE G. BEASLEY -------------------------------------- Name: George G. Beasley |
EXHIBIT 10.2
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") dated as of January 31, 2000, is made by and between Beasley Mezzanine Holdings, LLC, a Delaware limited liability company (together with any successor thereto, the "Company") and Bruce G. Beasley (the "Executive").
WHEREAS, the Company desires to assure itself of the services of the Executive, and the Executive desires to commit himself to serve the Company, on the terms herein provided;
NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below the parties hereto agree as follows:
1. CERTAIN DEFINITIONS.
(a) "Annual Base Salary" shall have the meaning set forth in Section 4.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cause" for the Company to terminate the Executive's employment hereunder shall exist upon the Executive's:
(i) failure substantially to perform his duties hereunder, other than any such failure resulting from the Executive's Disability, after notice and reasonable opportunity for cure, all as determined by the Board;
(ii) conviction of a felony or a crime involving moral turpitude; or
(iii) fraud or personal dishonesty involving Company assets.
(d) "Company" shall have the meaning set forth in the preamble hereto.
(e) "Compensation Committee" means the compensation committee of the Board.
(f) "Contract Year" shall mean each twelve month period beginning on the Effective Date hereof or an annual anniversary thereof.
(g) "Date of Termination" shall mean (i) if the Executive's employment is terminated by his death, the date of his death; and (ii) if the Executive's employment is terminated pursuant to any of Sections 5(a)(ii) through 5(a)(vi), the date specified in the Notice of Termination.
(h) "Disability" shall mean the absence of the Executive from the Executive's duties to the Company on a full-time basis for a period of 180 consecutive days as a result of incapacity due to mental or physical illness.
(i) "Effective Date" of this Agreement shall mean the date of effectiveness of the registration statement registering the initial public offering of shares of Class A common stock of the Company.
(j) "Executive" shall have the meaning set forth in the preamble hereto.
(k) "Good Reason" for the Executive to terminate his employment shall exist in the event that the Company fails to make any payment or provide any benefit hereunder or commits a material breach of this Agreement and does not cure such failure or breach after notice and a reasonable opportunity to cure.
(l) "Notice of Termination" shall have the meaning set forth in
Section 5(b).
(m) "Term of Employment" shall have the meaning set forth in Section 2(b).
2. EMPLOYMENT.
(a) Initial Term. The Company shall employ the Executive and the Executive shall enter the employ of the Company, for the period set forth in this Section 2, in the position set forth in Section 3 and upon the other terms and conditions herein provided. The initial term of employment under this Agreement (the "Initial Term") shall be for the period beginning on the Effective Date of this Agreement and shall expire on the third anniversary thereof, unless earlier terminated as provided in Section 5.
(b) Extension. The employment term hereunder shall automatically be extended for successive one-year periods ("Extension Terms" and, collectively with the Initial Term, the "Term of Employment") unless either party gives notice of non-extension to the other no later than 90 days prior to the expiration of the then-applicable Term of Employment.
3. POSITION AND DUTIES.
(a) Generally. The Executive shall serve as the President and Chief Operating Officer ("COO") of the Company. Subject to reasonable modification from time to time by the Board or by the Chief Executive Officer, Executive shall report to the Chief Executive Officer and shall supervise, control and have responsibility for the daily operating activities of all radio stations owned by the Company, including without limitation supervision of station management, personnel matters, short- and long-term strategic decision making, station budgets, management of third party relationships, and disbursements. Executive will, on a full-time basis, apply all of his skill and experience to the performance of his duties in such employment and will not, without the prior consent of the Board, devote substantial amounts of time to outside business activities. Notwithstanding the foregoing, Executive may devote a reasonable amount of his time to civic, community, charitable or passive investment activities.
(b) Subsidiaries. If elected or appointed thereto, and only for the duration of such elected term or appointment, the Executive shall serve as a director of the Company and any of its subsidiaries and/or in one or more executive offices of any of such subsidiaries, provided that the Executive is indemnified for serving in any and all such capacities on a basis consistent with that provided by the Company to other directors of the Company or similarly situated executive officers of any such subsidiaries.
4. COMPENSATION AND RELATED MATTERS.
(a) Annual Base Salary. The Executive shall receive a base salary at a rate of $325,000 per annum during the first 12 months of the Initial Term, increased by five percent per annum on each anniversary of the Contract Year during the Term of Employment. In its sole discretion, the Compensation Committee may review the Annual Base Salary with a view toward consideration of merit increases as the Compensation Committee deems appropriate. The Annual Base Salary shall be paid in arrears in substantially equal installments at monthly or more frequent intervals, in accordance with the normal payroll practices of the Company.
(b) Bonus. Executive shall be eligible to receive an annual bonus for each fiscal year of the Company ending during the Term of Employment at the sole discretion of the Board.
(c) Benefits. The Executive shall be eligible to participate in the 2000 Equity Plan of Beasley Broadcasting Group, Inc. and such other equity based or incentive compensation plans or programs as may be adopted by the Company from time to time (collectively, the "Equity Plan") for its senior executives, at such level and in such amounts as may be determined by the Board in its sole discretion, subject to the terms and conditions of the Equity Plan and any applicable award agreements; provided, however, that in the event Executive violates Section 7 or Section 8 of this Agreement, all stock options or other equity based or incentive compensation awards granted under the Equity Plan or otherwise (whether or not vested) shall, immediately upon the time of the first such violation, cease to be exercisable and shall thereupon be cancelled and be of no further force and effect. At the expense of the Company, the Executive shall be entitled to participate in the other employee benefit plans, programs and arrangements of the Company (including, without limitation, health insurance, long-term disability coverage and vacation for Executive and his eligible dependents) now (or, to the extent determined by the Board, hereafter) in effect which are applicable to the senior officers of the Company, subject to and on a basis consistent with the terms, conditions and overall administration thereof.
(d) Expenses. The Company shall reimburse the Executive for all reasonable travel and other business expenses incurred by him in the performance of his duties to the Company, in accordance with the Company's documentation and other policies with respect thereto.
5. TERMINATION.
The Executive's employment hereunder may be terminated by the Company or the Executive, as applicable, without any breach of this Agreement only under the following circumstances:
(a) Circumstances.
(i) Death. The Executive's employment hereunder shall terminate upon his death. In the event of the death of the Executive during the Term of this Agreement, Company shall pay to Executive's widow, if surviving, otherwise to his estate or legal representative, compensation at the Annual Base Salary rate then being received by Executive for a period of one year following Executive's death.
(ii) Disability. If the Company determines in good faith that the Executive has incurred a Disability, the Company may give the Executive written notice of its intention to terminate the Executive's employment. In such event, the Executive's employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of his duties. The Executive shall continue to receive his Annual Base Salary until the Date of Termination.
(iii) Termination for Cause. The Company may terminate the Executive's employment hereunder for Cause.
(iv) Termination without Cause. The Company may terminate the Executive's employment hereunder without Cause.
(v) Resignation for Good Reason. The Executive may terminate his employment for Good Reason.
(vi) Resignation without Good Reason. The Executive may resign his employment without Good Reason upon 90 days written notice to the Company.
(b) Notice of Termination. Any termination of the Executive's employment by the Company or by the Executive under this Section 5 (other than termination pursuant to Section 5(a)(i)) shall be communicated by a written notice to the other party hereto indicating the specific termination provision in this Agreement relied upon, setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated, and specifying a Date of Termination which, except in the case of termination for Cause, shall be at least fourteen days following the date of such notice (a "Notice of Termination"), or thirty days if termination is pursuant to Section 5(a)(ii).
6. SEVERANCE PAYMENTS.
(a) Entitlement to Severance Payments. If the Executive's employment shall terminate without Cause (pursuant to Section 5(a)(iv)) or for Good Reason (pursuant to Section 5(a)(v)), the Company shall:
(i) Pay to the Executive, in accordance with its regular payroll practice, following the Date of Termination, an amount equal to his then Annual Base Salary for the longer of one year or the remainder of the Initial Term (the "Severance Period").
(ii) At the expense of the Company continue for one year the Executive's coverage under all Company benefit plans and programs in which the Executive was entitled to participate immediately prior to the Date of Termination, to the extent permitted thereunder until the earlier of (A) the expiration of the Severance Period or (B) the date the Executive has commenced new employment and has thereby become eligible for comparable benefits. In the event that the Executive's participation in any such plan or program is not permitted, the Company shall arrange to provide the Executive with benefits substantially similar to those which the Executive would otherwise have been entitled to receive under such plans and programs.
(iii) Notwithstanding the terms or conditions of the Equity Plan or any stock option or other award agreement between the Company and the Executive, all such stock options or other awards shall become fully vested and exercisable as of the Date of Termination and shall remain exercisable until the earlier to occur of (A) the expiration of such stock option or other award pursuant to its terms or (B) the expiration of 90 days following the Date of Termination.
(b) Survival. The expiration or termination of the Term of Employment shall not impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such expiration.
(c) Mitigation of Damages. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amount payable to the Executive under any of the provisions of this
Agreement and such amounts shall not be reduced (except as provided in Section
6(a)(ii)) whether or not the Executive obtains other employment. Neither the
Executive nor the Company shall be liable to the other party for any damages in
addition to the amounts payable under Section 6 arising out of the termination
of the Executive's employment prior to the end of the Term of Employment (except
as provided in Section 9).
7. COMPETITION.
(a) Conduct of Executive. The term of Non-Competition (herein so called) shall be for a term beginning on the date hereof and continuing until the first anniversary of the Date of Termination; provided, however, that if the Executive's employment is terminated by the
Company other than for Cause or by the Executive for Good Reason the term of Non-Competition shall expire upon the earlier of the first anniversary of the Date of Termination or the date that the Executive waives his entitlement to any further payments under Section 6(a)(i) hereunder. During the term of Non-Competition, the Executive shall not, without the prior written consent of the Board, directly or indirectly engage in, or have any equity interest in, or manage or operate any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes with any business of the Company or any entity owned by it that is within 75 miles of any transmission site on which the Company or any entity owned by it operates a radio station at the Date of Termination provided, however, that the Executive shall be permitted to acquire a stock interest in such a corporation provided such stock is publicly traded and the stock so acquired is not more than five percent (5%) of the outstanding shares of such corporation.
(b) Construction of this Section. In the event the terms of this
Section 7 shall be determined by any court of competent jurisdiction to be
unenforceable by reason of its extending for too great a period of time or over
too great a geographical area or by reason of its being too extensive in any
other respect, it will be interpreted to extend only over the maximum period of
time for which it may be enforceable, and/or over the maximum geographical area
as to which it may be enforceable and/or to the maximum extent in all other
respects as to which it may be enforceable, all as determined by such court in
such action.
8. NONDISCLOSURE OF PROPRIETARY INFORMATION.
(a) Confidentiality. Except as required in the faithful performance of the Executive's duties hereunder or pursuant to subsection (c), the Executive shall, in perpetuity, maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for his benefit or the benefit of any person, firm, corporation or other entity any confidential or proprietary information or trade secrets of or relating to the Company, including, without limitation, information with respect to the Company's operations, processes, products, inventions, business practices, finances, principals, vendors, suppliers, customers, potential customers, marketing methods, costs, prices, contractual relationships, regulatory status, compensation paid to employees or other terms of employment, or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such confidential or proprietary information or trade secrets. The parties hereby stipulate and agree that as between them the foregoing matters are important, material and confidential proprietary information and trade secrets and affect the successful conduct of the businesses of the Company (and any successor or assignee of the Company).
(b) Return of Materials. Upon termination of the Executive's employment with Company for any reason and upon the Company's request, the Executive will promptly deliver to the Company all correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the Company's customers, business plans, marketing strategies, products or processes and/or which contain proprietary information or trade secrets.
(c) Response to Legal Process. The Executive may respond to a lawful and valid subpoena or other legal process but shall give the Company the earliest possible notice thereof, and shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought and shall assist such counsel in resisting or otherwise responding to such process.
9. INJUNCTIVE RELIEF.
It is recognized and acknowledged by the Executive that a breach of the covenants contained in Sections 7 and 8 will cause irreparable damage to Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Executive agrees that in the event of a breach of any of the covenants contained in Sections 7 and 8, in addition to any other remedy which may be available at law or in equity, the Company will be entitled to specific performance and injunctive relief.
10. BINDING ON SUCCESSORS.
This Agreement shall be binding upon and inure to the benefit of the Company, the Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable.
11. GOVERNING LAW.
This Agreement shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the State of Florida.
12. VALIDITY.
The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.
13. NOTICES.
Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by telex, telecopy, or certified or registered mail, postage prepaid, as follows:
(a) If to the Company:
Beasley Mezzanine Holdings, LLC 3033 Riviera Drive, Suite 200 Naples, Florida 34103
Attn: B. Caroline Beasley Fax: (941) 263-8191 |
With a copy to:
Latham & Watkins
1001 Pennsylvania Avenue, NW, Suite 1300
Washington, DC 20004
Attn: Joseph D. Sullivan
Fax: (202) 637-2201
(b) If to the Executive, to him at the address set forth below under his signature; or at any other address as any party shall have specified by notice in writing to the other parties.
14. COUNTERPARTS.
This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement.
15. ENTIRE AGREEMENT.
The terms of this Agreement are intended by the parties to be the final expression of their agreement with respect to the employment of the Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement. The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.
16. AMENDMENTS; WAIVERS.
This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by the Executive and the Chief Financial Officer. By an instrument in writing similarly executed, the Executive or the Company may waive compliance by the other party or parties with any provision of this Agreement that such other party was or is obligated to comply with or perform, provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
17. NO INCONSISTENT ACTIONS.
The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action inconsistent with the provisions or essential intent of this Agreement. Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement.
18. ARBITRATION.
Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted before a panel of three arbitrators in Washington, D.C. in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator's award in any court having jurisdiction; provided, however, that the Company shall be entitled to seek a restraining order or injunction in any court of competent jurisdiction to prevent any continuation of any violation of the provisions of Sections 7 or 8 of this Agreement and the Executive hereby consents that such restraining order or injunction may be granted without the necessity of the Company's posting any bond. The fees and expense of the arbitrator shall be borne by the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date and year first above written.
THE COMPANY
Beasley Mezzanine Holdings, LLC
By: /s/ B. CAROLINE BEASLEY
-----------------------------------
Name: B. Caroline Beasley
Title: Chief Financial Officer
|
THE EXECUTIVE
/s/ BRUCE G. BEASLEY ----------------------------------- Name: Bruce G. Beasley |
EXHIBIT 10.3
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") dated as of January 31, 2000, is made by and between Beasley Mezzanine Holdings, LLC, a Delaware limited liability company (together with any successor thereto, the "Company") and B. Caroline Beasley (the "Executive").
WHEREAS, the Company desires to assure itself of the services of the Executive, and the Executive desires to commit herself to serve the Company, on the terms herein provided;
NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below the parties hereto agree as follows:
1. CERTAIN DEFINITIONS.
(a) "Annual Base Salary" shall have the meaning set forth in Section 4.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cause" for the Company to terminate the Executive's employment hereunder shall exist upon the Executive's:
(i) failure substantially to perform her duties hereunder, other than any such failure resulting from the Executive's Disability, after notice and reasonable opportunity for cure, all as determined by the Board;
(ii) conviction of a felony or a crime involving moral turpitude; or
(iii) fraud or personal dishonesty involving Company assets.
(d) "Company" shall have the meaning set forth in the preamble hereto.
(e) "Compensation Committee" means the compensation committee of the Board.
(f) "Contract Year" shall mean each twelve month period beginning on the Effective Date hereof or an annual anniversary thereof.
(g) "Date of Termination" shall mean (i) if the Executive's employment is terminated by her death, the date of her death; and (ii) if the Executive's employment is terminated pursuant to any of Sections 5(a)(ii) through 5(a)(vi), the date specified in the Notice of Termination.
(h) "Disability" shall mean the absence of the Executive from the Executive's duties to the Company on a full-time basis for a period of 180 consecutive days as a result of incapacity due to mental or physical illness.
(i) "Effective Date" of this Agreement shall mean the date of effectiveness of the registration statement registering the initial public offering of shares of Class A common stock of the Company.
(j) "Executive" shall have the meaning set forth in the preamble hereto.
(k) "Good Reason" for the Executive to terminate her employment shall exist in the event that the Company fails to make any payment or provide any benefit hereunder or commits a material breach of this Agreement and does not cure such failure or breach after notice and a reasonable opportunity to cure.
(l) "Notice of Termination" shall have the meaning set forth in
Section 5(b).
(m) "Term of Employment" shall have the meaning set forth in Section 2(b).
2. EMPLOYMENT.
(a) Initial Term. The Company shall employ the Executive and the Executive shall enter the employ of the Company, for the period set forth in this Section 2, in the position set forth in Section 3 and upon the other terms and conditions herein provided. The initial term of employment under this Agreement (the "Initial Term") shall be for the period beginning on the Effective Date of this Agreement and shall expire on the third anniversary thereof, unless earlier terminated as provided in Section 5.
(b) Extension. The employment term hereunder shall automatically be extended for successive one-year periods ("Extension Terms" and, collectively with the Initial Term, the "Term of Employment") unless either party gives notice of non-extension to the other no later than 90 days prior to the expiration of the then-applicable Term of Employment.
3. POSITION AND DUTIES.
(a) Generally. The Executive shall serve as the Chief Financial Officer ("CFO") of the Company. Subject to reasonable modification from time to time by the Board or by the Chief Executive Officer, Executive shall report to the Chief Executive Officer and shall serve as CFO of the Company with such customary responsibilities, duties and authority as are usually incident to the position of CFO. Executive shall be responsible for the financial plans, policies and management of the Company along with its accounting practices and relationships with lending institutions, shareholders and the financial community. Executive shall direct the accounting, cash management, tax, insurance, budget, credit and treasury functions and activities associated with the security and investment of assets and funds that ensures that financial transactions, policies and plans meet short- and long-term objectives and regulatory requirements. Executive will, on a full-time basis, apply all of her skill and experience to the performance of her duties in such employment and will not, without the prior consent of the Board, devote substantial amounts of time to outside business activities. Notwithstanding the
foregoing, Executive may devote a reasonable amount of her time to civic, community, charitable or passive investment activities.
(b) Subsidiaries. If elected or appointed thereto, and only for the duration of such elected term or appointment, the Executive shall serve as a director of the Company and any of its subsidiaries and/or in one or more executive offices of any of such subsidiaries, provided that the Executive is indemnified for serving in any and all such capacities on a basis consistent with that provided by the Company to other directors of the Company or similarly situated executive officers of any such subsidiaries.
4. COMPENSATION AND RELATED MATTERS.
(a) Annual Base Salary. The Executive shall receive a base salary at a rate of $275,000 per annum during the first 12 months of the Initial Term, increased by five percent per annum on each anniversary of the Contract Year during the Term of Employment. In its sole discretion, the Compensation Committee may review the Annual Base Salary with a view toward consideration of merit increases as the Compensation Committee deems appropriate. The Annual Base Salary shall be paid in arrears in substantially equal installments at monthly or more frequent intervals, in accordance with the normal payroll practices of the Company.
(b) Bonus. Executive shall be eligible to receive an annual bonus for each fiscal year of the Company ending during the Term of Employment at the sole discretion of the Board.
(c) Equity Financing Bonus. Upon completion of the initial public offering of shares of Class A common stock of the Company (the "IPO"), the Company shall pay to Executive a one-time cash bonus of $50,000. This Equity Cash Bonus shall be due and payable by the Company within 30 days after the completion of the IPO.
(d) Benefits. The Executive shall be eligible to participate in the 2000 Equity Plan of Beasley Broadcasting Group, Inc. and such other equity based or incentive compensation plans or programs as may be adopted by the Company from time to time (collectively, the "Equity Plan") for its senior executives, at such level and in such amounts as may be determined by the Board in its sole discretion, subject to the terms and conditions of the Equity Plan and any applicable award agreements; provided, however, that in the event Executive violates Section 7 or Section 8 of this Agreement, all stock options or other equity based or incentive compensation awards granted under the Equity Plan or otherwise (whether or not vested) shall, immediately upon the time of the first such violation, cease to be exercisable and shall thereupon be cancelled and be of no further force and effect. At the expense of the Company, the Executive shall be entitled to participate in the other employee benefit plans, programs and arrangements of the Company (including, without limitation, health insurance, long-term disability coverage and vacation for Executive and her eligible dependents) now (or, to the extent determined by the Board, hereafter) in effect which are applicable to the senior officers of the Company, subject to and on a basis consistent with the terms, conditions and overall administration thereof.
(e) Expenses. The Company shall reimburse the Executive for all reasonable travel and other business expenses incurred by her in the performance of her duties to the Company, in accordance with the Company's documentation and other policies with respect thereto.
5. TERMINATION.
The Executive's employment hereunder may be terminated by the Company or the Executive, as applicable, without any breach of this Agreement only under the following circumstances:
(a) Circumstances.
(i) Death. The Executive's employment hereunder shall terminate upon her death. In the event of the death of the Executive during the Term of this Agreement, Company shall pay to Executive's widower, if surviving, otherwise to her estate or legal representative, compensation at the Annual Base Salary rate then being received by Executive for a period of one year following Executive's death.
(ii) Disability. If the Company determines in good faith that the Executive has incurred a Disability, the Company may give the Executive written notice of its intention to terminate the Executive's employment. In such event, the Executive's employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of her duties. The Executive shall continue to receive her Annual Base Salary until the Date of Termination.
(iii) Termination for Cause. The Company may terminate the Executive's employment hereunder for Cause.
(iv) Termination without Cause. The Company may terminate the Executive's employment hereunder without Cause.
(v) Resignation for Good Reason. The Executive may terminate her employment for Good Reason.
(vi) Resignation without Good Reason. The Executive may resign her employment without Good Reason upon 90 days written notice to the Company.
(b) Notice of Termination. Any termination of the Executive's employment by the Company or by the Executive under this Section 5 (other than termination pursuant to Section 5(a)(i)) shall be communicated by a written notice to the other party hereto indicating the specific termination provision in this Agreement relied upon, setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated, and specifying a Date of Termination which, except in the case of termination for Cause, shall be at least fourteen days following the date of
such notice (a "Notice of Termination"), or thirty days if termination is pursuant to Section 5(a)(ii).
6. SEVERANCE PAYMENTS.
(a) Entitlement to Severance Payments. If the Executive's employment shall terminate without Cause (pursuant to Section 5(a)(iv)) or for Good Reason (pursuant to Section 5(a)(v)), the Company shall:
(i) Pay to the Executive, in accordance with its regular payroll practice, following the Date of Termination, an amount equal to her then Annual Base Salary for the longer of one year or the remainder of the Initial Term (the "Severance Period").
(ii) At the expense of the Company continue for one year the Executive's coverage under all Company benefit plans and programs in which the Executive was entitled to participate immediately prior to the Date of Termination, to the extent permitted thereunder until the earlier of (A) the expiration of the Severance Period or (B) the date the Executive has commenced new employment and has thereby become eligible for comparable benefits. In the event that the Executive's participation in any such plan or program is not permitted, the Company shall arrange to provide the Executive with benefits substantially similar to those which the Executive would otherwise have been entitled to receive under such plans and programs.
(iii) Notwithstanding the terms or conditions of the Equity Plan or any stock option or other award agreement between the Company and the Executive, all such stock options or other awards shall become fully vested and exercisable as of the Date of Termination and shall remain exercisable until the earlier to occur of (A) the expiration of such stock option or other award pursuant to its terms or (B) the expiration of 90 days following the Date of Termination.
(b) Survival. The expiration or termination of the Term of Employment shall not impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such expiration.
(c) Mitigation of Damages. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amount payable to the Executive under any of the provisions of this
Agreement and such amounts shall not be reduced (except as provided in Section
6(a)(ii)) whether or not the Executive obtains other employment. Neither the
Executive nor the Company shall be liable to the other party for any damages in
addition to the amounts payable under Section 6 arising out of the termination
of the Executive's employment prior to the end of the Term of Employment (except
as provided in Section 9).
7. COMPETITION.
(a) Conduct of Executive. The term of Non-Competition (herein so called) shall be for a term beginning on the date hereof and continuing until the first anniversary of the Date of Termination; provided, however, that if the Executive's employment is terminated by the Company other than for Cause or by the Executive for Good Reason the term of Non-Competition shall expire upon the earlier of the first anniversary of the Date of Termination or the date that the Executive waives her entitlement to any further payments under Section 6(a)(i) hereunder. During the term of Non-Competition, the Executive shall not, without the prior written consent of the Board, directly or indirectly engage in, or have any equity interest in, or manage or operate any person, firm, corporation, partnership or business (whether as director, officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes with any business of the Company or any entity owned by it that is within 75 miles of any transmission site on which the Company or any entity owned by it operates a radio station at the Date of Termination provided, however, that the Executive shall be permitted to acquire a stock interest in such a corporation provided such stock is publicly traded and the stock so acquired is not more than five percent (5%) of the outstanding shares of such corporation.
(b) Construction of this Section. In the event the terms of this
Section 7 shall be determined by any court of competent jurisdiction to be
unenforceable by reason of its extending for too great a period of time or over
too great a geographical area or by reason of its being too extensive in any
other respect, it will be interpreted to extend only over the maximum period of
time for which it may be enforceable, and/or over the maximum geographical area
as to which it may be enforceable and/or to the maximum extent in all other
respects as to which it may be enforceable, all as determined by such court in
such action.
8. NONDISCLOSURE OF PROPRIETARY INFORMATION.
(a) Confidentiality. Except as required in the faithful performance of the Executive's duties hereunder or pursuant to subsection (c), the Executive shall, in perpetuity, maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for her benefit or the benefit of any person, firm, corporation or other entity any confidential or proprietary information or trade secrets of or relating to the Company, including, without limitation, information with respect to the Company's operations, processes, products, inventions, business practices, finances, principals, vendors, suppliers, customers, potential customers, marketing methods, costs, prices, contractual relationships, regulatory status, compensation paid to employees or other terms of employment, or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such confidential or proprietary information or trade secrets. The parties hereby stipulate and agree that as between them the foregoing matters are important, material and confidential proprietary information and trade secrets and affect the successful conduct of the businesses of the Company (and any successor or assignee of the Company).
(b) Return of Materials. Upon termination of the Executive's employment with Company for any reason and upon the Company's request, the Executive will promptly deliver to the Company all correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the Company's customers, business plans, marketing strategies, products or processes and/or which contain proprietary information or trade secrets.
(c) Response to Legal Process. The Executive may respond to a lawful and valid subpoena or other legal process but shall give the Company the earliest possible notice thereof, and shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought and shall assist such counsel in resisting or otherwise responding to such process.
9. INJUNCTIVE RELIEF.
It is recognized and acknowledged by the Executive that a breach of the covenants contained in Sections 7 and 8 will cause irreparable damage to Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Executive agrees that in the event of a breach of any of the covenants contained in Sections 7 and 8, in addition to any other remedy which may be available at law or in equity, the Company will be entitled to specific performance and injunctive relief.
10. BINDING ON SUCCESSORS.
This Agreement shall be binding upon and inure to the benefit of the Company, the Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable.
11. GOVERNING LAW.
This Agreement shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the State of Florida.
12. VALIDITY.
The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.
13. NOTICES.
Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by telex, telecopy, or certified or registered mail, postage prepaid, as follows:
(a) If to the Company:
Beasley Mezzanine Holdings, LLC 3033 Riviera Drive, Suite 200 Naples, Florida 34103 Attn: Bruce G. Beasley Fax: (941) 263-8191
With a copy to:
Latham & Watkins 1001 Pennsylvania Avenue, NW, Suite 1300 Washington, DC 20004 Attn: Joseph D. Sullivan Fax: (202) 637-2201
(b) If to the Executive, to her at the address set forth below under her signature; or at any other address as any party shall have specified by notice in writing to the other parties.
14. COUNTERPARTS.
This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement.
15. ENTIRE AGREEMENT.
The terms of this Agreement are intended by the parties to be the final expression of their agreement with respect to the employment of the Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement. The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.
16. AMENDMENTS; WAIVERS.
This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by the Executive and the Chief Operating Officer. By an instrument in writing similarly executed, the Executive or the Company may waive compliance by the other party or parties with any provision of this Agreement that such other party was or is obligated to comply with or perform, provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
17. NO INCONSISTENT ACTIONS.
The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action inconsistent with the provisions or essential intent of this Agreement. Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement.
18. ARBITRATION.
Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted before a panel of three arbitrators in Washington, D.C. in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator's award in any court having jurisdiction; provided, however, that the Company shall be entitled to seek a restraining order or injunction in any court of competent jurisdiction to prevent any continuation of any violation of the provisions of Sections 7 or 8 of this Agreement and the Executive hereby consents that such restraining order or injunction may be granted without the necessity of the Company's posting any bond. The fees and expense of the arbitrator shall be borne by the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date and year first above written.
THE COMPANY
Beasley Mezzanine Holdings, LLC
By: /s/ BRUCE G. BEASLEY
---------------------------------------
Name: Bruce G. Beasley
Title: President, Chief Operating Officer
|
THE EXECUTIVE
/s/ B. CAROLINE BEASLEY --------------------------------------- Name: B. Caroline Beasley |
EXHIBIT 10.4
EXECUTIVE EMPLOYMENT AGREEMENT
THIS EXECUTIVE EMPLOYMENT AGREEMENT ("Agreement") dated as of January 31, 2000, is made by and between Beasley Mezzanine Holdings, LLC, a Delaware limited liability company (together with any successor thereto, the "Company") and Brian E. Beasley (the "Executive").
WHEREAS, the Company desires to assure itself of the services of the Executive, and the Executive desires to commit himself to serve the Company, on the terms herein provided;
NOW, THEREFORE, in consideration of the foregoing and of the respective covenants and agreements set forth below the parties hereto agree as follows:
1. CERTAIN DEFINITIONS.
(a) "Annual Base Salary" shall have the meaning set forth in Section 4.
(b) "Board" shall mean the Board of Directors of the Company.
(c) "Cause" for the Company to terminate the Executive's employment hereunder shall exist upon the Executive's:
(i) failure substantially to perform his duties hereunder, other than any such failure resulting from the Executive's Disability, after notice and reasonable opportunity for cure, all as determined by the Board;
(ii) conviction of a felony or a crime involving moral turpitude; or
(iii) fraud or personal dishonesty involving Company assets.
(d) "Company" shall have the meaning set forth in the preamble hereto.
(e) "Compensation Committee" means the compensation committee of the Board.
(f) "Contract Year" shall mean each twelve month period beginning on the Effective Date hereof or an annual anniversary thereof.
(g) "Date of Termination" shall mean (i) if the Executive's employment is terminated by his death, the date of his death; and (ii) if the Executive's employment is terminated pursuant to any of Sections 5(a)(ii) through 5(a)(vi), the date specified in the Notice of Termination.
(h) "Disability" shall mean the absence of the Executive from the Executive's duties to the Company on a full-time basis for a period of 180 consecutive days as a result of incapacity due to mental or physical illness.
(i) "Effective Date" of this Agreement shall mean the date of effectiveness of the registration statement registering the initial public offering of shares of Class A common stock of the Company.
(j) "Executive" shall have the meaning set forth in the preamble hereto.
(k) "Good Reason" for the Executive to terminate his employment shall exist in the event that the Company fails to make any payment or provide any benefit hereunder or commits a material breach of this Agreement and does not cure such failure or breach after notice and a reasonable opportunity to cure.
(l) "Notice of Termination" shall have the meaning set forth in
Section 5(b).
(m) "Term of Employment" shall have the meaning set forth in Section 2(b).
2. EMPLOYMENT.
(a) Initial Term. The Company shall employ the Executive and the Executive shall enter the employ of the Company, for the period set forth in this Section 2, in the position set forth in Section 3 and upon the other terms and conditions herein provided. The initial term of employment under this Agreement (the "Initial Term") shall be for the period beginning on the Effective Date of this Agreement and shall expire on the third anniversary thereof, unless earlier terminated as provided in Section 5.
(b) Extension. The employment term hereunder shall automatically be extended for successive one-year periods ("Extension Terms" and, collectively with the Initial Term, the "Term of Employment") unless either party gives notice of non-extension to the other no later than 90 days prior to the expiration of the then-applicable Term of Employment.
3. POSITION AND DUTIES.
(a) Generally. The Executive shall serve as the Vice President of Operations of the Company. Subject to reasonable modification from time to time by the Board or by the Chief Executive Officer, Executive shall report to the Chief Operating Officer and shall, for such radio stations as designated by the Chief Executive Officer or by the Chief Operating Officer, supervise, control and have responsibility for the daily operating activities of such designated stations, including without limitation supervision of station management, personnel matters, short- and long-term strategic decision making, station budgets, management of third party relationships, and disbursements. Executive will, on a full-time basis, apply all of his skill and experience to the performance of his duties in such employment and will not, without the prior consent of the Board, devote substantial amounts of time to outside business activities. Notwithstanding the foregoing, Executive may devote a reasonable amount of his time to civic, community, charitable or passive investment activities.
(b) Subsidiaries. If elected or appointed thereto, and only for the duration of such elected term or appointment, the Executive shall serve as a director of the Company and any of its subsidiaries and/or in one or more executive offices of any of such subsidiaries, provided
that the Executive is indemnified for serving in any and all such capacities on a basis consistent with that provided by the Company to other directors of the Company or similarly situated executive officers of any such subsidiaries.
4. COMPENSATION AND RELATED MATTERS.
(a) Annual Base Salary. The Executive shall receive a base salary at a rate of $300,000 per annum during the first 12 months of the Initial Term, increased by five percent per annum on each anniversary of the Contract Year during the Term of Employment. In its sole discretion, the Compensation Committee may review the Annual Base Salary with a view toward consideration of merit increases as the Compensation Committee deems appropriate. The Annual Base Salary shall be paid in arrears in substantially equal installments at monthly or more frequent intervals, in accordance with the normal payroll practices of the Company.
(b) Bonus. Executive shall be eligible to receive an annual bonus for each fiscal year of the Company ending during the Term of Employment at the sole discretion of the Board.
(c) Benefits. The Executive shall be eligible to participate in the 2000 Equity Plan of Beasley Broadcasting Group, Inc. and such other equity based or incentive compensation plans or programs as may be adopted by the Company from time to time (collectively, the "Equity Plan") for its senior executives, at such level and in such amounts as may be determined by the Board in its sole discretion, subject to the terms and conditions of the Equity Plan and any applicable award agreements; provided, however, that in the event Executive violates Section 7 or Section 8 of this Agreement, all stock options or other equity based or incentive compensation awards granted under the Equity Plan or otherwise (whether or not vested) shall, immediately upon the time of the first such violation, cease to be exercisable and shall thereupon be cancelled and be of no further force and effect. At the expense of the Company, the Executive shall be entitled to participate in the other employee benefit plans, programs and arrangements of the Company (including, without limitation, health insurance, long-term disability coverage and vacation for Executive and his eligible dependents) now (or, to the extent determined by the Board, hereafter) in effect which are applicable to the senior officers of the Company, subject to and on a basis consistent with the terms, conditions and overall administration thereof.
(d) Expenses. The Company shall reimburse the Executive for all reasonable travel and other business expenses incurred by him in the performance of his duties to the Company, in accordance with the Company's documentation and other policies with respect thereto.
5. TERMINATION.
The Executive's employment hereunder may be terminated by the Company or the Executive, as applicable, without any breach of this Agreement only under the following circumstances:
(a) Circumstances.
(i) Death. The Executive's employment hereunder shall terminate upon his death. In the event of the death of the Executive during the Term of this Agreement, Company shall pay to Executive's widow, if surviving, otherwise to his estate or legal representative, compensation at the Annual Base Salary rate then being received by Executive for a period of one year following Executive's death.
(ii) Disability. If the Company determines in good faith that the Executive has incurred a Disability, the Company may give the Executive written notice of its intention to terminate the Executive's employment. In such event, the Executive's employment with the Company shall terminate effective on the 30th day after receipt of such notice by the Executive, provided that within the 30 days after such receipt, the Executive shall not have returned to full-time performance of his duties. The Executive shall continue to receive his Annual Base Salary until the Date of Termination.
(iii) Termination for Cause. The Company may terminate the Executive's employment hereunder for Cause.
(iv) Termination without Cause. The Company may terminate the Executive's employment hereunder without Cause.
(v) Resignation for Good Reason. The Executive may terminate his employment for Good Reason.
(vi) Resignation without Good Reason. The Executive may resign his employment without Good Reason upon 90 days written notice to the Company.
(b) Notice of Termination. Any termination of the Executive's employment by the Company or by the Executive under this Section 5 (other than termination pursuant to Section 5(a)(i)) shall be communicated by a written notice to the other party hereto indicating the specific termination provision in this Agreement relied upon, setting forth in reasonable detail the facts and circumstances claimed to provide a basis for termination of the Executive's employment under the provision so indicated, and specifying a Date of Termination which, except in the case of termination for Cause, shall be at least fourteen days following the date of such notice (a "Notice of Termination"), or thirty days if termination is pursuant to Section 5(a)(ii).
6. SEVERANCE PAYMENTS.
(a) Entitlement to Severance Payments. If the Executive's employment shall terminate without Cause (pursuant to Section 5(a)(iv)) or for Good Reason (pursuant to Section 5(a)(v)), the Company shall:
(i) Pay to the Executive, in accordance with its regular payroll practice, following the Date of Termination, an amount equal to his then Annual Base Salary for the longer of one year or the remainder of the Initial Term (the "Severance Period").
(ii) At the expense of the Company continue for one year the Executive's coverage under all Company benefit plans and programs in which the Executive was entitled to participate immediately prior to the Date of Termination, to the extent permitted thereunder until the earlier of (A) the expiration of the Severance Period or (B) the date the Executive has commenced new employment and has thereby become eligible for comparable benefits. In the event that the Executive's participation in any such plan or program is not permitted, the Company shall arrange to provide the Executive with benefits substantially similar to those which the Executive would otherwise have been entitled to receive under such plans and programs.
(iii) Notwithstanding the terms or conditions of the Equity Plan or any stock option or other award agreement between the Company and the Executive, all such stock options or other awards shall become fully vested and exercisable as of the Date of Termination and shall remain exercisable until the earlier to occur of (A) the expiration of such stock option or other award pursuant to its terms or (B) the expiration of 90 days following the Date of Termination.
(b) Survival. The expiration or termination of the Term of Employment shall not impair the rights or obligations of any party hereto which shall have accrued hereunder prior to such expiration.
(c) Mitigation of Damages. In no event shall the Executive be
obligated to seek other employment or take any other action by way of mitigation
of the amount payable to the Executive under any of the provisions of this
Agreement and such amounts shall not be reduced (except as provided in Section
6(a)(ii)) whether or not the Executive obtains other employment. Neither the
Executive nor the Company shall be liable to the other party for any damages in
addition to the amounts payable under Section 6 arising out of the termination
of the Executive's employment prior to the end of the Term of Employment (except
as provided in Section 9).
7. COMPETITION.
(a) Conduct of Executive. The term of Non-Competition (herein so called) shall be for a term beginning on the date hereof and continuing until the first anniversary of the Date of Termination; provided, however, that if the Executive's employment is terminated by the Company other than for Cause or by the Executive for Good Reason the term of Non-Competition shall expire upon the earlier of the first anniversary of the Date of Termination or the date that the Executive waives his entitlement to any further payments under Section 6(a)(i) hereunder. During the term of Non-Competition, the Executive shall not, without the prior written consent of the Board, directly or indirectly engage in, or have any equity interest in, or manage or operate any person, firm, corporation, partnership or business (whether as director,
officer, employee, agent, representative, partner, security holder, consultant or otherwise) that engages in any business which competes with any business of the Company or any entity owned by it that is within 75 miles of any transmission site on which the Company or any entity owned by it operates a radio station at the Date of Termination provided, however, that the Executive shall be permitted to acquire a stock interest in such a corporation provided such stock is publicly traded and the stock so acquired is not more than five percent (5%) of the outstanding shares of such corporation.
(b) Construction of this Section. In the event the terms of this
Section 7 shall be determined by any court of competent jurisdiction to be
unenforceable by reason of its extending for too great a period of time or over
too great a geographical area or by reason of its being too extensive in any
other respect, it will be interpreted to extend only over the maximum period of
time for which it may be enforceable, and/or over the maximum geographical area
as to which it may be enforceable and/or to the maximum extent in all other
respects as to which it may be enforceable, all as determined by such court in
such action.
8. NONDISCLOSURE OF PROPRIETARY INFORMATION.
(a) Confidentiality. Except as required in the faithful performance of the Executive's duties hereunder or pursuant to subsection (c), the Executive shall, in perpetuity, maintain in confidence and shall not directly, indirectly or otherwise, use, disseminate, disclose or publish, or use for his benefit or the benefit of any person, firm, corporation or other entity any confidential or proprietary information or trade secrets of or relating to the Company, including, without limitation, information with respect to the Company's operations, processes, products, inventions, business practices, finances, principals, vendors, suppliers, customers, potential customers, marketing methods, costs, prices, contractual relationships, regulatory status, compensation paid to employees or other terms of employment, or deliver to any person, firm, corporation or other entity any document, record, notebook, computer program or similar repository of or containing any such confidential or proprietary information or trade secrets. The parties hereby stipulate and agree that as between them the foregoing matters are important, material and confidential proprietary information and trade secrets and affect the successful conduct of the businesses of the Company (and any successor or assignee of the Company).
(b) Return of Materials. Upon termination of the Executive's employment with Company for any reason and upon the Company's request, the Executive will promptly deliver to the Company all correspondence, drawings, manuals, letters, notes, notebooks, reports, programs, plans, proposals, financial documents, or any other documents concerning the Company's customers, business plans, marketing strategies, products or processes and/or which contain proprietary information or trade secrets.
(c) Response to Legal Process. The Executive may respond to a lawful and valid subpoena or other legal process but shall give the Company the earliest possible notice thereof, and shall, as much in advance of the return date as possible, make available to the Company and its counsel the documents and other information sought and shall assist such counsel in resisting or otherwise responding to such process.
9. INJUNCTIVE RELIEF.
It is recognized and acknowledged by the Executive that a breach of the covenants contained in Sections 7 and 8 will cause irreparable damage to Company and its goodwill, the exact amount of which will be difficult or impossible to ascertain, and that the remedies at law for any such breach will be inadequate. Accordingly, the Executive agrees that in the event of a breach of any of the covenants contained in Sections 7 and 8, in addition to any other remedy which may be available at law or in equity, the Company will be entitled to specific performance and injunctive relief.
10. BINDING ON SUCCESSORS.
This Agreement shall be binding upon and inure to the benefit of the Company, the Executive and their respective successors, assigns, personnel and legal representatives, executors, administrators, heirs, distributees, devisees, and legatees, as applicable.
11. GOVERNING LAW.
This Agreement shall be governed, construed, interpreted and enforced in accordance with the substantive laws of the State of Florida.
12. VALIDITY.
The invalidity or unenforceability of any provision or provisions of this Agreement shall not affect the validity or enforceability of any other provision of this Agreement, which shall remain in full force and effect.
13. NOTICES.
Any notice, request, claim, demand, document and other communication hereunder to any party shall be effective upon receipt (or refusal of receipt) and shall be in writing and delivered personally or sent by telex, telecopy, or certified or registered mail, postage prepaid, as follows:
(a) If to the Company:
Beasley Mezzanine Holdings, LLC 3033 Riviera Drive, Suite 200 Naples, Florida 34103 Attn: B. Caroline Beasley Fax: (941) 263-8191
With a copy to:
Latham & Watkins 1001 Pennsylvania Avenue, NW, Suite 1300
Washington, DC 20004 Attn: Joseph D. Sullivan Fax: (202) 637-2201
(b) If to the Executive, to him at the address set forth below under his signature; or at any other address as any party shall have specified by notice in writing to the other parties.
14. COUNTERPARTS.
This Agreement may be executed in several counterparts, each of which shall be deemed to be an original, but all of which together will constitute one and the same Agreement.
15. ENTIRE AGREEMENT.
The terms of this Agreement are intended by the parties to be the final expression of their agreement with respect to the employment of the Executive by the Company and may not be contradicted by evidence of any prior or contemporaneous agreement. The parties further intend that this Agreement shall constitute the complete and exclusive statement of its terms and that no extrinsic evidence whatsoever may be introduced in any judicial, administrative, or other legal proceeding to vary the terms of this Agreement.
16. AMENDMENTS; WAIVERS.
This Agreement may not be modified, amended, or terminated except by an instrument in writing, signed by the Executive and the Chief Financial Officer. By an instrument in writing similarly executed, the Executive or the Company may waive compliance by the other party or parties with any provision of this Agreement that such other party was or is obligated to comply with or perform, provided, however, that such waiver shall not operate as a waiver of, or estoppel with respect to, any other or subsequent failure. No failure to exercise and no delay in exercising any right, remedy, or power hereunder preclude any other or further exercise of any other right, remedy, or power provided herein or by law or in equity.
17. NO INCONSISTENT ACTIONS.
The parties hereto shall not voluntarily undertake or fail to undertake any action or course of action inconsistent with the provisions or essential intent of this Agreement. Furthermore, it is the intent of the parties hereto to act in a fair and reasonable manner with respect to the interpretation and application of the provisions of this Agreement.
18. ARBITRATION.
Any dispute or controversy arising under or in connection with this Agreement shall be settled exclusively by arbitration, conducted before a panel of three arbitrators in Washington, D.C. in accordance with the rules of the American Arbitration Association then in effect. Judgment may be entered on the arbitrator's award in any court having jurisdiction; provided, however, that the Company shall be entitled to seek a restraining order or injunction in
any court of competent jurisdiction to prevent any continuation of any violation of the provisions of Sections 7 or 8 of this Agreement and the Executive hereby consents that such restraining order or injunction may be granted without the necessity of the Company's posting any bond. The fees and expense of the arbitrator shall be borne by the Company.
IN WITNESS WHEREOF, the parties have executed this Agreement on the date and year first above written.
THE COMPANY
Beasley Mezzanine Holdings, LLC
By: /s/ B. CAROLINE BEASLEY
---------------------------------------
Name: B. Caroline Beasley
Title: Chief Financial Officer
|
THE EXECUTIVE
/s/ BRIAN E. BEASLEY --------------------------------------- Name: Brian E. Beasley |
EXHIBIT 10.11
EXECUTION
BEASLEY FM ACQUISITION CORP.
BEASLEY BROADCASTING OF EASTERN NORTH CAROLINA, INCORPORATED
BEASLEY BROADCASTING OF EASTERN PENNSYLVANIA, INC.
BEASLEY BROADCASTING OF NEW JERSEY, INC.
W & B MEDIA, INC.
BEASLEY BROADCASTING OF SOUTHWEST FLORIDA, INC.
BEASLEY BROADCASTING OF COASTAL CAROLINA, INC.
BEASLEY-REED ACQUISITION PARTNERSHIP
BEASLEY RADIO, INC.
C S R A BROADCASTERS, INC.
BEASLEY COMMUNICATIONS, INC.
BEASLEY BROADCASTING OF AUGUSTA, INC.
THIRD AMENDMENT AND LIMITED WAIVER TO CREDIT AGREEMENT
This THIRD AMENDMENT AND LIMITED WAIVER TO CREDIT AGREEMENT (this "AMENDMENT") is dated as of February 7, 2000 and entered into by and among BEASLEY FM ACQUISITION CORP., a Delaware corporation ("FM ACQUISITION CORP."), BEASLEY BROADCASTING OF EASTERN NORTH CAROLINA, INCORPORATED, a North Carolina corporation ("BEASLEY OF NORTH Carolina"), BEASLEY BROADCASTING OF EASTERN PENNSYLVANIA, INC., a Delaware corporation ("BEASLEY OF PENNSYLVANIA"), BEASLEY BROADCASTING OF NEW JERSEY, INC., a Delaware corporation ("BEASLEY OF NEW JERSEY"), W & B MEDIA, INC., a North Carolina corporation ("W&B"), BEASLEY BROADCASTING OF SOUTHWEST FLORIDA, INC., a Delaware corporation ("BEASLEY OF FLORIDA"), BEASLEY BROADCASTING OF COASTAL CAROLINA, INC., a Delaware corporation ("BEASLEY OF COASTAL CAROLINA"), BEASLEY-REED ACQUISITION PARTNERSHIP, a Delaware general partnership ("BEASLEY-REED"), BEASLEY RADIO, INC., a Delaware corporation ("BEASLEY RADIO"), C S R A BROADCASTERS, INC., a Georgia corporation ("CSRA"), BEASLEY COMMUNICATIONS, INC., a Delaware corporation ("BEASLEY COMMUNICATIONS") and BEASLEY BROADCASTING OF AUGUSTA, INC., a Delaware corporation ("BEASLEY OF AUGUSTA"); each of FM Acquisition Corp., Beasley of North Carolina, Beasley of Pennsylvania, Beasley of New Jersey, W&B, Beasley of Florida, Beasley of Coastal Carolina, Beasley-Reed, Beasley Radio, CSRA, Beasley Communications and Beasley of Augusta are a "BORROWER" and collectively, the "BORROWERS"), on a joint and several basis, the financial institutions listed on the signature pages hereof ("LENDERS"), the CREDIT SUPPORT PARTIES (as defined in Section 4 hereof) listed on the signature pages hereof and BANK OF MONTREAL, CHICAGO BRANCH ("BANK OF MONTREAL"), as agent for Lenders (in such capacity, "AGENT"), and is made with reference to that certain Credit Agreement dated as of March 30, 1998, as amended by that certain First Amendment to Credit Agreement dated as of August 11, 1999 and that certain Second Amendment and Limited Consent to Credit Agreement (the "SECOND AMENDMENT") dated as of December 30, 1999 (as amended, supplemented or
otherwise modified to the date hereof, the "CREDIT AGREEMENT"), by and among Borrowers, certain Lenders and Agent. Capitalized terms used herein without definition shall have the same meanings herein as set forth in the Credit Agreement.
RECITALS
WHEREAS, Borrowers desire to waive compliance with the provisions of subsection 6.9 of the Credit Agreement until March 15, 2000 and to amend the Credit Agreement to make certain amendments thereto, in each case on the terms set forth herein.
NOW, THEREFORE, in consideration of the premises and the agreements, provisions and covenants herein contained, the parties hereto agree as follows:
SECTION 1. AMENDMENT TO THE CREDIT AGREEMENT
Subsection 7.7 of the Credit Agreement is hereby amended by deleting subdivision (vii) thereof in its entirety and substituting therefor the following:
"(vii) At any time after the First Amendment Effective Date, Borrowers and their respective Subsidiaries may sell or otherwise transfer the Transferred Tower Sites to BFT; provided that (a) the consideration for such sale or transfer shall consist of a promissory note or notes in an aggregate principal amount of not less than $2,800,000, which shall have a final maturity of not more than 20 years from the date of issuance thereof, shall provide for monthly cash interest at a per annum rate of not less than 6.0%, and shall provide for monthly repayments of principal such that the amount of each monthly installment of principal and interest through and including the last such installment shall be equal to each other such installment, (b) those Borrowers which are transferors of such Transferred Tower Sites (collectively, the "TRANSFEROR BORROWERS") shall, concurrently with such sale or transfer, enter into lease contracts with BFT for such Transferred Tower Sites, which contracts shall be in form and substance reasonably satisfactory to Agent, and (c) in any event, in any month following such transfer the aggregate of all lease payments for such Transferred Tower Sites made in such month by Transferor Borrowers shall not exceed the amount of the installment of principal and interest paid during such month in cash to Borrowers pursuant to the promissory note or notes referred to in the preceding clause (a); and"
SECTION 2. LIMITED WAIVER
Lenders hereby waive compliance with the provisions of subsection 6.9 of the Credit Agreement requiring Borrowers to maintain in effect one or more Interest Rate Agreements with respect to the Loans, in an aggregate notional principal amount at any time of not less than an amount equal to 50% of the then outstanding principal balance of the Loans; provided, that Borrowers shall comply with all such provisions of subsection 6.9 of the Credit Agreement on or before March 15, 2000.
SECTION 3. BORROWERS' REPRESENTATIONS AND WARRANTIES
In order to induce Lenders to enter into this Amendment and to amend the Credit Agreement in the manner provided herein, Borrowers represent and warrant to each Lender that the following statements are true, correct and complete:
A. POWER AND AUTHORITY. Each Credit Party is a corporation, limited liability company, partnership or limited partnership validly existing and in good standing under the laws of its state of organization. Each Credit Party has all requisite corporate, partnership or limited partnership power and authority to enter into this Amendment and to carry out the transactions contemplated by, and perform its obligations under, the Credit Agreement as amended by this Amendment (as so amended, the "AMENDED AGREEMENT").
B. AUTHORIZATION OF AGREEMENT. The execution and delivery of this Amendment and the performance of the Amended Agreement have been duly authorized by all necessary corporate, partnership or limited partnership action on the part of each Credit Party.
C. NO CONFLICT. The execution and delivery by each Credit Party of this Amendment and the performance by Borrowers of the Amended Agreement do not and will not (i) violate any provision of any law or any governmental rule or regulation applicable to any Credit Party, the Certificate or Articles of Incorporation, Certificate of Limited Partnership, Partnership Agreement or Bylaws of any Credit Party or any order, judgment or decree of any court or other agency of government binding on any Credit Party, (ii) conflict with, result in a breach of or constitute (with due notice or lapse of time or both) a default under any Contractual Obligation of any Credit Party, (iii) result in or require the creation or imposition of any Lien upon any of the properties or assets of any Credit Party (other than any Liens created under any of the Loan Documents in favor of Agent on behalf and for the ratable benefit of Lenders), or (iv) require any approval of stockholders or any approval or consent of any Person under any Contractual Obligation of any Credit Party.
D. GOVERNMENTAL CONSENTS. The execution and delivery by each Credit Party of this Amendment and the performance by Borrowers of the Amended Agreement do not and will not require any registration with, consent or approval of, or notice to, or other action to, with or by, any federal, state or other governmental authority or regulatory body including, without limitation, the FCC, except for filings required in connection with the perfection of the security interests or the exercise of the rights granted pursuant to the Security Documents and filings required with the FCC in connection with the Acquisitions contemplated by the Permitted Acquisition Documents and the filing of this Amendment and related documents with the FCC.
E. BINDING OBLIGATION. This Amendment and the Amended Agreement have been duly executed and delivered by each Credit Party which is a party thereto and are the legally valid and binding obligations of each such Credit Party, enforceable against each such Credit Party in accordance with their respective terms, except as may be limited by bankruptcy, insolvency, reorganization, moratorium or similar laws relating to or limiting creditors' rights generally or by equitable principles relating to enforceability.
F. INCORPORATION OF REPRESENTATIONS AND WARRANTIES FROM CREDIT AGREEMENT. The representations and warranties contained in Section 5 of the Credit Agreement are and will be true, correct and complete in all material respects on and as of the Third Amendment Effective Date to the same extent as though made on and as of that date, except to the extent such representations and warranties specifically relate to an earlier date, in which case they were true, correct and complete in all material respects on and as of such earlier date.
G. ABSENCE OF DEFAULT. After giving effect to this Amendment, no event has occurred and is continuing or will result from the consummation of the transactions contemplated by this Amendment that would constitute an Event of Default or a Potential Event of Default.
SECTION 4. ACKNOWLEDGMENT AND CONSENT
Each of the Borrowers and each of the Persons indicated as (i) Subsidiary Guarantors or (ii) Subordinated Creditors on the signature pages hereof (each individually a "CREDIT SUPPORT PARTY" and collectively, the "CREDIT SUPPORT PARTIES") hereby acknowledges and agrees that each Loan Document and Related Agreement to which it is a party is in full force and effect and shall not be limited or impaired in any manner by the effectiveness of this Amendment and the transactions contemplated hereby.
SECTION 5. MISCELLANEOUS
A. REFERENCE TO AND EFFECT ON THE CREDIT AGREEMENT AND THE OTHER LOAN DOCUMENTS.
(i) On and after the Third Amendment Effective Date, each reference in the Credit Agreement to "this Agreement", "hereunder", "hereof'", "herein" or words of like import referring to the Credit Agreement, and each reference in the other applicable Loan Documents to the "Credit Agreement", "thereunder", "thereof" or words of like import referring to the Credit Agreement shall mean and be a reference to the Amended Agreement.
(ii) Except as specifically waived or amended by this Amendment, the Credit Agreement and the other Loan Documents shall remain in full force and effect and are hereby ratified and confirmed.
(iii) Without limiting the generality of the provisions of Section 10.6 of the Credit Agreement, the waiver and the amendment set forth in Sections 1 and 2 shall be limited precisely as written, and nothing in this Amendment shall be deemed to (a) constitute a waiver of compliance by Borrowers with respect to (i) subsection 6.9 of the Credit Agreement in any other instance or (ii) any other term, provision or condition of the Credit Agreement or any of the Loan Documents, or (b) prejudice or operate as a waiver of any right, power or remedy that Agent or any Lender may now have or may have in the future under or in connection with the Credit Agreement or any of the other Loan Documents.
B. FEES AND EXPENSES. Borrowers acknowledge that all reasonable costs, fees and expenses incurred by Agent and its counsel with respect to this Amendment and the documents and transactions contemplated hereby shall be for the account of Borrowers, jointly and severally.
C. HEADINGS. Section and subsection headings in this Amendment are included herein for convenience of reference only and shall not constitute a part of this Amendment for any other purpose or be given any substantive effect.
D. APPLICABLE LAW. THIS AMENDMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES HERETO AND ALL OTHER ASPECTS HEREOF SHALL BE DEEMED TO BE MADE UNDER, SHALL BE GOVERNED BY, AND SHALL BE CONSTRUED AND ENFORCED IN ACCORDANCE WITH, THE LAWS OF THE STATE OF NEW YORK (INCLUDING SECTION 5-1401 OF THE GENERAL OBLIGATIONS LAW OF THE STATE OF NEW YORK), WITHOUT REGARD TO CONFLICTS OF LAWS PRINCIPLES.
E. COUNTERPARTS. This Amendment may be executed in any number of counterparts and by different parties hereto in separate counterparts, each of which when so executed and delivered shall be deemed an original, but all such counterparts together shall constitute but one and the same instrument; signature pages may be detached from multiple separate counterparts and attached to a single counterpart so that all signature pages are physically attached to the same document. This Amendment shall become effective upon the execution of a counterpart hereof by each Borrower, each Credit Support Party, Requisite Lenders and receipt by Borrowers and Agent of written or telephonic notification of such execution and authorization of delivery thereof (the "THIRD AMENDMENT EFFECTIVE DATE").
[Remainder of page intentionally left blank]
IN WITNESS WHEREOF, the parties hereto have caused this Amendment to be duly executed and delivered by their respective officers thereunto duly authorized as of the date first written above.
BORROWERS: BEASLEY FM ACQUISITION CORP.
By: /s/ CAROLINE BEASLEY
------------------------------------
Name: B. Caroline Beasley
Title: Secretary
BEASLEY BROADCASTING OF EASTERN NORTH
CAROLINA, INCORPORATED
By: /s/ CAROLINE BEASLEY
------------------------------------
Name: B. Caroline Beasley
Title: Assistant Secretary
|
BEASLEY BROADCASTING OF EASTERN
PENNSYLVANIA, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY BROADCASTING OF NEW JERSEY, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
W & B MEDIA, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY BROADCASTING OF SOUTHWEST
FLORIDA, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY BROADCASTING OF COASTAL
CAROLINA, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY-REED ACQUISITION PARTNERSHIP
By: BEASLEY FM ACQUISITION CORP.,
its general partner
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY RADIO, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
C S R A BROADCASTERS, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY BROADCASTING OF AUGUSTA, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY COMMUNICATIONS, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
SUBSIDIARY GUARANTORS:
WXTU LICENSE LIMITED PARTNERSHIP
WPOW LICENSE LIMITED PARTNERSHIP
WRXK LICENSE LIMITED PARTNERSHIP
WEWO LICENSE LIMITED PARTNERSHIP
WFLB LICENSE LIMITED PARTNERSHIP
WDAS LICENSE LIMITED PARTNERSHIP
WKIS LICENSE LIMITED PARTNERSHIP
WIKS LICENSE LIMITED PARTNERSHIP
WMGV LICENSE LIMITED PARTNERSHIP
WXNR LICENSE LIMITED PARTNERSHIP
WAZZ LICENSE LIMITED PARTNERSHIP
WJBX LICENSE LIMITED PARTNERSHIP
By: BEASLEY FM ACQUISITION CORP.,
the general partner of each of
the foregoing
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
WTMR LICENSE LIMITED PARTNERSHIP
By: BEASLEY BROADCASTING OF NEW JERSEY,
INC., its general partner
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
WNCT LICENSE LIMITED PARTNERSHIP
By: BEASLEY BROADCASTING OF COASTAL
CAROLINA, INC.,
its general partner
By: /s/ CAROLINE BEASLEY
--------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
WKML LICENSE LIMITED PARTNERSHIP
By: BEASLEY BROADCASTING OF EASTERN
NORTH CAROLINA, INCORPORATED,
its general partner
By: /s/ CAROLINE BEASLEY
--------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
WWDB LICENSE LIMITED PARTNERSHIP
By: BEASLEY BROADCASTING OF EASTERN
PENNSYLVANIA, INC.,
its general partner
By: /s/ CAROLINE BEASLEY
--------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
WXKB LICENSE LIMITED PARTNERSHIP
By: BEASLEY BROADCASTING OF SOUTHWEST
FLORIDA, INC.,
its general partner
By: /s/ CAROLINE BEASLEY
--------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
WSFL LICENSE LIMITED PARTNERSHIP
By: W & B MEDIA, INC.,
its general partner
By: /s/ CAROLINE BEASLEY
--------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
WQAM LICENSE LIMITED PARTNERSHIP
By: BEASLEY-REED ACQUISITION
PARTNERSHIP,
its general partner
By: BEASLEY FM ACQUISITION CORP.,
its general partner
By: /s/ CAROLINE BEASLEY
-------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
SUBORDINATED CREDITORS:
BEASLEY BROADCASTING OF PHILADELPHIA,
INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY-REED BROADCASTING OF MIAMI, INC.
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
BEASLEY BROADCASTING MANAGEMENT
CORPORATION
By: /s/ CAROLINE BEASLEY ------------------------------------ Name: B. Caroline Beasley Title: Secretary |
GEORGE BEASLEY,
an individual
/s/ GEORGE BEASLEY ------------------------------------ George Beasley |
LENDERS: BANK OF MONTREAL, CHICAGO BRANCH,
individually and as Agent
By: /s/ JULIET BARNES
------------------------------------
Name: Juliet Barnes
Title: Director
|
FLEET NATIONAL BANK
By: /s/ GARRET KOMJATHY ------------------------------------ Name: Garret Komjathy Title: Vice President |
KEY CORPORATE CAPITAL INC.
By: /s/ ELLEN M. HOFFMAN ------------------------------------ Name: Ellen M. Hoffman Title: Vice President |
BANK OF AMERICA, N.A.
By: /s/ TODD SHIPLEY ------------------------------------ Name: Todd Shipley Title: Managing Director |
PARIBAS
By: /s/ GUILLAUME PLASSARD ------------------------------------ Name: Guillaume Plassard Title: Assistant Vice President By: /s/ JEFFREY YOULE ------------------------------------ Name: Jeffrey Youle Title: Managing Director |
THE BANK OF NEW YORK
By: /s/ CYNTHIA L. ROGERS ------------------------------------ Name: Cynthia L. Rogers Title: Vice President |
UNION BANK OF CALIFORNIA
By: /s/ PETER C. CONNOY ------------------------------------ Name: Peter C. Connoy Title: Vice President |
EXHIBIT 10.12
Explanatory Note: Pursuant to Instruction 2 to Item 601 of Regulation S-K, the Registrant is filing a form of promissory note with the attached Schedule A setting forth the material details of each promissory note.
FORM OF PROMISSORY NOTE
$------------
January 31, 2000
For value received, __________, a ________ corporation (the "Maker"), hereby promises to pay to the order of ___________, a _______ corporation (the "Payee"), in lawful money of the United States, (i) the principal amount of _______________, or the aggregate unpaid and outstanding principal amount of this Promissory Note, if less, (ii) accrued and unpaid interest through December 31, 1999 in the amount of ________ and (iii) any additional accrued and unpaid interest incurred after December 31, 1999, and until the outstanding principal amount of this Promissory Note shall be paid in full. Interest shall accrue on the unpaid principal amount at a rate of _____ (__%) per annum. Interest shall be calculated on the basis of a 360-day year and will be accrued daily for each day that any principal amount is outstanding under this Promissory Note. The principal of this Promissory Note as well as all accrued and unpaid interest shall be payable by Maker upon demand by Payee.
This Promissory Note and the rights and obligations of Maker and Payee shall be construed in accordance with and governed by the laws of the State of New York.
By:__________________________ Name:
Title:
SCHEDULE A
BEASLEY BROADCAST GROUP, INC.
SCHEDULE OF RELATED PARTY INDEBTEDNESS
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OUTSTANDING RATE OF ACCRUED INTEREST
LENDER BORROWER PRINCIPAL INTEREST @ 12/31/99
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George G. Beasley Beasley FM $248,965 9.25% $142,915
Acquisition Corp.
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George G. Beasley W & B Media, Inc. $434,805 9.25% $163,158
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George G. Beasley Beasley $111,015 9.25% $41,448
Broadcasting of
Southwest Florida,
Inc.
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George G. Beasley Beasley $603,500 9.25% $225,156
Broadcasting of
Southwest Florida,
Inc.
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George G. Beasley Beasley Radio, $70,226 9.25% $6,543
Inc.
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George G. Beasley C S R A $1,166,550 9.25% $728,016
Broadcasters, Inc.
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George G. Beasley Beasley $696,053 8.0% $156,957
Communications,
Inc.
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George G. Beasley Beasley $608,462 9.25% $139,490
Communications,
Inc.
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George G. Beasley Beasley $1,087,437 9.25% $307,114
Broadcasting of
Augusta, Inc.
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George G. Beasley Beasley FM $1,500,000 N/A N/A
Acquisition Corp.
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George G. Beasley Beasley Radio, N/A N/A $38,537
Inc.
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George G. Beasley C S R A N/A N/A $78,128
Broadcasters, Inc.
----------------------------------------------------------------------------------------------------------------------------
Beasley Beasley FM $1,765,385 7.67% $802,277
Broadcasting Acquisition Corp.
Management Corp.
----------------------------------------------------------------------------------------------------------------------------
Beasley Beasley FM $496,646 7.67% $190,567
Broadcasting Acquisition Corp.
Management Corp.
----------------------------------------------------------------------------------------------------------------------------
Beasley Beasley FM $138,242 9.25% $60,649
Broadcasting Acquisition Corp.
Management Corp.
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|
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Beasley Beasley Radio, $154,988 9.25% $138,505
Broadcasting Inc.
Management Corp.
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Beasley C S R A $628,629 9.25% $579,091
Broadcasting Broadcasters, Inc.
Management Corp.
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Brian E. Beasley C S R A N/A N/A $6,454
Broadcasters, Inc.
--------------------------------------------------------------------------------------------------------------
Beasley Beasley $16,325 N/A N/A
Broadcasting of Broadcasting
New Jersey, Inc. Management Corp.
--------------------------------------------------------------------------------------------------------------
Beasley Beasley $540,471 N/A N/A
Broadcasting of Broadcasting of
Coastal Carolina, Greenville, Inc.
Inc.
--------------------------------------------------------------------------------------------------------------
Beasley FM B. Caroline $608,455 9.25% $97,624
Acquisition Corp. Beasley
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Beasley FM B. Caroline $84,031 9.25% $31,091
Acquisition Corp. Beasley
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Beasley George G. Beasley $750 9.25% $524
Broadcasting of
New Jersey, Inc.
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Beasley George G. Beasley $120,352 9.25% $113,876
Broadcasting of
Eastern North
Carolina,
Incorporated
--------------------------------------------------------------------------------------------------------------
Beasley FM George G. Beasley $3,638,657 9.25% $336,576
Acquisition Corp.
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Beasley FM Bruce G. Beasley $701,464 9.25% $108,240
Acquisition Corp.
--------------------------------------------------------------------------------------------------------------
Beasley FM Bruce G. Beasley $86,864 9.25% $32,140
Acquisition Corp.
--------------------------------------------------------------------------------------------------------------
Beasley FM Bradley C. $848,464 9.25% $110,664
Acquisition Corp. Beasley
--------------------------------------------------------------------------------------------------------------
Beasley FM Bradley C. $55,373 9.25% $20,489
Acquisition Corp. Beasley
--------------------------------------------------------------------------------------------------------------
Beasley FM Brian E. Beasley $101,096 9.25% $37,406
Acquisition Corp.
--------------------------------------------------------------------------------------------------------------
Beasley FM Brian E. Beasley $633,470 9.25% $101,182
Acquisition Corp.
--------------------------------------------------------------------------------------------------------------
Beasley FM Robert E. Beasley $582,608 9.25% $94,837
Acquisition Corp.
--------------------------------------------------------------------------------------------------------------
Beasley Radio, Inc. George G. Beasley $263,876 9.25% $93,558
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|
EXHIBIT 10.13
THE 2000 EQUITY PLAN
OF
BEASLEY BROADCAST GROUP, INC.
Beasley Broadcast Group, Inc., a Delaware corporation, has adopted The 2000 Equity Plan of Beasley Broadcast Group, Inc. (the "Plan"), effective as of the IPO Date (as defined below), for the benefit of its eligible employees, consultants and directors.
The purposes of the Plan are as follows:
(1) To provide an additional incentive for directors, key Employees (as defined below) and consultants to further the growth, development and financial success of the Company by personally benefiting through the ownership of Company stock and/or rights which recognize such growth, development and financial success.
(2) To enable the Company to obtain and retain the services of directors, key Employees and consultants considered essential to the long range success of the Company by offering them an opportunity to own stock in the Company and/or rights which will reflect the growth, development and financial success of the Company.
ARTICLE I.
DEFINITIONS
1.1 General. Wherever the following terms are used in the Plan they shall have the meanings specified below, unless the context clearly indicates otherwise.
1.2 Administrator. "Administrator" shall mean the entity that conducts the general administration of the Plan as provided in Article X. With reference to the administration of the Plan with respect to Options granted to Independent Directors or Independent Director Nominees, the term "Administrator" shall refer to the Board. With reference to the administration of the Plan with respect to any other Award, the term "Administrator" shall refer to the Committee unless the Board has assumed the authority for administration of the Plan generally as provided in Section 10.2.
1.3 Award. "Award" shall mean an Option, a Restricted Stock award, a Performance Award, a Dividend Equivalents award, a Deferred Stock award, a Stock Payment award or a Stock Appreciation Right which may be awarded or granted under the Plan (collectively, "Awards").
1.4 Award Agreement. "Award Agreement" shall mean a written agreement executed by an authorized officer of the Company and the Holder which shall contain such terms and conditions with respect to an Award as the Administrator shall determine, consistent with the Plan.
1.5 Award Limit. "Award Limit" shall mean five hundred
thousand (500,000) shares of Class A Common Stock, as adjusted pursuant to
Section 11.3 of the Plan.
1.6 Board. "Board" shall mean the Board of Directors of the Company.
1.7 Change in Control. "Change in Control" shall mean a change in ownership or control of the Company effected through either of the following transactions:
(a) any person or related group of persons (other than the Company or a person that directly or indirectly controls, is controlled by, or is under common control with, the Company) directly or indirectly acquires beneficial ownership (within the meaning of Rule 13d-3 under the Exchange Act) of securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities pursuant to a tender or exchange offer made directly to the Company's stockholders which the Board does not recommend such stockholders to accept; or
(b) there is a change in the composition of the Board over a period of thirty-six (36) consecutive months (or less) such that a majority of the Board members (rounded up to the nearest whole number) ceases, by reason of one or more proxy contests for the election of Board members, to be comprised of individuals who either (i) have been Board members continuously since the beginning of such period or (ii) have been elected or nominated for election as Board members during such period by at least a majority of the Board members described in clause (i) who were still in office at the time such election or nomination was approved by the Board.
1.8 Code. "Code" shall mean the Internal Revenue Code of 1986, as amended.
1.9 Committee. "Committee" shall mean the Compensation Committee of the Board, or another committee or subcommittee of the Board, appointed as provided in Section 11.1.
1.10 Class A Common Stock. "Class A Common Stock" shall mean the Class A Common Stock of the Company, par value $.001 per share, and any equity security of the Company issued or authorized to be issued in the future, but excluding any preferred stock and any warrants, options or other rights to purchase Class A Common Stock. Debt securities of the Company convertible into Class A Common Stock shall be deemed equity securities of the Company.
1.11 Company. "Company" shall mean Beasley Broadcast Group, Inc., a Delaware corporation.
1.12 Corporate Transaction. "Corporate Transaction" shall mean any of the following stockholder-approved transactions to which the Company is a party:
(a) a merger or consolidation in which the Company is not the surviving entity, except for a transaction the principal purpose of which is to change the State in which the Company is incorporated, form a holding company or effect a similar reorganization as to form whereupon the Plan and all Options are assumed by the successor entity;
(b) the sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company, in complete liquidation or dissolution of the Company in a transaction not covered by the exceptions to clause (a), above; or
(c) any reverse merger in which the Company is the surviving entity but in which securities possessing more than fifty percent (50%) of the total combined voting power of the Company's outstanding securities are transferred or issued to a person or persons different from those who held such securities immediately prior to such merger.
1.13 Deferred Stock. "Deferred Stock" shall mean Class A Common Stock awarded under Article VIII of the Plan.
1.14 Director. "Director" shall mean a member of the Board.
1.15 Dividend Equivalent. "Dividend Equivalent" shall mean a right to receive the equivalent value (in cash or Class A Common Stock) of dividends paid on Class A Common Stock, awarded under Article VIII of the Plan.
1.16 Employee. "Employee" shall mean any officer or other employee (as defined in accordance with Section 3401(c) of the Code) of the Company, or of any corporation which is a Subsidiary.
1.17 Exchange Act. "Exchange Act" shall mean the Securities Exchange Act of 1934, as amended.
1.18 Fair Market Value. "Fair Market Value" of a share of Class A Common Stock as of a given date shall be (i) the closing price of a share of Class A Common Stock on the principal exchange on which shares of Class A Common Stock are then trading, if any (or as reported on any composite index which includes such principal exchange), on the trading day previous to such date, or if shares were not traded on the trading day previous to such date, then on the next preceding date on which a trade occurred, or (ii) if Class A Common Stock is not traded on an exchange but is quoted on NASDAQ or a successor quotation system, the mean between the closing representative bid and asked prices for the Class A Common Stock on the trading day previous to such date as reported by NASDAQ or such successor quotation system; or (iii) if Class A Common Stock is not publicly traded on an exchange and not quoted on NASDAQ or a successor quotation system, the Fair Market Value of a share of Class A Common Stock as established by the Administrator acting in good faith; provided, however, that with respect to any Award granted as of the IPO Date, Fair Market Value shall mean the initial public
offering price (net of underwriting discounts and commissions) per share of Class A Common Stock.
1.19 Grantee. "Grantee" shall mean an Employee or consultant granted a Performance Award, Dividend Equivalent, Stock Payment or Stock Appreciation Right, or an award of Deferred Stock, under the Plan.
1.20 Holder. "Holder" shall mean a person who has been granted or awarded an Award.
1.21 Incentive Stock Option. "Incentive Stock Option" shall mean an option which conforms to the applicable provisions of Section 422 of the Code and which is designated as an Incentive Stock Option by the Committee.
1.22 Independent Director. "Independent Director" shall mean a member of the Board who is not an Employee of the Company. "Independent Director Nominee" shall mean a person who is nominated to become a member of the Board who is not an Employee of the Company.
1.23 IPO Date. "IPO Date" shall mean the effective date of the initial public offering of Class A Common Stock pursuant to a registration statement filed with the Securities and Exchange Commission.
1.24 Non-Qualified Stock Option. "Non-Qualified Stock Option" shall mean an Option which is not designated as an Incentive Stock Option by the Committee.
1.25 Option. "Option" shall mean a stock option granted under Article IV of the Plan. An Option granted under the Plan shall, as determined by the Committee, be either a Non-Qualified Stock Option or an Incentive Stock Option; provided, however, that Options granted to Independent Directors, Independent Director Nominees and consultants shall be Non-Qualified Stock Options.
1.26 Optionee. "Optionee" shall mean an Employee, consultant , Independent Director or Independent Director Nominee granted an Option under the Plan.
1.27 Performance Award. "Performance Award" shall mean a cash bonus, stock bonus or other performance or incentive award that is paid in cash, Class A Common Stock or a combination of both, awarded under Article VIII of the Plan.
1.28 Performance Criteria. "Performance Criteria" shall mean
the following business criteria with respect to the Company or any Subsidiary:
(i) net income, (ii) pre-tax income, (iii) operating income, (iv) cash flow, (v)
earnings per share, (vi) return on equity, (vii) return on invested capital or
assets, (viii) cost reductions or savings, (ix) funds from operations, (x)
appreciation in the fair market value of Class A Common Stock and (xi) earnings
before any one or more of the following items: interest, taxes, depreciation or
amortization.
1.29 Plan. "Plan" shall mean The 2000 Equity Plan of Beasley Broadcast Group, Inc.
1.30 QDRO. "QDRO" shall mean a qualified domestic relations order as defined by the Code or Title I of the Employee Retirement Income Security Act of 1974, as amended, or the rules thereunder.
1.31 Restricted Stock. "Restricted Stock" shall mean Class A Common Stock awarded under Article VII of the Plan.
1.32 Restricted Stockholder. "Restricted Stockholder" shall mean an Employee or consultant granted an award of Restricted Stock under Article VII of the Plan.
1.33 Rule 16b-3. "Rule 16b-3" shall mean that certain Rule 16b-3 under the Exchange Act, as such Rule may be amended from time to time.
1.34 Section 162(m) Participant. "Section 162(m) Participant" shall mean any key Employee designated by the Committee as a key Employee whose compensation for the fiscal year in which the key Employee is so designated or a future fiscal year may be subject to the limit on deductible compensation imposed by Section 162(m) of the Code.
1.35 Securities Act. "Securities Act" shall mean the Securities Act of 1933, as amended.
1.36 Stock Appreciation Right. "Stock Appreciation Right" shall mean a stock appreciation right granted under Article IX of the Plan.
1.37 Stock Payment. "Stock Payment" shall mean (i) a payment in the form of shares of Class A Common Stock, or (ii) an option or other right to purchase shares of Class A Common Stock, as part of a deferred compensation arrangement, made in lieu of all or any portion of the compensation, including without limitation, salary, bonuses and commissions, that would otherwise become payable to a key Employee or consultant in cash, awarded under Article VIII of the Plan.
1.38 Subsidiary. "Subsidiary" shall mean any corporation in an unbroken chain of corporations beginning with the Company if each of the corporations other than the last corporation in the unbroken chain then owns stock possessing fifty percent (50%) or more of the total combined voting power of all classes of stock in one of the other corporations in such chain.
1.39 Termination of Consultancy. "Termination of Consultancy" shall mean the time when the engagement of a Holder as a consultant to the Company or a Subsidiary is terminated for any reason, with or without cause, including, but not by way of limitation, by resignation, discharge, death or retirement; but excluding terminations where there is a simultaneous commencement of employment with the Company or any Subsidiary. The Committee, in its absolute discretion, shall determine the effect of all matters and questions relating to Termination of Consultancy, including, but not by way of limitation, the question of whether a Termination of Consultancy resulted from a discharge for good cause, and all
questions of whether a particular leave of absence constitutes a Terminations of Consultancy. Notwithstanding any other provision of the Plan, the Company or any Subsidiary has an absolute and unrestricted right to terminate a consultant's service at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in writing.
1.40 Termination of Directorship. "Termination of Directorship" shall mean the time when an Optionee who is an Independent Director ceases to be a Director for any reason, including, but not by way of limitation, a termination by resignation, failure to be elected, death or retirement. The Board, in its sole and absolute discretion, shall determine the effect of all matters and questions relating to Termination of Directorship with respect to Independent Directors.
1.41 Termination of Employment. "Termination of Employment"
shall mean the time when the employee-employer relationship between a Holder and
the Company or any Subsidiary is terminated for any reason, with or without
cause, including, but not by way of limitation, a termination by resignation,
discharge, death, disability or retirement; but excluding (i) terminations where
there is a simultaneous reemployment or continuing employment of a Holder by the
Company or any Subsidiary, (ii) at the discretion of the Committee, terminations
which result in a temporary severance of the employee-employer relationship, and
(iii) at the discretion of the Committee, terminations which are followed by the
simultaneous establishment of a consulting relationship by the Company or a
Subsidiary with the former employee. The Committee, in its absolute discretion,
shall determine the effect of all matters and questions relating to Termination
of Employment, including, but not by way of limitation, the question of whether
a Termination of Employment resulted from a discharge for good cause, and all
questions of whether a particular leave of absence constitutes a Termination of
Employment; provided, however, that, with respect to Incentive Stock Options,
unless otherwise determined by the Committee in its discretion, a leave of
absence, change in status from an employee to an independent contractor or other
change in the employee-employer relationship shall constitute a Termination of
Employment if, and to the extent that, such leave of absence, change in status
or other change interrupts employment for the purposes of Section 422(a)(2) of
the Code and the then applicable regulations and revenue rulings under said
Section. Notwithstanding any other provision of the Plan, the Company or any
Subsidiary has an absolute and unrestricted right to terminate an Employee's
employment at any time for any reason whatsoever, with or without cause, except
to the extent expressly provided otherwise in writing.
ARTICLE II.
SHARES SUBJECT TO PLAN
2.1 Shares Subject to Plan.
(a) The shares of stock subject to Awards shall be Class A Common Stock, initially shares of the Company's Class A Common Stock, par value $.001 per share. The aggregate number of such shares which may be issued upon exercise of such Options or rights or upon any such awards under the Plan shall not exceed three million (3,000,000). The shares of Class A Common Stock
issuable upon exercise of such Options or rights or upon any such awards may be either previously authorized but unissued shares or treasury shares.
(b) The maximum number of shares which may be subject to Awards, granted under the Plan to any individual in any calendar year shall not exceed the Award Limit. To the extent required by Section 162(m) of the Code, shares subject to Options which are canceled continue to be counted against the Award Limit and if, after grant of an Option, the price of shares subject to such Option is reduced, the transaction is treated as a cancellation of the Option and a grant of a new Option and both the Option deemed to be canceled and the Option deemed to be granted are counted against the Award Limit. Furthermore, to the extent required by Section 162(m) of the Code, if, after grant of a Stock Appreciation Right, the base amount on which stock appreciation is calculated is reduced to reflect a reduction in the Fair Market Value of the Class A Common Stock, the transaction is treated as a cancellation of the Stock Appreciation Right and a grant of a new Stock Appreciation Right and both the Stock Appreciation Right deemed to be canceled and the Stock Appreciation Right deemed to be granted are counted against the Award Limit.
2.2 Add-back of Options and Other Rights. If any Option, or
other right to acquire shares of Class A Common Stock under any other Award
under the Plan, expires or is canceled without having been fully exercised, or
is exercised in whole or in part for cash as permitted by the Plan, the number
of shares subject to such Option or other right but as to which such Option or
other right was not exercised prior to its expiration, cancellation or exercise
may again be optioned, granted or awarded hereunder, subject to the limitations
of Section 2.1. Furthermore, any shares subject to Awards which are adjusted
pursuant to Section 11.3 and become exercisable with respect to shares of stock
of another corporation shall be considered cancelled and may again be optioned,
granted or awarded hereunder, subject to the limitations of Section 2.1. Shares
of Class A Common Stock which are delivered by the Holder or withheld by the
Company upon the exercise of any Award under the Plan, in payment of the
exercise price thereof or tax withholding thereon, may again be optioned,
granted or awarded hereunder, subject to the limitations of Section 2.1. If any
share of Restricted Stock is forfeited by the Holder or repurchased by the
Company pursuant to Section 7.5 hereof, such share may again be optioned,
granted or awarded hereunder, subject to the limitations of Section 2.1.
Notwithstanding the provisions of this Section 2.2, no shares of Class A Common
Stock may again be optioned, granted or awarded if such action would cause an
Incentive Stock Option to fail to qualify as an incentive stock option under
Section 422 of the Code.
ARTICLE III.
GRANTING OF AWARDS
3.1 Award Agreement. Each Award shall be evidenced by an Award Agreement. Award Agreements evidencing Awards intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall contain such terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code.
Award Agreements evidencing Incentive Stock Options shall contain such terms and conditions as may be necessary to meet the applicable provisions of Section 422 of the Code.
3.2 Provisions Applicable to Section 162(m) Participants.
(a) The Committee, in its discretion, may determine whether an Award is to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code.
(b) Notwithstanding anything in the Plan to the contrary, the Committee may grant any Award to a Section 162(m) Participant, including Restricted Stock the restrictions with respect to which lapse upon the attainment of performance goals which are related to one or more of the Performance Criteria and any performance or incentive award described in Article VIII that vests or becomes exercisable or payable upon the attainment of performance goals which are related to one or more of the Performance Criteria.
(c) To the extent necessary to comply with the performance-based compensation requirements of Section 162(m)(4)(C) of the Code, with respect to any Award granted under Articles VII and VIII which may be granted to one or more Section 162(m) Participants, no later than ninety (90) days following the commencement of any fiscal year in question or any other designated fiscal period or period of service (or such other time as may be required or permitted by Section 162(m) of the Code), the Committee shall, in writing, (i) designate one or more Section 162(m) Participants, (ii) select the Performance Criteria applicable to the fiscal year or other designated fiscal period or period of service, (iii) establish the various performance targets, in terms of an objective formula or standard, and amounts of Restricted Stock or bonus amounts, as applicable, which may be earned for such fiscal year or other designated fiscal period or period of service and (iv) specify the relationship between Performance Criteria and the performance targets and the amounts of Restricted Stock or bonus amounts, as applicable, to be earned by each Section 162(m) Participant for such fiscal year or other designated fiscal period or period of service. Following the completion of each fiscal year or other designated fiscal period or period of service, the Committee shall certify in writing whether the applicable performance targets have been achieved for such fiscal year or other designated fiscal period or period of service. In determining the amount earned by a Section 162(m) Participant, the Committee shall have the right to reduce (but not to increase) the amount payable at a given level of performance to take into account additional factors that the Committee may deem relevant to the assessment of individual or corporate performance for the fiscal year or other designated fiscal period or period of service.
3.3 Consideration. In consideration of the granting of an Award under the Plan, the Holder shall agree, in the Award Agreement, to remain in the employ of (or to consult for or to serve as an Independent Director of, as applicable) the Company or any Subsidiary for a period of at least one year (or such shorter period as may be fixed in the Award Agreement or by
action of the Administrator following grant of the Award) after the Award is granted (or, in the case of an Independent Director or Independent Director Nominee, until the next annual meeting of stockholders of the Company).
3.4 At-Will Employment. Nothing in the Plan or in any Award Agreement hereunder shall confer upon any Holder any right to continue in the employ of, or as a consultant for, the Company or any Subsidiary, or as a director of the Company, or shall interfere with or restrict in any way the rights of the Company and any Subsidiary, which are hereby expressly reserved, to discharge any Holder at any time for any reason whatsoever, with or without cause, except to the extent expressly provided otherwise in a written employment agreement between the Holder and the Company and any Subsidiary.
ARTICLE IV.
GRANTING OF OPTIONS TO EMPLOYEES,
CONSULTANTS, INDEPENDENT DIRECTORS AND
INDEPENDENT DIRECTOR NOMINEES
4.1 Eligibility. Any Employee or consultant selected by the Committee pursuant to Section 4.4(a)(i) shall be eligible to be granted an Option. Each Independent Director and Independent Director Nominee of the Company shall be eligible to be granted Options at the times and in the manner set forth in Section 4.5.
4.2 Disqualification for Stock Ownership. No person may be
granted an Incentive Stock Option under the Plan if such person, at the time the
Incentive Stock Option is granted, owns stock possessing more than ten percent
(10%) of the total combined voting power of all classes of stock of the Company
or any then existing Subsidiary or parent corporation (within the meaning of
Section 422 of the Code) unless such Incentive Stock Option conforms to the
applicable provisions of Section 422 of the Code.
4.3 Qualification of Incentive Stock Options. No Incentive Stock Option shall be granted to any person who is not an Employee.
4.4 Granting of Options to Employees and Consultants.
(a) The Committee shall from time to time, in its absolute discretion, and subject to applicable limitations of the Plan:
(i) Determine which Employees are key Employees and select from among the key Employees or consultants (including Employees or consultants who have previously received Awards under the Plan) such of them as in its opinion should be granted Options;
(ii) Subject to the Award Limit, determine the number of shares to be subject to such Options granted to the selected key Employees or consultants;
(iii) Subject to Section 4.3, determine whether such Options are to be Incentive Stock Options or Non-Qualified Stock Options and whether such Options are to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code; and
(iv) Determine the terms and conditions of such Options, consistent with the Plan; provided, however, that the terms and conditions of Options intended to qualify as performance-based compensation as described in Section 162(m)(4)(C) of the Code shall include, but not be limited to, such terms and conditions as may be necessary to meet the applicable provisions of Section 162(m) of the Code.
(b) Upon the selection of a key Employee or consultant to be granted an Option, the Committee shall instruct the Secretary of the Company to issue the Option and may impose such conditions on the grant of the Option as it deems appropriate. Without limiting the generality of the preceding sentence, the Committee may, in its discretion and on such terms as it deems appropriate, require as a condition on the grant of an Option to an Employee or consultant that the Employee or consultant surrender for cancellation some or all of the unexercised Options, any other Award or other rights which have been previously granted to him under the Plan or otherwise. An Option, the grant of which is conditioned upon such surrender, may have an Option price lower (or higher) than the exercise price of such surrendered Option or other award, may cover the same (or a lesser or greater) number of shares as such surrendered Option or other award, may contain such other terms as the Committee deems appropriate, and shall be exercisable in accordance with its terms, without regard to the number of shares, price, exercise period or any other term or condition of such surrendered Option or other award.
(c) Any Incentive Stock Option granted under the Plan may be modified by the Committee, with the consent of the Optionee, to disqualify such Option from treatment as an "incentive stock option" under Section 422 of the Code.
4.5 Granting of Options to Independent Directors or Independent Director Nominees.
(a) Each person who is an Independent Director or Independent Director Nominee as of the IPO Date automatically shall be granted an Option to purchase twenty thousand (20,000) shares of Class A Common Stock (subject to adjustment as provided in Section 11.3) on the IPO Date, subject to forfeiture pursuant to Section 4.5(d).
(b) Following the IPO Date, each person who is initially elected to the Board during the term of the Plan and who is an Independent Director at the time of such initial election automatically shall be granted an option to purchase twenty
thousand (20,000) shares of Class A Common Stock (subject to adjustment as provided in Section 11.3) on the date of such initial election.
(c) In addition to Options granted to Independent
Directors and Independent Director Nominees pursuant to
Section 4.5(a) and 4.5(b), during the term of the Plan the
Board may from time to time, in its absolute discretion, and
subject to applicable limitations of the Plan:
(i) Select from among the Independent Directors (including Independent Directors who have previously received Options under the Plan) such of them as in its opinion should be granted Options;
(ii) Subject to the Award Limit, determine the number of shares to be subject to such Options granted to the selected Independent Directors;
(iii) Subject to the provisions of Article V, determine the terms and conditions of such Options, consistent with the Plan.
All the foregoing Option grants authorized by this Section 4.5 are subject to stockholder approval of the Plan.
(d) If an Independent Director Nominee fails to become an Independent Director of the Company within 90 days of the initial public offering of the Company's Class A Common Stock, he forfeits all Options granted to him pursuant to this Plan.
4.6 Options in Lieu of Cash Compensation. Options may be granted under the Plan to Employees and consultants in lieu of cash bonuses which would otherwise be payable to such Employees and consultants and to Independent Directors in lieu of directors' fees which would otherwise be payable to such Independent Directors, pursuant to such policies which may be adopted by the Administrator from time to time.
ARTICLE V.
TERMS OF OPTIONS
5.1 Option Price. The price per share of the shares subject
to each Option granted to Employees and consultants shall be set by the
Committee; provided, however, that such price shall be no less than the par
value of a share of Class A Common Stock, unless otherwise permitted by
applicable state law, and (i) in the case of Options intended to qualify as
performance-based compensation as described in Section 162(m)(4)(C) of the Code,
such price shall not be less than 100% of the Fair Market Value of a share of
Class A Common Stock on the date the Option is granted; (ii) in the case of
Incentive Stock Options such price shall not be less than 100% of the Fair
Market Value of a share of Class A Common Stock on the date the Option is
granted (or the date the Option is modified, extended or renewed for purposes of
Section 424(h) of the Code); (iii) in the case of Incentive Stock Options
granted to an individual then owning (within the meaning of Section 424(d) of
the Code) more than 10% of the total combined voting power of all classes of
stock of the Company or any Subsidiary or parent corporation
thereof (within the meaning of Section 422 of the Code), such price shall not be less than 110% of the Fair Market Value of a share of Class A Common Stock on the date the Option is granted (or the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code).
5.2 Option Term. The term of an Option granted to an Employee
or consultant shall be set by the Committee in its discretion; provided,
however, that, in the case of Incentive Stock Options, the term shall not be
more than ten (10) years from the date the Incentive Stock Option is granted, or
five (5) years from such date if the Incentive Stock Option is granted to an
individual then owning (within the meaning of Section 424(d) of the Code) more
than 10% of the total combined voting power of all classes of stock of the
Company or any Subsidiary or parent corporation thereof (within the meaning of
Section 422 of the Code). Except as limited by requirements of Section 422 of
the Code and regulations and rulings thereunder applicable to Incentive Stock
Options, the Committee may extend the term of any outstanding Option in
connection with any Termination of Employment or Termination of Consultancy of
the Optionee, or amend any other term or condition of such Option relating to
such a termination.
5.3 Option Vesting.
(a) The period during which the right to exercise, in whole or in part, an Option granted to an Employee or a consultant vests in the Optionee shall be set by the Committee and the Committee may determine that an Option may not be exercised in whole or in part for a specified period after it is granted; provided, however, that, unless the Committee otherwise provides in the terms of -------- ------- the Award Agreement or otherwise, no Option shall be exercisable by any Optionee who is then subject to Section 16 of the Exchange Act within the period ending six months and one day after the date the Option is granted. At any time after grant of an Option, the Committee may, in its sole and absolute discretion and subject to whatever terms and conditions it selects, accelerate the period during which an Option granted to an Employee or consultant vests.
(b) No portion of an Option granted to an Employee or consultant which is unexercisable at Termination of Employment or Termination of Consultancy, as applicable, shall thereafter become exercisable, except as may be otherwise provided by the Committee either in the Award Agreement or by action of the Committee following the grant of the Option.
(c) To the extent that the aggregate Fair Market Value of
stock with respect to which "incentive stock options" (within
the meaning of Section 422 of the Code, but without regard to
Section 422(d) of the Code) are exercisable for the first time
by an Optionee during any calendar year (under the Plan and
all other incentive stock option plans of the Company and any
parent or subsidiary corporation (within the meaning of
Section 422 of the Code) of the Company) exceeds $100,000,
such Options shall be treated as Non-Qualified Options to the
extent required by Section 422 of the Code. The rule set forth
in the preceding
sentence shall be applied by taking Options into account in
the order in which they were granted. For purposes of this
Section 5.3(c), the Fair Market Value of stock shall be
determined as of the time the Option with respect to such
stock is granted.
5.4 Terms of Options Granted to Independent Directors or
Independent Director Nominees. The price per share of the shares subject to each
Option granted to an Independent Director or Independent Director Nominees shall
equal 100% of the Fair Market Value of a share of Class A Common Stock on the
date the Option is granted. Subject to Section 6.6, the term of each Option
granted to an Independent Director or Independent Director Nominees shall be ten
(10) years from the date the Option is granted, without variation or
acceleration hereunder. Options granted to Independent Directors or Independent
Director Nominees pursuant to Sections 4.5(a) and 4.5(b) shall be exercisable
with respect to 50% of the shares covered thereby on the date of grant and shall
become exercisable with respect to the remainder of the shares covered thereby
in two cumulative annual installments of 25% each on each of the first two
anniversaries of the date of Option grant, without variation or acceleration
hereunder except as provided in Section 11.3(b). Any Options granted to
Independent Directors or Independent Director Nominees pursuant to Section
4.5(c) shall become exercisable at such times as provided by the Board, in its
sole discretion, at the time of grant. No portion of an Option which is
unexercisable at Termination of Directorship shall thereafter become
exercisable.
ARTICLE VI.
EXERCISE OF OPTIONS
6.1 Partial Exercise. An exercisable Option may be exercised in whole or in part. However, an Option shall not be exercisable with respect to fractional shares and the Administrator may require that, by the terms of the Option, a partial exercise be with respect to a minimum number of shares.
6.2 Manner of Exercise. All or a portion of an exercisable Option shall be deemed exercised upon delivery of all of the following to the Secretary of the Company or his office:
(a) A written notice complying with the applicable rules established by the Administrator stating that the Option, or a portion thereof, is exercised. The notice shall be signed by the Optionee or other person then entitled to exercise the Option or such portion of the Option;
(b) Such representations and documents as the Administrator, in its absolute discretion, deems necessary or advisable to effect compliance with all applicable provisions of the Securities Act and any other federal or state securities laws or regulations. The Administrator may, in its absolute discretion, also take whatever additional actions it deems appropriate to effect such compliance including, without limitation, placing legends on share certificates and issuing stop-transfer notices to agents and registrars;
(c) In the event that the Option shall be exercised pursuant to Section 11.1 by any person or persons other than the Optionee, appropriate proof of the right of such person or persons to exercise the Option; and
(d) Full cash payment to the Secretary of the Company for
the shares with respect to which the Option, or portion
thereof, is exercised. However, the Administrator, may in its
discretion (i) allow a delay in payment up to thirty (30) days
from the date the Option, or portion thereof, is exercised;
(ii) allow payment, in whole or in part, through the delivery
of shares of Class A Common Stock which have been owned by the
Optionee for at least six months, duly endorsed for transfer
to the Company with a Fair Market Value on the date of
delivery equal to the aggregate exercise price of the Option
or exercised portion thereof; (iii) allow payment, in whole or
in part, through the surrender of shares of Class A Common
Stock then issuable upon exercise of the Option having a Fair
Market Value on the date of Option exercise equal to the
aggregate exercise price of the Option or exercised portion
thereof; (iv) allow payment, in whole or in part, through the
delivery of property of any kind which constitutes good and
valuable consideration; (v) allow payment, in whole or in
part, through the delivery of a full recourse promissory note
bearing interest (at no less than such rate as shall then
preclude the imputation of interest under the Code) and
payable upon such terms as may be prescribed by the Committee
or the Board; (vi) allow payment, in whole or in part, through
the delivery of a notice that the Optionee has placed a market
sell order with a broker with respect to shares of Class A
Common Stock then issuable upon exercise of the Option, and
that the broker has been directed to pay a sufficient portion
of the net proceeds of the sale to the Company in satisfaction
of the Option exercise price; or (vii) allow payment through
any combination of the consideration provided in the foregoing
subparagraphs (ii), (iii), (iv), (v) and (vi). In the case of
a promissory note, the Administrator may also prescribe the
form of such note and the security to be given for such note.
The Option may not be exercised, however, by delivery of a
promissory note or by a loan from the Company when or where
such loan or other extension of credit is prohibited by law.
6.3 Conditions to Issuance of Stock Certificates. The Company shall not be required to issue or deliver any certificate or certificates for shares of stock purchased upon the exercise of any Option or portion thereof prior to fulfillment of all of the following conditions:
(a) The admission of such shares to listing on all stock exchanges or automated quotation systems on which such class of stock is then listed or quoted;
(b) The completion of any registration or other qualification of such shares under any state or federal law, or under the rulings or regulations of the Securities and Exchange Commission or any other governmental regulatory body which the Administrator shall, in its absolute discretion, deem necessary or advisable;
(c) The obtaining of any approval or other clearance from any state or federal governmental agency which the Administrator shall, in its absolute discretion, determine to be necessary or advisable;
(d) The lapse of such reasonable period of time following the exercise of the Option as the Committee (or Board, in the case of Options granted to Independent Directors and Independent Director Nominees) may establish from time to time for reasons of administrative convenience; and
(e) The receipt by the Company of full payment for such shares, including payment of any applicable withholding tax, which in the discretion of the Committee or the Board may be in the form of consideration used by the Optionee to pay for such shares under Section 6.2(d).
6.4 Rights as Stockholders/ Dividend Equivalents. Optionees shall not be, nor have any of the rights or privileges of, stockholders of the Company in respect of any shares purchasable upon the exercise of any part of an Option unless and until certificates representing such shares have been issued by the Company to such Optionees. Notwithstanding the foregoing, any Optionee who is an Employee or consultant selected by the Committee may be granted Dividend Equivalents based on the dividends declared on Class A Common Stock, to be credited as of dividend payment dates, during the period between the date an Option is granted, and the date such Option is exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Class A Common Stock by such formula and at such time and subject to such limitations as may be determined by the Committee. With respect to Dividend Equivalents granted with respect to Options intended to be qualified performance-based compensation for purposes of Section 162(m) of the Code, such Dividend Equivalents shall be payable regardless of whether such Option is exercised.
6.5 Ownership and Transfer Restrictions. The Administrator, in its absolute discretion, may impose such restrictions on the ownership and transferability of the shares purchasable upon the exercise of an Option as it deems appropriate. Any such restriction shall be set forth in the respective Award Agreement and may be referred to on the certificates evidencing such shares. The Committee may require the Employee to give the Company prompt notice of any disposition of shares of Class A Common Stock acquired by exercise of an Incentive Stock Option within (i) two years from the date of granting (including the date the Option is modified, extended or renewed for purposes of Section 424(h) of the Code) such Option to such Employee or (ii) one year after the transfer of such shares to such Employee. The Committee may direct that the certificates evidencing shares acquired by exercise of any such Option refer to such requirement to give prompt notice of disposition.
6.6 Limitations on Exercise of Options Granted to Independent Directors or Independent Director Nominees. No Option granted to an Independent Director or Independent Director Nominee may be exercised to any extent by anyone after the first to occur of the following events:
(a) The expiration of twelve (12) months from the date of the Optionee's death;
(b) the expiration of twelve (12) months from the date of the Optionee's Termination of Directorship by reason of his permanent and total disability (within the meaning of Section 22(e)(3) of the Code);
(c) the expiration of three (3) months from the date of the Optionee's Termination of Directorship for any reason other than such Optionee's death or his permanent and total disability, unless the Optionee dies within said three-month period; or
(d) The expiration of ten (10) years from the date the Option was granted.
6.7 Additional Limitations on Exercise of Options. Optionees may be required to comply with any timing or other restrictions with respect to the settlement or exercise of an Option, including a window-period limitation, as may be imposed in the discretion of the Administrator.
ARTICLE VII.
AWARD OF RESTRICTED STOCK
7.1 Eligibility. Subject to the Award Limit, Restricted Stock may be awarded to any Employee who the Committee determines is a key Employee or any consultant who the Committee determines should receive such an Award.
7.2 Award of Restricted Stock
(a) The Committee may from time to time, in its absolute discretion:
(i) Determine which Employees are key Employees and select from among the key Employees or consultants (including Employees or consultants who have previously received other awards under the Plan) such of them as in its opinion should be awarded Restricted Stock; and
(ii) Determine the purchase price, if any, and other terms and conditions applicable to such Restricted Stock, consistent with the Plan.
(b) The Committee shall establish the purchase price, if any, and form of payment for Restricted Stock; provided, however, that such purchase price shall be no less than the par value of the Class A Common Stock to be purchased, unless otherwise permitted by applicable state law. In all cases, legal consideration shall be required for each issuance of Restricted Stock.
(c) Upon the selection of a key Employee or consultant to be awarded Restricted Stock, the Committee shall instruct the Secretary of the Company to
issue such Restricted Stock and may impose such conditions on the issuance of such Restricted Stock as it deems appropriate.
7.3 Rights as Stockholders. Subject to Section 7.4, upon delivery of the shares of Restricted Stock to the escrow holder pursuant to Section 7.6, the Restricted Stockholder shall have, unless otherwise provided by the Committee, all the rights of a stockholder with respect to said shares, subject to the restrictions in his Award Agreement, including the right to receive all dividends and other distributions paid or made with respect to the shares; provided, however, that in the discretion of the Committee, any extraordinary distributions with respect to the Class A Common Stock shall be subject to the restrictions set forth in Section 7.4.
7.4 Restriction. All shares of Restricted Stock issued under the Plan (including any shares received by holders thereof with respect to shares of Restricted Stock as a result of stock dividends, stock splits or any other form of recapitalization) shall, in the terms of each individual Award Agreement, be subject to such restrictions as the Committee shall provide, which restrictions may include, without limitation, restrictions concerning voting rights and transferability and restrictions based on duration of employment with the Company, Company performance and individual performance; provided, however, that, unless the Committee otherwise provides in the terms of the Award Agreement or otherwise, no share of Restricted Stock granted to a person subject to Section 16 of the Exchange Act shall be sold, assigned or otherwise transferred until at least six months and one day have elapsed from the date on which the Restricted Stock was issued, and provided, further, that, except with respect to shares of Restricted Stock granted to Section 162(m) Participants, by action taken after the Restricted Stock is issued, the Committee may, on such terms and conditions as it may determine to be appropriate, remove any or all of the restrictions imposed by the terms of the Award Agreement. Restricted Stock may not be sold or encumbered until all restrictions are terminated or expire. If no consideration was paid by the Restricted Stockholder upon issuance, a Restricted Stockholder's rights in unvested Restricted Stock shall lapse upon Termination of Employment or, if applicable, upon Termination of Consultancy with the Company; provided, however, that the Committee in its sole and absolute discretion may provide that such rights shall not lapse in the event of a Termination of Employment following a "change of ownership control" (within the meaning of Treasury Regulation Section 1.62-27(e)(2)(v) or any successor regulation thereto) of the Company or because of the Restricted Stockholder's death or disability; provided, further, except with respect to shares of Restricted Stock granted to Section 162(m) Participants, the Committee in its sole and absolute discretion may provide that no such right of repurchase shall exist in the event of a Termination of Employment, or a Termination of Consultancy, without cause or following any Change in Control of the Company or because of the Restricted Stockholder's retirement, or otherwise.
7.5 Repurchase of Restricted Stock. The Committee shall provide in the terms of each individual Award Agreement that the Company shall have the right to repurchase from the Restricted Stockholder the Restricted Stock then subject to restrictions under the Award Agreement immediately upon a Termination of Employment or, if applicable, upon a Termination of Consultancy between the Restricted Stockholder and the Company, at a cash price per share equal to the price paid by the Restricted Stockholder for such Restricted Stock; provided, however, that the Committee in its sole and absolute discretion may provide that no such right of repurchase shall exist in the event of a Termination of Employment following a "change of ownership or control" (within the meaning of Treasury Regulation Section 1.162-27(e)(2)(v) or any successor regulation thereto) of the Company or because of the Restricted Stockholder's death or disability; provided, further, that, except with respect to shares of Restricted Stock granted to Section 162(m) Participants, the Committee in its sole and absolute discretion may provide that no
such right of repurchase shall exist in the event of a Termination of Employment or a Termination of Consultancy without cause or following any Change in Control of the Company or because of the Restricted Stockholder's retirement, or otherwise. 7.6 Escrow. The Secretary of the Company or such other escrow holder as the Committee may appoint shall retain physical custody of each certificate representing Restricted Stock until all of the restrictions imposed under the Award Agreement with respect to the shares evidenced by such certificate expire or shall have been removed.
7.7 Legend. In order to enforce the restrictions imposed upon shares of Restricted Stock hereunder, the Committee shall cause a legend or legends to be placed on certificates representing all shares of Restricted Stock that are still subject to restrictions under Award Agreements, which legend or legends shall make appropriate reference to the conditions imposed thereby.
7.8 Section 83(b) Election. If a Restricted Stockholder makes an election under Section 83(b) of the Code, or any successor section thereto, to be taxed with respect to the Restricted Stock as of the date of transfer of the Restricted Stock rather than as of the date or dates upon which the Restricted Stockholder would otherwise be taxable under Section 83(a) of the Code, the Restricted Stockholder shall deliver a copy of such election to the Company immediately after filing such election with the Internal Revenue Service.
ARTICLE VIII.
PERFORMANCE AWARDS, DIVIDEND EQUIVALENTS,
DEFERRED STOCK, STOCK PAYMENTS
8.1 Eligibility. Subject to the Award Limit, one or more Performance Awards, Dividend Equivalents, awards of Deferred Stock, and/or Stock Payments may be granted to any Employee whom the Committee determines is a key Employee or any consultant whom the Committee determines should receive such an Award.
8.2 Performance Awards. Any key Employee or consultant selected by the Committee may be granted one or more Performance Awards. The value of such Performance Awards may be linked to any one or more of the Performance Criteria or other specific performance criteria determined appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. In making such determinations, the Committee shall consider (among such other factors as it deems relevant in light of the specific type of award) the contributions, responsibilities and other compensation of the particular key Employee or consultant.
8.3 Dividend Equivalents. Any key Employee or consultant selected by the Committee may be granted Dividend Equivalents based on the dividends declared on Class A Common Stock, to be credited as of dividend payment dates, during the period between the date a Stock Appreciation Right, Deferred Stock or Performance Award is granted, and the date such Stock Appreciation Right, Deferred Stock or Performance Award is exercised, vests or expires, as determined by the Committee. Such Dividend Equivalents shall be converted to cash or additional shares of Class A Common Stock by such formula and at such time and subject to such limitations as may be determined by the Committee.
8.4 Stock Payments. Any key Employee or consultant selected by the Committee may receive Stock Payments in the manner determined from time to time by the Committee. The number of shares shall be determined by the Committee and may be based upon the Performance Criteria or other specific performance criteria determined appropriate by the Committee, determined on the date such Stock Payment is made or on any date thereafter.
8.5 Deferred Stock. Any key Employee or consultant selected by the Committee may be granted an award of Deferred Stock in the manner determined from time to time by the Committee. The number of shares of Deferred Stock shall be determined by the Committee and may be linked to the Performance Criteria or other specific performance criteria determined to be appropriate by the Committee, in each case on a specified date or dates or over any period or periods determined by the Committee. Class A Common Stock underlying a Deferred Stock award will not be issued until the Deferred Stock award has vested, pursuant to a vesting schedule or performance criteria set by the Committee. Unless otherwise provided by the Committee, a Holder of Deferred Stock shall have no rights as a Company stockholder with respect to such Deferred Stock until such time as the Award has vested and the Class A Common Stock underlying the Award has been issued.
8.6 Term. The term of a Performance Award, Dividend Equivalent, award of Deferred Stock and/or Stock Payment shall be set by the Committee in its discretion.
8.7 Exercise or Purchase Price. The Committee may establish the exercise or purchase price of a Performance Award, shares of Deferred Stock, or shares received as a Stock Payment; provided, however, that such price shall not be less than the par value for a share of Class A Common Stock, unless otherwise permitted by applicable state law.
8.8 Exercise Upon Termination of Employment or Termination of Consultancy. A Performance Award, Dividend Equivalent, award of Deferred Stock and/or Stock Payment is exercisable or payable only while the Holder is an Employee or consultant; provided, however, that the Committee in its sole and absolute discretion may provide that the Performance Award, Dividend Equivalent, award of Deferred Stock and/or Stock Payment may be exercised or paid subsequent to a Termination of Employment following a "change of control or ownership" (within the meaning of Treasury Regulation Section 1.162-27(e)(2)(v) or any successor regulation thereto) of the Company; provided, further, that except with respect to Performance Awards granted to Section 162(m) Participants, the Committee in its sole and absolute discretion may provide that the Performance Awards may be exercised or paid following a Termination of Employment or a Termination of Consultancy without cause, or following a
Change in Control of the Company, or because of the Grantee's retirement, death or disability, or otherwise.
8.9 Payment on Exercise. Payment of the amount determined under Section 8.1 or 8.2 above shall be in cash, in Class A Common Stock or a combination of both, as determined by the Committee. To the extent any payment under this Article VIII is effected in Class A Common Stock, it shall be made subject to satisfaction of all provisions of Section 6.3.
ARTICLE IX.
STOCK APPRECIATION RIGHTS
9.1 Grant of Stock Appreciation Rights. A Stock Appreciation Right may be granted to any key Employee or consultant selected by the Committee. A Stock Appreciation Right may be granted (i) in connection and simultaneously with the grant of an Option, (ii) with respect to a previously granted Option, or (iii) independent of an Option. A Stock Appreciation Right shall be subject to such terms and conditions not inconsistent with the Plan as the Committee shall impose and shall be evidenced by an Award Agreement. Without limiting the generality of the foregoing, the Committee may, in its discretion and on such terms as it deems appropriate, require as a condition of the grant of a Stock Appreciation Right to an Employee or consultant that the Employee or consultant surrender for cancellation some or all of the unexercised Options, awards of Restricted Stock or Deferred Stock, Performance Awards, Stock Appreciation Rights, Dividend Equivalents or Stock Payments, or other rights which have been previously granted to him under the Plan or otherwise. A Stock Appreciation Right, the grant of which is conditioned upon such surrender, may have an exercise price lower (or higher) than the exercise price of the surrendered Option or other award, may cover the same (or a lesser or greater) number of shares as such surrendered Option or other award, may contain such other terms as the Committee deems appropriate, and shall be exercisable in accordance with its terms, without regard to the number of shares, price, exercise period or any other term or condition of such surrendered Option or other award.
9.2 Coupled Stock Appreciation Rights.
(a) A Coupled Stock Appreciation Right ("CSAR") shall be related to a particular Option and shall be exercisable only when and to the extent the related Option is exercisable.
(b) A CSAR may be granted to the Grantee for no more than the number of shares subject to the simultaneously or previously granted Option to which it is coupled.
(c) A CSAR shall entitle the Grantee (or other person entitled to exercise the Option pursuant to the Plan) to surrender to the Company unexercised a portion of the Option to which the CSAR relates (to the extent then exercisable pursuant to its terms) and to receive from the Company in exchange therefor an amount determined by multiplying the difference obtained by subtracting the Option exercise price from the Fair Market Value of a share of Class A Common
Stock on the date of exercise of the CSAR by the number of shares of Class A Common Stock with respect to which the CSAR shall have been exercised, subject to any limitations the Committee may impose.
9.3 Independent Stock Appreciation Rights.
(a) An Independent Stock Appreciation Right ("ISAR") shall be unrelated to any Option and shall have a term set by the Committee. An ISAR shall be exercisable in such installments as the Committee may determine. An ISAR shall cover such number of shares of Class A Common Stock as the Committee may determine; provided, however, that unless the Committee otherwise provides in the terms of the ISAR or otherwise, no ISAR granted to a person subject to Section 16 of the Exchange Act shall be exercisable until at least six months have elapsed from (but excluding) the date on which the Option was granted. The exercise price per share of Class A Common Stock subject to each ISAR shall be set by the Committee. An ISAR is exercisable only while the Grantee is an Employee or consultant; provided that the Committee may determine that the ISAR may be exercised subsequent to Termination of Employment or Termination of Consultancy without cause, or following a Change in Control of the Company, or because of the Grantee's retirement, death or disability, or otherwise.
(b) An ISAR shall entitle the Grantee (or other person entitled to exercise the ISAR pursuant to the Plan) to exercise all or a specified portion of the ISAR (to the extent then exercisable pursuant to its terms) and to receive from the Company an amount determined by multiplying the difference obtained by subtracting the exercise price per share of the ISAR from the Fair Market Value of a share of Class A Common Stock on the date of exercise of the ISAR by the number of shares of Class A Common Stock with respect to which the ISAR shall have been exercised, subject to any limitations the Committee may impose.
9.4 Payment and Limitations on Exercise.
(a) Payment of the amount determined under Section 9.2(c) and 9.3(b) above shall be in cash, in Class A Common Stock (based on its Fair Market Value as of the date the Stock Appreciation Right is exercised) or a combination of both, as determined by the Committee. To the extent such payment is effected in Class A Common Stock it shall be made subject to satisfaction of all provisions of Section 6.3 above pertaining to Options.
(b) Grantees of Stock Appreciation Rights may be required to comply with any timing or other restrictions with respect to the settlement or exercise of a Stock Appreciation Right, including a window-period limitation, as may be imposed in the discretion of the Committee.
ARTICLE X.
ADMINISTRATION
10.1 Compensation Committee. Prior to the Company's initial
registration of Class A Common Stock under Section 12 of the Exchange Act, the
Compensation Committee shall consist of the entire Board. Following such
registration, The Compensation Committee (or another committee or a subcommittee
of the Board assuming the functions of the Committee under the Plan) shall
consist solely of two or more Independent Directors appointed by and holding
office at the pleasure of the Board, each of whom is both a "non-employee
director" as defined by Rule 16b-3 and an "outside director" for purposes of
Section 162(m) of the Code. Appointment of Committee members shall be effective
upon acceptance of appointment or as otherwise provided by the Board. Committee
members may resign at any time by delivering written notice to the Board.
Vacancies in the Committee may be filled by the Board.
10.2 Duties and Powers of Committee. It shall be the duty of the Committee to conduct the general administration of the Plan in accordance with its provisions. The Committee shall have the power to interpret the Plan and the agreements pursuant to which Awards are granted or awarded, and to adopt such rules for the administration, interpretation, and application of the Plan as are consistent therewith and to interpret, amend or revoke any such rules. Notwithstanding the foregoing, the full Board, acting by a majority of its members in office, shall conduct the general administration of the Plan with respect to Options granted to Independent Directors or Independent Director Nominees. Any such grant or award under the Plan need not be the same with respect to each Holder. Any such interpretations and rules with respect to Incentive Stock Options shall be consistent with the provisions of Section 422 of the Code. In its absolute discretion, the Board may at any time and from time to time exercise any and all rights and duties of the Committee under the Plan except with respect to matters which under Rule 16b-3 or Section 162(m) of the Code, or any regulations or rules issued thereunder, are required to be determined in the sole discretion of the Committee.
10.3 Majority Rule; Unanimous Written Consent. The Committee shall act by a majority of its members in attendance at a meeting at which a quorum is present or by a memorandum or other written instrument signed by all members of the Committee.
10.4 Compensation; Professional Assistance; Good Faith Actions. Members of the Committee shall receive such compensation, if any, for their services as members as may be determined by the Board. All expenses and liabilities which members of the Committee incur in connection with the administration of the Plan shall be borne by the Company. The Committee may, with the approval of the Board, employ attorneys, consultants, accountants, appraisers, brokers, or other persons. The Committee, the Company and the Company's officers and Directors shall be entitled to rely upon the advice, opinions or valuations of any such persons. All actions taken and all interpretations and determinations made by the Committee or the Board in good faith shall be final and binding upon all Holders, the Company and all other interested persons. No members of the Committee or Board shall be personally liable for any action, determination or interpretation made in good faith with respect to the Plan or Awards, and all members of the Committee and the Board shall be fully protected by the Company in respect of any such action, determination or interpretation.
ARTICLE XI.
MISCELLANEOUS PROVISIONS
11.1 Not Transferable.
(a) Except as otherwise provided in Section 11.1(b):
(i) No Award under the Plan may be sold, pledged, assigned or transferred in any manner other than by will or the laws of descent and distribution or, subject to the consent of the Administrator, pursuant to a QDRO, unless and until such Award has been exercised, or the shares underlying such Award have been issued, and all restrictions applicable to such shares have lapsed;
(ii) No Option, Restricted Stock award, Deferred Stock award, Performance Award, Stock Appreciation Right, Dividend Equivalent or Stock Payment or interest or right therein shall be liable for the debts, contracts or engagements of the Holder or his successors in interest or shall be subject to disposition by transfer, alienation, anticipation, pledge, encumbrance, assignment or any other means whether such disposition be voluntary or involuntary or by operation of law by judgment, levy, attachment, garnishment or any other legal or equitable proceedings (including bankruptcy), and any attempted disposition thereof shall be null and void and of no effect, except to the extent that such disposition is permitted by the preceding sentence; and
(iii) During the lifetime of the Holder, only he may exercise an Option or other Award (or any portion thereof) granted to him under the Plan, unless it has been disposed of pursuant to a QDRO; after the death of the Holder, any exercisable portion of an Option or other Award may, prior to the time when such portion becomes unexercisable under the Plan or the applicable Award Agreement, be exercised by his personal representative or by any person empowered to do so under the deceased Holder's will or under the then applicable laws of descent and distribution.
(b) Notwithstanding Section 11.1(a), the Administrator, in its sole discretion, may determine to permit a Holder to transfer a Non-Qualified Stock Option to any one or more Permitted Transferees (as defined below), subject to the following terms and conditions: (i) a Non-Qualified Stock Option transferred to a Permitted Transferee shall not be assignable or transferable by the Permitted Transferee other than by will or the laws of descent and distribution; (ii) any Non-Qualified Stock Option which is transferred to a Permitted Transferee shall continue to be subject to all the terms and conditions of the Non-Qualified Stock Option as applicable to the original Holder (other than the ability to further transfer the Non-Qualified Stock Option); and (iii) the Holder and the Permitted Transferee shall execute any and all documents requested by the Administrator, including, without limitation documents to (A) confirm the status of the transferee
as a Permitted Transferee, (B) satisfy any requirements for an
exemption for the transfer under applicable federal and state
securities laws and (C) evidence the transfer. For purposes of this
Section 11.1(b), "Permitted Transferee" shall mean, with respect to a
Holder, any child, stepchild, grandchild, parent, stepparent,
grandparent, spouse, former spouse, sibling, niece, nephew,
mother-in-law, father-in-law, son-in-law, daughter-in-law,
brother-in-law, or sister-in-law, including adoptive relationships, any
person sharing the Holder's household (other than a tenant or
employee), a trust in which these persons have more than fifty percent
of the beneficial interest, a foundation in which these persons (or the
Holder) control the management of assets, and any other entity in which
these persons (or the Holder) own more than fifty percent of the voting
interests, or any other transferee specifically approved by the
Committee after taking into account any state or federal tax or
securities laws applicable to transferable Non-Qualified Stock Options.
11.2 Amendment, Suspension or Termination of the Plan. Except as otherwise provided in this Section 11.2, the Plan may be wholly or partially amended or otherwise modified, suspended or terminated at any time or from time to time by the Board or the Committee. However, without approval of the Company's stockholders given within twelve months before or after the action by the Board or the Committee, no action of the Board or the Committee may, except as provided in Section 11.3, increase the limits imposed in Section 2.1 on the maximum number of shares which may be issued under the Plan. No amendment, suspension or termination of the Plan shall, without the consent of the Holder alter or impair any rights or obligations under any Award theretofore granted or awarded, unless the Award itself otherwise expressly so provides. No Awards may be granted or awarded during any period of suspension or after termination of the Plan, and in no event may any Incentive Stock Option be granted under the Plan after the first to occur of the following events:
(a) The expiration of ten years from the date the Plan is adopted by the Board; or
(b) The expiration of ten years from the date the Plan is approved by the Company's stockholders under Section 11.4.
In addition, if the Board determines that Awards other than Options or Stock
Appreciation Rights which may be granted to Section 162(m) Participants should
continue to be eligible to qualify as performance-based compensation under
Section 162(m)(4)(C) of the Code, the Performance Criteria must be disclosed to
and approved by the Company's stockholders no later than the first stockholder
meeting that occurs in the fifth year following the year in which the Company's
stockholders previously approved the Performance Criteria.
11.3 Changes in Class A Common Stock or Assets of the Company, Acquisition or Liquidation of the Company, Change in Control and Other Corporate Events.
(a) Subject to Section 11.3(d), in the event that the Administrator determines that any dividend or other distribution (whether in the form of cash,
Class A Common Stock, other securities, or other property), recapitalization, reclassification, stock split, reverse stock split, reorganization, merger, consolidation, split-up, spin-off, combination, repurchase, liquidation, dissolution, or sale, transfer, exchange or other disposition of all or substantially all of the assets of the Company (including, but not limited to, a Corporate Transaction), or exchange of Class A Common Stock or other securities of the Company, issuance of warrants or other rights to purchase Class A Common Stock or other securities of the Company, or other similar corporate transaction or event, in the Administrator's, affects the Class A Common Stock such that an adjustment is determined by the Administrator to be appropriate in order to prevent dilution or enlargement of the benefits or potential benefits intended to be made available under the Plan or with respect to an Award, then the Administrator shall, in such manner as it may deem equitable, adjust any or all of:
(i) the number and kind of shares of Class A Common Stock (or other securities or property) with respect to which Awards may be granted or awarded (including, but not limited to, adjustments of the limitations in Section 2.1 on the maximum number and kind of shares which may be issued and adjustments of the Award Limit),
(ii) the number and kind of shares of Class A Common Stock (or other securities or property) subject to outstanding Options, Performance Awards, Stock Appreciation Rights, Dividend Equivalents, or Stock Payments, and in the number and kind of shares of outstanding Restricted Stock or Deferred Stock, and
(iii) the grant or exercise price with respect to any Award.
(b) Subject to Sections 11.3(b)(vii) and 11.3(d), in the event
of any Corporate Transaction or other transaction or event described in
Section 11.3(a) or any unusual or nonrecurring transactions or events
affecting the Company, any affiliate of the Company, or the financial
statements of the Company or any affiliate, or of changes in applicable
laws, regulations, or accounting principles, the Administrator, in its
sole and absolute discretion, and on such terms and conditions as it
deems appropriate, either by the terms of the Award or by action taken
prior to the occurrence of such transaction or event and either
automatically or upon the Holder's request, is hereby authorized to
take any one or more of the following actions whenever the
Administrator determines that such action is appropriate in order to
prevent dilution or enlargement of the benefits or potential benefits
intended to be made available under the Plan or with respect to any
Award under the Plan, to facilitate such transactions or events or to
give effect to such changes in laws, regulations or principles:
(i) To provide for either the purchase of any such Award for an amount of cash equal to the amount that could have been attained upon the exercise of such Award or realization of the Holder's rights had such Award been
currently exercisable or payable or fully vested or the replacement of such Award with other rights or property selected by the Administrator in its sole discretion;
(ii) To provide that the Award cannot vest, be exercised or become payable after such event;
(iii) To provide that such Award shall be exercisable as to all shares covered thereby, notwithstanding anything to the contrary in (i) Section 5.3 or 5.4 or (ii) the provisions of such Award;
(iv) To provide that such Award be assumed by the successor or survivor corporation, or a parent or subsidiary thereof, or shall be substituted for by similar options, rights or awards covering the stock of the successor or survivor corporation, or a parent or subsidiary thereof, with appropriate adjustments as to the number and kind of shares and prices; and
(v) To make adjustments in the number and type of shares of Class A Common Stock (or other securities or property) subject to outstanding Awards, and in the number and kind of outstanding Restricted Stock or Deferred Stock and/or in the terms and conditions of (including the grant or exercise price), and the criteria included in, outstanding options, rights and awards and options, rights and awards which may be granted in the future.
(vi) To provide that, for a specified period of time
prior to such event, the restrictions imposed under an Award Agreement
upon some or all shares of Restricted Stock or Deferred Stock may be
terminated, and, in the case of Restricted Stock, some or all shares of
such Restricted Stock may cease to be subject to repurchase under
Section 7.5 or forfeiture under Section 7.4 after such event.
(vii) None of the foregoing discretionary actions
taken under this Section 11.3(b) shall be permitted with respect to
Options granted under Section 4.5 to Independent Directors or
Independent Director Nominees to the extent that such discretion would
be inconsistent with the applicable exemptive conditions of Rule 16b-3.
In the event of a Change in Control or a Corporate Transaction, to the
extent that the Board does not have the ability under Rule 16b-3 to
take or to refrain from taking the discretionary actions set forth in
Section 11.3(b)(iii) above, each Option granted to an Independent
Director or Independent Director Nominees shall be exercisable as to
all shares covered thereby upon such Change in Control or during the
five days immediately preceding the consummation of such Corporate
Transaction and subject to such consummation, notwithstanding anything
to the contrary in Section 5.4 or the vesting schedule of such Options.
In the event of a Corporate Transaction, to the extent that the Board
does not have the ability under Rule 16b-3 to take or to refrain from
taking the discretionary actions set forth in Section 11.3(b)(ii)
above, no Option granted to an Independent Director or Independent
Director Nominee may be exercised following such
Corporate Transaction unless such Option is, in connection with such Corporate Transaction, either assumed by the successor or survivor corporation (or parent or subsidiary thereof) or replaced with a comparable right with respect to shares of the capital stock of the successor or survivor corporation (or parent or subsidiary thereof).
(c) Subject to Section 11.3(d) and 11.8, the Administrator may, in its discretion, include such further provisions and limitations in any Award, agreement or certificate, as it may deem equitable and in the best interests of the Company.
(d) With respect to Awards described in Article VII or VIII
which are granted to Section 162(m) Participants and are intended to
qualify as performance-based compensation under Section 162(m)(4)(C),
no adjustment or action described in this Section 11.3 or in any other
provision of the Plan shall be authorized to the extent that such
adjustment or action would cause such Award to fail to so qualify under
Section 162(m)(4)(C), or any successor provisions thereto. No
adjustment or action described in this Section 11.3 or in any other
provision of the Plan shall be authorized to the extent that such
adjustment or action would cause the Plan to violate Section 422(b)(1)
of the Code. Furthermore, no such adjustment or action shall be
authorized to the extent such adjustment or action would result in
short-swing profits liability under Section 16 or violate the exemptive
conditions of Rule 16b-3 unless the Administrator determines that the
Award is not to comply with such exemptive conditions. The number of
shares of Class A Common Stock subject to any Award shall always be
rounded to the next whole number.
11.4 Approval of Plan by Stockholders. The Plan will be submitted for the approval of the Company's stockholders within twelve months after the date of the Board's initial adoption of the Plan. Awards may be granted or awarded prior to such stockholder approval, provided that such Awards shall not be exercisable nor shall such Awards vest prior to the time when the Plan is approved by the stockholders, and provided further that if such approval has not been obtained at the end of said twelve-month period, all Awards previously granted or awarded under the Plan shall thereupon be canceled and become null and void.
11.5 Tax Withholding. The Company shall be entitled to require payment in cash or deduction from other compensation payable to each Holder of any sums required by federal, state or local tax law to be withheld with respect to the issuance, vesting, exercise or payment of any Award. The Administrator may in its discretion and in satisfaction of the foregoing requirement allow such Holder to elect to have the Company withhold shares of Class A Common Stock otherwise issuable under such Award (or allow the return of shares of Class A Common Stock) having a Fair Market Value equal to the sums required to be withheld.
11.6 Loans. The Committee may, in its discretion, extend one or more loans to key Employees in connection with the exercise or receipt of an Award granted or awarded under
the Plan, or the issuance of Restricted Stock or Deferred Stock awarded under the Plan. The terms and conditions of any such loan shall be set by the Committee.
11.7 Forfeiture Provisions. Pursuant to its general authority to
determine the terms and conditions applicable to Awards under the Plan, the
Administrator shall have the right (to the extent consistent with the applicable
exemptive conditions of Rule 16b-3) to provide, in the terms of Awards made
under the Plan, or to require a Holder to agree by separate written instrument,
that (i) any proceeds, gains or other economic benefit actually or
constructively received by the Holder upon any receipt or exercise of the Award,
or upon the receipt or resale of any Class A Common Stock underlying the Award,
must be paid to the Company, and (ii) the Award shall terminate and any
unexercised portion of the Award (whether or not vested) shall be forfeited, if
(a) a Termination of Employment, Termination of Consultancy or Termination of
Directorship occurs prior to a specified date, or within a specified time period
following receipt or exercise of the Award, or (b) the Holder at any time, or
during a specified time period, engages in any activity in competition with the
Company, or which is inimical, contrary or harmful to the interests of the
Company, as further defined by the Committee (or the Board, as applicable) or
the Holder incurs a Termination of Employment, Termination of Consultancy or
Termination of Directorship for cause.
11.8 Limitations Applicable to Section 16 Persons and Performance-Based
Compensation. Notwithstanding any other provision of the Plan, the Plan, and any
Award granted or awarded to any individual who is then subject to Section 16 of
the Exchange Act, shall be subject to any additional limitations set forth in
any applicable exemptive rule under Section 16 of the Exchange Act (including
any amendment to Rule 16b-3 of the Exchange Act) that are requirements for the
application of such exemptive rule. To the extent permitted by applicable law,
the Plan and Awards granted or awarded hereunder shall be deemed amended to the
extent necessary to conform to such applicable exemptive rule. Furthermore,
notwithstanding any other provision of the Plan or any Award described in
Article VII or VIII which is granted to a Section 162(m) Participant and is
intended to qualify as performance-based compensation as described in Section
162(m)(4)(C) of the Code shall be subject to any additional limitations set
forth in Section 162(m) of the Code (including any amendment to Section 162(m)
of the Code) or any regulations or rulings issued thereunder that are
requirements for qualification as performance-based compensation as described in
Section 162(m)(4)(C) of the Code, and the Plan shall be deemed amended to the
extent necessary to conform to such requirements.
11.9 Effect of Plan Upon Options and Compensation Plans. The adoption of the Plan shall not affect any other compensation or incentive plans in effect for the Company or any Subsidiary. Nothing in the Plan shall be construed to limit the right of the Company (i) to establish any other forms of incentives or compensation for Employees, Directors or Consultants of the Company or any Subsidiary or (ii) to grant or assume options or other rights or awards otherwise than under the Plan in connection with any proper corporate purpose including but not by way of limitation, the grant or assumption of options in connection with the acquisition by purchase, lease, merger, consolidation or otherwise, of the business, stock or assets of any corporation, partnership, limited liability company, firm or association.
11.10 Compliance with Laws. The Plan, the granting and vesting of Awards under the Plan and the issuance and delivery of shares of Class A Common Stock and the payment of money under the Plan or under Awards granted or awarded hereunder are subject to compliance with all applicable federal and state laws, rules and regulations (including but not limited to state and federal securities law and federal margin requirements) and to such approvals by any listing, regulatory or governmental authority as may, in the opinion of counsel for the Company, be necessary or advisable in connection therewith. Any securities delivered under the Plan shall be subject to such restrictions, and the person acquiring such securities shall, if requested by the Company, provide such assurances and representations to the Company as the Company may deem necessary or desirable to assure compliance with all applicable legal requirements. To the extent permitted by applicable law, the Plan and Awards granted or awarded hereunder shall be deemed amended to the extent necessary to conform to such laws, rules and regulations.
11.11 Titles. Titles are provided herein for convenience only and are not to serve as a basis for interpretation or construction of the Plan.
11.12 Governing Law. The Plan and any agreements hereunder shall be administered, interpreted and enforced under the internal laws of the State of Delaware without regard to conflicts of laws thereof.
[THE REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]
* * * *
I hereby certify that the foregoing Plan was duly adopted by the Board of Directors of Beasley Broadcast Group, Inc. on February 10, 2000.
Executed on this 10th day of February, 2000.
/s/ CAROLINE BEASLEY
-----------------------------------------------
Name: B. Caroline Beasley
Title: Vice President, Chief Financial Officer,
Secretary and Treasurer
|
EXHIBIT 10.14
AGREEMENT OF SALE (OT/LL)
This Agreement of Sale (the "Agreement") is made this ___ day of February, 2000, between Beasley FM Acquisition Corp., a Delaware corporation (the "Seller"), and Beasley Family Towers, Inc., a Delaware corporation (the "Buyer") (together, the "Parties").
WITNESSETH:
WHEREAS, Seller owns four (4) communications tower facilities used in the operation of radio broadcast stations WIKS-FM, WRXK-FM and WZFX-FM (each a "Tower" and collectively the "Towers"), each such Tower situated on a certain tract of land which Seller leases from a third party (such tracts of land called collectively herein the "Tower Sites", and individually, a "Tower Site", each such Tower and its corresponding Tower Site described on Exhibit A attached hereto);
WHEREAS, Seller desires to sell and Buyer desires to purchase the Towers and certain personal property belonging to Seller and associated with the Tower Sites;
NOW, THEREFORE, in consideration of the mutual premises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
1. Agreement to Sell and Purchase.
Seller agrees to sell, transfer, assign, convey and deliver to Buyer and Buyer agrees to purchase and accept from Seller, the following assets upon the terms and conditions contained herein (collectively, the "Assets"):
(a) The Towers;
(b) The leases for use of space on certain of the Towers located at the Tower Sites as more particularly discussed in Section 5(d) of this Agreement; and
(c) The ground leases for each of the Tower Sites (the "Ground Leases"), such Ground Leases attached as Exhibit B hereto and incorporated herein.
2. Assumption of Liabilities.
(a) Upon the terms and subject to the conditions contained herein, Buyer shall assume and become responsible for any and all liabilities and obligations arising out of, or relating to events occurring after 12:01 am Eastern Standard Time on the Closing Date (the "Adjustment Time") under the Tower Leases (as such term is defined in Section 5(d) hereof), the Ground Leases, and with respect to the ownership of the Towers, and the operation of the business relating to the Assets (collectively, the "Assumed Liabilities").
(b) Subject to the provisions of Section 13 hereof, it is understood and agreed that all liabilities to third parties relating to the Assets that arise out of any act, event, or
transaction of Seller or the ownership of the Assets or the operation of the business relating to the Assets prior to the Closing Date (the "Retained Liabilities") shall remain the responsibility of Seller. Buyer shall not be required to defend any suit or claim arising out of any Retained Liabilities, and Seller shall and hereby agrees to satisfy in due course all such Retained Liabilities, and subject to the provisions of Section 13 hereof Seller shall protect and forever hold Buyer harmless from all claims with respect to such Retained Liabilities. Subject to the provisions of Section 13 hereof, it is understood and agreed that all liabilities relating to the Assets that arise out of any act, event, or transaction of Buyer following the Closing Date (the "Assumed Liabilities") shall be the responsibility of Buyer. Seller shall not be required to defend any suit or claim arising out of any Assumed Liabilities, and Buyer shall and hereby agrees to satisfy in due course all such Assumed Liabilities, and subject to the provisions of Section 13 hereof Buyer shall protect and forever hold Seller harmless from all claims with respect to such Assumed Liabilities.
3. Purchase Price.
(a) The purchase price for the Assets shall be the amount of Nine Hundred Thirty Thousand Four Hundred Forty Eight Dollars ($930,448.00) (the "Purchase Price"). The Purchase Price shall be adjusted at the Closing by the amount of any prorations derived by operation of Section 6 hereof, and for any other normal income and expense items related to the operation of the Tower Sites as of 12:01 am on the day on which the Closing occurs. The Purchase Price shall be allocated among the Assets in accordance with Section 3(b)).
(b) Buyer and Seller agree to allocate the aggregate of the Purchase Price, the Assumed Liabilities and other relevant items among the Assets in accordance with section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"). Buyer and Seller will each report the federal, state, and local and other tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Form 8594) in a manner consistent with such allocation.
4. Delivery of Purchase Price.
(a) The Purchase Price shall be payable at Closing (as defined in Section 8 below) in the manner set forth in Section 4(b).
(b) As payment of the Purchase Price, Buyer shall deliver to Seller at Closing an unsecured promissory note of Buyer in the aggregate principal amount of (Nine Hundred Thirty Thousand Four Hundred Forty Eight Dollars) ($930,448.00), substantially in the form of Exhibit C (the "Purchase Note").
5. Transfer of Assets.
(a) Transfer of ownership of the Towers and assumption of the Assumed Liabilities (except for the Ground Leases, which shall be transferred according to Section(b) below) pursuant to Section 2 hereof shall be pursuant to the Assignment, Bill of Sale
and Assumption Agreement from the Seller to Buyer in the form of Exhibit D attached hereto and incorporated herein (the "Assignment, Bill of Sale and Assumption Agreement").
(b) The Assets shall be transferred to Buyer free and
clear of all liens, encumbrances other than Permitted Encumbrances, if any.
"Permitted Encumbrances" shall mean: (i) encumbrances for taxes, assessments,
or governmental charges or levies which are not yet due and payable, or that,
subject to adequate security for payment, are being contested; (ii) existing
building restrictions, ordinances, easements of roads, privileges, or rights of
public service companies or other rights of way, other restrictions or
conditions of record, if any or other encumbrances disclosed in this Agreement
(including the Exhibits attached hereto); (iii) easements, rights of way or
other encumbrances that do not have a material adverse effect on the Assets or
the operation of the business relating to the Assets as currently operated;
(iv) encumbrances imposed by law, such as materialmen's, mechanic's, carrier's,
workmen's, or repairmen's liens or other similar encumbrances attaching in the
ordinary course of business or securing obligations that are not overdue; (v)
encumbrances securing indebtedness, which will be removed prior to or at the
Closing; and (vi) encumbrances pursuant to contracts and leases to be assumed
by Buyer pursuant to Section 2.
(c) Assumption of the Ground Leases pursuant to Section 2 hereof shall be pursuant to the Ground Lease Assignment and Assumption Agreement in the form of Exhibit E attached hereto and incorporated herein (the "Ground Lease Assignment and Assumption Agreement").
(d) Buyer and Seller acknowledge that certain of the Towers are occupied, or will be occupied, by various tenants pursuant to tower leases between third party lessees and the Seller, for space on certain of the Towers, such tower leases all made effective prior to the effective date of this Agreement (the "Tower Leases"). Buyer acknowledges receipt of copies of the Tower Leases from Seller. At Closing, Seller will assign all of its right, title, and interest in the Tower Leases to Buyer, and Buyer shall assume the obligations under such Tower Leases, in the Assignment, Bill of Sale and Assumption Agreement. In the event that the Buyer receives after Closing any payment from tenants pursuant to Tower Leases for rent (or other amounts owed) that accrued prior to Closing, Buyer shall remit any such payment promptly to Seller. Conversely, in the event Seller receives after Closing any such payments from tenants pursuant to the Tower Leases for rent (or other amounts owed) that accrued after Closing, Seller shall remit such payments promptly to Buyer.
6. Apportionment of Real Estate Taxes, Rent, Utilities.
(a) Current real estate taxes, rent, utilities and all other normal income and expense items related to the Assets shall be apportioned between the parties to reflect the principle that all expenses and income arising from the operation of the Assets up through the Adjustment Time shall be for the account of Seller, and all expenses and income arising from the operation of the business relating to the Assets acquired by Buyer after the Adjustment Time shall be for the account of Buyer.
(b) As soon as practicable following the Closing Date, or at such other time as the parties agree, Buyer shall deliver to Seller a certificate from Buyer which sets forth as of the Adjustment Time, all adjustments to be made as provided in Section 6(a) above (the "Buyer's Certificate"). Buyer shall provide Seller or its representatives access to copies of such portions of books and records Seller may reasonably request solely for the purposes of verifying such adjustments. The Buyer's Certificate shall be final and conclusive unless objected to by Seller in writing within ninety (90) days after delivery. Buyer and Seller shall attempt jointly to reach agreement as to the amount of the adjustments to be made hereunder within thirty (30) days after receipt of such written objection, which agreement, if achieved, shall be binding upon all parties to this Agreement and not subject to dispute or review.
(c) In the event of a disagreement between Buyer and Seller with respect to the accounting to be made hereunder, the parties agree that a public accounting firm chosen jointly by Buyer and Seller shall be the final arbiter of such disagreement.
(d) Any amounts due for the adjustments provided for herein shall be paid within thirty (30) business days after final determination.
7. Expenses.
All costs and expenses incurred by the Parties in this transaction, including, but not limited to attorneys' fees, shall be paid by the party incurring them.
8. Closing; Closing Conditions.
(a) Closing of the transactions contemplated by this Agreement (the "Closing") shall occur at a place and time mutually agreeable to Seller and Buyer (the "Closing Date"). Seller and Buyer shall both make a good faith effort to close under this Agreement promptly.
(b) Seller's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Buyer being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or warranty is made as of a specified date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Buyer or any of its affiliates, which would render it unlawful as of the Closing Date to effect the transactions contemplated by this Agreement in accordance with its terms, (iv) the delivery by Buyer of the Purchase Price in the manner set forth in Section 4(b) above, and (v) the delivery by Buyer of Buyer's Closing Documents (as defined in Section 9 hereof) on or before the Closing Date.
(c) Buyer's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Seller being then true and complete in all material respects
as if made on and as of the Closing Date, except to the extent that any such
representation or warranty is made as of a specific date, in which case such
representation or warranty shall have been true and correct as of such date,
(ii) all consents of third parties required for Seller to consummate the
transactions contemplated under this Agreement shall have been obtained, (iii)
no order, decree or judgment of any court, agency or other governmental
authority shall have been issued based on or arising out of the conduct,
action, inaction, qualifications or status of Seller or any of its affiliates,
which would render it unlawful as of the Closing Date to effect that
transactions contemplated by this Agreement in accordance with its terms, and
(iv) the delivery by Seller of Seller's Closing Documents as set forth in
Section 9 hereof.
9. Closing Deliveries.
(a) At Closing, Seller shall execute and/or deliver to Buyer the following (collectively "Seller's Closing Documents"):
(i) The Assignment, Bill of Sale and Assumption Agreement;
(ii) The Ground Lease Assignment and Assumption Agreement;
(iii) A certificate from an officer of Seller reasonably acceptable to Buyer confirming the accuracy of the representations and warranties in Section 10 as of the Closing Date;
(iv) Authorizing resolutions or minutes from Seller approving this Agreement and the transactions contemplated herein;
(v) A FIRPTA affidavit to the effect that Seller
is not a "foreign person" (as defined in
Section 1445(f)(3) of the Code and the
regulations issued thereunder); and
(vi) Three (3) lease agreements, each lease agreement by and between Buyer, as lessor, and Seller, as lessee, and each lease agreement substantially in the form of Exhibit F (the "Lease Agreements").
(b) At Closing, Buyer shall execute and/or deliver to Seller the following (collectively "Buyer's Closing Documents"):
(i) Authorizing resolutions from Buyer approving this Agreement and the transactions contemplated herein;
(ii) A certificate from an officer of Buyer reasonably acceptable to Seller confirming the accuracy of the representations and warranties in Section 11 as of the Closing Date;
(iii) The Purchase Note executed by a duly authorized officer of Buyer;
(iv) Three (3) lease agreements, each lease agreement by and between Buyer, as lessor, and Seller, as lessee, each lease agreement substantially in the form of Exhibit F (the "Lease Agreements"); and
(v) The Assignment, Bill of Sale and Assumption Agreement.
(c) Seller's Closing Documents and Buyer's Closing Documents shall be collectively called herein the "Closing Documents". Buyer and Seller agree that such other documents as may be legally necessary or appropriate to carry out the terms of this Agreement or as reasonably requested by the other party shall be executed and delivered by the appropriate party at Closing.
10. Representations and Warranties of Seller.
As a material inducement to Buyer to enter into this Agreement, Seller represents and warrants to Buyer as follows:
(a) Seller has good and marketable title to the Towers, and the Assets are free and clear of liens, encumbrances, restrictions and security interests other than Permitted Encumbrances.
(b) Seller has full power and authority to execute and deliver this Agreement and Seller's Closing Documents, and to perform its obligations hereunder and thereunder.
(c) This Agreement and Seller's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Seller, enforceable against Seller in accordance with their terms.
(d) The sale of the Assets shall not materially conflict with, or result in, a breach of the terms of any agreements or instruments to which the Seller is a party which would result in the creation or imposition of any lien, charge or encumbrance on, or give to others any interest in or right to, any of the Assets.
(e) Seller has paid or will pay, at or prior to Closing, all outstanding obligations for utilities and taxes through the Closing Date, except for such items as are covered by the proration of items of income and expense as set forth in Section 6 hereof.
(f) No third-party authorization or approval of, or filing with, any person, entity, or authority will be required in connection with the execution and delivery of this Agreement or the transactions contemplated by this Agreement.
(g) Assuming all consents and approvals required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Seller's compliance with, the terms and provisions of this Agreement will conflict with, or result in, a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Seller, or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Seller is subject or any material agreement or contract to which Seller is a party or to which it is subject, or constitute a material default thereunder.
(h) Seller is not a foreign person within the meaning of
Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and the
regulations issued thereunder.
11. Representations and Warranties of Buyer.
As a material inducement to Seller to enter into this Agreement, Buyer represents and warrants to Seller as follows:
(a) Buyer has full power and authority to execute and deliver this Agreement and Buyer's Closing Documents, and to perform its respective obligations hereunder and thereunder.
(b) This Agreement and Buyer's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Buyer enforceable against Buyer, in accordance with their terms.
(c) Assuming all consents and approvals required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Buyer's compliance with, the terms and provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Buyer or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Buyer is subject or any material agreement or contract to which Buyer is a party or to which it is subject, or constitute a material default thereunder.
(d) Buyer acknowledges that the Towers are located on land which is leased and subject to corresponding Ground Leases. Buyer acknowledges that it has received copies of such Ground Leases and that there are no assurances that such Ground Leases will be extended or, if extended, whether the terms and conditions of any such extension will be the same as the terms and conditions of the current Ground Leases.
12. Representations and Warranties Survive Closing.
All of the provisions of this Agreement and of the Closing Documents and all of the representations, warranties, considerations, and agreements contained herein and in the Closing Documents shall survive Closing and continue in full force and effect for a period of twelve (12) months from the Closing Date; provided that if a claim for indemnification is made
by either party under Section 13 hereof within such twelve (12) month period, the provisions of Section 13 shall survive until the resolution of such claim. No claim may be brought under this Agreement unless written notice describing in reasonable detail the nature of the claim is given on or prior to the last day of the twelve (12) month period following the Closing Date.
13. Indemnification.
(a) Seller shall indemnify, defend, and hold Buyer, its affiliates, partners, employees, officers, directors, agents, and representatives harmless from and against any and all reasonable losses, costs, expenses, liabilities, penalties, claims, and other damages including, but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigation, reasonably incurred and resulting from:
(i) any breach of Seller's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Seller of any of its covenants or agreements contained herein or in any Seller's Closing Document;
(iii) the Retained Liabilities;
(iv) any and all losses, liabilities or damages resulting from Sellers' operations or ownership of any Tower prior to the Closing Date, including any and all liabilities arising under the Assets which relate to events occurring prior to the Closing Date.
(b) Buyer shall indemnify, defend and hold Seller, its affiliates, employees, officers, directors, agents and representatives harmless from and against any and all losses, costs, expenses, liabilities, penalties, claims, and other damages, including but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigations, reasonably incurred and resulting from:
(i) any breach of Buyer's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Buyer of any of its covenants or agreements contained herein or in any Buyer's Closing Document;
(iii) the Assumed Liabilities;
(iv) any and all losses, liabilities or damages resulting from Buyer's operations or ownership of any Tower subsequent to the Closing Date, including any and all liabilities arising
under the Assets which related to events occurring subsequent to the Closing Date.
(c) In the event either Buyer or Seller (the "Indemnified Party") becomes aware of circumstances which would entitle such party to indemnification by the other party hereunder (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party prompt written notice, with reasonable detail, of such claim. Upon receipt of such notice by the Indemnified Party to the Indemnifying Party, the Indemnifying Party shall have the option of defending against such pending litigation through engagement of legal counsel of its choice, provided, however, that the Indemnifying Party's choice of legal counsel must be acceptable to the Indemnified Party in its reasonable discretion. In the event the Indemnifying Party elects to defend, the Indemnifying Party shall keep the Indemnified Party fully informed on a timely basis of the status of the pending litigation. In the event that the Indemnifying Party elects to defend and is unsuccessful in such defense, it shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages as described above, including but not limited to, reasonable attorney's fees and other costs and expenses associated with the pending litigation being so defended. In the event the Indemnifying Party elects not to defend and the Indemnified Party defends, but is unsuccessful, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages, as described above, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. In the event that Indemnifying Party elects not to defend and the Indemnified Party defends successfully, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all costs and expenses incurred, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. Finally, the Indemnifying Party shall reimburse the Indemnified Party upon demand for any payment made by the Indemnified Party at any time after Closing, based on the final judgement of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands or actions in respect to any damages to which the foregoing indemnification relates.
(d) Notwithstanding anything in this Agreement to the contrary, Seller's obligation to indemnify Buyer shall be subject to all of the following limitations:
(i) The amount of any losses, costs, expenses, liabilities, penalties, claims, and other damages ("Losses") incurred by Buyer shall be reduced by (A) the amount Buyer recovers (after deducting all attorneys' fees, expenses, and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Buyer shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Buyer shall be entitled to indemnification only for Losses as to which Buyer has given Seller written notice describing in reasonable detail the nature and basis for such
indemnification ("Notice of Claim") on or prior to the first anniversary of the Closing Date.
(iii) Seller shall not be required to make any indemnification under clause (i) of Section 13(a) until the aggregate amount of Losses resulting from or arising out of the matters referred to in Section 13(a)(i) exceeds Five Thousand Dollars ($5,000.00); provided that if the aggregate amount of such Losses exceeds such amount, Seller shall be required to indemnify Buyer for all Losses indemnifiable under Section 13(a)(i) without regard to such Five Thousand Dollar ($5,000.00) limitation.
(iv) Any amounts owed to Buyer by Seller pursuant to this Section 13 shall be limited to One Hundred Thousand Dollars ($100,000.00) and Seller shall have no other liability or responsibility for indemnification hereunder.
(e) Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Buyer with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
(f) Notwithstanding anything in this Agreement to the contrary, Buyer's obligation to indemnify Seller shall be subject to all of the following limitations:
(i) The amount of any Losses incurred by Seller shall be reduced by (A) the amount Seller recovers (after deducting all attorneys' fees, expenses and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Seller shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Seller shall be entitled to indemnification only for Losses as to which Seller has given Buyer a Notice of Claim on or prior to the first anniversary of the Closing Date.
(iii) Buyer shall not be required to make any indemnification under clause (i) of Section 13(b) until the aggregate amount of Losses resulting from or arising out of the matters referred to in Section 13(b)(i) exceeds Five Thousand Dollars ($5,000.00); provided that if the aggregate amount of such Losses exceeds such amount, Buyer shall be required to indemnify Seller for all Losses indemnifiable under Section 13(b)(i) without regard to such Five Thousand Dollar ($5,000.00) limitation.
(iv) Any amounts owed to Seller by Buyer pursuant to this Section 13 shall be limited to One Hundred Thousand Dollars ($100,000.00) and Buyer shall have no other liability or responsibility for Indemnification hereunder.
(g) Subsequent to the Closing, indemnification under this
Section 13 shall be the exclusive remedy of Seller with respect to any legal,
equitable or other claim for relief based upon this Agreement or arising
hereunder.
14. Termination; Liquidated Damages.
(a) Right of Termination. This Agreement may be terminated prior to Closing:
(i) By written notice from a party that is not then in material breach of this Agreement if:
(A) The other party has continued in material breach of this Agreement for twenty (20) days after written notice of such breach from the terminating party;
(B) Closing does not occur by May 31, 2000 or such other date as is mutually agreed to by Buyer and Seller.
(b) Obligations Upon Termination.
(i) Upon termination of this Agreement, each party shall thereafter remain liable for breach of this Agreement prior to such termination and remain liable to pay and perform any obligation under Section 13.
(ii) If Closing shall not have occurred, Seller's sole remedy at law or in equity for any breach or default by Buyer described in Section 14(a)(i)(A) shall be the termination by Seller of this Agreement by giving of written notice to Buyer pursuant to Section 14(a)(i)(A).
(c) Termination Notice. Each notice given by a party pursuant to Section 14(a) to terminate this Agreement shall specify the subsection of Section 14(a) pursuant to which such notice is given. If at the time a party gives a termination notice, such party is entitled to give such notice pursuant to more than one subsection of Section 14(a), the subsection pursuant to which such notice is given and termination is effected shall be deemed to be the subsection specified in such notice provided that the party giving such notice is at such time entitled to terminate this Agreement pursuant to the specified subsection.
15. Default; Disputes.
If Seller fails to perform under this Agreement, the Buyer may exercise any right it has against the Seller, including bringing an action for specific performance. The remedies provided by this Section are in addition to any right or remedies provided elsewhere in this Agreement or at law or in equity. In the event a dispute arises between the Parties over the interpretation of this Agreement, or the performance, alleged non-performance or breach by either Party hereunder, the Parties hereby agree to seek resolution of such dispute in good faith through an alternative dispute resolution process mutually agreeable to the Parties prior to the institution of any legal proceedings related thereto.
16. Liabilities.
Buyer shall not, in connection with the purchase and sale of Assets contemplating herein, assume any liabilities or obligations of the Seller except as specifically set forth herein.
17. Third Party Brokerage.
Seller and Buyer hereby represent and warrant to each other that neither Seller or Buyer has dealt with any broker or finder in connection with the transaction which is the subject of this Agreement. Each party hereby agrees to indemnify, save harmless and defend the other from and against all claims, losses, liabilities and expenses, including reasonable attorney's fees, arising out of any claim made by any broker, finder or other intermediary who claims to have dealt with such party in connection with the transaction which is the subject of this Agreement. The provisions of the paragraph shall survive Closing hereunder.
18. Entire Agreement.
This Agreement (which includes the exhibits and schedules attached hereto) constitutes the entire agreement between the Parties and there are no other understandings, representations or warranties, oral or written, relating to the subject matter hereof.
19. Amendment.
This Agreement may not be changed, modified or amended, in whole or in part, except in writing, signed by all parties.
20. Notice.
Notices given pursuant to this Agreement shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this Section. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Seller: Beasley FM Acquisition Corp.
3303 Riviera Drive, Suite 200
Naples, Florida 34103
Attn: Mr. George Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
If to the Buyer: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. Caroline Beasley
Secretary
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Phone: (941) 263-5000 Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
21. Construction.
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Whenever used in this Agreement the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.
22. Assignment and Recording.
Seller hereby covenants not to assign or record this Agreement except with the prior written consent of the Buyer. Buyer may assign this Agreement freely to any affiliated entity, provided such assignment shall not relieve Buyer of its obligations hereunder.
23. Binding Effect.
This Agreement and all of its terms and conditions shall extend to and be binding upon the Parties hereto and upon their respective heirs, executors, administrators, successors and assigns.
24. Further Assurances.
Seller and Buyer agree to execute and deliver any further documents or assurances that in law or otherwise are necessary, desirable or proper to consummate the transactions
contemplated by this Agreement and to vest, perfect, assign or confirm, of record or otherwise, in Buyer title to the Assets.
25. Governing Law.
This Agreement is made and shall be governed by and construed in accordance with the internal laws of the State of North Carolina.
26. Headings.
The headings and captions in this Agreement are for convenience only and are not part of this Agreement.
27. Interpretation.
Neither this Agreement nor any provision contained herein shall be interpreted for or against either party solely because that party or that party's legal representative drafted the provision.
28. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute the same Agreement.
29. Severability.
If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be severed from this Agreement and the remainder shall remain in full force and effect.
[Signature page follows]
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound, have caused this Agreement to be duly executed on the day and year first written above.
SELLER:
BEASLEY FM ACQUISITION CORP.
BUYER:
BEASLEY FAMILY TOWERS, INC.
BY:
INDEX OF EXHIBITS
Exhibit A Description of Towers and Tower Sites
Exhibit B Ground Leases
Exhibit C Form of Purchase Note
Exhibit D Form of Assignment, Bill of
Sale and Assumption Agreement
Exhibit E Form of Ground Lease
Assignment and Assumption
Agreement
Exhibit F Form of Lease Agreements
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EXHIBIT A
DESCRIPTION OF TOWERS AND TOWER SITES
WIKS-FM (MAIN TOWER)
That certain communications tower situated on a two-acre portion of a tract of land situate in Township Nine, Craven County, North Carolina, described as the second parcel in deed recorded in Book 903, Page 34 in the Office of the Register of Deeds of Craven County, North Carolina.
Such land does not include that certain one-half acre lot described in deed recorded in Book 983, Page 904, Craven County Registry, nor shall it include the property described in Deed Book 1110, Page 917, Craven County Registry, nor shall it include the property described in Deed Book 1508, Page 707, Craven County Registry.
WIKS-FM (STL TOWER)
That certain one-hundred (100) foot tower providing a link to the WIKS main transmitting tower, such one-hundred (100) foot tower situated on a tract of land more particularly described as follows:
All that certain Piece, Parcel or Plot of land lying, situate and being in Township No. Eight (8), Craven County, North Carolina and being more fully described and bounded as follows:
Beginning at an existing iron pipe in the Southerly right-of-way line of Glenburnie Drive (formerly Park Avenue), which point of beginning lies North 51 degrees 11'59" East at a distance of 762.92 feet from an existing iron pipe in the intersection of the Southern right-of-way line of Glenburnie Drive with the Eastern right-of-way line of Oaks Road.
Thence continuing along the Southerly right-of-way line of Glenburnie Drive, North 50 degrees 14'00" East for a distance of 350.00 feet to an existing iron pipe;
Thence South 36 degrees 50'00" East for a distance of 434.98 feet to a point;
Thence South 50 degrees 14'00" West for a distance of 350.00 feet to a point;
Thence North 36 degrees 50'00" West for a distance of 434.98 feet to the point or place of beginning and containing 3.490 acres more or less.
Saving and excepting, however, from the hereinabove described property that certain perpetual right-of-way and easement of ingress and egress, on, across and upon the following described lands, to wit:
All that certain Piece, Parcel or Plot of land lying, situate and being in Township No. Eight (8), Craven County, North Carolina and being more fully described and bounded as follows:
Beginning at an existing iron pipe in the Southerly right-of-way line of Glenburnie Drive (formerly Park Avenue), which point of beginning lies North 51 degrees 11'59" East a distance of 762.92 feet and North 50 degrees 14'00" East a distance of 350.00 feet from an existing iron pipe in the intersection of the Southern right-of-way line of Glenburnie Drive with the Eastern right-of-way line of Oaks Road. Said point of beginning being the Northereasternmost corner of the hereinabove described parcel of land.
Thence from said point of beginning South 36 degrees 50'00" East a distance of 434.98 feet to a point;
Thence South 50 degrees 14'00" West a distance of 15 feet more or less to a point;
Thence North 36 degrees 50'00" West a distance of 434.98 feet to an existing iron pin set in the Southerly right-of-way line of Glenburnie Drive;
Thence in an Easterly direction along said Southerly right-of-way line of Glenburnie Drive North 50 degrees 14'00" East a distance of 15 feet more or less to the point or place of beginning.
This being the same right-of-way easement as conveyed by an indenture dated February 14, 1963 between Jefferay Broadcasting Corporation and Walter Long and wife Julia B. Long as recorded in Book 642 at Page 482 in the Office of the Register of Deeds of Craven County.
All that certain perpetual right and easement to construct and maintain a drainage ditch on, across and upon the lands of Walter Long and wife Julia B. Long as is set forth in that certain indenture dated February 14, 1963 between Jefferay Broadcasting Corporation and Walter Long and wife Julia B. Long recorded on Book 642 at Page 482 in the Office of the Register of Deeds of Craven County, over the following described lands:
Beginning at a point in the Southwesternmost corner of the parcel previously described (Tract One). Said point of beginning being located 434.98 feet from the Southern right-of-way line of Glenburnie Drive, along the Westernmost boundary of Tract One hereinabove conveyed.
Thence from said point of beginning South 36 degrees 50'00" East a distance of 800 feet more or less to the Southern boundary of lands now or formerly owned by Walter Long and wife Julia B. Long;
Thence in an Easterly direction and parallel with Glenburnie Drive 15 feet more or less to a point;
Thence North 36 degrees 50'00" West and parallel with the first call herein 800 feet more or less to the Southerly boundary line of the aforementioned and described Tract One;
Thence along said Southerly line in a Westerly direction 15 feet more or less to the point or place of beginning.
WRXK-FM
That certain five hundred (500) foot communications tower situated on a tract of land more particularly described as follows:
All that of that Tract or Parcel of land lying and being in the East half (E 1/2) of the Northwest Quarter (NW 1/4) of Section 28, Township 46 South, Range 25 East, Lee County, Florida, and being more particularly described as follows:
Commencing at the Northeast corner of the Northwest Quarter (NW 1/4) of said
Section 28, run North 89 degrees 12'00" West along the North line of Section 28
for a distance of 256.67 feet to a concrete monument at the point of beginning;
said corner lying on the Northwesterly right-of-way line of a 40 foot roadway
easement; thence South 30 degrees 34'30" West along the Northwesterly line of
said 40 foot roadway easement 615.00 feet; thence North 29 degrees 18'45" West,
617.09 feet to the North line of said Section; thence South 89 degrees 18'00"
East along said Section line 615.00 feet to the Norhwesterly line of said 40
foot roadway easement and the point of beginning.
WZFX-FM
That certain one thousand one hundred twenty-one (1121) foot communications tower situated on a tract of land more particularly described as follows:
Lying and being in Bladen County, North Carolina near the Town of Tar Heel, and being located in a part of a 145.1 acre tract of Land bounded on the south by N.C. Highway Number 87, on the west by the William Robeson Estate on the northeast by the Cape Fear River and on the southeast by Lands of Emily Myers Averitte, it being contemplated and understood that the area includes only a 2 acre portion of a cleared field lying south of a mill pond and dam area in said tract, with the central tower location to be within the cleared area of said field, with sufficient area for its guy wires, as appropriate, not to exceed the total 2 acres.
EXHIBIT B
GROUND LEASES
EXHIBIT C
FORM OF PURCHASE NOTE
PROMISSORY NOTE
$930,448.00 February ___, 2000
BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Payor"), for value received, promises to pay to the order of BEASLEY FM ACQUISITION CORP., a Delaware corporation, ("Payee"), the principal amount of NINE HUNDRED THIRTY THOUSAND FOUR HUNDRED AND FORTY EIGHT DOLLARS ($930,448.00), together with accrued interest thereon, calculated and payable as set forth below in this Note. The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement of Sale (the "Sale Agreement"), dated February ____, 2000, by and among Payor and Payee.
1. Payment of Principal and Interest.
(a) Calculation and Payment of Interest.
Interest on the principal balance of this Note outstanding from time to time until paid in full shall accrue at the rate of six and seventy-seven one hundredths percent (6.77%) compounded annually (the "Rate"), computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof.
(b) Payments Prior to Maturity Date.
On the first day of each month Maker shall pay, in advance, Seven Thousand Forty Six Dollars and Eleven Cents ($7,046.11). All remaining principal, together with accrued and unpaid interest thereon shall be due and payable on the "Maturity Date" (defined below). Each monthly payment shall be credited first to interest then accrued and the remainder, if any, to principal, and interest shall thereupon cease to accrue upon the principal paid.
(c) Payment on Maturity Date.
The principal balance of, and any accrued and unpaid interest on, this Note shall be payable twenty (20) years from the effective date of this Note (such date the "Maturity Date").
(d) Prepayment.
(i) Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this Note.
(ii) Any prepayment of this Note shall be applied as follows: first, to payment of accrued interest; and second, to payment of principal.
2. Events of Default.
The following shall constitute "Events of Default" under this Note:
(a) Failure by Payor to make any payment required under
this Note when the same shall become due and payable
(whether at maturity or otherwise) and the
continuation of such failure for a period of ninety
(90) days; or
(b) Payor pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an involuntary case or proceeding;
(iii) consents to the appointment of a of it or for all or any substantial portion of its property or assets;
(iv) makes a general assignment for the benefit of its creditors; or
(c) an involuntary case or proceeding is commenced against Payor under any Bankruptcy Law and is not dismissed, bonded or discharged within ninety (90) days thereafter, or a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against Payor in an involuntary case or proceeding;
(ii) appoints a Custodian of Payor or for all or substantially all of its properties; or
(iii) orders the liquidation of Payor; and in each case the order or decree remains unstayed and in effect for ninety (90) days.
(d) The following terms used in this Note have the meaning assigned below:
"Bankruptcy Law" means Title 11, United States Code, or any similar federal, state or foreign law for the relief of debtors or any arrangement, reorganization, assignment for the benefit of creditors or any other marshalling of the assets and liabilities of Payor.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
"Event of Default" means any of the occurrences specified in Section 2 of this Note.
If any Event of Default shall have occurred and be continuing, Payee may proceed to protect and enforce its rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to Payee under this Note.
3. Assignment.
The holders of this Note may not assign or otherwise transfer all or any portion of their rights and obligations under this Note to any other person or entity, without the prior written consent of the Payor, which consent shall not be unreasonably withheld.
4. Miscellaneous
(a) Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
(b) Amendment and Waiver. No provision of this Note may be amended or waived unless Payor shall have obtained the written agreement of Payee. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c) Successors, Assigns and Transferors. The foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
(d) Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of North Carolina, without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction.
(e) Notices. Any notice, request, instruction or other document to be given hereunder by either party to the other shall be in writing and shall be deemed given when received and shall be (i) delivered personally or (ii) mailed by certified mail, postage prepaid,
return receipt requested or (iii) delivered by Federal Express or a similar overnight courier or (iv) sent via facsimile transmission to the fax number given below, as follows:
If to Payor, addressed to:
Beasley Family Towers, Inc. 3033 Riviera Drive, Suite 200 Naples, FL 34103 Attention: Ms. B. Caroline Beasley Fax Number: (941) 434-8950
With a copy to:
Latham & Watkins 1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Attention: Joseph D. Sullivan, Esq.
Fax Number: (202) 637-2201
If to Payee, addressed to:
Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attention: Ms. Caroline Beasley
Fax Number: (941) 434-8950
or to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
[Signature page follows]
IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
BEASLEY FAMILY TOWERS, INC.
EXHIBIT D
FORM OF ASSIGNMENT, BILL OF SALE AND ASSUMPTION AGREEMENT
This Assignment, Bill of Sale and Assumption Agreement (this "Agreement") is made effective as of 12:01 a.m. Eastern Time, on the ____ day of February, 2000 by and between BEASLEY FM ACQUISITION CORP. ("Seller") and BEASLEY FAMILY TOWERS, INC.
("Purchaser").
RECITALS
A. Reference is made to that certain Agreement of Sale (the "Asset Purchase Agreement") dated as of February _____, 2000 by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings given such terms in the Asset Purchase Agreement.
B. The Asset Purchase Agreement provides that Seller shall sell, convey and assign to Purchaser all of Seller's right, title and interest to the Towers and Tower Leases and Purchaser shall assume the Assumed Liabilities, as defined in Section 2 of the Asset Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows (capitalized terms used herein but not defined herein shall have the meaning given to them in the Asset Purchase Agreement):
1. Seller hereby bargains, sells, conveys, assigns and delivers all of Seller's right, title and interest in and to:
a. The Towers, such Towers more particularly described in Exhibit A of the Asset Purchase Agreement; and
b. The Tower Leases.
Items a. and b. above are hereinafter referred to as the "Assigned Assets."
2. Purchaser hereby accepts the sale, conveyance and assignment of the Assigned Assets, effective as of 12:01 a.m. Eastern Time on February __, 2000.
3. Purchaser hereby assumes and agrees to pay and perform the Assumed Liabilities pursuant to Section 2 of the Asset Purchase Agreement, effective as of 12:01 a.m. Eastern Time on February __, 2000.
4. After the date hereof, Purchaser and Seller will, at the request of the other party, promptly obtain, execute and deliver, or cause to be obtained, executed and delivered, to the other party such assignments, bills of sale, endorsements, and other such instruments or documents to be executed by Seller or Purchaser, as the case may be, in addition to this Agreement, in form and substance reasonably satisfactory to the other party, as such other party
may reasonably deem necessary or desirable so as (i) to vest in Purchaser title to and possession of the Assigned Assets and (ii) to perfect and record, if necessary, the sale, assignment, conveyance, transfer and delivery to Purchaser of the Assigned Assets.
5. This Agreement is made pursuant to, and is subject to all of the terms, representations, warranties and covenants of, the Asset Purchase Agreement, the terms of which are hereby incorporated by reference. In the event of any conflict between this Agreement and the Asset Purchase Agreement, the terms of the Asset Purchase Agreement shall govern.
[Signature page follows]
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this Agreement as of the day and year first written above.
SELLER:
BEASLEY FM ACQUISITION CORP.
PURCHASER:
BEASLEY FAMILY TOWERS, INC.
By:
-------------------------------------
Name: B. Caroline Beasley
Title: Secretary
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EXHIBIT E
FORM OF GROUND LEASE
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION OF LEASE ("Assignment") is entered into as of this _____ day of February, 2000 by and between BEASLEY FM ACQUISITION CORP. ("Assignor"), and BEASLEY FAMILY TOWERS, INC., ("Assignee").
WHEREAS, David Moreadith, Tresia Moreadith and Maggie Moreadith (collectively, "Lessor"), and Joyner Communications, Inc. ("Joyner"), entered into that certain Lease Agreement, dated November 3, 1986, where Lessor, pursuant to such Lease Agreement, leased to Joyner certain real property in New Bern, North Carolina (the "WIKS-FM Lease");
WHEREAS, Joyner, pursuant to that certain Assignment Agreement dated December 19, 1988, assigned all of its right, title and interest, in and to the WIKS-FM Lease to WIKS-FM, Inc. ("WIKS");
WHEREAS, WIKS, pursuant to that certain Assignment of Lease dated October 31, 1996, assigned all of its right, title and interest in and to the WIKS-FM Lease to Assignor;
WHEREAS, D. Spurgeon Canady and wife, Minnie Canady (collectively "Canady"), and Action Radio, Inc. ("Action"), entered into that certain Lease Agreement, dated May 27, 1986, where Canady, pursuant to such Lease Agreement, leased to Action an approximately two acre portion of a tract of land in Whiteville, North Carolina (the "WZFX-FM Lease");
WHEREAS, Joyner, by virtue of, and pursuant to, the merger of Action and Power Broadcasting, Inc. on or about October 1, 1987, such merger forming Joyner, became lessee under the WZFX-FM Lease;
WHEREAS, Joyner, pursuant to that certain Assignment of Lease Agreement, dated May 20, 1997, assigned all of its right, title and interest in and to the WZFX-FM Lease to Assignor;
WHEREAS, Assignor is the lessee under that certain Lease Agreement, dated September 6, 1994, by and between Assignor and George G. Beasley, such Lease Agreement leasing certain real property in Estero, Florida to Assignor (such Lease Agreement called herein the "WRXK-FM Lease" and together with the WIKS-FM Lease and the WZFX-FM Lease, called collectively herein, the "Leases");
WHEREAS, Assignor intends to sell and convey to Assignee certain tower assets used and held for use in the operation of broadcast stations WIKS-FM, New Bern, North Carolina, WZFX-FM, Whiteville, North Carolina and WRXK-FM, Estero, Florida, pursuant to
the terms of that certain Agreement of Sale (the "Purchase Agreement"), dated as of February ___, 2000, by and between Assignor and Assignee;
WHEREAS, in connection with such transaction, Assignor is required to assign to Assignee all of Assignor's right, title and interest, as lessee, in and to the Leases; and
NOW, THEREFORE, in consideration of the mutual promises contained herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Assignment. Assignor hereby transfers, conveys and assigns to Assignee all of Assignor's right, title and interest in, to and under the Leases.
2. Assumption of Liabilities under the Leases. Assignee hereby assumes the liabilities, duties and obligations of Assignor under the Leases which accrue on or after the date hereof, and Assignor shall have no further liability or responsibility therefor.
3. Counterparts. This Assignment may be executed in counterparts.
[Signature pages follow]
IN WITNESS WHEREOF, the undersigned have executed this Assignment as of the day and year first written above.
[SEAL] ASSIGNOR:
BEASLEY FM ACQUISITION CORP.
ATTEST: By:
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Name: George G. Beasley Its: Chief Executive Officer
Title: Secretary
STATE OF: )
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) ss.
COUNTY OF )
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This is to certify that on the _____ day of February, 2000, before me personally appeared George G. Beasley with whom I am personally acquainted, who, being by me duly sworn, says:
That he is Chief Executive Officer and B. Caroline Beasley is the Secretary of BEASLEY FM ACQUISITION CORP., the corporation described in and which executed the foregoing instrument; that he knows the common seal of said corporation; that the seal affixed to the foregoing instrument is said common seal, and the name of the corporation was subscribed thereto by the said Chief Executive Officer, attested by said Secretary, and said common seal was affixed, all by authority duly conferred, and that said instrument is the act and deed of said corporation.
WITNESS, my hand and notarial seal, this ____ day of February, 2000.
My commission expires:
[SEAL] ASSIGNEE:
BEASLEY FAMILY TOWERS, INC.
ATTEST: By:
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Name: George G. Beasley Its: Chief Executive Officer
Title: Secretary
STATE OF: )
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) ss.
COUNTY OF )
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This is to certify that on the _____ day of February, 2000, before me personally appeared George G. Beasley with whom I am personally acquainted, who, being by me duly sworn, says:
That he is Chief Financial Officer and B. Caroline Beasley is the Secretary of BEASLEY FAMILY TOWERS, INC., the corporation described in and which executed the foregoing instrument; that she knows the common seal of said corporation; that the seal affixed to the foregoing instrument is said common seal, and the name of the corporation was subscribed thereto by the said Chief Executive Officer, attested by said Secretary and said common seal was affixed, all by authority duly conferred, and that said instrument is the act and deed of said corporation.
WITNESS, my hand and notarial seal, this ____ day of February, 2000.
My commission expires:
EXHIBIT F
FORM OF LEASE AGREEMENTS
LEASE AGREEMENT (O&L - WRXK-FM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY FM ACQUISITION CORP., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns a communications tower as such tower is described on Exhibit B attached hereto ("Tower"), on a certain tract of real estate located at Estero, Florida, as such land is more fully described in Exhibit A attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements on such land);
WHEREAS, Lessor desires to lease the space on the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such space from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 TOWER SPACE. Lessor hereby leases to Lessee, and Lessee leases from Lessor, space on the Tower, as such space is described on Exhibit C attached hereto, for the purposes of the broadcast transmission of WRXK-FM (the "Tower Space").
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below), all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Tower Space after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain Lessee's Property, and are hereinafter
referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Tower Space at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Tower Space for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Tower Space may be used only for radio transmitting and receiving. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Tower. Lessee may repair and maintain equipment as it deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. The Tower Space, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to
Lessee in this Lease and with prior notice to Lessee and no loss of service or
interruption (beyond a temporary, non-recurring and de minimis amount), Lessor
reserves the right to use the Tower, at its own expense, as it sees fit and to
fasten additional equipment to the Tower for any purpose, including the right
to install transmitting and/or receiving antennas of others; provided that
Lessor shall use reasonable efforts to restrict any loss of Lessee's service or
interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00
a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space on the Tower or in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
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Lease Year Rent Per Lease Year Monthly Rent
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1 $9,097.36 $757.28
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2 $9,097.36 $757.28
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3 $9,097.36 $757.28
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4 $9,097.36 $757.28
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5 $9,097.36 $757.28
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6 $9,097.36 $757.28
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7 $9,097.36 $757.28
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8 $9,097.36 $757.28
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9 $9,097.36 $757.28
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10 $9,097.36 $757.28
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11 $9,097.36 $757.28
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12 $9,097.36 $757.28
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13 $9,097.36 $757.28
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14 $9,097.36 $757.28
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15 $9,097.36 $757.28
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16 $9,097.36 $757.28
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17 $9,097.36 $757.28
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18 $9,097.36 $757.28
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19 $9,097.36 $757.28
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20 $9,097.36 $757.28
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor under that certain Promissory Note, made by Lessor in favor of Lessee dated _______,
2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Tower Space, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Tower Space except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF TOWER SPACE AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to the Tower. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Tower or the Tower Site, or the prevention of interference with Lessor or any other user of the Tower or any other broadcaster, Lessor may, at its option, make such emergency repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Tower or the Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Tower unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans
and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Tower (including any ascension of the Tower), or in or about the Tower Site. Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor
shall be carried out (i) in a good and workmanlike manner; (ii) in accordance
with established engineering standards and public ordinances, rules, and
regulations applicable to such work, including, without limitation, any rules,
regulations, or guidelines of the FCC implementing the National Environmental
Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation;
(iii) in accordance with plans and specifications, including mechanical and
electrical drawings, which have been submitted to and approved in writing and
in advance by Lessor; and (iv) in accordance with Lessor's security procedures
with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Tower Space to Lessor in as
good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. MAINTENANCE OF TOWER.
9.01 MAINTENANCE OF TOWER.
(a) Lessor shall maintain the Tower in good y security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with trequirements of the FCC regarding obstruction, marking and lighting of the Tower. Lessor shall maintain the Tower and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that
repairs, alterations, or improare necessary or desirable to the Tower or the
leased spaces of other tenants, Lessor may, upon reasonable notice and for the
shortest practical period of time (except for emergency situations), close
entrance doors, common areas, drive-ways, rights-of-way, service areas, parking
areas, or any other facilities at its discretion without being liable to
Lessee; provided that if any of the above would restrict Lessee's ability to
broadcast, Lessor shall use reasonable efforts to restrict any closure or
interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00
a.m.. The closing of entrances, doors, common areas, parking areas, or other
facilities for the making of the repairs, alterations, or improvements
described herein shall, under no circumstances, constitute an eviction of the
Lessee or be grounds for termination of this Lease or the withholding of any
rental payments or other payments or performances required to be paid or made
by Lessee under the terms hereof, provided, Lessor shall use reasonable efforts
to ensure that any action taken in accordance with this paragraph shall not
adversely affect the rights of Lessee hereunder. Under no such circumstances
shall Lessee be entitled to terminate this Lease nor shall it be entitled to
compensation for any loss or damage it may sustain (including loss of use, loss
of advertising/sponsorship revenues, and consequential damages) by reason of
such changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Tower, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine Tower loading capacity, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Tower Space or on the Tower after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of Tower space whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph. 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by
such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Tower shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Tower shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes, assessments, or levies assessed or imposed against the Tower Site (including the Tower Space), and all taxes which may be assessed against the Tower and any buildings thereon. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per of First Amendment to Credit Agreement]. Lessee shall pay all
personal property or other taxes assessed or imposed on Lessee's Property, and shall cooperate with Lessor to ensure that such property is properly separated from that of Lessor or other tenants for assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Tower Space, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Tower elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWER INSURANCE. Lessee shall procure and maintain physical damage insurance on the Tower in an amount sufficient to repair or replace the Tower with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWER DAMAGE. In the event that the Tower is
destroyed or damaged by fire, lightning, windstorm, flood, earthquake,
explosion, collapse, aircraft, or other vehicle damage or other casualty covered
by insurance, Lessor shall promptly reconstruct or repair the Tower to such good
condition as existed before the destruction or damage, and give possession to
Lessee of substantially the same space leased hereunder. Lessee shall promptly
pay over to Lessor any insurance proceeds it receives from insurance policies
Lessee is required to procure under Section 14.03 hereof for the purpose of use
by Lessor to fund reconstruction of the Tower as required of Lessor under this
Section 14.04. If the Tower is in need of such repair or is so damaged by fire,
lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle
damage, collapse, or other casualty that reconstruction or repair cannot
reasonably be undertaken without dismantling Lessee's antenna, then upon written
notice to Lessee, Lessor may remove
any such antenna and interrupt the signal activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably possible. Lessor agrees to provide Lessee alternative space, if available, on the Tower during such reconstruction/repair period. If such space is not available, then Lessee shall be responsible for procuring its own alternative space. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Tower without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Tower or (b) replace the Tower within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to Tower damage (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower (or any portion of the Tower necessary for the guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for the Tower on the condemned property, Lessor agrees to provide space on the new tower reasonably comparable to the space leased to Lessee pursuant to this Lease on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Tower Space within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Tower Space after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any
payment herein provided for and any such default shall continue for a period of
ten (10) business days after written notice to Lessee, or if Lessee shall make
default in the performance of any obligation of Lessee herein (other than as to
payment of money) and any such default shall continue for a period of thirty
(30) days after written notice to Lessee, or if Lessee shall file a voluntary
petition in bankruptcy, or if Lessee shall file any petition or institute any
proceedings under any Insolvency or Bankruptcy Act or any amendment thereto
hereafter made, seeking to effect its
reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Tower Space, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Tower Space by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Tower Space. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Tower Space (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of Florida at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it
has the authority to enter into this Lease and to grant the rights it grants
hereunder, and that performance of its obligations pursuant to this Lease will
not violate the rights of any third party whatsoever. Lessee agrees to indemnify
and defend Lessor against any claim for damages, losses, liabilities, costs, or
expenses, including reasonable attorney's fees, arising (a) out of any breach by
Lessee of its warranties, representations, or covenants under this Lease; (b)
out of the use, management, or occupancy of the Tower Space by Lessee, its
agents, or invitees; (c) out of any omissions, negligence or willful misconduct
of Lessee, its agents, servants, employees, licensees, or invitees; (d) out of
failure of Lessee to comply with any laws, statutes, ordinances, or regulations;
(e) out of Lessee's failure to maintain equipment in proper working order; and
(f) out of Lessee's failure to comply with any of its other obligations under
the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Tower Space by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for indemnity,
and the Indemnifying Party shall have the right and opportunity to undertake the
legal defense of such claims. The Indemnified Party and its counsel may
nevertheless participate in (but not control) such proceedings, negotiations, or
defense at its own expense. In all such cases, the Indemnified Party will give
all reasonable assistance to the Indemnifying Party, including making the
Indemnified Party's employees and documents available as reasonably requested
without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after
either party's request, the other party shall deliver, executed in recordable
form, a declaration to any person designated by the requesting party (a)
ratifying this Lease; (b) stating the commencement and termination dates; and
(c) certifying (i) that this Lease is in full force and effect, and has not been
assigned, modified, supplemented, or amended (except by such writings as shall
be stated); (ii) that all conditions under this Lease to be performed have been
satisfied (stating exceptions, if any); (iii) that no defenses or offsets
against the enforcement of this Lease by the requesting party exist (or stating
those claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which
rent has been paid; (vi) the amount of security deposited with Lessor (if
hereafter applicable for any reason); and (vii) such other information as the
requesting party reasonably requires. Persons receiving such statements shall be
entitled to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Tower Space, or, if any of the Tower Space comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph
20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of Florida.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one-half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
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Phone: (941) 263-5000 Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
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Phone: (941) 263-5000 Fax: (941) 434-8950
21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Tower, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Tower Space; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users
of the Tower and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Tower Space or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: ` LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
-------------------------------- --------------------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
LESSEE:
BEASLEY FM ACQUISITION CORP.
By: (SEAL)
-------------------------------- --------------------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
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EXHIBIT A
DESCRIPTION OF THE TOWER SITE
WRXK-FM
All of that Tract or Parcel of land lying and being in the East half (E1/2) of the Northwest Quarter (NW 1/4) of Section 28, Township 46 South, Range 25 East, Lee County, Florida, and being more particularly described as follows:
Commencing at the Northeast corner of the Northwest Quarter (NW 1/4) of said
Section 28, run North 89 degrees 12'00" West along the North line of Section 28
for a distance of 256.67 feet to a concrete monument at the point of beginning;
said corner lying on the Northwesterly right-of-way line of a 40 foot roadway
easement; thence South 30 degrees 34'30" West along the Northwesterly line of
said 40 foot roadway easement 615.00 feet; thence North 29 degrees 18'45" West,
617.09 feet to the North line of said Section; thence South 89 degrees 18'00"
East along said Section line 615.00 feet to the Norhwesterly line of said 40
foot roadway easement and the point of beginning.
Together with the rights, privileges and the use of the following described 40 foot roadway easement.
Commencing at the Northeast corner of the Northwest Quarter (NW 1/4) of Section
28, Township 46 South, Range 25 East, run North 89 degrees 12'00" West along the
North line of said Section, 210.59 feet to the Southeasterly line of a 40 foot
roadway easement and the point of beginning; thence run South 30 degrees 34'30"
West along the Southeasterly line of said roadway easement 1038.0 feet to the
Northeasterly right-of-way line of U. S. #41 (State Road #45) new alignment;
thence North 56 degrees 02'00" West along said right-of-way line 40.07 feet to
the Northwesterly line of said 40 foot roadway easement; thence North 30 degrees
34'30" East along said Easement line 1012.75 feet to the North line of Section
28 of said Township and range; thence South 89 degrees 12'00" East along said
Section line 46.08 feet to the Southeasterly line of said 40 foot roadway
easement and the point of beginning.
Description of Ingress-Egress and Utility Easement Area:
A portion of lands described in official records Book 1238, Page 1903, lying in the East 1/2 of the Northwest 1/4 of Section 28, Township 46 South, Range 25 East, Lee County, Florida, and being more particularly described as follows:
Commence at the Northeast corner of the Northwest 1/4 of said Section 28, proceed North 89 degrees 12'00" West along the North line of Section 28 a distance of 256.67 feet; thence South 30 degrees 34'05" West along the Westerly right-of-way line of a 40 foot roadway easement (as described in O.R.B. 1238, Page 1903, Lee County, Florida) a distance of 527.48 feet to the point of beginning; thence continue South 30 degrees 34'05" West along said right-of-way line a distance of 20.33 feet; thence North 49 degrees 03'31" West a distance of 38.58 feet; thence North 35 degrees 36'36" West a distance of 125.83 feet; thence North 11 degrees 49'52 West a distance of 119.12 feet; thence North
23 degrees 07'25" East a distance of 76.27 feet: thence North 52 degrees 56'39" East a distance of 89.87 feet; thence South 56 degrees 49'08" East a distance of 57.04 feet; thence South 33 degrees 18'52" West a distance of 20.00 feet; thence North 56 degrees 49'08" West a distance of 42.93 feet; thence South 52 degrees 56'39" West a distance of 70.48 feet; thence South 23 degrees 07'25" West a distance of 64.64 feet; thence South 11 degrees 49'52" East a distance of 108.61 feet; thence South 35 degrees 36'36" East a distance of 119.26 feet; thence South 49 degrees 03'31" East a distance of 32.56 feet to the point of beginning.
EXHIBIT B
WRXK-FM
That certain five hundred (500) foot communications tower situated on a tract of land more particularly described as follows:
All of that Tract or Parcel of land lying and being in the East half (E 1/2) of the Northwest Quarter (NW 1/4) of Section 28, Township 46 South, Range 25 East, Lee County, Florida, and being more particularly described as follows:
Commencing at the Northeast corner of the Northwest Quarter (NW 1/4) of said
Section 28, run North 89 degrees 12'00" West along the North line of Section 28
for a distance of 256.67 feet to a concrete monument at the point of beginning;
said corner lying on the Northwesterly right-of-way line of a 40 foot roadway
easement; thence South 30 degrees 34'30" West along the Northwesterly line of
said 40 foot roadway easement 615.00 feet; thence North 29 degrees 18'45" West,
617.09 feet to the North line of said Section; thence South 89 degrees 18'00"
East along said Section line 615.00 feet to the Norhwesterly line of said 40
foot roadway easement and the point of beginning.
Together with the rights, privileges and the use of the following described 40 foot roadway easement.
Commencing at the Northeast corner of the Northwest Quarter (NW 1/4) of Section
28, Township 46 South, Range 25 East, run North 89 degrees 12'00" West along the
North line of said Section, 210.59 feet to the Southeasterly line of a 40 foot
roadway easement and the point of beginning; thence run South 30 degrees 34'30"
West along the Southeasterly line of said roadway easement 1038.0 feet to the
Northeasterly right-of-way line of U. S. #41 (State Road #45) new alignment;
thence North 56 degrees 02'00" West along said right-of-way line 40.07 feet to
the Northwesterly line of said 40 foot roadway easement; thence North 30 degrees
34'30" East along said Easement line 1012.75 feet to the North line of Section
28 of said Township and range; thence South 89 degrees 12'00" East along said
Section line 46.08 feet to the Southeasterly line of said 40 foot roadway
easement and the point of beginning.
EXHIBIT C
DESCRIPTION OF TOWER SPACE
EXHIBIT D
DESCRIPTION OF TOWER SPACE
LEASE AGREEMENT (O&L - WZFX-FM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY FM ACQUISITION CORP., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns a communications tower as such tower is described on Exhibit B attached hereto ("Tower"), on a certain tract of real estate located at Whiteville, North Carolina, as such land is more fully described in Exhibit A attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements on such land);
WHEREAS, Lessor desires to lease the space on the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such space from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 TOWER SPACE. Lessor hereby leases to Lessee, and Lessee leases from Lessor, space on the Tower, as such space is described on Exhibit C attached hereto, for the purposes of the broadcast transmission of WZFX-FM, Whiteville, North Carolina (the "Tower Space").
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except as otherwise provided for herein below as "Lessee's Property" (as defined below), all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Tower Space after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain Lessee's Property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Tower Space at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Tower Space for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Tower Space may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Tower. Lessee may repair and maintain equipment as it deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. The Tower Space, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to
Lessee in this Lease and with prior notice to Lessee and no loss of service or
interruption (beyond a temporary, non-recurring and de minimis amount), Lessor
reserves the right to use the Tower, at its own expense, as it sees fit and to
fasten additional equipment to the Tower for any purpose, including the right
to install transmitting and/or receiving antennas of others; provided that
Lessor shall use reasonable efforts to restrict any loss of Lessee's service or
interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00
a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space on the Tower or in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a
structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
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Lease Year Rent Per Lease Year Monthly Rent
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1 $21,422.16 $1,785.18
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2 $21,422.16 $1,785.18
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3 $21,422.16 $1,785.18
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4 $21,422.16 $1,785.18
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5 $21,422.16 $1,785.18
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6 $21,422.16 $1,785.18
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7 $21,422.16 $1,785.18
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8 $21,422.16 $1,785.18
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9 $21,422.16 $1,785.18
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10 $21,422.16 $1,785.18
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11 $21,422.16 $1,785.18
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17 $21,422.16 $1,785.18
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18 $21,422.16 $1,785.18
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19 $21,422.16 $1,785.18
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated _______, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Tower Space, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Tower Space except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF TOWER SPACE AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to the Tower. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Tower or the Tower Site, or the prevention of interference with Lessor or any other user of the Tower or any other broadcaster, Lessor may, at its option, make such emergency repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs
which Lessor, in its reasonable discretion, determines that Lessee should make
to maintain Lessee's Property and equipment in good order, and that such
repairs are necessary for the safety of the Tower or the Tower Site, or the
prevention of interference with Lessor, in violation of the terms of this
Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance
and repairs required to be performed by Lessee. In the event that, within ten
(10) business days following such written notice (or such longer period as may
be reasonably necessary taking into account all facts and circumstances),
Lessee shall not have performed such maintenance and repairs, Lessor may, at
its sole option, make such repairs as it deems reasonably necessary, and any
amount expended by Lessor therefor shall be deemed additional rent. Lessor
shall not be liable for inconvenience, disturbance, loss of business, or other
damage to Lessee by reason of repairing the property and equipment of Lessee
which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a
failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Tower unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Tower (including any ascension of the Tower), or in or about the Tower Site. Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the
foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Tower Space to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. MAINTENANCE OF TOWER.
9.01 MAINTENANCE OF TOWER.
(a) Lessor shall maintain the Tower in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the Tower. Lessor shall maintain the Tower and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that
repairs, alterations, or improvements are necessary or desirable to the Tower
or the leased spaces of other tenants, Lessor may, upon reasonable notice and
for the shortest practical period of time (except for emergency situations),
close entrance doors, common areas, drive-ways, rights-of-way, service areas,
parking areas, or any other facilities at its discretion without being liable
to Lessee; provided that if any of the above would restrict Lessee's ability to
broadcast, Lessor shall use reasonable efforts to restrict any closure or
interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00
a.m.. The closing of entrances, doors, common areas, parking areas, or other
facilities for the making of the repairs, alterations, or improvements
described herein shall, under no circumstances, constitute an eviction of the
Lessee or be grounds for termination of this Lease or the withholding of any
rental payments or other payments or performances required to be paid or made
by Lessee under the terms hereof, provided, Lessor shall use reasonable efforts
to ensure that any action taken in accordance with this paragraph shall not
adversely affect the rights of Lessee hereunder. Under no such circumstances
shall Lessee be entitled to terminate this Lease nor shall it be entitled to
compensation for any loss or damage it may sustain (including loss of use, loss
of advertising/sponsorship revenues, and consequential damages) by reason of
such changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Tower, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the
FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine Tower loading capacity, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation in the Tower Space or on the Tower after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Tower whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this
Paragraph 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Tower shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Tower shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes, assessments, or levies assessed or imposed against the Tower Site (including the Tower Space), and all taxes which may be assessed against the Tower and any buildings thereon. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall pay all personal property or other taxes assessed or imposed on Lessee's Property, and shall cooperate with Lessor to ensure that such property is properly separated from that of Lessor or other tenants for assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Tower Space, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Tower elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWER INSURANCE. Lessee shall procure and maintain physical damage insurance on the Tower in an amount sufficient to repair or replace the Tower with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property together with business interruption insurance.
14.04 TOWER DAMAGE. In the event that the Tower is destroyed or damaged by fire, lightning, windstorm, flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or other casualty covered by insurance, Lessor shall promptly reconstruct or repair the Tower to such good condition as existed before the destruction or damage, and give
possession to Lessee of substantially the same space leased hereunder. Lessee shall promptly pay over to Lessor any insurance proceeds it receives from insurance policies Lessee is required to procure under Section 14.03 hereof for the purpose of use by Lessor to fund reconstruction of the Tower as required of Lessor under this Section 14.04. If the Tower is in need of such repair or is so damaged by fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle damage, collapse, or other casualty that reconstruction or repair cannot reasonably be undertaken without dismantling Lessee's antenna, then upon written notice to Lessee, Lessor may remove any such antenna and interrupt the signal activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably possible. Lessor agrees to provide Lessee alternative space, if available, on the Tower during such reconstruction/repair period. If such space is not available, then Lessee shall be responsible for procuring its own alternative space. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Tower without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Tower or (b) replace the Tower within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to Tower damage (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower (or any portion of the Tower necessary for the guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for the Tower on the condemned property, Lessor agrees to provide space on the new tower reasonably comparable to the space leased to Lessee pursuant to this Lease on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Tower Space within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Tower Space after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after
written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Tower Space, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Tower Space by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Tower Space. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Tower Space (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of North Carolina at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Tower Space by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees;
(d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Tower Space by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for
indemnity, and the Indemnifying Party shall have the right and opportunity to
undertake the legal defense of such claims. The Indemnified Party and its
counsel may nevertheless participate in (but not control) such proceedings,
negotiations, or defense at its own expense. In all such cases, the Indemnified
Party will give all reasonable assistance to the Indemnifying Party, including
making the Indemnified Party's employees and documents available as reasonably
requested without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after
either party's request, the other party shall deliver, executed in recordable
form, a declaration to any person designated by the requesting party (a)
ratifying this Lease; (b) stating the commencement and termination dates; and
(c) certifying (i) that this Lease is in full force and effect, and has not been
assigned, modified, supplemented, or amended (except by such writings as shall
be stated); (ii) that all conditions under this Lease to be performed have been
satisfied (stating exceptions, if any); (iii) that no defenses or offsets
against the enforcement of this Lease by the requesting party exist (or stating
those claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which
rent has been paid; (vi) the amount of security deposited with Lessor (if
hereafter applicable for any reason); and (vii) such other information as the
requesting party reasonably requires. Persons receiving such statements shall be
entitled to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Tower Space, or, if any of the Tower Space comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of North Carolina.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from
all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
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Phone: (941) 263-5000 Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
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Phone: (941) 263-5000 Fax: (941) 434-8950
21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY, Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Tower, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Tower Space; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Tower and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Tower Space or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of
delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
-------------------------------- --------------------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
LESSEE:
BEASLEY FM ACQUISITION CORP.
By: (SEAL)
-------------------------------- --------------------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
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EXHIBIT A
DESCRIPTION OF TOWER SITE
WZFX-FM
That certain tract of land more particularly described as follows:
Lying and being in Bladen County, North Carolina near the Town of Tar Heel, and being located in a part of a 145.1 acre tract of Land bounded on the south by N.C. Highway Number 87, on the west by the William Robeson Estate on the northeast by the Cape Fear River and on the southeast by Lands of Emily Myers Averitte, it being contemplated and understood that the area includes only a 2 acre portion of a cleared field lying south of a mill pond and dam area in said tract, with the central tower location to be within the cleared area of said field, with sufficient area for its guy wires, as appropriate, not to exceed the total 2 acres.
EXHIBIT B
DESCRIPTION OF TOWER
WZFX-FM
That certain one thousand one hundred twenty-one (1121) foot communications tower situated on a tract of land more particularly described as follows:
Lying and being in Bladen County, North Carolina near the Town of Tar Heel, and being located in a part of a 145.1 acre tract of Land bounded on the south by N.C. Highway Number 87, on the west by the William Robeson Estate on the northeast by the Cape Fear River and on the southeast by Lands of Emily Myers Averitte, it being contemplated and understood that the area includes only a 2 acre portion of a cleared field lying south of a mill pond and dam area in said tract, with the central tower location to be within the cleared area of said field, with sufficient area for its guy wires, as appropriate, not to exceed the total 2 acres.
EXHIBIT C
DESCRIPTION OF TOWER SPACE
[HAVE FM ANTENNA, STL AND EAS EQUIPMENT]
LEASE AGREEMENT (O&L - WIKS-FM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY FM ACQUISITION CORP., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns two communications towers as such towers are described on Exhibit B (collectively, the "Towers") one of such Towers being a one hundred (100) foot Tower used to transmit to the main tower for WIKS-FM and called herein the "STL Tower", and the other Tower called herein the "Main Tower", both the Main Tower and STL Tower situated on a certain tract of real estate located at New Bern, North Carolina, as such land is more fully described in Exhibit A attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements on such land);
WHEREAS, Lessor desires to lease the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower from Lessor therefor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee leases from Lessor, with a right of access thereto and parking therefor in accordance with Section 9:
(a) Space on the Main Tower as such space is described on Exhibit C attached hereto, for the purposes of the broadcast transmission of WIKS-FM, New Bern, North Carolina ("WIKS").
(b) Space on the STL Tower, as such space is described on Exhibit D attached hereto, for the purposes of transmitting the broadcast signal of WIKS from the STL Tower to the Main Tower;
(c) The transmitter building on the Tower Site used in the operation of WIKS, as more fully described in Exhibit E hereto, (the "WIKS Transmitter Building"), for the purposes of housing, operation and maintenance of transmitter and related equipment used in the operation of WIKS (such space "Lessee's WIKS Transmitter Building Space); and ;
(d) The transmitter building on the Tower Site, used in the operation of WXNR-FM ("WXNR"), as more particularly described in Exhibit F hereto (the "WXNR Transmitter Building"), for the purposes of the housing, operation and maintenance of transmitter and related equipment used in the operation of WXNR. The WXNR Transmitter Building, together with the WIKS Transmitter Building, collectively, called herein the "Transmitter Buildings".
(e) All of the property leased under this Paragraph 2.01 shall hereinafter be called the "Leased Premises".
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below) all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Leased Premises after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain Lessee's Property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Tower at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Tower for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Leased Premises may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Leased Premises. Lessee may repair and maintain
equipment as it deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. The Leased Premises, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to Lessee in this Lease and with prior notice to Lessee and no loss of service or interruption (beyond a temporary, non-recurring and de minimis amount), Lessor reserves the right to use the Leased Premises, at its own expense, as it sees fit and to fasten additional equipment to the Tower or Transmitter Buildings for any purpose, including the right to install transmitting and/or receiving antennas of others; provided that Lessor shall use reasonable efforts to restrict any loss of Lessee's service or interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00 a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Leased Premises or use of any of the improvements thereon, space in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have an term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
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Lease Year Rent Per Lease Year Monthly Rent
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1 $54,043.80 $4,503.65
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2 $54,043.80 $4,503.65
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3 $54,043.80 $4,503.65
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4 $54,043.80 $4,503.65
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5 $54,043.80 $4,503.65
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6 $54,043.80 $4,503.65
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7 $54,043.80 $4,503.65
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8 $54,043.80 $4,503.65
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9 $54,043.80 $4,503.65
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10 $54,043.80 $4,503.65
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11 $54,043.80 $4,503.65
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12 $54,043.80 $4,503.65
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13 $54,043.80 $4,503.65
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14 $54,043.80 $4,503.65
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15 $54,043.80 $4,503.65
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16 $54,043.80 $4,503.65
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17 $54,043.80 $4,503.65
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18 $54,043.80 $4,503.65
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19 $54,043.80 $4,503.65
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20 $54,043.80 $4,503.65
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated ______, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower and/or Transmitter Buildings used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and
stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Leased Premises, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary
licenses or permits in connection with the Towers and Transmitter Buildings
except that Lessee shall obtain, at its own expense, any and all necessary
licenses or permits from such governmental authorities as shall have
jurisdiction in connection with the (b) the operations, installation, repair,
alteration, or replacement of Lessee's equipment (including, without
limitation, Lessee's antenna and transmission and/or receiving equipment); or
(c) with any of Lessee's activities thereon or contemplated by this Lease. At
Lessor's request, Lessee shall furnish Lessor with copies of same, and shall
abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF TOWER AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to the Towers and the Transmitter Buildings. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Towers, Transmitter Buildings or the Tower Site, or the prevention of interference with Lessor or any other user of
the Towers or any other broadcaster, Lessor may, at its option, make such emergency repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs
which Lessor, in its reasonable discretion, determines that Lessee should make
to maintain Lessee's Property and equipment in good order, and that such
repairs are necessary for the safety of the Towers or Tower Site, or the
prevention of interference with Lessor, in violation of the terms of this
Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance
and repairs required to be performed by Lessee. In the event that, within ten
(10) business days following such written notice (or such longer period as may
be reasonably necessary taking into account all facts and circumstances),
Lessee shall not have performed such maintenance and repairs, Lessor may, at
its sole option, make such repairs as it deems reasonably necessary, and any
amount expended by Lessor therefor shall be deemed additional rent. Lessor
shall not be liable for inconvenience, disturbance, loss of business, or other
damage to Lessee by reason of repairing the property and equipment of Lessee
which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Towers or in the Transmitter Buildings unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Towers or in the Transmitter Buildings (including any ascension of the Towers), or in or about the Tower Site. Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency
radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Leased Premises Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Leased Premises to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. MAINTENANCE OF TOWER.
9.01 MAINTENANCE OF TOWER.
(a) Lessor shall maintain the Leased Premises (including any common areas therein or any fence thereon) in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the Towers. Lessor shall maintain the Towers and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs, alterations, or improvements are necessary or desirable to the Leased Premises or the leased spaces of other tenants, Lessor may, upon reasonable notice and for the shortest practical period of time (except for emergency situations), close entrance doors, common areas, drive-ways, rights-of-way,
service areas, parking areas, or any other facilities at its discretion without
being liable to Lessee; provided that if any of the above would restrict
Lessee's ability to broadcast, Lessor shall use reasonable efforts to restrict
any closure or interruption pursuant to this Section 9.02 to the hours of 1:00
a.m. to 5:00 a.m.. The closing of entrances, doors, common areas, parking
areas, or other facilities for the making of the repairs, alterations, or
improvements described herein shall, under no circumstances, constitute an
eviction of the Lessee or be grounds for termination of this Lease or the
withholding of any rental payments or other payments or performances required
to be paid or made by Lessee under the terms hereof, provided, Lessor shall use
reasonable efforts to ensure that any action taken in accordance with this
paragraph shall not adversely affect the rights of Lessee hereunder. Under no
such circumstances shall Lessee be entitled to terminate this Lease nor shall
it be entitled to compensation for any loss or damage it may sustain (including
loss of use, loss of advertising/sponsorship revenues, and consequential
damages) by reason of such changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Towers, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine loading capacity of the Towers, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Leased Premises after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Towers whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested
to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph. 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Leased Premises shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially
reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Towers shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes, assessments, or levies assessed or imposed against the Tower Site (including the Towers), and all taxes which may be assessed against the Towers or the Transmitter Buildings. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall pay all personal property or other taxes assessed or imposed on Lessee's Property, and shall cooperate with Lessor to ensure that such property is properly separated from that of Lessor or other tenants for assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Leased Premises, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including any Tower elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject
to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWER INSURANCE. Lessee shall procure and maintain physical damage insurance on the Towers and Transmitter Buildings in an amount sufficient to repair or replace the Towers or Transmitter Buildings with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWER DAMAGE. In the event that the Towers and Transmitter Buildings are destroyed or damaged by fire, lightning, windstorm, flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or other casualty covered by insurance, Lessor shall promptly reconstruct or repair the Towers and/or Transmitter Buildings to such good condition as existed before the destruction or damage, and give possession to Lessee of substantially the same space leased hereunder. Lessee shall promptly pay over to Lessor any insurance proceeds it receives from insurance policies Lessee is required to procure under Section 14.03 hereof for the purpose of use by Lessor to fund reconstruction of the Towers and Transmitter Buildings as required of Lessor under this Section 14.04. If the Towers and/or Transmitter Buildings are in need of such repair or is so damaged by fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle damage, collapse, or other casualty that reconstruction or repair cannot reasonably be undertaken without dismantling Lessee's antenna, then upon written notice to Lessee, Lessor may remove any such antenna and interrupt the signal activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably possible. Lessor agrees to provide Lessee an alternative tower or transmitter building, if available, during such reconstruction/repair period. If such tower is not available, then Lessee shall be responsible for procuring its own alternative tower or transmitter building. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Towers without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Towers and/or Transmitter Buildings or (b) replace the Towers and/or Transmitter Buildings within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election
within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to damage to the Towers or Transmitter Buildings (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower Site (or any portion of the Tower Site necessary for the guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower or transmitter building as a replacement for the Tower on the condemned property, Lessor agrees to lease the new tower or transmitter building on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Tower or within the Transmitter Building within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Tower or within the Transmitter Building after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any
payment herein provided for and any such default shall continue for a period of
ten (10) business days after written notice to Lessee, or if Lessee shall make
default in the performance of any obligation of Lessee herein (other than as to
payment of money) and any such default shall continue for a period of thirty
(30) days after written notice to Lessee, or if Lessee shall file a voluntary
petition in bankruptcy, or if Lessee shall file any petition or institute any
proceedings under any Insolvency or Bankruptcy Act or any amendment thereto
hereafter made, seeking to effect its reorganization or a composition with its
creditors, or if, in any proceedings based on the insolvency of Lessee or
relating to bankruptcy proceedings, a receiver or trustee shall be appointed
for Lessee or the Leased Premises, or if any proceedings shall be commenced for
the reorganization of Lessee (which, in the case of involuntary proceedings,
are not dismissed or stayed within 30 days of the commencement thereof), or if
the leasehold estate created hereby shall be taken on execution or by any
process of law, or if Lessee shall admit in writing its inability to pay its
obligations generally as they become due, then Lessor may, at its option,
terminate this Lease without notice, and declare all amounts due or to become
due hereunder immediately due and payable, and Lessor's agents and servants may
immediately, or any time thereafter, reenter the Leased Premises by reasonably
necessary force, summary proceedings, or otherwise, and remove all persons and
properly therein, without being liable to indictment, prosecution, or damage
therefor, and Lessee hereby expressly waives the service of any notice in
writing of intention to reenter said Leased Premises. Lessor may, in addition
to any other remedy
provided by law or permitted herein, at its option, relet the Leased Premises (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of North Carolina at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for
indemnity, and the Indemnifying Party shall have the right and opportunity to
undertake the legal defense of such claims. The Indemnified Party and its
counsel
may nevertheless participate in (but not control) such proceedings, negotiations, or defense at its own expense. In all such cases, the Indemnified Party will give all reasonable assistance to the Indemnifying Party, including making the Indemnified Party's employees and documents available as reasonably requested without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after
either party's request, the other party shall deliver, executed in recordable
form, a declaration to any person designated by the requesting party (a)
ratifying this Lease; (b) stating the commencement and termination dates; and
(c) certifying (i) that this Lease is in full force and effect, and has not
been assigned, modified, supplemented, or amended (except by such writings as
shall be stated); (ii) that all conditions under this Lease to be performed
have been satisfied (stating exceptions, if any); (iii) that no defenses or
offsets against the enforcement of this Lease by the requesting party exist (or
stating those claimed); (iv) advance rent, if any, paid by Lessee; (v) the date
to which rent has been paid; (vi) the amount of security deposited with Lessor
(if hereafter applicable for any reason); and (vii) such other information as
the requesting party reasonably requires. Persons receiving such statements
shall be entitled to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Leased Premises, or, if any of the Leased Premises comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of North Carolina.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
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Phone: (941) 263-5000 Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
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Phone: (941) 263-5000 Fax: (941) 434-8950
21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Tower, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Tower; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Tower and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Tower or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: LESSOR:
BEASLEY FAMILY TOWERS, INC.
-------------------------------- By: (SEAL)
Witness --------------------------------
Name: B. Caroline Beasley
Title: Secretary
LESSEE:
BEASLEY FM ACQUISITION CORP.
-------------------------------- By: (SEAL)
Witness --------------------------------
Name: George G. Beasley
Title: Chief Executive Officer
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EXHIBIT A
DESCRIPTION OF TOWER SITE
WIKS-FM (MAIN TOWER)
That certain two-acre portion of a tract of land situate in Township Nine, Craven County, North Carolina, described as the second parcel in deed recorded in Book 903, Page 34 in the Office of the Register of Deeds of Craven County, North Carolina.
Such land does not include that certain one-half acre lot described in deed recorded in Book 983, Page 904, Craven County Registry, nor shall it include the property described in Deed Book 1110, Page 917, Craven County Registry, nor shall it include the property described in Deed Book 1508, Page 707, Craven County Registry.
WIKS-FM (STL TOWER)
That certain tract of land more particularly described as follows:
All that certain Piece, Parcel or Plot of land lying, situate and being in Township No. Eight (8), Craven County, North Carolina and being more fully described and bounded as follows:
Beginning at an existing iron pipe in the Southerly right-of-way line of Glenburnie Drive (formerly Park Avenue), which point of beginning lies North 51 degrees 11'59" East at a distance of 762.92 feet from an existing iron pipe in the intersection of the Southern right-of-way line of Glenburnie Drive with the Eastern right-of-way line of Oaks Road.
Thence continuing along the Southerly right-of-way line of Glenburnie Drive, North 50 degrees 14'00" East for a distance of 350.00 feet to an existing iron pipe;
Thence South 36 degrees 50'00" East for a distance of 434.98 feet to a point;
Thence South 50 degrees 14'00" West for a distance of 350.00 feet to a point;
Thence North 36 degrees 50'00" West for a distance of 434.98 feet to the point or place of beginning and containing 3.490 acres more or less.
Saving and excepting, however, from the hereinabove described property that certain perpetual right-of-way and easement of ingress and egress, on, across and upon the following described lands, to wit:
All that certain Piece, Parcel or Plot of land lying, situate and being in Township No. Eight (8), Craven County, North Carolina and being more fully described and bounded as follows:
Beginning at an existing iron pipe in the Southerly right-of-way line of Glenburnie Drive (formerly Park Avenue), which point of beginning lies North 51 degrees 11'59" East a distance of 762.92 feet and North 50 degrees 14'00" East a distance of 350.00 feet from an existing iron pipe in the intersection of the Southern right-of-way line of Glenburnie Drive with the Eastern right-of-way line of Oaks Road. Said point of beginning being the Northereasternmost corner of the hereinabove described parcel of land.
Thence from said point of beginning South 36 degrees 50'00" East a distance of 434.98 feet to a point;
Thence South 50 degrees 14'00" West a distance of 15 feet more or less to a point;
Thence North 36 degrees 50'00" West a distance of 434.98 feet to an existing iron pin set in the Southerly right-of-way line of Glenburnie Drive;
Thence in an Easterly direction along said Southerly right-of-way line of Glenburnie Drive North 50 degrees 14'00" East a distance of 15 feet more or less to the point or place of beginning.
This being the same right-of-way easement as conveyed by an indenture dated February 14, 1963 between Jefferay Broadcasting Corporation and Walter Long and wife Julia B. Long as recorded in Book 642 at Page 482 in the Office of the Register of Deeds of Craven County.
All that certain perpetual right and easement to construct and maintain a drainage ditch on, across and upon the lands of Walter Long and wife Julia B. Long as is set forth in that certain indenture dated February 14, 1963 between Jefferay Broadcasting Corporation and Walter Long and wife Julia B. Long recorded on Book 642 at Page 482 in the Office of the Register of Deeds of Craven County, over the following described lands:
Beginning at a point in the Southwesternmost corner of the parcel previously described (Tract One). Said point of beginning being located 434.98 feet from the Southern right-of-way line of Glenburnie Drive, along the Westernmost boundary of Tract One hereinabove conveyed.
Thence from said point of beginning South 36 degrees 50'00" East a distance of 800 feet more or less to the Southern boundary of lands now or formerly owned by Walter Long and wife Julia B. Long;
Thence in an Easterly direction and parallel with Glenburnie Drive 15 feet more or less to a point;
Thence North 36 degrees 50'00" West and parallel with the first call herein 800 feet more or less to the Southerly boundary line of the aforementioned and described Tract One;
Thence along said Southerly line in a Westerly direction 15 feet more or less to the point or place of beginning.
Such legal description is subject to the following exceptions:
1. General Permit to Carolina Telephone and Telegraph Company recorded in Book 788, page 178, Craven County Registry. (Tracts 1 & 2)
2. Easement for drainage recorded in Book 1140, page 1015, Craven County Registry. (Tracts 1 & 2)
3. Rights of the Grantors, their heirs and assigns in that easement recorded in Book 642, page 482, Craven County Registry. (Tracts 1 & 2)
EXHIBIT B
DESCRIPTION OF TOWERS
WIKS-FM (MAIN TOWER)
That certain communications tower situated on a two-acre portion of a tract of land situate in Township Nine, Craven County, North Carolina, described as the second parcel in deed recorded in Book 903, Page 34 in the Office of the Register of Deeds of Craven County, North Carolina.
Such land does not include that certain one-half acre lot described in deed recorded in Book 983, Page 904, Craven County Registry, nor shall it include the property described in Deed Book 1110, Page 917, Craven County Registry, nor shall it include the property described in Deed Book 1508, Page 707, Craven County Registry.
WIKS-FM (STL)
That certain one-hundred (100) foot tower providing a link to the main transmission tower for WIKS-FM, such one-hundred (100) foot backup tower situated on a tract of land more particularly described as follows:
All that certain Piece, Parcel or Plot of land lying, situate and being in Township No. Eight (8), Craven County, North Carolina and being more fully described and bounded as follows:
Beginning at an existing iron pipe in the Southerly right-of-way line of Glenburnie Drive (formerly Park Avenue), which point of beginning lies North 51 degrees 11'59" East at a distance of 762.92 feet from an existing iron pipe in the intersection of the Southern right-of-way line of Glenburnie Drive with the Eastern right-of-way line of Oaks Road.
Thence continuing along the Southerly right-of-way line of Glenburnie Drive, North 50 degrees14'00" East for a distance of 350.00 feet to an existing iron pipe;
Thence South 36 degrees 50'00" East for a distance of 434.98 feet to a point;
Thence South 50 degrees 14'00" West for a distance of 350.00 feet to a point;
Thence North 36 degrees 50'00" West for a distance of 434.98 feet to the point or place of beginning and containing 3.490 acres more or less.
Saving and excepting, however, from the hereinabove described property that certain perpetual right-of-way and easement of ingress and egress, on, across and upon the following described lands, to wit:
All that certain Piece, Parcel or Plot of land lying, situate and being in Township No. Eight (8), Craven County, North Carolina and being more fully described and bounded as follows:
Beginning at an existing iron pipe in the Southerly right-of-way line of Glenburnie Drive (formerly Park Avenue), which point of beginning lies North 51 degrees11'59" East a distance of 762.92 feet and North 50 degrees14'00" East a distance of 350.00 feet from an existing iron pipe in the intersection of the Southern right-of-way line of Glenburnie Drive with the Eastern right-of-way line of Oaks Road. Said point of beginning being the Northereasternmost corner of the hereinabove described parcel of land.
Thence from said point of beginning South 36 degrees 50'00" East a distance of 434.98 feet to a point;
Thence South 50 degrees 14'00" West a distance of 15 feet more or less to a point;
Thence North 36 degrees 50'00" West a distance of 434.98 feet to an existing iron pin set in the Southerly right-of-way line of Glenburnie Drive;
Thence in an Easterly direction along said Southerly right-of-way line of Glenburnie Drive North 50 degrees14'00" East a distance of 15 feet more or less to the point or place of beginning.
This being the same right-of-way easement as conveyed by an indenture dated February 14, 1963 between Jefferay Broadcasting Corporation and Walter Long and wife Julia B. Long as recorded in Book 642 at Page 482 in the Office of the Register of Deeds of Craven County.
All that certain perpetual right and easement to construct and maintain a drainage ditch on, across and upon the lands of Walter Long and wife Julia B. Long as is set forth in that certain indenture dated February 14, 1963 between Jefferay Broadcasting Corporation and Walter Long and wife Julia B. Long recorded on Book 642 at Page 482 in the Office of the Register of Deeds of Craven County, over the following described lands:
Beginning at a point in the Southwesternmost corner of the parcel previously described (Tract One). Said point of beginning being located 434.98 feet from the Southern right-of-way line of Glenburnie Drive, along the Westernmost boundary of Tract One hereinabove conveyed.
Thence from said point of beginning South 36 degrees 50'00" East a distance of 800 feet more or less to the Southern boundary of lands now or formerly owned by Walter Long and wife Julia B. Long;
Thence in an Easterly direction and parallel with Glenburnie Drive 15 feet more or less to a point;
Thence North 36 degrees 50'00" West and parallel with the first call herein 800 feet more or less to the Southerly boundary line of the aforementioned and described Tract One;
Thence along said Southerly line in a Westerly direction 15 feet more or less to the point or place of beginning.
EXHIBIT C
DESCRIPTION OF SPACE ON MAIN TOWER
EXHIBIT D
DESCRIPTION OF SPACE ON STL TOWER
EXHIBIT E
DESCRIPTION OF WIKS TRANSMITTER BUILDING
EXHIBIT F
DESCRIPTION OF WXNR TRANSMITTER BUILDING
EXHIBIT 10.15
AGREEMENT OF SALE (O&O)
This Agreement of Sale (the "Agreement") is made this ___ day of February, 2000, between Beasley Broadcasting of Eastern North Carolina, Inc., a North Carolina corporation (the "Seller") and Beasley Family Towers, Inc., a Delaware corporation (the "Buyer") (together, the "Parties").
WITNESSETH:
WHEREAS, Seller owns certain real and personal property comprising one parcel of real property and two (2) communications tower facilities (the "Towers") located in Saddletree Township, North Carolina and used in connection with the operation of radio broadcast station WKML-FM (the "Tower Site");
WHEREAS, Seller desires to sell and Buyer desires to purchase the Towers and certain real and personal property belonging to Seller and associated with the Tower Site;
NOW, THEREFORE, in consideration of the mutual premises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
1. Agreement to Sell and Purchase.
Seller agrees to sell, transfer, assign, convey and deliver to Buyer and Buyer agrees to purchase and accept from Seller, the following assets upon the terms and conditions contained herein (collectively, the "Assets"):
(a) That certain tract of land, and easements or appurtenances incident to such tract of land, that are associated with the Tower Site (collectively, such land, easements and appurtenances, the "Land"), and the Towers, such Towers and the Land more particularly described in Exhibit A attached hereto and incorporated herein; and
(b) The leases for use of space on certain of the Towers located at the Tower Site and certain real property within the Tower Site as more particularly discussed in Section 5(d) of this Agreement.
2. Assumption of Liabilities.
(a) Upon the terms and subject to the conditions contained herein, Buyer shall assume and become responsible for any and all liabilities and obligations arising out of, or relating to events occurring after 12:01 am Eastern Standard Time on the Closing Date (the "Adjustment Time") under the Tower Leases and with respect to the ownership of the Land and Towers, and the operation of the business relating to the Assets (as defined in Section 5(d) hereof) (collectively, the "Assumed Liabilities").
(b) Subject to the provisions of Section 13 hereof, it is understood and agreed that all liabilities to third parties relating to the Assets that arise out of any act, event, or
transaction of Seller or the ownership of the Assets or the operation of the business relating to the Assets prior to the Closing Date (the "Retained Liabilities") shall remain the responsibility of Seller. Buyer shall not be required to defend any suit or claim arising out of any Retained Liabilities, and, (subject to Section 13 hereof), Seller shall and hereby agrees to satisfy in due course all such Retained Liabilities, and Seller shall protect and forever hold Buyer harmless from all claims with respect to such Retained Liabilities. It is understood and agreed that all liabilities relating to the Assets that arise out of any act, event, or transaction of Buyer following the Closing Date (the "Assumed Liabilities") shall be the responsibility of Buyer. Seller shall not be required to defend any suit or claim arising out of any Assumed Liabilities, and Buyer shall and hereby agrees to satisfy in due course all such Assumed Liabilities, and subject to Section 13 hereof Buyer shall protect and forever hold Seller harmless from all claims with respect to such Assumed Liabilities.
3. Purchase Price.
(a) The purchase price for the Assets shall be the amount of Four Hundred Eighty Nine Thousand Ninety Nine Dollars ($489,099.00) (the "Purchase Price"). The Purchase Price shall be adjusted at the Closing by the amount of any prorations derived by operation of Section 6 hereof, and for any other normal income and expense items related to the operation of the Tower Sites as of 12:01 am on the day on which the Closing occurs. The Purchase Price shall be allocated among the Assets in accordance with Section 3(b).
(b) Buyer and Seller agree to allocate the aggregate of the Purchase Price, the Assumed Liabilities and other relevant items among the Assets in accordance with section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"). Buyer and Seller will each report the federal, state, and local and other tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Form 8594) in a manner consistent with such allocation.
4. Delivery of Purchase Price.
(a) The Purchase Price shall be payable at Closing (as defined in Section 8 below) in the manner set forth in Section 4(b).
(b) As payment of the Purchase Price, Buyer shall deliver to Seller at Closing an unsecured promissory note of Buyer in the aggregate principal amount of Four Hundred Eighty Nine Thousand Ninety Nine Dollars ($489,099.00), substantially in the form of Exhibit B (the "Purchase Note").
5. Transfer of Tower; Title Insurance.
(a) Transfer of title to the Land shall be by deed from the Seller to the Buyer (a "Deed"), which Deed shall be in the form of Exhibit C attached hereto and incorporated herein. Transfer of ownership of the Towers and assumption of the Assumed Liabilities pursuant to Section 2 hereof shall be pursuant to the Assignment, Bill of Sale and Assumption Agreement
from the Seller to Buyer in the form of Exhibit D attached hereto and incorporated herein (the "Assignment, Bill of Sale and Assumption Agreement").
(b) The Assets shall be transferred to Buyer free and clear of
all liens, encumbrances other than Permitted Encumbrances, if any; otherwise the
title to the Land shall be good and marketable or such as will be insured by a
reputable title insurance company at regular rates. "Permitted Encumbrances"
shall mean: (i) encumbrances for taxes, assessments, or governmental charges or
levies which are not yet due and payable, or that, subject to adequate security
for payment, are being contested; (ii) existing building restrictions,
ordinances, easements of roads, privileges, or rights of public service
companies or other rights of way, other restrictions or conditions of record, if
any or other encumbrances disclosed in this Agreement (including the Exhibits
attached hereto); (iii) easements, rights of way or other encumbrances that do
not have a material adverse effect on the Assets or the operation of the
business relating to the Assets as currently operated; (iv) encumbrances imposed
by law, such as materialmen's, mechanic's, carrier's, workmen's, or repairmen's
liens or other similar encumbrances attaching in the ordinary course of business
or securing obligations that are not overdue; (v) encumbrances securing
indebtedness, which will be removed prior to or at the Closing; and (vi)
encumbrances pursuant to contracts and leases to be assumed by Buyer pursuant to
Section 2.
(c) As soon as practicable following the Closing, or at such other time as the parties agree, Seller, at its expense, shall obtain and deliver to Buyer a commitment for title insurance (the "Title Commitment") issued by a nationally recognized title company in the ALTA Owner's Form Policy of Title Insurance (each a "Title Policy" and collectively, "Title Policies") covering each tract of Land, setting forth the current status of title thereto, showing all recorded liens, claims, encumbrances, easements, rights-of-way, encroachments, reservations, restrictions and any other matters of public record affecting title to the Land pursuant to which such title company agrees to issue to Buyer the Title Policies. The cost of the Title Policies shall be borne by the Buyer. Seller shall execute such customary documents as the title company reasonably requests, including, but not limited to, an affidavit of debts and liens and customary closing statements.
(d) Buyer and Seller acknowledge that the Towers are occupied, or will be occupied, by various tenants pursuant to tower leases between third party lessees and the Seller, for space on certain of the Towers, such tower leases all made effective prior to the effective date of this Agreement and that one such lease also leases a portion of the real property within the Tower Site (the "Tower Leases"). Buyer acknowledges receipt of copies of the Tower Leases from Seller. At Closing, Seller will assign all of its right, title, and interest in the Tower Leases to Buyer, and Buyer shall assume the obligations under such Tower Leases, in the Assignment, Bill of Sale and Assumption Agreement. In the event that the Buyer receives after Closing any lease payment from tenants pursuant to Tower Leases for rent that accrued prior to Closing, Buyer shall remit such lease payment promptly to Seller. Conversely, in the event Seller receives after Closing any lease payments from tenants pursuant to the Tower Leases for rent that accrued after Closing, Seller shall remit such lease payments promptly to Buyer.
6. Apportionment of Real Estate Taxes, Rent, Utilities.
(a) Current real estate taxes, rent, utilities and all other normal income and expense items related to the Assets shall be apportioned between the parties to reflect the principle that all expenses and income arising from the operation of the Assets up through the Adjustment Time shall be for the account of Seller, and all expenses and income arising from the operation of the business relating to the Assets acquired by Buyer after the Adjustment Time shall be for the account of Buyer.
(b) As soon as practicable following the Closing Date, or at
such other time as the parties agree, Buyer shall deliver to Seller a
certificate from Buyer which sets forth as of the Adjustment Time, all
adjustments to be made as provided in Section 6(a) above (the "Buyer's
Certificate"). Buyer shall provide Seller or its representatives access to
copies of such portions of books and records Seller may reasonably request
solely for the purposes of verifying such adjustments. The Buyer's Certificate
shall be final and conclusive unless objected to by Seller in writing within
ninety (90) days after delivery. Buyer and Seller shall attempt jointly to reach
agreement as to the amount of the adjustments to be made hereunder within thirty
(30) days after receipt of such written objection, which agreement, if achieved,
shall be binding upon all parties to this Agreement and not subject to dispute
or review.
(c) In the event of a disagreement between Buyer and Seller with respect to the accounting to be made hereunder, the parties agree that a public accounting firm chosen jointly by Buyer and Seller shall be the final arbiter of such disagreement.
(d) Any amounts due for the adjustments provided for herein shall be paid within thirty (30) business days after final determination.
7. Expenses.
(a) Seller and Buyer shall share equally the costs of preparation of the Deeds, acknowledgement of the Deeds, Federal, state and local revenue stamps, and real estate transfer taxes.
(b) All other costs and expenses incurred by the Parties in this transaction, including, but not limited to attorneys' fees, shall be paid by the party incurring them.
8. Closing; Closing Conditions.
(a) Closing of the transactions contemplated by this Agreement (the "Closing") shall occur at a place and time mutually agreeable to Seller and Buyer (the "Closing Date"). Seller and Buyer shall both make a good faith effort to close under this Agreement promptly.
(b) Seller's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Buyer being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or
warranty is made as of a specified date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Buyer or any of its affiliates, which would render it unlawful as of the Closing Date to effect the transactions contemplated by this Agreement in accordance with its terms, (iv) the delivery by Buyer of the Purchase Price in the manner set forth in Section 4(b), and (v) the delivery by Buyer of Buyer's Closing Documents (as defined in Section 9 hereof) on or before the Closing Date.
(c) Buyer's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Seller being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or warranty is made as of a specific date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Seller or any of its affiliates, which would render it unlawful as of the Closing Date to effect that transactions contemplated by this Agreement in accordance with its terms, and (iv) the delivery by Seller of Seller's Closing Documents as set forth in Section 9 hereof.
9. Closing Deliveries.
(a) At Closing, Seller shall execute and/or deliver to Buyer the following (collectively "Seller's Closing Documents"):
(i) The Deed;
(ii) The Assignment, Bill of Sale and Assumption Agreement;
(iii) A certificate from an officer of Seller reasonably acceptable to Buyer confirming the accuracy of the representations and warranties in Section 10 as of the Closing Date;
(iv) Authorizing resolutions or minutes from Seller approving this Agreement and the transactions contemplated herein;
(v) A FIRPTA affidavit to the effect that Seller is not a "foreign person" (as defined in Section 1445(f)(3) of the Code and the regulations issued thereunder); and
(vi) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit F (the "Lease Agreement").
(b) At Closing, Buyer shall execute and/or deliver to Seller the following (collectively "Buyer's Closing Documents"):
(i) Authorizing resolutions from Buyer approving this Agreement and the transactions contemplated herein; and
(ii) A certificate from an officer of Buyer reasonably acceptable to Seller confirming the accuracy of the representations and warranties in Section 11 as of the Closing Date;
(iii) The Purchase Note executed by a duly authorized officer of Buyer;
(iv) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit F (the "Lease Agreement"); and
(v) the Assignment, Bill of Sale and Assumption Agreement.
(c) Seller's Closing Documents and Buyer's Closing Documents shall be collectively called herein the "Closing Documents". Buyer and Seller agree that such other documents as may be legally necessary or appropriate to carry out the terms of this Agreement or as reasonably requested by the other party shall be executed and delivered by the appropriate party at Closing.
10. Representations and Warranties of Seller.
As a material inducement to Buyer to enter into this Agreement, Seller represents and warrants to Buyer as follows:
(a) Seller has good and marketable title to the Towers and the Land (or such condition of title as will be insured by any reputable title insurance company at their regular rates), and the Assets are free and clear of liens, encumbrances, restrictions and security interests other than Permitted Encumbrances.
(b) Seller has full power and authority to execute and deliver this Agreement and Seller's Closing Documents, and to perform its obligations hereunder and thereunder.
(c) This Agreement and Seller's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Seller, enforceable against Seller in accordance with their terms.
(d) The sale of the Assets shall not materially conflict with, or result in, a breach of the terms of any agreements or instruments to which the Seller is a party or which would result in the creation or imposition of any lien, charge or encumbrance on, or give to others any interest in or right to, any of the Assets.
(e) Seller has paid or will pay, at or prior to Closing, all outstanding obligations for utilities and taxes through the Closing Date except for such items as are covered by the proration of items of income and expense as set forth in Section 6 hereof.
(f) No third-party authorization or approval of, or filing with, any person, entity, or authority will be required in connection with the execution and delivery of this Agreement or the transactions contemplated by this Agreement.
(g) Assuming all consents and approvals required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Seller's compliance with, the terms and provisions of this Agreement will conflict with, or result in, a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Seller, or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Seller is subject or any material agreement or contract to which Seller is a party or to which it is subject, or constitute a material default thereunder.
(h) Seller is not a foreign person within the meaning of
Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and the
regulations issued thereunder.
11. Representations and Warranties of Buyer.
As a material inducement to Seller to enter into this Agreement, Buyer represents and warrants to Seller as follows:
(a) Buyer has full power and authority to execute and deliver this Agreement and Buyer's Closing Documents, and to perform its respective obligations hereunder and thereunder.
(b) This Agreement and Buyer's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Buyer enforceable against Buyer, in accordance with their terms.
(c) Assuming all consents and approvals required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Buyer's compliance with, the terms and provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Buyer or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Buyer is subject or any material agreement or contract to which Buyer is a party or to which it is subject, or constitute a material default thereunder.
12. Representations and Warranties Survive Closing.
All of the provisions of this Agreement and of the Closing Documents and all of the representations, warranties, considerations, and agreements contained herein and in the
Closing Documents shall survive Closing and continue in full force and effect for a period of twelve (12) months from the Closing Date; provided that if a claim for indemnification is made by either party under Section 13 hereof within such twelve (12) month period, the provisions of Section 13 shall survive until resolution of such claim. No claim may be brought under this Agreement unless written notice describing in reasonable detail the nature of the claim is given on or prior to the last day of the twelve (12) month period following the Closing Date.
13. Indemnification.
(a) Seller shall indemnify, defend, and hold Buyer, its affiliates, partners, employees, officers, directors, agents, and representatives harmless from and against any and all reasonable losses, costs, expenses, liabilities, penalties, claims, and other damages including, but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigation, reasonably incurred and resulting from:
(i) any breach of Seller's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Seller of any of its covenants or agreements contained herein or in any Seller's Closing Document;
(iii) the Retained Liabilities;
(iv) any and all losses, liabilities or damages resulting from Sellers' operations or ownership of any Tower Site prior to the Closing Date, including any and all liabilities arising under the Assets which relate to events occurring prior to the Closing Date.
(b) Buyer shall indemnify, defend and hold Seller, its affiliates, employees, officers, directors, agents and representatives harmless from and against any and all losses, costs, expenses, liabilities, penalties, claims, and other damages, including but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigations, reasonably incurred and resulting from:
(i) any breach of Buyer's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Buyer of any of its covenants or agreements contained herein or in any Buyer's Closing Document;
(iii) the Assumed Liabilities;
(iv) any and all losses, liabilities or damages resulting from Buyer's operations or ownership of any Tower Site
subsequent to the Closing Date, including any and all liabilities arising under the Assets which related to events occurring subsequent to the Closing Date.
(c) In the event either Buyer or Seller (the "Indemnified Party") becomes aware of circumstances which would entitle such party to indemnification by the other party hereunder (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party prompt written notice, with reasonable detail, of such claim. Upon receipt of such notice by the Indemnified Party to the Indemnifying Party, the Indemnifying Party shall have the option of defending against such pending litigation through engagement of legal counsel of its choice, provided, however, that the Indemnifying Party's choice of legal counsel must be acceptable to the Indemnified Party in its reasonable discretion. In the event the Indemnifying Party elects to defend, the Indemnifying Party shall keep the Indemnified Party fully informed on a timely basis of the status of the pending litigation. In the event that the Indemnifying Party elects to defend and is unsuccessful in such defense, it shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages as described above, including but not limited to, reasonable attorney's fees and other costs and expenses associated with the pending litigation being so defended. In the event the Indemnifying Party elects not to defend and the Indemnified Party defends, but is unsuccessful, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages, as described above, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. In the event that Indemnifying Party elects not to defend and the Indemnified Party defends successfully, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all costs and expenses incurred, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. The Indemnifying Party shall reimburse the Indemnified Party upon demand for any payment made by the Indemnified Party at any time after Closing, based on the final judgement of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands or actions in respect to any damages to which the foregoing indemnification relates.
(d) Limitations on Seller Indemnification. Notwithstanding anything in this Agreement to the contrary, Seller's obligation to indemnify Buyer shall be subject to all of the following limitations:
(i) The amount of any losses, costs, expenses,
liabilities, penalties, claims, and other damages
("Losses") incurred by Buyer shall be reduced by (A)
the amount Buyer recovers (after deducting all
attorneys' fees, expenses, and other out-of-pocket
costs of recovery) from any insurer or other party
liable for such Losses, and Buyer shall use
commercially reasonable efforts to effect any such
recovery and (B) any tax benefit realized by Buyer
or its owners as a result of any such Loss.
(ii) Buyer shall be entitled to indemnification only for Losses as to which Buyer has given Seller written notice describing in reasonable detail the nature and basis for such indemnification ("Notice of Claim") on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Buyer by Seller pursuant to this
Section 13 shall be limited to Fifty Thousand
Dollars ($50,000.00) and Seller shall have no other
liability or responsibility for indemnification
hereunder.
(e) Buyer's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Buyer with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
(f) Limitation on Buyer's Indemnification. Notwithstanding anything in this Agreement to the contrary, Buyer's obligation to indemnify Seller shall be subject to all of the following limitations:
(i) The amount of any Losses incurred by Seller shall be reduced by (A) the amount Seller recovers (after deducting all attorneys' fees, expenses and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Seller shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Seller shall be entitled to indemnification only for Losses as to which Seller has given Buyer a Notice of Claim on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Seller by Buyer pursuant to this
Section 13 shall be limited to Fifty Thousand
Dollars ($50,000.00) and Buyer shall have no other
liability or responsibility for Indemnification
hereunder.
(g) Seller's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Seller with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
14. Termination; Liquidated Damages
(a) Right of Termination. This Agreement may be terminated prior to Closing:
(i) By written notice from a party that is not then in material breach of this Agreement if:
(A) The other party has continued in material breach of this Agreement for twenty (20) days after written notice of such breach from the terminating party;
(B) Closing does not occur by May 31, 2000 or such other date as is mutually agreed to by Buyer and Seller.
(b) Obligations Upon Termination.
(i) Upon termination of this Agreement, each party shall
thereafter remain liable for breach of this
Agreement prior to such termination and remain
liable to pay and perform any obligation under
Section 13.
(ii) If Closing shall not have occurred, Seller's sole
remedy at law or in equity for any breach or default
by Buyer described in Section 14(a)(i)(A) shall be
the termination by Seller of this Agreement by
giving of written notice to Buyer pursuant to
Section 14(a)(i)(A).
(c) Termination Notice. Each notice given by a party pursuant
to Section 14(a) to terminate this Agreement shall specify the subsection of
Section 14(a) pursuant to which such notice is given. If at the time a party
gives a termination notice, such party is entitled to give such notice pursuant
to more than one subsection of Section 14(a), the subsection pursuant to which
such notice is given and termination is effected shall be deemed to be the
subsection specified in such notice provided that the party giving such notice
is at such time entitled to terminate this Agreement pursuant to the specified
subsection.
15. Default; Disputes.
If Seller fails to perform under this Agreement, the Buyer may exercise any right he has against the Seller, including bringing an action for specific performance. The remedies provided by this Section are in addition to any right or remedies provided elsewhere in this Agreement or at law or in equity. In the event a dispute arises between the Parties over the interpretation of this Agreement, or the performance, alleged non-performance or breach by either Party hereunder, the Parties hereby agree to seek resolution of such dispute in good faith through an alternative dispute resolution process mutually agreeable to the Parties prior to the institution of any legal proceedings related thereto.
16. Liabilities.
Buyer shall not, in connection with the purchase and sale of Assets contemplating herein, assume any liabilities or obligations of the Seller except as specifically set forth herein.
17. Third Party Brokerage.
Seller and Buyer hereby represent and warrant to each other that neither Seller or Buyer has dealt with any broker or finder in connection with the transaction which is the subject of this Agreement. Each party hereby agrees to indemnify, save harmless and defend the other from and against all claims, losses, liabilities and expenses, including reasonable attorney's fees, arising out of any claim made by any broker, finder or other intermediary who claims to have dealt with such party in connection with the transaction which is the subject of this Agreement. The provisions of the paragraph shall survive Closing hereunder.
18. Entire Agreement.
This Agreement (which includes the exhibits and schedules attached hereto) constitutes the entire agreement between the Parties and there are no other understandings, representations or warranties, oral or written, relating to the subject matter hereof.
19. Amendment.
This Agreement may not be changed, modified or amended, in whole or in part, except in writing, signed by all parties.
20. Notice.
Notices given pursuant to this Agreement shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this Section. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Seller: Beasley Broadcasting of Eastern North Carolina, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
If to the Buyer: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
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Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
21. Construction.
Whenever used in this Agreement the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.
22. Assignment and Recording.
Seller hereby covenants not to assign or record this Agreement except with the prior written consent of the Buyer. Buyer may assign this Agreement freely to any affiliated entity, provided such assignment shall not relieve Buyer of its obligations hereunder.
23. Binding Effect.
This Agreement and all of its terms and conditions shall extend to and be binding upon the Parties hereto and upon their respective heirs, executors, administrators, successors and assigns.
24. Further Assurances.
Seller and Buyer agree to execute and deliver any further documents or assurances that in law or otherwise are necessary, desirable or proper to consummate the transactions
contemplated by this Agreement and to vest, perfect, assign or confirm, of record or otherwise, in Buyer title to the Assets.
25. Governing Law.
This Agreement is made and shall be governed by and construed in accordance with the internal laws of the State of North Carolina.
26. Headings.
The headings and captions in this Agreement are for convenience only and are not part of this Agreement.
27. Interpretation.
Neither this Agreement nor any provision contained herein shall be interpreted for or against either party solely because that party or that party's legal representative drafted the provision.
28. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute the same Agreement.
29. Severability.
If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be severed from this Agreement and the remainder shall remain in full force and effect.
30. Covenant of Seller.
Seller shall make all reasonable efforts to resolve any title or restriction issues prior to the Closing, but will continue these efforts subsequent to the Closing to the extent reasonably necessary.
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound, have caused this Agreement to be duly executed on the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF EASTERN
NORTH CAROLINA, INC.
BUYER:
BEASLEY FAMILY TOWERS, INC.
INDEX OF EXHIBITS
Exhibit A Description of Land and Towers
Exhibit B Form of Purchase Note
Exhibit C Form of Deed
Exhibit D Form of Assignment, Bill of Sale and Assumption
Agreement
Exhibit E Form of Lease Agreement
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EXHIBIT A
DESCRIPTION OF LAND AND TOWERS
WKML-FM
(1) That certain communications tower manufactured by Stainless and (2) that certain communications tower manufactured by Sabre, both such towers situated on that certain tract of land more particularly described as follows:
Lying and being in Saddletree Township, Robeson County, North Carolina, about 4.2 miles southwest of the Town of St. Pauls, about 8 miles southeast of the Town of Red Springs, about 0.3 miles northeast of the intersection of Secondary Road No. 1318 with Secondary Road No. 1763, and on the southeast side of and adjoining paved Secondary Road No. 1318. Bounded on the northwest by Peacock's Furniture of Laurinburg, Inc. and Secondary Road No. 1318 and on all other sides by other lands of the parties of the first part, and being more particularly described as follows:
BEGINNING at an existing concrete monument 116.99 feet southeast of the centerline of paved Secondary Road No. 1318, said monument being a corner of the original tract and also having North Carolina Grid Coordinates of N-375,950.15 feet and E-1,986,107.94 feet, and runs thence as a new line, South 51 degrees 08 minutes 10 seconds East 1,183.72 feet to an iron rod; thence as another new line, South 38 degrees 51 minutes 50 seconds West 975.00 feet to an iron rod, pine pointer; thence as another new line, North 51 degrees 08 minutes 10 seconds West 1183.72 feet to an iron rod in the original line, said iron rod being 13.86 feet southeast of the centerline of paved Secondary Road No. 1318, and also being located North 56 degrees 10 minutes 50 seconds East 1377.65 feet from a nail at the centerline intersection of paved Secondary Road No. 1318 with Secondary Road No. 1763; thence as the original northwestern line of the tract of which this is a part, North 38 degrees 51 minutes 50 seconds East 119.44 feet to a nail in the centerline of paved Secondary Road No. 1318; thence as the centerline of said road, North 45 degrees 28 minutes 50 seconds East 100.00 feet to a nail; thence North 43 degrees 59 minutes 30 seconds East 100.00 feet to a nail; thence North 39 degrees 35 minutes 05 seconds East 100.00 feet to a nail; thence North 34 degrees 20 minutes 50 seconds East 100.01 feet to a nail; thence North 28 degrees 40 minutes East 78.20 feet to a nail in the intersection of said centerline with the original line; thence as said original line, North 38 degrees 51 minutes 50 seconds East 379.98 feet to the BEGINNING, containing 26.34 acres as surveyed by George T. Paris and Associate in June, 1983 using North Carolina Grid Meridian and EXCEPTING NEVERTHELESS a fenced cemetery plot known as the "Old Carlyle Cemetery" and being more particularly described as follows: BEGINNING at an iron fence post, said post being located South 9 degrees 48 minutes 40 seconds East 412.82 feet from a concrete monument, the beginning a northern most corner of the above described 26.34 acre tract, and runs thence as the southeastern fence line of said cemetery, South 31 degrees 11 minutes 50 seconds West 53.4 feet to an iron fence post; thence North 58 degrees 48 minutes 10 seconds West, with and beyond a fence, 25 feet to a point; thence North 31 degrees 11 minutes 50 seconds East 53.4 feet to a point; thence to and with an old fence South 58 degrees 48 minutes 10 seconds East 25 feet to the BEGINNING.
The property hereinabove described was acquired by Grantor by Deed dated February 15, 1985, recorded March 11, 1985, in Book 573 Page 0914 in the Robeson County, North Carolina Registry.
The real property conveyed hereby is exclusive of the building situated thereon and owned by Bell South, Inc., a tenant leasing space on the tower manufactured by Sabre.
EXHIBIT B
FORM OF PURCHASE NOTE
PROMISSORY NOTE
$489,099.00 February ___, 2000
BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Payor"), for value received, promises to pay to the order BEASLEY BROADCASTING OF EASTERN NORTH CAROLINA, INC. a North Carolina Corporation, ("Payee"), the principal amount of FOUR HUNDRED EIGHTY NINE THOUSAND NINETY NINE DOLLARS ($489,099.00), together with accrued interest thereon, calculated and payable as set forth below in this Note. The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement of Sale (the "Sale Agreement"), dated February ____, 2000, by and among Payor and Payee.
1. Payment of Principal and Interest.
(a) Calculation and Payment of Interest. Interest on the principal balance of this Note outstanding from time to time until paid in full shall accrue at the rate of six and seventy-seven one hundredths percent (6.77%) compounded annually (the "Rate"), computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof.
(b) Payments Prior to Maturity Date. On the first day of each month Maker shall pay, in advance, THREE THOUSAND SEVEN HUNDRED THREE DOLLARS AND EIGHTY FIVE CENTS ($3,703.85.00). All remaining principal, together with accrued and unpaid interest thereon shall be due and payable on the "Maturity Date" (defined below). Each monthly payment shall be credited first to interest then accrued and the remainder, if any, to principal, and interest shall thereupon cease to accrue upon the principal paid.
(c) Payment on Maturity Date. The principal balance of, and any accrued and unpaid interest on, this Note shall be payable twenty (20) years from the effective date of this Note (such date the "Maturity Date").
(d) Prepayment.
(i) Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this Note.
(ii) Any prepayment of this Note shall be applied as follows: first, to payment of accrued interest; and second, to payment of principal.
2. Events of Default.
The following shall constitute "Events of Default" under this Note:
(a) Failure by Payor to make any payment required under this Note when the same shall become due and payable (whether at maturity or otherwise) and the continuation of such failure for a period of ninety (90) days; or
(b) Payor pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for all or any substantial portion of its property or assets;
(iv) makes a general assignment for the benefit of its creditors; or
(c) an involuntary case or proceeding is commenced against Payor under any Bankruptcy Law and is not dismissed, bonded or discharged within ninety (90) days thereafter, or a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against Payor in an involuntary case or proceeding;
(ii) appoints a Custodian of Payor or for all or substantially all of its properties; or
(iii) orders the liquidation of Payor; and in each case the order or decree remains unstayed and in effect for ninety (90) days.
(d) The following terms used in this Note have the meanings assigned below:
"Bankruptcy Law" means Title 11, United States Code, or any similar federal, state or foreign law for the relief of debtors or any arrangement, reorganization, assignment for the benefit of creditors or any other marshalling of the assets and liabilities of Payor.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
"Event of Default" means any of the occurrences specified in Section 2 of this Note.
If any Event of Default shall have occurred and be continuing, Payee may proceed to protect and enforce its rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to Payee under this Note.
3. Assignment.
The holders of this Note may not assign or otherwise transfer all or any portion of their rights and obligations under this Note to any other person or entity, without the prior written consent of the Payor, which consent shall not be unreasonably withheld.
4. Miscellaneous.
(a) Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
(b) Amendment and Waiver. No provision of this Note may be amended or waived unless Payor shall have obtained the written agreement of Payee. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c) Successors, Assigns and Transferors. The foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
(d) Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of North Carolina without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction.
(e) Notices. Any notice, request, instruction or other document to be given hereunder by either party to the other shall be in writing and shall be deemed given when received and shall be (i) delivered personally or (ii) mailed by certified mail, postage prepaid, return receipt requested or (iii) delivered by Federal Express or a similar overnight courier or (iv) sent via facsimile transmission to the fax number given below, as follows:
If to Payor, addressed to:
Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Fax: (941) 434-8950
With a copy to:
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Attn: Joseph D. Sullivan, Esq.
Fax: (202) 637-2201
If to Payee, addressed to:
Beasley Broadcasting of Eastern North Carolina, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Fax: (941) 434-8950
or to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
BEASLEY FAMILY TOWERS, INC.
EXHIBIT C
FORM OF DEED
EXHIBIT D
FORM OF ASSIGNMENT, BILL OF
SALE AND ASSUMPTION AGREEMENT
This Assignment, Bill of Sale and Assumption Agreement (this "Agreement") is
made effective as of 12:01 a.m. Eastern Time, on the ____ day of February, 2000
by and between BEASLEY BROADCASTING OF EASTERN NORTH CAROLINA, INC. ("Seller")
and BEASLEY FAMILY TOWERS, INC. ("Purchaser").
RECITALS
A. Reference is made to that certain Agreement of Sale (the "Asset Purchase Agreement") dated as of February ___, 2000 by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings given such terms in the Asset Purchase Agreement.
B. The Asset Purchase Agreement provides that Seller shall sell, convey and assign to Purchaser all of Seller's right, title and interest to the Tower and Tower Leases and Purchaser shall assume the Assumed Liabilities, as defined in Section 2 of the Asset Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows (capitalized terms used herein but not defined herein shall have the meaning given to them in the Asset Purchase Agreement):
1. Seller hereby bargains, sells, conveys, assigns and delivers all of Seller's right, title and interest in and to:
a. The Towers, such Towers more particularly described in Exhibit A of the Asset Purchase Agreement; and
b. The Tower Leases.
Items a. and b. above are hereinafter referred to as the "Assigned Assets."
2. Purchaser hereby accepts the sale, conveyance and assignment of the Assigned Assets, effective as of 12:01 a.m. Eastern Time on February __, 2000.
3. Purchaser hereby assumes and agrees to pay and perform the Assumed Liabilities pursuant to Section 2 of the Asset Purchase Agreement, effective as of 12:01 a.m. Eastern Time on February __, 2000.
4. After the date hereof, Purchaser and Seller will, at the request of the other party, promptly obtain, execute and deliver, or cause to be obtained, executed and delivered, to the other party such assignments, bills of sale, endorsements, and other such instruments or
documents to be executed by Seller or Purchaser, as the case may be, in addition to this Agreement, in form and substance reasonably satisfactory to the other party, as such other party may reasonably deem necessary or desirable so as (i) to vest in Purchaser title to and possession of the Assigned Assets and (ii) to perfect and record, if necessary, the sale, assignment, conveyance, transfer and delivery to Purchaser of the Assigned Assets.
5. This Agreement is made pursuant to, and is subject to all of the terms, representations, warranties and covenants of, the Asset Purchase Agreement, the terms of which are hereby incorporated by reference. In the event of any conflict between this Agreement and the Asset Purchase Agreement, the terms of the Asset Purchase Agreement shall govern.
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this Agreement as of the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF EASTERN
NORTH CAROLINA, INC.
PURCHASER:
BEASLEY FAMILY TOWERS, INC.
EXHIBIT E
FORM OF LEASE AGREEMENT
LEASE AGREEMENT (O&O - WKML-FM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY BROADCASTING OF EASTERN NORTH CAROLINA, INC., a North Carolina corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns two communications towers described on Exhibit A attached hereto, (the "Towers"), together with other improvements on a certain tract of real estate located at Saddletree Township, North Carolina, as such land is more fully described in Exhibit B attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements or improvements on such land, including, without limitation, any buildings or other structures, but not including that certain transmitter building owned by a tenant of Lessor);
WHEREAS, Lessor desires to lease the Tower Site and space on the Towers for the purpose of Lessee's radio transmission activities; and
WHEREAS, Lessee wishes to lease such Tower Site and space on the Towers from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee leases from Lessor, with a right of access thereto and parking therefor in accordance with Section 9:
(a) Space on the Towers, as more fully described in Exhibit C hereto, for the purpose of the broadcast transmission of WKML-FM, Saddle Township, North Carolina; and
(b) Space in the transmitter building owned by Lessor and located on the Tower Site, as such space is more fully described in Exhibit D hereto (the "Transmitter Building") for the purposes of the housing, operation and maintenance of Lessee's transmitter and related equipment (such space "Lessee's Building Space");
(c) All of the property leased under this Paragraph 2.01 shall hereinafter be called the "Leased Premises".
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below), all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Leased Premises after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, including, without limitation, an electrical power generator, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain lessee's property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Leased Premises at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Leased Premises for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Leased Premises may be used only for radio activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Towers. Lessee may repair and maintain equipment as it reasonably deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. Lessee's space on the Towers, Lessee's Building Space, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to Lessee in
this Lease and with prior notice to Lessee and no loss of service or
interruption (beyond a temporary, non-recurring and de minimis amount), Lessor
reserves the right to use the Towers, at its own expense, as it sees fit and to
fasten additional equipment to the Towers for any purpose, including the right
to install transmitting and/or receiving antennas of others; provided that
Lessor shall use reasonable efforts to restrict any loss of Lessee's service or
interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00
a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space on the Towers or in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Towers to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
---------------------------------------------------
Lease Year Rent Per Lease Year Monthly Rent
---------------------------------------------------
1 $44,446.20 $3,703.85
---------------------------------------------------
2 $44,446.20 $3,703.85
---------------------------------------------------
3 $44,446.20 $3,703.85
---------------------------------------------------
4 $44,446.20 $3,703.85
---------------------------------------------------
5 $44,446.20 $3,703.85
---------------------------------------------------
6 $44,446.20 $3,703.85
---------------------------------------------------
7 $44,446.20 $3,703.85
---------------------------------------------------
8 $44,446.20 $3,703.85
---------------------------------------------------
9 $44,446.20 $3,703.85
---------------------------------------------------
10 $44,446.20 $3,703.85
---------------------------------------------------
11 $44,446.20 $3,703.85
---------------------------------------------------
12 $44,446.20 $3,703.85
---------------------------------------------------
13 $44,446.20 $3,703.85
---------------------------------------------------
14 $44,446.20 $3,703.85
---------------------------------------------------
15 $44,446.20 $3,703.85
---------------------------------------------------
16 $44,446.20 $3,703.85
---------------------------------------------------
17 $44,446.20 $3,703.85
---------------------------------------------------
18 $44,446.20 $3,703.85
---------------------------------------------------
19 $44,446.20 $3,703.85
---------------------------------------------------
20 $44,446.20 $3,703.85
---------------------------------------------------
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by the Lessee by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated ________, 2000, on the first day of each month during the term of the Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Towers used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Towers for the Towers lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and
stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Leased Premises, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Towers and the Transmitter Building except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment and generator); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF LEASED PREMISES AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to the Towers and Transmitter Building. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Towers, the Transmitter Building, and the Tower Site, or the prevention of interference with Lessor or any
other user of the Towers or any other broadcaster, Lessor may, at its option, make such emergency repairs to the Leased Premises as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Towers, the Transmitter Building, and the Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Towers unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Towers (including any ascension of the Towers), in the Transmitter Building, or in or about the Tower Site, Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the
National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Leased Premises to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. USE AND MAINTENANCE OF COMMON PREMISES.
9.01 USE OF COMMON PREMISES. Lessee, at its own risk, shall have
the right to use in common with Lessor and its licensees, invitees, and other
tenants, and in connection with Lessee's permissible activities and operations
(a) any access road from any public highway to the Tower Site or to any building
on the Tower Site; (b) any parking lot on the Tower Site; and (c) all common
areas in the Transmitter Building (such items (a), (b) and (c) called
collectively herein the "Common Premises").
9.02 MAINTENANCE OF COMMON PREMISES.
(a) Lessor shall maintain the Common Premises and any fence around the Towers in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the Towers. Lessor shall maintain the Towers and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs,
alterations, or improvements are necessary or desirable to the Towers or any
building or structure constructed by Lessor on the Tower Site, any common areas,
or the leased spaces of other tenants, Lessor may, upon reasonable notice and
for the shortest practical period of time (except for emergency situations),
close entrance doors, common areas, drive-ways, rights-of-way, service areas,
parking areas, or any other facilities at its discretion without being liable to
Lessee; provided that if any of the above would restrict Lessee's ability to
broadcast, Lessor shall use reasonable efforts to restrict any closure or
interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00
a.m.. The closing of entrances, doors, common areas, parking areas, or other
facilities for the making of the repairs, alterations, or improvements described
herein shall, under no circumstances, constitute an eviction of the Lessee or be
grounds for termination of this Lease or the withholding of any rental payments
or other payments or performances required to be paid or made by Lessee under
the terms hereof, provided, Lessor shall use reasonable efforts to ensure that
any action taken in accordance with this paragraph shall not adversely affect
the rights of Lessee hereunder. Under no such circumstances shall Lessee be
entitled to terminate this Lease nor shall it be entitled to compensation for
any loss or damage it may sustain (including loss of use, loss of
advertising/sponsorship revenues, and consequential damages) by reason of such
changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Towers, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine the loading capacity of the Towers, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any
proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Leased Premises or on the Towers after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Towers whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Towers, Tower Site or any building on the Tower Site shall provide that, should the installation, operation, or maintenance
of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Towers, Tower Site or any buildings on the Tower Site shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Towers shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes,
assessments, or levies assessed or imposed against the Leased Premises.
[Foregoing obligation is subject to $200,000 12-month limit when aggregated with
other borrowers under Credit Agreement per 1.5D of First Amendment to Credit
Agreement]. Lessee shall pay all personal property or other taxes assessed or
imposed on Lessee's Property, and shall cooperate with Lessor to ensure that
such property is properly separated from that of Lessor or other tenants for
assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Leased Premises, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Towers elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWERS AND TRANSMITTER BUILDING INSURANCE. Lessee shall procure and maintain physical damage insurance on the Towers and any building on the Tower Site used or leased by Lessee pursuant to this Lease in an amount sufficient to repair or replace the Towers and any such building with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWERS AND/OR TRANSMITTER BUILDING DAMAGE. In the event that the Towers and/or the Transmitter Building are destroyed or damaged by fire, lightning, windstorm, flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or other casualty covered by insurance, Lessor shall promptly reconstruct or repair the Towers and/or the Transmitter Building affected to such good condition as existed before the destruction or damage, and give possession to Lessee of substantially the same space leased hereunder. Lessee shall promptly pay over to Lessor any insurance proceeds it receives from insurance policies Lessee is required to procure under Section 14.03 hereof for the purpose of use by Lessor to fund reconstruction of the Towers and/or Transmitter Building as required of Lessor under this Section 14.01. If the Towers and/or the Transmitter Building are in need of such repair or is so damaged by fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle damage, collapse, or other casualty that reconstruction or repair cannot reasonably be undertaken without dismantling Lessee's antenna, then upon written notice to Lessee, Lessor may remove any such antenna and interrupt the signal activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably possible. Lessor agrees to provide Lessee alternative
space, if available, on the Towers and/or in the Transmitter Building during such reconstruction/repair period. If such space is not available, then Lessee shall be responsible for procuring its own alternative space. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Towers without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Towers and/or the Transmitter Building or (b) replace the Towers and/or the Transmitter Building within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to damage to the Towers and/or Transmitter Building (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower Site (or any portion of the Tower Site necessary for the Towers, guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower or towers or a new transmitter building as a replacement for the Towers and/or Transmitter Building on the condemned property, Lessor agrees to lease space to Lessee on the new tower or towers and space in the new building reasonably comparable to the space leased to Lessee pursuant to this Lease and on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Leased Premises within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Leased Premises after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after
written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Leased Premises, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Leased Premises by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Leased Premises. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Leased Premises (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of North Carolina at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees;
(d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for indemnity,
and the Indemnifying Party shall have the right and opportunity to undertake the
legal defense of such claims. The Indemnified Party and its counsel may
nevertheless participate in (but not control) such proceedings, negotiations, or
defense at its own expense. In all such cases, the Indemnified Party will give
all reasonable assistance to the Indemnifying Party, including making the
Indemnified Party's employees and documents available as reasonably requested
without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after either
party's request, the other party shall deliver, executed in recordable form, a
declaration to any person designated by the requesting party (a) ratifying this
Lease; (b) stating the commencement and termination dates; and (c) certifying
(i) that this Lease is in full force and effect, and has not been assigned,
modified, supplemented, or amended (except by such writings as shall be stated);
(ii) that all conditions under this Lease to be performed have been satisfied
(stating exceptions, if any); (iii) that no defenses or offsets against the
enforcement of this Lease by the requesting party exist (or stating those
claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which rent
has been paid; (vi) the amount of security deposited with Lessor (if hereafter
applicable for any reason); and (vii) such other information as the requesting
party reasonably requires. Persons receiving such statements shall be entitled
to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Leased Premises, or, if any of the Leased Premises or any building thereon comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of North Carolina.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one-half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of
mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
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Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley Broadcasting of Eastern North Carolina, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
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21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Towers, Transmitter Building, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Towers, or the malfunction of any utility, facility, or installation,
or by reason of any other existing condition or defect in the Leased Premises; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Towers, Transmitter Building, and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Leased Premises or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
---------------------------- --------------------------------
Witness Printed Name:
Title:
LESSEE:
BEASLEY BROADCASTING OF EASTERN NORTH
CAROLINA, INC.
By: (SEAL)
---------------------------- --------------------------------
Witness Printed Name:
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Title:
EXHIBIT A
WKML-FM
That certain communications tower situated on that certain tract of land and described on Exhibit B herein.
EXHIBIT B
DESCRIPTION OF TOWER SITE
That certain tract of land more particularly described as follows:
Lying and being in Saddletree Township, Robeson County, North Carolina, about 4.2 miles southwest of the Town of St. Pauls, about 8 miles southeast of the Town of Red Springs, about 0.3 miles northeast of the intersection of Secondary Road No. 1318 with Secondary Road No. 1763, and on the southeast side of and adjoining paved Secondary Road No. 1318. Bounded on the northwest by Peacock's Furniture of Laurinburg, Inc. and Secondary Road No. 1318 and on all other sides by other lands of the parties of the first part, and being more particularly described as follows:
BEGINNING at an existing concrete monument 116.99 feet southeast of the centerline of paved Secondary Road No. 1318, said monument being a corner of the original tract and also having North Carolina Grid Coordinates of N-375,950.15 feet and E-1,986,107.94 feet, and runs thence as a new line, South 51 degrees 08 minutes 10 seconds East 1,183.72 feet to an iron rod; thence as another new line, South 38 degrees 51 minutes 50 seconds West 975.00 feet to an iron rod, pine pointer; thence as another new line, North 51 degrees 08 minutes 10 seconds West 1183.72 feet to an iron rod in the original line, said iron rod being 13.86 feet southeast of the centerline of paved Secondary Road No. 1318, and also being located North 56 degrees 10 minutes 50 seconds East 1377.65 feet from a nail at the centerline intersection of paved Secondary Road No. 1318 with Secondary Road No. 1763; thence as the original northwestern line of the tract of which this is a part, North 38 degrees 51 minutes 50 seconds East 119.44 feet to a nail in the centerline of paved Secondary Road No. 1318; thence as the centerline of said road, North 45 degrees 28 minutes 50 seconds East 100.00 feet to a nail; thence North 43 degrees 59 minutes 30 seconds East 100.00 feet to a nail; thence North 39 degrees 35 minutes 05 seconds East 100.00 feet to a nail; thence North 34 degrees 20 minutes 50 seconds East 100.01 feet to a nail; thence North 28 degrees 40 minutes East 78.20 feet to a nail in the intersection of said centerline with the original line; thence as said original line, North 38 degrees 51 minutes 50 seconds East 379.98 feet to the BEGINNING, containing 26.34 acres as surveyed by George T. Paris and Associate in June, 1983 using North Carolina Grid Meridian and EXCEPTING NEVERTHELESS a fenced cemetery plot known as the "Old Carlyle Cemetery" and being more particularly described as follows: BEGINNING at an iron fence post, said post being located South 9 degrees 48 minutes 40 seconds East 412.82 feet from a concrete monument, the beginning a northern most corner of the above described 26.34 acre tract, and runs thence as the southeastern fence line of said cemetery, South 31 degrees 11 minutes 50 seconds West 53.4 feet to an iron fence post; thence North 58 degrees 48 minutes 10 seconds West, with and beyond a fence, 25 feet to a point; thence North 31 degrees 11 minutes 50 seconds East 53.4 feet to a point; thence to and with an old fence South 58 degrees 48 minutes 10 seconds East 25 feet to the BEGINNING.
The property hereinabove described was acquired by Grantor by Deed dated February 15, 1985, recorded March 11, 1985, in Book 573 Page 0914 in the Robeson County, North Carolina Registry.
EXHIBIT C
[TOWER SPACE DIAGRAM OR DESCRIPTION]
EXHIBIT D
[TRANSMITTER BUILDING SPACE DIAGRAM OR DESCRIPTION]
EXHIBIT 10.16
AGREEMENT OF SALE (O&O)
This Agreement of Sale (the "Agreement") is made this ___ day of February, 2000, between Beasley Broadcasting of New Jersey, Inc., a Delaware corporation (the "Seller") and Beasley Family Towers, Inc., a Delaware corporation (the "Buyer") (together, the "Parties").
WITNESSETH:
WHEREAS, Seller owns certain real and personal property comprising a parcel of real estate and two (2) communications tower facilities (the "Towers", one of such Towers used exclusively for broadcast during daytime hours and called herein the "Daytime Tower"), located in Camden, New Jersey and used in connection with the operation of radio broadcast station WTMR-AM (the "Tower Site");
WHEREAS, Seller desires to sell and Buyer desires to purchase the Towers and certain real and personal property belonging to Seller and associated with the Tower Site;
NOW, THEREFORE, in consideration of the mutual premises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
1. Agreement to Sell and Purchase.
Seller agrees to sell, transfer, assign, convey and deliver to Buyer and Buyer agrees to purchase and accept from Seller, the following assets upon the terms and conditions contained herein (collectively, the "Assets"):
(a) Those certain tracts of land, and easements or appurtenances incident to such tracts of land, that are associated with the Tower Site, excluding any building improvements situated thereon (collectively, such land, easements and appurtenances, the "Land"), and the Towers, such Towers and the Land more particularly described in Exhibit A attached hereto and incorporated herein; and
(b) The lease for use of space on the Daytime Tower located at the Tower Site and certain real property within the Tower Site as such lease is more particularly discussed in Section 5(d) of this Agreement.
2. Assumption of Liabilities.
(a) Upon the terms and subject to the conditions contained herein, Buyer shall assume and become responsible for any and all liabilities and obligations arising out of, or relating to events occurring after 12:01 am Eastern Standard Time on the Closing Date (the "Adjustment Time") under the RBC Lease (as defined in Section 5(d) hereof) and with respect to the ownership of the Land and Towers, the operation of the business relating to the Assets, (collectively, the "Assumed Liabilities").
(b) Subject to the provisions of Section 13 hereof, it is understood and agreed that all liabilities to third parties relating to the Assets that arise out of any act, event, or transaction of Seller or the ownership of the Assets or the operation of the business relating to the Assets prior to the Closing Date (the "Retained Liabilities") shall remain the responsibility of Seller. Buyer shall not be required to defend any suit or claim arising out of any Retained Liabilities, and subject to Section 13 hereof Seller shall and hereby agrees to satisfy in due course all such Retained Liabilities, and Seller shall protect and forever hold Buyer harmless from all claims with respect to such Retained Liabilities. It is understood and agreed that all liabilities relating to the Assets that arise out of any act, event, or transaction of Buyer following the Closing Date (the "Assumed Liabilities") shall be the responsibility of Buyer. Seller shall not be required to defend any suit or claim arising out of any Assumed Liabilities, and Buyer shall and hereby agrees to satisfy in due course all such Assumed Liabilities, subject to Section 13 hereof, and Buyer shall protect and forever hold Seller harmless from all claims with respect to such Assumed Liabilities.
3. Purchase Price.
(a) The purchase price for the Assets shall be the amount of Three Sixteen Thousand Two Hundred Dollars ($316,200.00) (the "Purchase Price"). The Purchase Price shall be adjusted at the Closing by the amount of any prorations derived by operation of Section 6 hereof, and for any other normal income and expense items related to the operation of the Tower Sites as of 12:01 am on the day on which the Closing occurs. The Purchase Price shall be allocated among the Assets in accordance with Section 3(b).
(b) Buyer and Seller agree to allocate the aggregate of the Purchase Price, the Assumed Liabilities and other relevant items among the Assets in accordance with section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"). Buyer and Seller will each report the federal, state, and local and other tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Form 8594) in a manner consistent with such allocation.
4. Delivery of Purchase Price.
(a) The Purchase Price shall be payable at Closing (as defined in
Section 8 below) in the manner set forth in Section 4(b).
(b) As payment of the Purchase Price, Buyer shall deliver to Seller at Closing an unsecured promissory note of Buyer in the aggregate principal amount of Three Sixteen Thousand Two Hundred Dollars ($316,200.00), substantially in the form of Exhibit B (the "Purchase Note").
5. Transfer of Towers; Title Insurance.
(a) Transfer of title to the Land shall be by deed from the Seller to the Buyer (a "Deed"), which Deed shall be in the Form of Exhibit C attached hereto and incorporated herein. Transfer of ownership of the Towers and assumption of the Assumed
Liabilities pursuant to Section 2 hereof shall be pursuant to the Assignment, Bill of Sale and Assumption Agreement from the Seller to Buyer in the form of Exhibit D attached hereto and incorporated herein (the "Assignment, Bill of Sale and Assumption Agreement").
(b) The Assets shall be transferred to Buyer free and clear of all
liens, encumbrances other than Permitted Encumbrances, if any; otherwise the
title to the Land shall be good and marketable or such as will be insured by a
reputable title insurance company at regular rates. "Permitted Encumbrances"
shall mean: (i) encumbrances for taxes, assessments, or governmental charges or
levies which are not yet due and payable, or that, subject to adequate security
for payment, are being contested; (ii) existing building restrictions,
ordinances, easements of roads, privileges, or rights of public service
companies or other rights of way, other restrictions or conditions of record, if
any or other encumbrances disclosed in this Agreement (including the Exhibits
attached hereto); (iii) easements, rights of way or other encumbrances that do
not have a material adverse effect on the Assets or the operation of the
business relating to the Assets as currently operated; (iv) encumbrances imposed
by law, such as materialmen's, mechanic's, carrier's, workmen's, or repairmen's
liens or other similar encumbrances attaching in the ordinary course of business
or securing obligations that are not overdue; (v) encumbrances securing
indebtedness, which will be removed prior to or at the Closing; and (vi)
encumbrances pursuant to contracts and leases to be assumed by Buyer pursuant to
Section 2.
(c) As soon as practicable following the Closing, or at such other time as the parties agree, Seller, at its expense, shall obtain and deliver to Buyer a commitment for title insurance (the "Title Commitment") issued by a nationally recognized title company in the ALTA Owner's Form Policy of Title Insurance (each a "Title Policy" and collectively, "Title Policies") covering each tract of Land, setting forth the current status of title thereto, showing all recorded liens, claims, encumbrances, easements, rights-of-way, encroachments, reservations, restrictions and any other matters of public record affecting title to the Land pursuant to which such title company agrees to issue to Buyer the Title Policies. The cost of the Title Policies shall be borne by the Buyer. Seller shall execute such customary documents as the title company reasonably requests, including, but not limited to, an affidavit of debts and liens and customary closing statements.
(d) Buyer and Seller acknowledge that the Daytime Tower is occupied, or will be occupied, by a tenant pursuant to that certain Sale and Lease Agreement, dated June 29, 1981, between Family Stations, Inc. and Roberts Broadcasting Company ("RBC") (the "RBC Lease"), such RBC Lease leasing certain space on the Daytime Tower and certain real property within the Tower Site, and assigning to Gore-Overgaard Broadcasting, Inc. ("Gore"), all of RBC's right and interest to and in the RBC Lease, such rights subsequently assigned to Seller pursuant to that certain Assignment and Assumption Agreement, dated December 1, 1998, by and between Gore and Seller. At Closing, Seller will assign all of its right, title, and interest in the RBC Lease to Buyer, and Buyer shall assume the obligations under the RBC Lease, in the Assignment, Bill of Sale and Assumption Agreement. In the event that the Buyer receives after Closing any lease payment from tenants pursuant to the RBC Lease for rent that accrued prior to Closing, Buyer shall remit such lease payment promptly to Seller. Conversely, in the event Seller receives after Closing any lease payments from tenants pursuant to the RBC Lease for rent that accrued after Closing, Seller shall remit such lease payments promptly to Buyer.
6. Apportionment of Real Estate Taxes, Rent, Utilities.
(a) Current real estate taxes, rent, utilities and all other normal income and expense items related to the Assets shall be apportioned between the parties to reflect the principle that all expenses and income arising from the operation of the Assets up through the Adjustment Time shall be for the account of Seller, and all expenses and income arising from the operation of the business relating to the Assets acquired by Buyer after the Adjustment Time shall be for the account of Buyer.
(b) As soon as practicable following the Closing Date, or at such other time as the parties agree, Buyer shall deliver to Seller a certificate from Buyer which sets forth as of the Adjustment Time, all adjustments to be made as provided in Section 6(a) above (the "Buyer's Certificate"). Buyer shall provide Seller or its representatives access to copies of such portions of books and records Seller may reasonably request solely for the purposes of verifying such adjustments. The Buyer's Certificate shall be final and conclusive unless objected to by Seller in writing within ninety (90) days after delivery. Buyer and Seller shall attempt jointly to reach agreement as to the amount of the adjustments to be made hereunder within thirty (30) days after receipt of such written objection, which agreement, if achieved, shall be binding upon all parties to this Agreement and not subject to dispute or review.
(c) In the event of a disagreement between Buyer and Seller with respect to the accounting to be made hereunder, the parties agree that a public accounting firm chosen jointly by Buyer and Seller shall be the final arbiter of such disagreement.
(d) Any amounts due for the adjustments provided for herein shall be paid within thirty (30) business days after final determination.
7. Expenses.
(a) Seller shall pay the costs of preparation of the Deeds, acknowledgement of the Deeds, Federal, state and local revenue stamps, and real estate transfer taxes.
(b) All other costs and expenses incurred by the Parties in this transaction, including, but not limited to attorneys' fees, shall be paid by the party incurring them.
8. Closing; Closing Conditions.
(a) Closing of the transactions contemplated by this Agreement (the "Closing") shall occur at a place and time mutually agreeable to Seller and Buyer (the "Closing Date"). Seller and Buyer shall both make a good faith effort to close under this Agreement promptly.
(b) Seller's obligation to close hereunder shall be conditioned upon
(i) all representations and warranties of Buyer being then true and complete in
all material respects as if made on and as of the Closing Date, except to the
extent that any such representation or
warranty is made as of a specified date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Buyer or any of its affiliates, which would render it unlawful as of the Closing Date to effect the transactions contemplated by this Agreement in accordance with its terms, (iv) the delivery by Buyer of the Purchase Price in the manner set forth in Section 4(b), and (v) the delivery by Buyer of Buyer's Closing Documents (as defined in Section 9 hereof) on or before the Closing Date.
(c) Buyer's obligation to close hereunder shall be conditioned upon
(i) all representations and warranties of Seller being then true and complete in
all material respects as if made on and as of the Closing Date, except to the
extent that any such representation or warranty is made as of a specific date,
in which case such representation or warranty shall have been true and correct
as of such date, (ii) all consents of third parties required for Seller to
consummate the transactions contemplated under this Agreement shall have been
obtained, (iii) no order, decree or judgment of any court, agency or other
governmental authority shall have been issued based on or arising out of the
conduct, action, inaction, qualifications or status of Seller or any of its
affiliates, which would render it unlawful as of the Closing Date to effect that
transactions contemplated by this Agreement in accordance with its terms, and
(iv) the delivery by Seller of Seller's Closing Documents as set forth in
Section 9 hereof.
9. Closing Deliveries.
(a) At Closing, Seller shall execute and/or deliver to Buyer the following (collectively "Seller's Closing Documents"):
(i) The Deed;
(ii) The Assignment, Bill of Sale and Assumption Agreement;
(iii) A certificate from an officer of Seller reasonably acceptable to Buyer confirming the accuracy of the representations and warranties in Section 10 as of the Closing Date;
(iv) Authorizing resolutions or minutes from Seller approving this Agreement and the transactions contemplated herein;
(v) A FIRPTA affidavit to the effect that Seller is not a "foreign person" (as defined in Section 1445(f)(3) of the Code and the regulations issued thereunder); and
(vi) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit E (the "Lease Agreement").
(b) At Closing, Buyer shall execute and/or deliver to Seller the following (collectively "Buyer's Closing Documents"):
(i) Authorizing resolutions from Buyer approving this Agreement and the transactions contemplated herein; and
(ii) A certificate from an officer of Buyer reasonably acceptable to Seller confirming the accuracy of the representations and warranties in Section 11 as of the Closing Date;
(iii) The Purchase Note executed by a duly authorized officer of Buyer;
(iv) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit E (the "Lease Agreement"); and
(v) The Assignment, Bill of Sale and Assumption Agreement.
(c) Seller's Closing Documents and Buyer's Closing Documents shall be collectively called herein the "Closing Documents". Buyer and Seller agree that such other documents as may be legally necessary or appropriate to carry out the terms of this Agreement or as reasonably requested by the other party shall be executed and delivered by the appropriate party at Closing.
10. Representations and Warranties of Seller.
As a material inducement to Buyer to enter into this Agreement, Seller represents and warrants to Buyer as follows:
(a) Seller has good and marketable title to the Towers and the Land (or such condition of title as will be insured by any reputable title insurance company at their regular rates), and the Assets are free and clear of liens, encumbrances, restrictions and security interests other than Permitted Encumbrances.
(b) Seller has full power and authority to execute and deliver this Agreement and Seller's Closing Documents, and to perform its obligations hereunder and thereunder.
(c) This Agreement and Seller's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Seller, enforceable against Seller in accordance with their terms.
(d) The sale of the Assets shall not materially conflict with, or result in, a breach of the terms of any agreements or instruments to which the Seller is a party or which would result in the creation or imposition of any lien, charge or encumbrance on, or give to others any interest in or right to, any of the Assets.
(e) Seller has paid or will pay, at or prior to Closing, all outstanding obligations for utilities and taxes through the Closing Date except for such items as are covered by the proration of items of income and expense as set forth in Section 6 hereof.
(f) No third-party authorization or approval of, or filing with, any person, entity, or authority will be required in connection with the execution and delivery of this Agreement or the transactions contemplated by this Agreement.
(g) Assuming all consents and approvals required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Seller's compliance with, the terms and provisions of this Agreement will conflict with, or result in, a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Seller, or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Seller is subject or any material agreement or contract to which Seller is a party or to which it is subject, or constitute a material default thereunder.
(h) Seller is not a foreign person within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and the regulations issued thereunder.
11. Representations and Warranties of Buyer.
As a material inducement to Seller to enter into this Agreement, Buyer represents and warrants to Seller as follows:
(a) Buyer has full power and authority to execute and deliver this Agreement and Buyer's Closing Documents, and to perform its respective obligations hereunder and thereunder.
(b) This Agreement and Buyer's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Buyer enforceable against Buyer, in accordance with their terms.
(c) Assuming all consents and approvals required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Buyer's compliance with, the terms and provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Buyer or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Buyer is subject or any material agreement or contract to which Buyer is a party or to which it is subject, or constitute a material default thereunder.
12. Representations and Warranties Survive Closing.
All of the provisions of this Agreement and of the Closing Documents and all of the representations, warranties, considerations, and agreements contained herein and in the
Closing Documents shall survive Closing and continue in full force and effect for a period of twelve (12) months from the Closing Date; provided that if a claim for indemnification is made by either party under Section 13 hereof within such twelve (12) month period, the provisions of Section 13 shall survive until the resolution of such claim. No claim may be brought under this Agreement unless written notice describing in reasonable detail the nature of the claim is given on or prior to the last day of the twelve (12) month period following the Closing Date.
13. Indemnification.
(a) Seller shall indemnify, defend, and hold Buyer, its affiliates, partners, employees, officers, directors, agents, and representatives harmless from and against any and all reasonable losses, costs, expenses, liabilities, penalties, claims, and other damages including, but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigation, reasonably incurred and resulting from:
(i) any breach of Seller's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Seller of any of its covenants or agreements contained herein or in any Seller's Closing Document;
(iii) the Retained Liabilities;
(iv) any and all losses, liabilities or damages resulting from Sellers' operations or ownership of any Tower Site prior to the Closing Date, including any and all liabilities arising under the Assets which relate to events occurring prior to the Closing Date.
(b) Buyer shall indemnify, defend and hold Seller, its affiliates, employees, officers, directors, agents and representatives harmless from and against any and all losses, costs, expenses, liabilities, penalties, claims, and other damages, including but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigations, reasonably incurred and resulting from:
(i) any breach of Buyer's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Buyer of any of its covenants or agreements contained herein or in any Buyer's Closing Document;
(iii) the Assumed Liabilities;
(iv) any and all losses, liabilities or damages resulting from Buyer's operations or ownership of any Tower Site
subsequent to the Closing Date, including any and all liabilities arising under the Assets which related to events occurring subsequent to the Closing Date.
(c) In the event either Buyer or Seller (the "Indemnified Party") becomes aware of circumstances which would entitle such party to indemnification by the other party hereunder (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party prompt written notice, with reasonable detail, of such claim. Upon receipt of such notice by the Indemnified Party to the Indemnifying Party, the Indemnifying Party shall have the option of defending against such pending litigation through engagement of legal counsel of its choice, provided, however, that the Indemnifying Party's choice of legal counsel must be acceptable to the Indemnified Party in its reasonable discretion. In the event the Indemnifying Party elects to defend, the Indemnifying Party shall keep the Indemnified Party fully informed on a timely basis of the status of the pending litigation. In the event that the Indemnifying Party elects to defend and is unsuccessful in such defense, it shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages as described above, including but not limited to, reasonable attorney's fees and other costs and expenses associated with the pending litigation being so defended. In the event the Indemnifying Party elects not to defend and the Indemnified Party defends, but is unsuccessful, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages, as described above, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. In the event that Indemnifying Party elects not to defend and the Indemnified Party defends successfully, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all costs and expenses incurred, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. The Indemnifying Party shall reimburse the Indemnified Party upon demand for any payment made by the Indemnified Party at any time after Closing, based on the final judgement of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands or actions in respect to any damages to which the foregoing indemnification relates.
(d) Limitations on Seller Indemnification. Notwithstanding anything in this Agreement to the contrary, Seller's obligation to indemnify Buyer shall be subject to all of the following limitations:
(i) The amount of any losses, costs, expenses, liabilities, penalties, claims, and other damages ("Losses") incurred by Buyer shall be reduced by (A) the amount Buyer recovers (after deducting all attorneys' fees, expenses, and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Buyer shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Buyer shall be entitled to indemnification only for Losses as to which Buyer has given Seller written notice describing in reasonable detail the nature and basis for such indemnification ("Notice of Claim") on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Buyer by Seller pursuant to this
Section 13 shall be limited to Forty Thousand Dollars
($40,000.00) and Seller shall have no other liability or
responsibility for indemnification hereunder.
(e) Buyer's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Buyer with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
(f) Limitation on Buyer's Indemnification. Notwithstanding anything in this Agreement to the contrary, Buyer's obligation to indemnify Seller shall be subject to all of the following limitations:
(i) The amount of any Losses incurred by Seller shall be reduced by (A) the amount Seller recovers (after deducting all attorneys' fees, expenses and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Seller shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Seller shall be entitled to indemnification only for Losses as to which Seller has given Buyer a Notice of Claim on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Seller by Buyer pursuant to this
Section 13 shall be limited to Forty Thousand Dollars
($40,000.00) and Buyer shall have no other liability or
responsibility for Indemnification hereunder.
(g) Seller's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Seller with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
14. Termination; Liquidated Damages
(a) Right of Termination. This Agreement may be terminated prior to Closing:
(i) By written notice from a party that is not then in material breach of this Agreement if:
(A) The other party has continued in material breach of this Agreement for twenty (20) days after written notice of such breach from the terminating party;
(B) Closing does not occur by May 31, 2000 or such other date as is mutually agreed to by Buyer and Seller.
(b) Obligations Upon Termination.
(i) Upon termination of this Agreement, each party shall thereafter remain liable for breach of this Agreement prior to such termination and remain liable to pay and perform any obligation under Section 13.
(ii) If Closing shall not have occurred, Seller's sole remedy at law or in equity for any breach or default by Buyer described in Section 14(a)(i)(A) shall be the termination by Seller of this Agreement by giving of written notice to Buyer pursuant to Section 14(a)(i)(A).
(c) Termination Notice. Each notice given by a party pursuant to
Section 14(a) to terminate this Agreement shall specify the subsection of
Section 14(a) pursuant to which such notice is given. If at the time a party
gives a termination notice, such party is entitled to give such notice pursuant
to more than one subsection of Section 14(a), the subsection pursuant to which
such notice is given and termination is effected shall be deemed to be the
subsection specified in such notice provided that the party giving such notice
is at such time entitled to terminate this Agreement pursuant to the specified
subsection.
15. Default; Disputes.
If Seller fails to perform under this Agreement, the Buyer may exercise any right he has against the Seller, including bringing an action for specific performance. The remedies provided by this Section are in addition to any right or remedies provided elsewhere in this Agreement or at law or in equity. In the event a dispute arises between the Parties over the interpretation of this Agreement, or the performance, alleged non-performance or breach by either Party hereunder, the Parties hereby agree to seek resolution of such dispute in good faith through an alternative dispute resolution process mutually agreeable to the Parties prior to the institution of any legal proceedings related thereto.
16. Liabilities.
Buyer shall not, in connection with the purchase and sale of Assets contemplating herein, assume any liabilities or obligations of the Seller except as specifically set forth herein.
17. Third Party Brokerage.
Seller and Buyer hereby represent and warrant to each other that neither Seller or Buyer has dealt with any broker or finder in connection with the transaction which is the subject of this Agreement. Each party hereby agrees to indemnify, save harmless and defend the other from and against all claims, losses, liabilities and expenses, including reasonable attorney's fees, arising out of any claim made by any broker, finder or other intermediary who claims to have dealt with such party in connection with the transaction which is the subject of this Agreement. The provisions of the paragraph shall survive Closing hereunder.
18. Entire Agreement.
This Agreement (which includes the exhibits and schedules attached hereto) constitutes the entire agreement between the Parties and there are no other understandings, representations or warranties, oral or written, relating to the subject matter hereof.
19. Amendment.
This Agreement may not be changed, modified or amended, in whole or in part, except in writing, signed by all parties.
20. Notice.
Notices given pursuant to this Agreement shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this Section. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Seller: Beasley Broadcasting of New Jersey, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
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Phone: (941) 263-5000 Fax: (941) 434-8950
If to the Buyer: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
Fax: (941) 434-8950
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With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
21. Construction.
Whenever used in this Agreement the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.
22. Assignment and Recording.
Seller hereby covenants not to assign or record this Agreement except with the prior written consent of the Buyer. Buyer may assign this Agreement freely to any affiliated entity, provided such assignment shall not relieve Buyer of its obligations hereunder.
23. Binding Effect.
This Agreement and all of its terms and conditions shall extend to and be binding upon the Parties hereto and upon their respective heirs, executors, administrators, successors and assigns.
24. Further Assurances.
Seller and Buyer agree to execute and deliver any further documents or assurances that in law or otherwise are necessary, desirable or proper to consummate the transactions contemplated by this Agreement and to vest, perfect, assign or confirm, of record or otherwise, in Buyer title to the Assets.
25. Governing Law.
This Agreement is made and shall be governed by and construed in accordance with the internal laws of the State of New Jersey.
26. Headings.
The headings and captions in this Agreement are for convenience only and are not part of this Agreement.
27. Interpretation.
Neither this Agreement nor any provision contained herein shall be interpreted for or against either party solely because that party or that party's legal representative drafted the provision.
28. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute the same Agreement.
29. Severability.
If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be severed from this Agreement and the remainder shall remain in full force and effect.
30. Covenant of Seller.
Seller shall make all reasonable efforts to resolve any title or restriction issues prior to the Closing, but will continue these efforts subsequent to the Closing to the extent reasonably necessary.
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound, have caused this Agreement to be duly executed on the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF NEW JERSEY, INC.
BUYER:
BEASLEY FAMILY TOWERS, INC.
INDEX OF EXHIBITS
Exhibit A Description of Land and Towers
Exhibit B Form of Purchase Note
Exhibit C Form of Deed
Exhibit D Form of Assignment, Bill of Sale and
Assumption Agreement
Exhibit E Form of Lease Agreement
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EXHIBIT A
DESCRIPTION OF LAND AND TOWERS
WTMR-AM
(1) That certain communications tower used exclusively to broadcast during daytime hours and
(2) that certain communications tower used exclusively to broadcast during nighttime hours, each tower situated on that certain tract of land more particularly described as follows:
BEGINNING AT A POINT IN THE WESTERLY LINE OF MT. EPHRAIM AVENUE (73 FEET WIDE) SAID POINT BEING 1,007.87 FEET NORTH, 18 DEGREES 17 MINUTES 00 SECONDS WEST, MEASURED FROM THE INTERSECTION OF THE WESTERLY LINE OF MT. EPHRAIM AVENUE WITH THE TRUNCATED NORTHWESTERLY LINE OF OLYMPIA AVENUE, SAID BEGINNING POINT BEING THE NORTHERLY CORNER OF LANDS NOW OR FORMERLY RELDON ENTERPRISES: THENCE
1) ALONG SAID LANDS, NOW OR FORMERLY OF RELDON ENTERPRISES, SOUTH 71 DEGREES 43 MINUTES 00 SECONDS WEST, 175 FEET TO A POINT: THENCE
2) SOUTH 54 DEGREES 14 MINUTES 30 SECONDS WEST, 110.50 FEET TO A POINT: THENCE
3) NORTH 19 DEGREES 23 MINUTES 00 SECONDS WEST, 176.86 FEET TO A POINT CORNER TO LANDS NOW OR FORMERLY RELDON ENTERPRISES: THENCE
4) STILL ALONG SAID LANDS, SOUTH 71 DEGREES 43 MINUTES 00 SECONDS WEST, 383 FEET TO A POINT: THENCE
5) NORTH 29 DEGREES 49 MINUTES 01 SECONDS WEST, 242, 45 FEET TO A POINT IN THE
PIERHEAD AND BULKHEAD LINE AS ESTABLISHED BY THE DEPARTMENT OF CONSERVATION:
THENCE
6) ALONG THE PIERHEAD AND BULKHEAD LINE NORTH 04 DEGREES 00 MINUTES 00 SECONDS EAST, 125 FEET TO A POINT: THENCE
7) STILL ALONG SAME, NORTH 29 DEGREES 00 MINUTES WEST, 210.46 FEET TO A POINT:
THENCE
8) ALONG LANDS RETAINED BY SOUTH JERSEY BROADCASTING COMPANY, NORTH 71 DEGREES 43 MINUTES 00 SECONDS EAST, 400.23 FEET TO A POINT, CORNER TO LANDS NOW OR FORMERLY ELGIN DINER: THENCE
9) ALONG SAID LANDS SOUTH 18 DEGREES 17 MINUTES 00 SECONDS EAST, 150 FEET TO A POINT FOR A CORNER: THENCE
10) STILL ALONG LANDS NOW OR FORMERLY OF ELGIN DINER AND LANDS NOW OR FORMERLY OF LEO T. ITALIANO NORTH 71 DEGREES 43 MINUTES 00 SECONDS EAST, 300 FEET TO A POINT IN THE WESTERLY LINE OF MT. EPHRAIM AVENUE: THENCE
11) ALONG SAME, SOUTH 18 DEGREES 17 MINUTES 00 SECONDS EAST, 200 FEET TO THE FIRST MENTIONED POINT AND PLACE OF BEGINNING.
TOGETHER WITH ALL RIGHTS UNDER GRANT OF EASEMENT AS CONTAINED IN BOOK 2888, PAGE 272 AND EASEMENT AS CONTAINED IN BOOK 2894, PAGE 49.
COMMONLY KNOWN AS: 2775 Mt. Ephraim Avenue, Camden, New Jersey
The real property to be conveyed hereunder shall be exclusive of any building improvements situated thereon.
The real property to be conveyed hereunder is subject to the RBC lease (as defined in Section 5(D) of this agreement).
EXHIBIT B
FORM OF PURCHASE NOTE
PROMISSORY NOTE
$316,200.00 February ___, 2000
BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Payor"), for value received, promises to pay to the order of BEASLEY BROADCASTING OF NEW JERSEY, INC., a Delaware corporation, ("Payee"), the principal amount of THREE HUNDRED SIXTEEN THOUSAND TWO HUNDRED DOLLARS ($316,200.00), together with accrued interest thereon, calculated and payable as set forth below in this Note. The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement of Sale (the "Sale Agreement"), dated February ____, 2000, by and among Payor and Payee.
1. Payment of Principal and Interest.
(a) Calculation and Payment of Interest. Interest on the principal balance of this Note outstanding from time to time until paid in full shall accrue at the rate of six and seventy-seven one hundredths percent (6.77%) compounded annually (the "Rate"), computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof.
(b) Payments Prior to Maturity Date. On the first day of each month Maker shall pay Two Thousand Three Hundred Ninety Four Dollars and Fifty Two Cents ($2,394.52). All remaining principal, together with accrued and unpaid interest thereon shall be due and payable on the "Maturity Date" (defined below). Each monthly payment shall be credited first to interest then accrued and the remainder, if any, to principal, and interest shall thereupon cease to accrue upon the principal paid.
(c) Payment on Maturity Date. The principal balance of, and any accrued and unpaid interest on, this Note shall be payable twenty (20) years from the effective date of this Note (such date the "Maturity Date").
(d) Prepayment.
(i) Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this Note.
(ii) Any prepayment of this Note shall be applied as follows:
first, to payment of accrued interest; and second, to
payment of principal.
2. Events of Default.
The following shall constitute "Events of Default" under this Note:
(a) Failure by Payor to make any payment required under this Note when the same shall become due and payable (whether at maturity or otherwise) and the continuation of such failure for a period of ninety (90) days; or
(b) Payor pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for all or any substantial portion of its property or assets; (iv) makes a general assignment for the benefit of its creditors; or
(c) an involuntary case or proceeding is commenced against Payor under any Bankruptcy Law and is not dismissed, bonded or discharged within ninety (90) days thereafter, or a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against Payor in an involuntary case or proceeding;
(ii) appoints a Custodian of Payor or for all or substantially all of its properties; or
(iii) orders the liquidation of Payor; and in each case the order or decree remains unstayed and in effect for ninety (90) days.
(d) The following terms used in this Note have the meanings assigned below:
"Bankruptcy Law" means Title 11, United States Code, or any similar federal, state or foreign law for the relief of debtors or any arrangement, reorganization,
assignment for the benefit of creditors or any other marshalling of the assets and liabilities of Payor.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
"Event of Default" means any of the occurrences specified in Section 2 of this Note.
If any Event of Default shall have occurred and be continuing, Payee may proceed to protect and enforce its rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to Payee under this Note.
3. Assignment.
The holders of this Note may not assign or otherwise transfer all or any portion of their rights and obligations under this Note to any other person or entity, without the prior written consent of the Payor, which consent shall not be unreasonably withheld.
4. Miscellaneous.
(a) Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
(b) Amendment and Waiver. No provision of this Note may be amended or waived unless Payor shall have obtained the written agreement of Payee. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c) Successors, Assigns and Transferors. The foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
(d) Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of New Jersey, without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction.
(e) Notices. Any notice, request, instruction or other document to be given hereunder by either party to the other shall be in writing and shall be deemed given when received and shall be (i) delivered personally or (ii) mailed by certified mail, postage prepaid, return receipt requested or (iii) delivered by Federal Express or a similar overnight courier or (iv) sent via facsimile transmission to the fax number given below, as follows:
If to Payor, addressed to:
Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Fax: (941) 434-8950
With a copy to:
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Attn: Joseph D. Sullivan, Esq.
Fax: (202) 637-2201
If to Payee, addressed to:
Beasley Broadcasting of New Jersey, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Fax: (941) 434-8950
or to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
BEASLEY FAMILY TOWERS, INC.
EXHIBIT C
FORM OF DEED
EXHIBIT D
FORM OF ASSIGNMENT, BILL OF
SALE AND ASSUMPTION AGREEMENT
This Assignment, Bill of Sale and Assumption Agreement (this "Agreement") is made effective as of 12:01 a.m. Eastern Time, on the ____ day of February, 2000 by and between BEASLEY BROADCASTING OF NEW JERSEY, INC. ("Seller") and BEASLEY FAMILY TOWERS, INC. ("Purchaser").
RECITALS
A. Reference is made to that certain Agreement of Sale (the "Asset Purchase Agreement") dated as of February, 2000 by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings given such terms in the Asset Purchase Agreement.
B. The Asset Purchase Agreement provides that Seller shall sell, convey and assign to Purchaser all of Seller's right, title and interest to the Towers and Tower Leases and Purchaser shall assume the Assumed Liabilities, as defined in Section 2 of the Asset Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows (capitalized terms used herein but not defined herein shall have the meaning given to them in the Asset Purchase Agreement):
1. Seller hereby bargains, sells, conveys, assigns and delivers all of Seller's right, title and interest in and to:
a. The Towers, such Towers more particularly described in Exhibit A of the Asset Purchase Agreement; and
b. The RBC Lease.
Items a. and b. above are hereinafter referred to as the "Assigned Assets."
2. Purchaser hereby accepts the sale, conveyance and assignment of the Assigned Assets, effective as of 12:01 a.m. Eastern Time on February __, 2000.
3. Purchaser hereby assumes and agrees to pay and perform the Assumed Liabilities pursuant to Section 2 of the Asset Purchase Agreement, effective as of 12:01 a.m. Eastern Time on February __, 2000.
4. After the date hereof, Purchaser and Seller will, at the request of the other party, promptly obtain, execute and deliver, or cause to be obtained, executed and delivered, to the other party such assignments, bills of sale, endorsements, and other such instruments or
documents to be executed by Seller or Purchaser, as the case may be, in addition to this Agreement, in form and substance reasonably satisfactory to the other party, as such other party may reasonably deem necessary or desirable so as (i) to vest in Purchaser title to and possession of the Assigned Assets and (ii) to perfect and record, if necessary, the sale, assignment, conveyance, transfer and delivery to Purchaser of the Assigned Assets.
5. This Agreement is made pursuant to, and is subject to all of the terms, representations, warranties and covenants of, the Asset Purchase Agreement, the terms of which are hereby incorporated by reference. In the event of any conflict between this Agreement and the Asset Purchase Agreement, the terms of the Asset Purchase Agreement shall govern.
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this Agreement as of the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF NEW JERSEY, INC.
PURCHASER:
BEASLEY FAMILY TOWERS, INC.
EXHIBIT E
FORM OF LEASE AGREEMENT
LEASE AGREEMENT (O&O - WTMR-AM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY BROADCASTING OF NEW JERSEY, INC., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns two communications towers described on Exhibit A attached hereto (the "Towers"), together with other improvements on a certain tract of real estate located at Camden, New Jersey, as such land is more fully described in Exhibit B attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements or improvements on such land, including, without limitation, any buildings or other structures, but not including that certain studio building owned by Lessor on such land and that certain transmitter building owned by [Family Stations, Inc.]);
WHEREAS, Lessor desires to lease the Tower Site and the Towers for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower Site and Towers from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee leases from Lessor, with a right of access thereto and parking therefor in accordance with Section 9:
(a) The Towers, for the purposes of broadcast transmission of
WTMR-AM, Camden, New Jersey, subject to the lease of certain tower space to
[Family Stations, Inc.] under the [RBC Lease]; and
(b) The Tower Site.
(c) All of the property leased under this Paragraph 2.01 shall hereinafter be called the "Leased Premises".
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below), all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Leased Premises after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain lessee's property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Leased Premises at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Leased Premises for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Leased Premises may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Towers. Lessee may repair and maintain equipment as it reasonably deems necessary to its operations within Lessee's Space in all respects in compliance with the terms hereof. Lessee shall maintain the Leased Premises, Lessee's interior and exterior equipment, and all other improvements in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to Lessee in this Lease and with prior notice to Lessee and no loss of service or interruption (beyond a temporary, non-recurring and de minimis amount), Lessor reserves the right to use the Towers, at its own expense, as it sees fit and to fasten additional equipment to the Towers for any purpose, including the right to install transmitting and/or receiving antennas of others; provided that Lessor shall use
reasonable efforts to restrict any loss of Lessee's service or interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00 a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Towers to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
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Lease Year Rent Per Lease Year Monthly Rent
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1 $28,734.24 $2,394.52
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2 $28,734.24 $2,394.52
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3 $28,734.24 $2,394.52
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4 $28,734.24 $2,394.52
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5 $28,734.24 $2,394.52
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6 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
7 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
8 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
9 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
10 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
11 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
12 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
13 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
14 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
15 $28,734.24 $2,394.52
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16 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
17 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
18 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
19 $28,734.24 $2,394.52
------------------------------------------------------------------------------------------------------------
20 $28,734.24 $2,394.52
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated ______, 2000, on the first day of each month during the term of the Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Towers used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Towers for the Towers lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and
stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Leased Premises, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in
connection with the Towers and any building on the Tower Site except that Lessee
shall obtain, at its own expense, any and all necessary licenses or permits from
such governmental authorities as shall have jurisdiction in connection with the
(b) the operations, installation, repair, alteration, or replacement of Lessee's
equipment (including, without limitation, Lessee's antenna and transmission
and/or receiving equipment); or (c) with any of Lessee's activities thereon or
contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor
with copies of same, and shall abide by the terms and provisions of such
licenses and permits.
8. MAINTENANCE OF LEASED PREMISES AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to the Towers. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Towers and the Tower Site, or the prevention of interference with Lessor or any other user of the Towers or any other
broadcaster, Lessor may, at its option, make such emergency repairs to the Leased Premises as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Towers and the Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Towers unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Towers (including any ascension of the Towers), or in or about the Tower Site, Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency
radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Leased Premises to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. USE AND MAINTENANCE OF COMMON PREMISES.
9.01 USE OF COMMON PREMISES. Lessee, at its own risk, shall have the
right to use in common with Lessor and its licensees, invitees, and other
tenants, and in connection with Lessee's permissible activities and operations
(a) any access road from any public highway to the Tower Site or to any building
on the Tower Site; and (b) any parking lot on the Tower Site (such items (a) and
(b) called collectively herein the "Common Premises").
9.02 MAINTENANCE OF COMMON PREMISES.
(a) Lessor shall maintain the Common Premises and any fence around the Towers in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the
Towers. Lessor shall maintain the Towers and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs,
alterations, or improvements are necessary or desirable to the Towers or any
building or structure constructed by Lessor on the Tower Site, any common areas,
or the leased spaces of other tenants, Lessor may, upon reasonable notice and
for the shortest practical period of time (except for emergency situations),
close entrance doors, common areas, drive-ways, rights-of-way, service areas,
parking areas, or any other facilities at its discretion without being liable to
Lessee; provided that if any of the above would restrict Lessee's ability to
broadcast, Lessor shall use reasonable efforts to restrict any closure or
interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00
a.m.. The closing of entrances, doors, common areas, parking areas, or other
facilities for the making of the repairs, alterations, or improvements described
herein shall, under no circumstances, constitute an eviction of the Lessee or be
grounds for termination of this Lease or the withholding of any rental payments
or other payments or performances required to be paid or made by Lessee under
the terms hereof, provided, Lessor shall use reasonable efforts to ensure that
any action taken in accordance with this paragraph shall not adversely affect
the rights of Lessee hereunder. Under no such circumstances shall Lessee be
entitled to terminate this Lease nor shall it be entitled to compensation for
any loss or damage it may sustain (including loss of use, loss of
advertising/sponsorship revenues, and consequential damages) by reason of such
changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property which is situated on the Towers, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine the loading capacity of the Towers, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Leased Premises or on the Towers after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Towers whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Towers, Tower Site or any building on the Tower Site shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct
such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Towers, Tower Site or any buildings on the Tower Site shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Towers shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes,
assessments, or levies assessed or imposed against the Leased Premises.
[Foregoing obligation is subject to $200,000 12-month limit when aggregated with
other borrowers under Credit Agreement per 1.5D of First Amendment to Credit
Agreement]. Lessee shall pay all personal property or other taxes assessed or
imposed on Lessee's Property, and shall cooperate with Lessor to ensure that
such property is properly separated from that of Lessor or other tenants for
assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Leased Premises,
including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Towers elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 INSURANCE ON THE TOWERS. Lessee shall procure and maintain physical damage insurance on the Towers in an amount sufficient to repair or replace the Towers and any such building with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 DAMAGE TO THE TOWERS. In the event that the Towers are destroyed
or damaged by fire, lightning, windstorm, flood, earthquake, explosion,
collapse, aircraft, or other vehicle damage or other casualty covered by
insurance, Lessor shall promptly reconstruct or repair the Towers to such good
condition as existed before the destruction or damage, and give possession to
Lessee of substantially the same space leased hereunder. Lessee shall promptly
pay over to Lessor any insurance proceeds it receives from insurance policies
Lessee is required to procure under Section 14.03 hereof for the purpose of use
by Lessor to fund reconstruction of the Tower as required of Lessor under this
Section 14.04. If the Towers are in need of such repair or is so damaged by
fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other
vehicle damage, collapse, or other casualty that reconstruction or repair cannot
reasonably be undertaken without dismantling Lessee's antenna, then upon written
notice to Lessee, Lessor may remove any such antenna and interrupt the signal
activity of Lessee, but will use its best efforts to have the antenna replaced
as soon as reasonably possible. Lessor agrees to provide Lessee an alternative
tower, if available, during such reconstruction/repair period. If such tower on
the Tower Site is not available, then Lessee shall be responsible for procuring
its own alternative tower. No monetary or other rental shall be due pursuant to
the terms of this Lease for such time as Lessee is unable to conduct its
broadcasting activities on the Towers without significant diminution of signal
quality as a result of such total or partial destruction or damage or need of
repair, and Lessor shall refund to Lessee any rent paid in advance for such
time. Should Lessor not either (a) inform Lessee in writing within ninety (90)
days of the date of
destruction of Lessor's intent to replace the Towers or (b) replace the Towers within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to damage to the Towers (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower Site (or any portion of the Tower Site necessary for the Towers, guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower or towers as a replacement for the Towers on the condemned property, Lessor agrees to lease to Lessee the new tower or towers on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event
either party elects to terminate this Lease in accordance with the provisions
herein or at the expiration of the term hereof, Lessee or its mortgagee shall
have the right to remove Lessee's Property, except any fixtures (it being
specifically understood and agreed that Lessee's antenna, transmitters,
transmission line, and similar broadcasting equipment shall not be deemed
fixtures) on the Leased Premises within thirty (30) days of such termination.
Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee
shall promptly repair any and all damage caused by such removal. Any of Lessee's
Property remaining on the Leased Premises after the expiration of the thirty
(30) day period shall be deemed to be the property of Lessor, which Lessor may
have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Leased Premises, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Leased Premises by reasonably necessary force, summary proceedings, or
otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Leased Premises. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Leased Premises (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of New Jersey at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder ("Indemnified Party") shall provide the other party ("Indemnifying Party") reasonably prompt notice of known claims giving rise to any claim for indemnity, and the Indemnifying Party shall have the right and opportunity to undertake the legal defense of such claims. The Indemnified Party and its counsel may nevertheless participate in (but not control) such proceedings, negotiations, or defense at its own expense. In all such cases, the Indemnified Party will give all reasonable assistance to the Indemnifying Party, including making the Indemnified Party's employees and documents available as reasonably requested without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after either party's
request, the other party shall deliver, executed in recordable form, a
declaration to any person designated by the requesting party (a) ratifying this
Lease; (b) stating the commencement and termination dates; and (c) certifying
(i) that this Lease is in full force and effect, and has not been assigned,
modified, supplemented, or amended (except by such writings as shall be stated);
(ii) that all conditions under this Lease to be performed have been satisfied
(stating exceptions, if any); (iii) that no defenses or offsets against the
enforcement of this Lease by the requesting party exist (or stating those
claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which rent
has been paid; (vi) the amount of security deposited with Lessor (if hereafter
applicable for any reason); and (vii) such other information as the requesting
party reasonably requires. Persons receiving such statements shall be entitled
to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Leased Premises, or, if any of the Leased Premises or any building thereon comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of New Jersey.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
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Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley Broadcasting of New Jersey, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
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Fax: (941) 434-8950
21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Towers, Building, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Towers, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Leased Premises; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Towers and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Leased Premises or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: ` LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
---------------------------------- ----------------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
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LESSEE:
BEASLEY BROADCASTING OF NEW JERSEY, INC.
By: (SEAL)
---------------------------------- ----------------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
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EXHIBIT A
WTMR-AM
(1) That certain communications tower and for the daytime operation of WTMR-AM and (2) that certain communications tower used for the nighttime operation of WTMR-AM and situated on that certain tract of land more particularly described on Exhibit B herein.
EXHIBIT B
WTMR-AM
That certain tract of land (exclusive of the studio building used for the
broadcast operation of WTMR-AM thereon and the transmitter building owned by
[Family Stations, Inc.]) more particularly described as follows:
BEGINNING AT A POINT IN THE WESTERLY LINE OF MT. EPHRAIM AVENUE (73 FEET WIDE) SAID POINT BEING 1,007.87 FEET NORTH, 18 DEGREES 17 MINUTES 00 SECONDS WEST, MEASURED FROM THE INTERSECTION OF THE WESTERLY LINE OF MT. EPHRAIM AVENUE WITH THE TRUNCATED NORTHWESTERLY LINE OF OLYMPIA AVENUE, SAID BEGINNING POINT BEING THE NORTHERLY CORNER OF LANDS NOW OR FORMERLY RELDON ENTERPRISES: THENCE
1) ALONG SAID LANDS, NOW OR FORMERLY OF RELDON ENTERPRISES, SOUTH 71 DEGREES 43 MINUTES 00 SECONDS WEST, 175 FEET TO A POINT: THENCE
2) SOUTH 54 DEGREES 14 MINUTES 30 SECONDS WEST, 110.50 FEET TO A POINT: THENCE
3) NORTH 19 DEGREES 23 MINUTES 00 SECONDS WEST, 176.86 FEET TO A POINT CORNER TO LANDS NOW OR FORMERLY RELDON ENTERPRISES: THENCE
4) STILL ALONG SAID LANDS, SOUTH 71 DEGREES 43 MINUTES 00 SECONDS WEST, 383 FEET TO A POINT: THENCE
5) NORTH 29 DEGREES 49 MINUTES 01 SECONDS WEST, 242, 45 FEET TO A POINT IN THE
PIERHEAD AND BULKHEAD LINE AS ESTABLISHED BY THE DEPARTMENT OF CONSERVATION:
THENCE
6) ALONG THE PIERHEAD AND BULKHEAD LINE NORTH 04 DEGREES 00 MINUTES 00 SECONDS EAST, 125 FEET TO A POINT: THENCE
7) STILL ALONG SAME, NORTH 29 DEGREES 00 MINUTES WEST, 210.46 FEET TO A POINT:
THENCE
8) ALONG LANDS RETAINED BY SOUTH JERSEY BROADCASTING COMPANY, NORTH 71 DEGREES 43 MINUTES 00 SECONDS EAST, 400.23 FEET TO A POINT, CORNER TO LANDS NOW OR FORMERLY ELGIN DINER: THENCE
9) ALONG SAID LANDS SOUTH 18 DEGREES 17 MINUTES 00 SECONDS EAST, 150 FEET TO A POINT FOR A CORNER: THENCE
10) STILL ALONG LANDS NOW OR FORMERLY OF ELGIN DINER AND LANDS NOW OR FORMERLY OF LEO T. ITALIANO NORTH 71 DEGREES 43 MINUTES 00 SECONDS EAST, 300 FEET TO A POINT IN THE WESTERLY LINE OF MT. EPHRAIM AVENUE: THENCE
11) ALONG SAME, SOUTH 18 DEGREES 17 MINUTES 00 SECONDS EAST, 200 FEET TO THE FIRST MENTIONED POINT AND PLACE OF BEGINNING.
TOGETHER WITH ALL RIGHTS UNDER GRANT OF EASEMENT AS CONTAINED IN BOOK 2888, PAGE 272 AND EASEMENT AS CONTAINED IN BOOK 2894, PAGE 49.
COMMONLY KNOWN AS: 2775 Mt. Ephraim Avenue, Camden, New Jersey
EXHIBIT 10.17
AGREEMENT OF SALE (O&O)
This Agreement of Sale (the "Agreement") is made this ___ day of February, 2000, between Beasley Broadcasting of Eastern Pennsylvania, Inc., a Delaware corporation (the "Seller") and Beasley Family Towers, Inc., a Delaware corporation (the "Buyer") (together, the "Parties").
WITNESSETH:
WHEREAS, Seller owns certain real and personal property comprising one parcel of real property and four (4) communications tower facilities (the "Towers") located in East Norriton, Pennsylvania used in the operation of radio broadcast station WWDB-AM (the "Tower Site");
WHEREAS, Seller desires to sell and Buyer desires to purchase the Towers and certain real and personal property belonging to Seller and associated with the Tower Site;
NOW, THEREFORE, in consideration of the mutual premises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
1. Agreement to Sell and Purchase.
Seller agrees to sell, transfer, assign, convey and deliver to Buyer and Buyer agrees to purchase and accept from Seller, the following assets upon the terms and conditions contained herein (collectively, the "Assets"):
(a) Those certain tracts of land, and easements or appurtenances incident to such tracts of land, that are associated with the Tower Site (collectively, such land, easements and appurtenances, the "Land"), and the Towers, such Towers and such Land and are more particularly described in Exhibit A attached hereto and incorporated herein.
2. Assumption of Liabilities
(a) Upon the terms and subject to the conditions contained herein, Buyer shall assume and become responsible for any and all liabilities and obligations arising out of, or relating to events occurring after 12:01 am Eastern Standard Time on the Closing Date (the "Adjustment Time") the ownership of the Land and the Towers, and the operation of the business relating to the Assets (collectively, the "Assumed Liabilities").
(b) Subject to the provisions of Section 13, it is understood and agreed that all liabilities to third parties relating to the Assets that arise out of any act, event, or transaction of Seller or the ownership of the Assets or the operator of the business relating to the Assets subject to the provisions of Section 13 prior to the Closing Date (the "Retained Liabilities") shall remain the responsibility of Seller. Buyer shall not be required to defend any suit or claim arising out of any Retained Liabilities, and Seller shall and hereby agrees to satisfy in due course all such Retained Liabilities, and Seller shall protect and forever hold Buyer
harmless from all claims with respect to such Retained Liabilities. It is understood and agreed that all liabilities relating to the Assets that arise out of any act, event, or transaction of Buyer following the Closing Date (the "Assumed Liabilities") shall be the responsibility of Buyer. Seller shall not be required to defend any suit or claim arising out of any Assumed Liabilities, and Buyer shall and hereby agrees to satisfy in due course all such Assumed Liabilities, and subject to the provisions of Section 13 Buyer shall protect and forever hold Seller harmless from all claims with respect to such Assumed Liabilities.
3. Purchase Price.
(a) The purchase price for the Assets shall be the amount of Three Hundred Thirty Six Thousand One Hundred One Dollars ($336,101.00) (the "Purchase Price"). The Purchase Price shall be adjusted at the Closing by the amount of any prorations derived by operation of Section 6 hereof, and for any other normal income and expense items related to the operation of the Tower Sites as of 12:01 am on the day on which the Closing occurs. The Purchase Price shall be allocated among the Assets in accordance with Section 3(b).
(b) Buyer and Seller agree to allocate the aggregate of the Purchase Price, the Assumed Liabilities and other relevant items among the Assets in accordance with section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"). Buyer and Seller will each report the federal, state, and local and other tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Form 8594) in a manner consistent with such allocation.
4. Delivery of Purchase Price
(a) The Purchase Price shall be payable at Closing (as defined in Section 8 below) in the manner set forth in Section 4(b).
(b) As payment of the Purchase Price, Buyer shall deliver to Seller at Closing an unsecured promissory note of Buyer in the aggregate principal amount of Three Hundred Thirty Six Thousand One Hundred One Dollars ($336,101.00), substantially in the form of Exhibit B (the "Purchase Note").
5. Transfer of Towers; Title Insurance.
(a) Transfer of title to the Land shall be by deed from the Seller to the Buyer (a "Deed"), which Deed shall be in the Form of Exhibit C attached hereto and incorporated herein. Transfer of ownership of the Towers and assumption of the Assumed Liabilities pursuant to Section 2 hereof shall be pursuant to the Assignment, Bill of Sale and Assumption Agreement from the Seller to Buyer in the form of Exhibit D attached hereto and incorporated herein (the "Assignment, Bill of Sale and Assumption Agreement").
(b) The Assets shall be transferred to Buyer free and clear of all liens, encumbrances other than Permitted Encumbrances, if any; otherwise the title to the Land shall be good and marketable or such as will be insured by a reputable title insurance company at regular rates. "Permitted Encumbrances" shall mean: (i) encumbrances for taxes, assessments, or
governmental charges or levies which are not yet due and payable, or that,
subject to adequate security for payment, are being contested; (ii) existing
building restrictions, ordinances, easements of roads, privileges, or rights of
public service companies or other rights of way, other restrictions or
conditions of record, if any or other encumbrances disclosed in this Agreement
(including the Exhibits attached hereto); (iii) easements, rights of way or
other encumbrances that do not have a material adverse effect on the Assets or
the operation of the business relating to the Assets as currently operated;
(iv) encumbrances imposed by law, such as materialmen's, mechanic's, carrier's,
workmen's, or repairmen's liens or other similar encumbrances attaching in the
ordinary course of business or securing obligations that are not overdue; (v)
encumbrances securing indebtedness, which will be removed prior to or at the
Closing; and (vi) encumbrances pursuant to contracts and leases to be assumed
by Buyer pursuant to Section 2.
(c) As soon as practicable following the Closing, or at such other time as the parties agree, Seller, at its expense, shall obtain and deliver to Buyer a commitment for title insurance (the "Title Commitment") issued by a nationally recognized title company in the ALTA Owner's Form Policy of Title Insurance (each a "Title Policy" and collectively, "Title Policies") covering the Land, setting forth the current status of title thereto, showing all recorded liens, claims, encumbrances, easements, rights-of-way, encroachments, reservations, restrictions and any other matters of public record affecting title to the Land pursuant to which such title company agrees to issue to Buyer the Title Policies. The cost of the Title Policies shall be borne by the Buyer. Seller shall execute such customary documents as the title company reasonably requests, including, but not limited to, an affidavit of debts and liens and customary closing statements.
6. Apportionment of Real Estate Taxes, Rent, Utilities.
(a) Current real estate taxes, rent, utilities and all other normal income and expense items related to the Assets shall be apportioned between the parties to reflect the principle that all expenses and income arising from the operation of the Assets up through the Adjustment Time shall be for the account of Seller, and all expenses and income arising from the operation of the business relating to the Assets acquired by Buyer after the Adjustment Time shall be for the account of Buyer.
(b) As soon as practicable following the Closing Date, or at such other time as the parties agree, Buyer shall deliver to Seller a certificate from Buyer which sets forth as of the Adjustment Time, all adjustments to be made as provided in Section 6(a) above (the "Buyer's Certificate"). Buyer shall provide Seller or its representatives access to copies of such portions of books and records Seller may reasonably request solely for the purposes of verifying such adjustments. The Buyer's Certificate shall be final and conclusive unless objected to by Seller in writing within ninety (90) days after delivery. Buyer and Seller shall attempt jointly to reach agreement as to the amount of the adjustments to be made hereunder within thirty (30) days after receipt of such written objection, which agreement, if achieved, shall be binding upon all parties to this Agreement and not subject to dispute or review.
(c) In the event of a disagreement between Buyer and Seller with respect to the accounting to be made hereunder, the parties agree that a public accounting firm chosen jointly by Buyer and Seller shall be the final arbiter of such disagreement.
(d) Any amounts due for the adjustments provided for herein shall be paid within thirty (30) business days after final determination.
7. Expenses.
(a) Seller and Buyer shall share equally the costs of preparation of the Deed, acknowledgement of the Deed, Federal, state and local revenue stamps, and real estate transfer taxes.
(b) All other costs and expenses incurred by the Parties in this transaction, including, but not limited to attorneys' fees, shall be paid by the party incurring them.
8. Closing; Closing Conditions.
(a) Closing of the transactions contemplated by this Agreement (the "Closing") shall occur at a place and time mutually agreeable to Seller and Buyer (the "Closing Date"). Seller and Buyer shall both make a good faith effort to close under this Agreement promptly.
(b) Seller's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Buyer being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or warranty is made as of a specified date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Buyer or any of its affiliates, which would render it unlawful as of the Closing Date to effect the transactions contemplated by this Agreement in accordance with its terms, (iv) the delivery by Buyer of the Purchase Price in the manner set forth in Section 4(b), and (v) the delivery by Buyer of Buyer's Closing Documents (as defined in Section 9 hereof) on or before the Closing Date.
(c) Buyer's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Seller being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or warranty is made as of a specific date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Seller or any of its affiliates, which would render it unlawful as of the Closing Date to effect that
transactions contemplated by this Agreement in accordance with its terms, and
(iv) the delivery by Seller of Seller's Closing Documents as set forth in
Section 9 hereof.
9. Closing Deliveries.
(a) At Closing, Seller shall execute and/or deliver to Buyer the following (collectively "Seller's Closing Documents"):
(i) The Deed;
(ii) The Assignment, Bill of Sale and Assumption Agreement;
(iii) A certificate from an officer of Seller reasonably acceptable to Buyer confirming the accuracy of the representations and warranties in Section 10 as of the Closing Date;
(iv) Authorizing resolutions or minutes from Seller approving this Agreement and the transactions contemplated herein;
(v) A FIRPTA affidavit to the effect that Seller is not a "foreign person" (as defined in Section 1445(f)(3) of the Code and the regulations issued thereunder); and
(vi) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit E (the "Lease Agreement").
(b) At Closing, Buyer shall execute and/or deliver to Seller the following (collectively "Buyer's Closing Documents"):
(i) Authorizing resolutions from Buyer approving this Agreement and the transactions contemplated herein;
(ii) A certificate from an officer of Buyer reasonably acceptable to Seller confirming the accuracy of the representations and warranties in Section 11 as of the Closing Date;
(iii) The Purchase Note executed by a duly authorized officer of Buyer;
(iv) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit E (the "Lease Agreement"); and
(v) The Assignment, Bill of Sale and Assumption Agreement.
(c) Seller's Closing Documents and Buyer's Closing Documents shall be collectively called herein the "Closing Documents". Buyer and Seller agree that such other
documents as may be legally necessary or appropriate to carry out the terms of this Agreement or as reasonably requested by the other party shall be executed and delivered by the appropriate party at Closing.
10. Representations and Warranties of Seller.
As a material inducement to Buyer to enter into this Agreement, Seller represents and warrants to Buyer as follows:
(a) Seller has good and marketable title to the Tower and the Land (or such condition of title as will be insured by any reputable title insurance company at their regular rates), and the Assets are free and clear of liens, encumbrances, restrictions and security interests other than Permitted Encumbrances.
(b) Seller has full power and authority to execute and deliver this Agreement and Seller's Closing Documents, and to perform its obligations hereunder and thereunder.
(c) This Agreement and Seller's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Seller, enforceable against Seller in accordance with their terms.
(d) The sale of the Assets shall not materially conflict with, or result in, a breach of the terms of any agreements or instruments to which the Seller is a party or which would result in the creation or imposition of any lien, charge or encumbrance on, or give to others any interest in or right to, any of the Assets.
(e) Seller has paid or will pay, at or prior to Closing, all outstanding obligations for utilities and taxes through the Closing Date except for such items as are covered by the proration of items of income and expense as set forth in Section 6 hereof.
(f) No third-party authorization or approval of, or filing with, any person, entity, or authority will be required in connection with the execution and delivery of this Agreement or the transactions contemplated by this Agreement.
(g) Assuming all consents and approvals required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Seller's compliance with, the terms and provisions of this Agreement will conflict with, or result in, a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Seller, or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Seller is subject or any material agreement or contract to which Seller is a party or to which it is subject, or constitute a material default thereunder.
(h) Seller is not a foreign person within the meaning of
Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and the
regulations issued thereunder.
11. Representations and Warranties of Buyer.
As a material inducement to Seller to enter into this Agreement, Buyer represents and warrants to Seller as follows:
(a) Buyer has full power and authority to execute and deliver this Agreement and Buyer's Closing Documents, and to perform its respective obligations hereunder and thereunder.
(b) This Agreement and Buyer's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Buyer enforceable against Buyer, in accordance with their terms.
(c) Assuming all consents and approvals required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Buyer's compliance with, the terms and provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Buyer or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Buyer is subject or any material agreement or contract to which Buyer is a party or to which it is subject, or constitute a material default thereunder.
12. Representations and Warranties Survive Closing.
All of the provisions of this Agreement and of the Closing Documents and all of the representations, warranties, considerations, and agreements contained herein and in the Closing Documents shall survive Closing and continue in full force and effect for a period of twelve (12) months from the Closing Date; provided that if a claim for indemnification is made by either party under Section 13 hereof within such twelve (12) month period, the provisions of Section 13 shall survive until resolution of such claim. No claim may be brought under this Agreement unless written notice describing in reasonable detail the nature of the claim is given on or prior to the last day of the twelve (12) month period following the Closing Date.
13. Indemnification.
(a) For a period of one (1) year from the date of this Agreement, Seller shall indemnify, defend, and hold Buyer, its affiliates, partners, employees, officers, directors, agents, and representatives harmless from and against any and all reasonable losses, costs, expenses, liabilities, penalties, claims, and other damages including, but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigation, reasonably incurred and resulting from:
(i) any breach of Seller's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Seller of any of its covenants or agreements contained herein or in any Seller's Closing Document;
(iii) the Retained Liabilities;
(iv) any and all losses, liabilities or damages resulting from Sellers' operations or ownership of any Tower Site prior to the Closing Date, including any and all liabilities arising under the Assets which relate to events occurring prior to the Closing Date.
(b) For a period of one (1) year from the date of this Agreement, Buyer shall indemnify, defend and hold Seller, its affiliates, employees, officers, directors, agents and representatives harmless from and against any and all losses, costs, expenses, liabilities, penalties, claims, and other damages, including but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigations, reasonably incurred and resulting from:
(i) any breach of Buyer's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Buyer of any of its covenants or agreements contained herein or in any Buyer's Closing Document;
(iii) the Assumed Liabilities;
(iv) any and all losses, liabilities or damages resulting from Buyer's operations or ownership of any Tower Site subsequent to the Closing Date, including any and all liabilities arising under the Assets which related to events occurring subsequent to the Closing Date.
(c) In the event either Buyer or Seller (the "Indemnified Party") becomes aware of circumstances which would entitle such party to indemnification by the other party hereunder (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party prompt written notice, with reasonable detail, of such claim. Upon receipt of such notice by the Indemnified Party to the Indemnifying Party, the Indemnifying Party shall have the option of defending against such pending litigation through engagement of legal counsel of its choice, provided, however, that the Indemnifying Party's choice of legal counsel must be acceptable to the Indemnified Party in its reasonable discretion. In the event the Indemnifying Party elects to defend, the Indemnifying Party shall keep the Indemnified Party fully informed on a timely basis of the status of the pending litigation. In the event that the Indemnifying Party elects to defend and is unsuccessful in such defense, it shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages as described above,
including but not limited to, reasonable attorney's fees and other costs and expenses associated with the pending litigation being so defended. In the event the Indemnifying Party elects not to defend and the Indemnified Party defends, but is unsuccessful, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages, as described above, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. In the event that Indemnifying Party elects not to defend and the Indemnified Party defends successfully, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all costs and expenses incurred, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. The Indemnifying Party shall reimburse the Indemnified Party upon demand for any payment made by the Indemnified Party at any time after Closing, based on the final judgement of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands or actions in respect to any damages to which the foregoing indemnification relates.
(d) Limitations on Seller Indemnification. Notwithstanding anything in this Agreement to the contrary, Seller's obligation to indemnify Buyer shall be subject to all of the following limitations:
(i) The amount of any losses, costs, expenses, liabilities, penalties, claims, and other damages ("Losses") incurred by Buyer shall be reduced by (A) the amount Buyer recovers (after deducting all attorneys' fees, expenses, and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Buyer shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Buyer shall be entitled to indemnification only for Losses as to which Buyer has given Seller written notice describing in reasonable detail the nature and basis for such indemnification ("Notice of Claim") on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Buyer by Seller pursuant to this Section 13 shall be limited to Forty Thousand Dollars ($40,000.00) and Seller shall have no other liability or responsibility for indemnification hereunder.
(e) Buyer's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Buyer with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
(f) Limitation on Buyer's Indemnification. Notwithstanding anything in this Agreement to the contrary, Buyer's obligation to indemnify Seller shall be subject to all of the following limitations:
(i) The amount of any Losses incurred by Seller shall be reduced by (A) the amount Seller recovers (after deducting all attorneys' fees, expenses and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Seller shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Seller shall be entitled to indemnification only for Losses as to which Seller has given Buyer a Notice of Claim on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Seller by Buyer pursuant to this Section 13 shall be limited to Forty Thousand Dollars ($40,000.00) and Buyer shall have no other liability or responsibility for Indemnification hereunder.
(g) Seller's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Seller with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
14. Termination; Liquidated Damages.
(a) Right of Termination. This Agreement may be terminated prior to Closing:
(i) By written notice from a party that is not then in material breach of this Agreement if:
(A) The other party has continued in material breach of this Agreement for twenty (20) days after written notice of such breach from the terminating party;
(B) Closing does not occur by May 31, 2000 or such other date as is mutually agreed to by Buyer and Seller.
(b) Obligations Upon Termination.
(i) Upon termination of this Agreement, each party shall thereafter remain liable for breach of this Agreement prior to such termination and remain liable to pay and perform any obligation under Section 13.
(ii) If Closing shall not have occurred, Seller's sole remedy at law or in equity for any breach or default by Buyer described in Section 14(a)(i)(A) shall be the termination by Seller of this Agreement by giving of written notice to Buyer pursuant to Section 14(a)(i)(A).
(c) Termination Notice. Each notice given by a party pursuant to Section 14(a) to terminate this Agreement shall specify the subsection of Section 14(a) pursuant to which such notice is given. If at the time a party gives a termination notice, such party is entitled to give such notice pursuant to more than one subsection of Section 14(a), the subsection pursuant to which such notice is given and termination is effected shall be deemed to be the subsection specified in such notice provided that the party giving such notice is at such time entitled to terminate this Agreement pursuant to the specified subsection.
15. Default; Disputes.
If Seller fails to perform under this Agreement, the Buyer may exercise any right he has against the Seller, including bringing an action for specific performance. The remedies provided by this Section are in addition to any right or remedies provided elsewhere in this Agreement or at law or in equity. In the event a dispute arises between the Parties over the interpretation of this Agreement, or the performance, alleged non-performance or breach by either Party hereunder, the Parties hereby agree to seek resolution of such dispute in good faith through an alternative dispute resolution process mutually agreeable to the Parties prior to the institution of any legal proceedings related thereto.
16. Liabilities.
Buyer shall not, in connection with the purchase and sale of Assets contemplating herein, assume any liabilities or obligations of the Seller except as specifically set forth herein.
17. Third Party Brokerage.
Seller and Buyer hereby represent and warrant to each other that neither Seller or Buyer has dealt with any broker or finder in connection with the transaction which is the subject of this Agreement. Each party hereby agrees to indemnify, save harmless and defend the other from and against all claims, losses, liabilities and expenses, including reasonable attorney's fees, arising out of any claim made by any broker, finder or other intermediary who claims to have dealt with such party in connection with the transaction which is the subject of this Agreement. The provisions of the paragraph shall survive Closing hereunder.
18. Entire Agreement.
This Agreement (which includes the exhibits and schedules attached hereto) constitutes the entire agreement between the Parties and there are no other understandings, representations or warranties, oral or written, relating to the subject matter hereof.
19. Amendment.
This Agreement may not be changed, modified or amended, in whole or in part, except in writing, signed by all parties.
20. Notice.
Notices given pursuant to this Agreement shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this Section. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Seller: Beasley Broadcasting of Eastern
Pennsylvania, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax:(941) 434-8950
If to the Buyer: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
Fax:(941) 434-8950
|
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax:(202) 637-2201
21. Construction.
Whenever used in this Agreement the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.
22. Assignment and Recording.
Seller hereby covenants not to assign or record this Agreement except with the prior written consent of the Buyer. Buyer may assign this Agreement freely to any affiliated entity, provided such assignment shall not relieve Buyer of its obligations hereunder.
23. Binding Effect.
This Agreement and all of its terms and conditions shall extend to and be binding upon the Parties hereto and upon their respective heirs, executors, administrators, successors and assigns.
24. Further Assurances.
Seller and Buyer agree to execute and deliver any further documents or assurances that in law or otherwise are necessary, desirable or proper to consummate the transactions contemplated by this Agreement and to vest, perfect, assign or confirm, of record or otherwise, in Buyer title to the Assets.
25. Governing Law.
This Agreement is made and shall be governed by and construed in accordance with the internal laws of the Commonwealth of Pennsylvania.
26. Headings.
The headings and captions in this Agreement are for convenience only and are not part of this Agreement.
27. Interpretation.
Neither this Agreement nor any provision contained herein shall be interpreted for or against either party solely because that party or that party's legal representative drafted the provision.
28. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute the same Agreement.
29. Severability.
If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be severed from this Agreement and the remainder shall remain in full force and effect.
30. Covenant of Seller.
Seller shall make all reasonable efforts to resolve any title or restriction issues prior to the Closing, but will continue these efforts subsequent to the Closing to the extent reasonably necessary.
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound, have caused this Agreement to be duly executed on the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF
EASTERN PENNSYLVANIA, INC.
By:
---------------------------------------
Name: George G. Beasley
Title: Chief Executive Officer
|
BUYER:
BEASLEY FAMILY TOWERS, INC.
By:
---------------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
INDEX OF EXHIBITS
Exhibit A Description of Land and Towers
Exhibit B Form of Purchase Note
Exhibit C Form of Deed
Exhibit D Form of Assignment, Bill of Sale and
Assumption Agreement
Exhibit E Form of Lease Agreement
|
EXHIBIT A
DESCRIPTION OF LAND AND TOWERS
WWDB-AM
Those four certain communications towers used in the operation of WWDB-AM situated on that certain tract of land more particularly described as follows:
ALL THAT CERTAIN lot or piece of ground situate in the Township of East Norriton, County of Montgomery and Commonwealth of Pennsylvania, bounded and described according to a Sub-division Plan of East Norriton Industrial Park made by Donald H. Schurr, Civil Engineer and Surveyor, Norristown, Pennsylvania, dated 3/9/1967 and last revised 4/14/1967 as follows, to wit:
BEGINNING at a point in the bed of 50 feet wide access and drainage right-of-way on the Southeasterly side of Foundry Road (60 feet wide) said point being measured the two following courses and distances from a point of curve on the Southwesterly side of Germantown Pike (75 feet wide): (1) along the arc of a circle curving to the left having a radius of 20 feet the arc distance of 31.42 feet to a point of tangent on the Southeasterly side of Foundry Road and (2) South 22 degrees 12 minutes 15 seconds West along the southwesterly side of Foundry Road 295.00 feet to the point of beginning; thence extending from said point of beginning through the bed of said 50 feet wide access and drainage right-of-way along the rear lines of lots Nos. 1, 2, 3, 4 and partly along rear line of Lot No. 5, South 67 degrees 47 minutes 45 seconds East, crossing over the bed of a 30 feet wide drainage easement, and crossing over the bed of an existing creek, 936.77 feet to a point on rear line of said Lot No. 5 and in the bed of a 50 feet wide access and drainage right-of-way; thence extending along the same along the arc of a circle curving to the left having a radius of 275 feet the arc distance of 110.03 feet to a point on line of Lot No. 7 and on the Easterly side of a 20 feet wide drainage easement; thence extending along the same South 22 degrees 12 minutes 15 seconds West 185.88 feet to an iron pin a corner of lands now or late of Frederick Muller; thence extending along the same South 45 degrees 42 minutes 15 seconds West, crossing over the bed of the aforesaid 30 feet wide drainage easement, 421.52 feet to an iron pin a corner of lands now or late of Hownet Corporation; thence extending along the same the next two following courses and distances, viz: (1) North 48 degrees 50 minutes 07 seconds East 67.95 feet to a point of curve; and (2) along the arc of a circle curving to the left having a radius of 535 feet the arc distance of 248.67 feet to the first mentioned point and place of beginning.
BEING Lot No. 8 on the above mentioned Plan.
BEING Parcel No. 33-00-02752-00-5.
BEING the same premises which Mid-Central Associates, Inc., a Pennsylvania Corporation, by Indenture bearing date the 12th day of September, A.D., 1967, recorded in the Office for the Recording of Deeds, in and for the County of Montgomery, at Norristown, Pennsylvania, in Deed
Book 3484 page 806, granted and conveyed unto WTEL, Inc., a Delaware corporation, its successors and assigns, in fee and being on the same premises acquired by Grantor by deed dated October 31, 1986, recorded in Deed Book 4818 page 1634 in the Office of the Recorder of Deeds, County of Montgomery, Pennsylvania.
TOGETHER WITH THE free and uninterrupted use, right, liberty and privilege of the above said 50 feet wide access and drainage rights-of-way in common with the owners, tenants and occupiers of other lots of ground abutting thereon and entitled to the use thereof; SUBJECT, however, to the payment of the expenses in maintaining same in good order and repair.
UNDER AND SUBJECT to covenants, conditions, restrictions, and easements of record, if any, as are now valid and enforceable.
EXHIBIT B
FORM OF PURCHASE NOTE
$336,101.00 February ___, 2000
BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Payor"), for value received, promises to pay to the order of Beasley Broadcasting of Eastern Pennsylvania, a Delaware Corporation, ("Payee"), the principal amount of THREE HUNDRED THIRTY-SIX THOUSAND ONE HUNDRED ONE DOLLARS ($336,101.00), together with accrued interest thereon, calculated and payable as set forth below in this Note. The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement of Sale (the "Sale Agreement"), dated February ____, 2000, by and among Payor and Payee.
1. Payment of Principal and Interest.
(a) Calculation and Payment of Interest. Interest on the principal balance of this Note outstanding from time to time until paid in full shall accrue at the rate of six and seventy-seven one hundredths percent (6.77%) compounded annually (the "Rate"), computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof.
(b) Payments Prior to Maturity Date. On the first day of each month Maker shall pay TWO THOUSAND FIVE HUNDRED FORTY FIVE DOLLARS AND TWENTY-THREE CENTS ($2,545.23). All remaining principal, together with accrued and unpaid interest thereon shall be due and payable on the "Maturity Date" (defined below). Each monthly payment shall be credited first to interest then accrued and the remainder, if any, to principal, and interest shall thereupon cease to accrue upon the principal paid.
(c) Payment on Maturity Date. The principal balance of, and any accrued and unpaid interest on, this Note shall be payable twenty (20) years from the effective date of this Note (such date the "Maturity Date").
(d) Prepayment.
(i) Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this Note.
(ii) Any prepayment of this Note shall be applied as follows: first, to payment of accrued interest; and second, to payment of principal.
2. Events of Default.
The following shall constitute "Events of Default" under this Note:
(a) Failure by Payor to make any payment required under
this Note when the same shall become due and payable
(whether at maturity or otherwise) and the
continuation of such failure for a period of ninety
(90) days; or
(b) Payor pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for all or any substantial portion of its property or assets;
(iv) makes a general assignment for the benefit of its creditors; or
(c) an involuntary case or proceeding is commenced against Payor under any Bankruptcy Law and is not dismissed, bonded or discharged within ninety (90) days thereafter, or a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against Payor in an involuntary case or proceeding;
(ii) appoints a Custodian of Payor or for all or substantially all of its properties; or
(iii) orders the liquidation of Payor; and in each case the order or decree remains unstayed and in effect for ninety (90) days.
(d) The following terms used in this Note have the meanings assigned below:
"Bankruptcy Law" means Title 11, United States Code, or any similar federal, state or foreign law for the relief of debtors or any arrangement, reorganization, assignment for the benefit of creditors or any other marshalling of the assets and liabilities of Payor.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
"Event of Default" means any of the occurrences specified in Section 2 of this Note.
If any Event of Default shall have occurred and be continuing, Payee may proceed to protect and enforce its rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to Payee under this Note.
3. Assignment. The holders of this Note may not assign or otherwise transfer all or any portion of their rights and obligations under this Note to any other person or entity, without the prior written consent of the Payor, which consent shall not be unreasonably withheld.
4. Miscellaneous.
(a) Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
(b) Amendment and Waiver. No provision of this Note may be amended or waived unless Payor shall have obtained the written agreement of Payee. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c) Successors, Assigns and Transferors. The foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
(d) Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the Commonwealth of Pennsylvania, without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction.
(e) Notices. Any notice, request, instruction or other
document to be given hereunder by either party to the other shall be in writing
and shall be deemed given when received and shall be (i) delivered personally
or (ii) mailed by certified mail, postage prepaid, return receipt requested or
(iii) delivered by Federal Express or a similar overnight courier or (iv) sent
via facsimile transmission to the fax number given below, as follows:
If to Payor, addressed to:
Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Fax:(941) 434-8950
With a copy to:
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Attn: Joseph D. Sullivan, Esq.
Fax:(202) 637-2201
If to Payee, addressed to:
Beasley Broadcasting of Eastern
Pennsylvania, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Fax:(941) 434-8950
or to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
BEASLEY FAMILY TOWERS, INC.
By:
-------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
EXHIBIT C
FORM OF DEED
EXHIBIT D
FORM OF ASSIGNMENT, BILL OF
SALE AND ASSUMPTION AGREEMENT
This Assignment, Bill of Sale and Assumption Agreement (this "Agreement") is
made effective as of 12:01 a.m. Eastern Time, on the ____ day of February, 2000
by and between BEASLEY BROADCASTING OF EASTERN PENNSYLVANIA, INC. ("Seller")
and BEASLEY FAMILY TOWERS, INC. ("Purchaser").
RECITALS
A. Reference is made to that certain Agreement of Sale (the "Asset Purchase Agreement") dated as of February ___, 2000 by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings given such terms in the Asset Purchase Agreement.
B. The Asset Purchase Agreement provides that Seller shall sell, convey and assign to Purchaser all of Seller's right, title and interest to the Tower and Tower Leases and Purchaser shall assume the Assumed Liabilities, as defined in Section 2 of the Asset Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows (capitalized terms used herein but not defined herein shall have the meaning given to them in the Asset Purchase Agreement):
1. Seller hereby bargains, sells, conveys, assigns and delivers all of Seller's right, title and interest in and to the Towers, such Tower more particularly described in Exhibit A of the Asset Purchase Agreement.
2. Purchaser hereby accepts the sale, conveyance and assignment of the Towers, effective as of 12:01 a.m. Eastern Time on February __, 2000.
3. Purchaser hereby assumes and agrees to pay and perform the Assumed Liabilities pursuant to Section 2 of the Asset Purchase Agreement, effective as of 12:01 a.m. Eastern Time on February __, 2000.
4. After the date hereof, Purchaser and Seller will, at the request of the other party, promptly obtain, execute and deliver, or cause to be obtained, executed and delivered, to the other party such assignments, bills of sale, endorsements, and other such instruments or documents to be executed by Seller or Purchaser, as the case may be, in addition to this Agreement, in form and substance reasonably satisfactory to the other party, as such other party may reasonably deem necessary or desirable so as (i) to vest in Purchaser title to and possession of the Towers and (ii) to perfect and record, if necessary, the sale, assignment, conveyance, transfer and delivery to Purchaser of the Towers.
5. This Agreement is made pursuant to, and is subject to all of the terms, representations, warranties and covenants of, the Asset Purchase Agreement, the terms of which are hereby incorporated by reference. In the event of any conflict between this Agreement and the Asset Purchase Agreement, the terms of the Asset Purchase Agreement shall govern.
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this Agreement as of the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF EASTERN
PENNSYLVANIA, INC.
By:
--------------------------------------
Name: George G. Beasley
Title: Chief Executive Officer
|
PURCHASER:
BEASLEY FAMILY TOWERS, INC.
By:
--------------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
EXHIBIT E
FORM OF LEASE AGREEMENT
LEASE AGREEMENT (O&O - WWDB-AM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY BROADCASTING OF EASTERN PENNSYLVANIA, a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns four communications towers described on Exhibit A attached hereto (the "Towers"), together with other improvements on a certain tract of real estate located at East Norriton, Pennsylvania, as such land is more fully described in Exhibit B attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements or improvements on such land, including, without limitation, any buildings or other structures);
WHEREAS, Lessor desires to lease the Tower Site and the Towers for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower Site and Towers from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee leases from Lessor, with a right of access thereto and parking therefor in accordance with Section 9:
(a) The Towers for the purpose of the broadcast transmission of WWDB-AM, East Norriton, Pennsylvania;
(b) Space in the transmitter building on the Tower Site, as such space is more fully described in Exhibit C hereto (the "Transmitter Building"), for the purposes of the housing, operation and maintenance of Lessee's transmitter and related equipment by
Lessee in the Building for the aforementioned purposes immediately prior to the effective date of this Lease (such space "Lessee's Building Space"); and
(c) Space in the transmitter building on the Tower Site, as such space is more fully described in Exhibit C hereto (the "Building"), for the purposes of the housing, operation and maintenance of Lessee's transmitter and related equipment (such space "lessee's Building Space"); and
(d) The Tower Site.
(e) All of the property leased under this Paragraph 2.01 shall hereinafter be called the "Leased Premises".
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below), all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Leased Premises after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain Lessee's Property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Leased Premises at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Leased Premises for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Leased Premises may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Towers. Lessee may repair and maintain equipment as it reasonably deems necessary to its operations within Lessee's Space in all respects in compliance with the terms hereof. Lessee shall maintain the Leased Premises, Lessee's
interior and exterior equipment, and all other improvements in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to
Lessee in this Lease and with prior notice to Lessee and no loss of service or
interruption (beyond a temporary, non-recurring and de minimis amount), Lessor
reserves the right to use the Towers, at its own expense, as it sees fit and to
fasten additional equipment to the Towers for any purpose, including the right
to install transmitting and/or receiving antennas of others; provided that
Lessor shall use reasonable efforts to restrict any loss of Lessee's service or
interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00
a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Towers to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made to the following schedule:
Lease Rent Per Year Lease Year Monthly Rent ---------------------------------------- 1 $30,542.76 $2,545.23 ---------------------------------------- 2 $30,542.76 $2,545.23 ---------------------------------------- 3 $30,542.76 $2,545.23 ---------------------------------------- 4 $30,542.76 $2,545.23 ---------------------------------------- 5 $30,542.76 $2,545.23 ---------------------------------------- 6 $30,542.76 $2,545.23 ---------------------------------------- 7 $30,542.76 $2,545.23 ---------------------------------------- 8 $30,542.76 $2,545.23 ---------------------------------------- 9 $30,542.76 $2,545.23 ---------------------------------------- 10 $30,542.76 $2,545.23 ---------------------------------------- 11 $30,542.76 $2,545.23 ---------------------------------------- 12 $30,542.76 $2,545.23 ---------------------------------------- 13 $30,542.76 $2,545.23 ---------------------------------------- 14 $30,542.76 $2,545.23 ---------------------------------------- 15 $30,542.76 $2,545.23 ---------------------------------------- 16 $30,542.76 $2,545.23 ---------------------------------------- 17 $30,542.76 $2,545.23 ---------------------------------------- 18 $30,542.76 $2,545.23 ---------------------------------------- 19 $30,542.76 $2,545.23 ---------------------------------------- 20 $30,542.76 $2,545.23 ---------------------------------------- |
5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated _______, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Towers used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Towers for the Towers lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and
stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Leased Premises, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Towers and Building Transmitter except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF LEASED PREMISES AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to the Towers and Transmitter Building. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Towers, the Building, and the Tower Site, or the prevention of interference with Lessor or any other user of the Towers
or any other broadcaster, Lessor may, at its option, make such emergency repairs to the Leased Premises as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Towers, the Transmitter Building and the Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Towers unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Towers (including any ascension of the Towers), in the Transmitter Building, or in or about the Tower Site, Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the
National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Leased Premises to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. USE AND MAINTENANCE OF COMMON PREMISES.
9.01 USE OF COMMON PREMISES. Lessee, at its own risk, shall have the right to use in common with Lessor and its licensees, invitees, and other tenants, and in connection with Lessee's permissible activities and operations (a) any access road from any public highway to the Tower Site or to any building on the Tower Site; (b) any parking lot on the Tower Site; and (c) all common areas in the building (such items (a), (b) and (c) called collectively herein the "Common Premises").
9.02 MAINTENANCE OF COMMON PREMISES.
(a) Lessor shall maintain the Common Premises and any fence around the Towers in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the Towers. Lessor shall maintain the Towers and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs, alterations, or improvements are necessary or desirable to the Towers or any building or structure constructed by Lessor on the Tower Site, any common areas, or the leased spaces of other tenants, Lessor may, upon reasonable notice and for the shortest practical period of time (except for emergency situations), close entrance doors, common areas, drive-ways, rights-of-way, service areas, parking areas, or any other facilities at its discretion without being liable to Lessee; provided that if any of the above would restrict Lessee's ability to broadcast, Lessor shall use reasonable efforts to restrict any closure or interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00 a.m.. The closing of entrances, doors, common areas, parking areas, or other facilities for the making of the repairs, alterations, or improvements described herein shall, under no circumstances, constitute an eviction of the Lessee or be grounds for termination of this Lease or the withholding of any rental payments or other payments or performances required to be paid or made by Lessee under the terms hereof, provided, Lessor shall use reasonable efforts to ensure that any action taken in accordance with this paragraph shall not adversely affect the rights of Lessee hereunder. Under no such circumstances shall Lessee be entitled to terminate this Lease nor shall it be entitled to compensation for any loss or damage it may sustain (including loss of use, loss of advertising/sponsorship revenues, and consequential damages) by reason of such changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Towers, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine the loading capacity of the Towers, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any
proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Leased Premises or on the Towers after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of Tower space whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Towers, Tower Site or any building shall provide that, should the installation, operation, or maintenance of the equipment or
the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Towers, Tower Site or the Transmitter Building shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Towers shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate
taxes, assessments, or levies assessed or imposed against the Leased Premises.
[Foregoing obligation is subject to $200,000 12-month limit when aggregated
with other borrowers under Credit Agreement per 1.5D of First Amendment to
Credit Agreement] Lessee shall pay all personal property or other taxes
assessed or imposed on Lessee's Property, and shall cooperate with Lessor to
ensure that such property is properly separated from that of Lessor or other
tenants for assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Leased Premises, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Towers elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 INSURANCE ON THE TOWERS AND TRANSMITTER Building. Lessee shall procure and maintain physical damage insurance on the Towers and any building on the Tower Site used or leased by Lessee pursuant to this Lease in an amount sufficient to repair or replace the Towers and any such building with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWERS AND/OR BUILDING DAMAGE. In the event that the Towers or the Transmitter Building are destroyed or damaged by fire, lightning, windstorm, flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or other casualty covered by insurance, Lessor shall promptly reconstruct or repair the Towers and/or the Transmitter Building to such good condition as existed before the destruction or damage, and give possession to Lessee of substantially the same space leased hereunder. Lessee shall promptly pay over to Lessor any insurance proceeds it receives from insurance policies Lessee is required to procure under Section 14.03 hereof for the purpose of use by Lessor to fund reconstruction of the Towers and/or Transmitter Buildings as required of Lessor under this Section 14.04. If the Towers or the Transmitter Building are in need of such repair or is so damaged by fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle damage, collapse, or other casualty that reconstruction or repair cannot reasonably be undertaken without dismantling Lessee's antenna, then upon written notice to Lessee, Lessor may remove any such antenna and interrupt the signal
activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably possible. Lessor agrees to provide Lessee an alternative tower or transmitter building if available, during such reconstruction/repair period. If such towers or space in another transmitter building on the Tower Site is not available, then Lessee shall be responsible for procuring its own alternative towers. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Towers without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Towers and/or Transmitter Building or (b) replace the Towers and/or Transmitter Building within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to damage to the Towers (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that the Tower Site (or any portion of the Tower Site necessary for the Towers, Transmitter Building, guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for any of the Towers and/or the Transmitter Building on the condemned property, Lessor agrees to lease to Lessee the new towers and/or transmitter building on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Leased Premises within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Leased Premises after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after
written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Leased Premises, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Leased Premises by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Leased Premises. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Leased Premises (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the Commonwealth of Pennsylvania at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees;
(d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for
indemnity, and the Indemnifying Party shall have the right and opportunity to
undertake the legal defense of such claims. The Indemnified Party and its
counsel may nevertheless participate in (but not control) such proceedings,
negotiations, or defense at its own expense. In all such cases, the Indemnified
Party will give all reasonable assistance to the Indemnifying Party, including
making the Indemnified Party's employees and documents available as reasonably
requested without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after
either party's request, the other party shall deliver, executed in recordable
form, a declaration to any person designated by the requesting party (a)
ratifying this Lease; (b) stating the commencement and termination dates; and
(c) certifying (i) that this Lease is in full force and effect, and has not
been assigned, modified, supplemented, or amended (except by such writings as
shall be stated); (ii) that all conditions under this Lease to be performed
have been satisfied (stating exceptions, if any); (iii) that no defenses or
offsets against the enforcement of this Lease by the requesting party exist (or
stating those claimed); (iv) advance rent, if any, paid by Lessee; (v) the date
to which rent has been paid; (vi) the amount of security deposited with Lessor
(if hereafter applicable for any reason); and (vii) such other information as
the requesting party reasonably requires. Persons receiving such statements
shall be entitled to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Leased Premises, or, if any of the Leased Premises or any building thereon comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the Commonwealth of Pennsylvania.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one-half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from
all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: 941) 263-5000
Fax:(941) 434-8950
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With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax:(202) 637-2201
If to the Lessee: Beasley Broadcasting of Eastern Pennsylvania
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax:(941) 434-8950
17
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21.08 WAIVER. It is agreed that the waiving of any of the
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covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Towers, Building, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Towers, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Leased Premises; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Towers, Building, and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Leased Premises or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of
delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: ` LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
----------------------- ----------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
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LESSEE:
BEASLEY BROADCASTING OF EASTERN
PENNSYLVANIA, INC.
By: (SEAL)
----------------------- ----------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
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EXHIBIT A
DESCRIPTION OF TOWERS
WWDB-AM
(1) Four communication towers used in the operation of WWDB-AM situated on that certain tract of land more particularly described on Exhibit B herein.
EXHIBIT B
DESCRIPTION OF TOWER SITE
WWDB-AM
That certain tract of land more particularly described as follows:
ALL THAT CERTAIN lot or piece of ground situate in the Township of East Norriton, County of Montgomery and Commonwealth of Pennsylvania, bounded and described according to a Sub-division Plan of East Norriton Industrial Park made by Donald H. Schurr, Civil Engineer and Surveyor, Norristown, Pennsylvania, dated 3/9/1967 and last revised 4/14/1967 as follows, to wit:
BEGINNING at a point in the bed of 50 feet wide access and drainage right-of-way on the Southeasterly side of Foundry Road (60 feet wide) said point being measured the two following courses and distances from a point of curve on the Southwesterly side of Germantown Pike (75 feet wide): (1) along the arc of a circle curving to the left having a radius of 20 feet the arc distance of 31.42 feet to a point of tangent on the Southeasterly side of Foundry Road and (2) South 22 degrees 12 minutes 15 seconds West along the southwesterly side of Foundry Road 295.00 feet to the point of beginning; thence extending from said point of beginning through the bed of said 50 feet wide access and drainage right-of-way along the rear lines of lots Nos. 1, 2, 3, 4 and partly along rear line of Lot No. 5, South 67 degrees 47 minutes 45 seconds East, crossing over the bed of a 30 feet wide drainage easement, and crossing over the bed of an existing creek, 936.77 feet to a point on rear line of said Lot No. 5 and in the bed of a 50 feet wide access and drainage right-of-way; thence extending along the same along the arc of a circle curving to the left having a radius of 275 feet the arc distance of 110.03 feet to a point on line of Lot No. 7 and on the Easterly side of a 20 feet wide drainage easement; thence extending along the same South 22 degrees 12 minutes 15 seconds West 185.88 feet to an iron pin a corner of lands now or late of Frederick Muller; thence extending along the same South 45 degrees 42 minutes 15 seconds West, crossing over the bed of the aforesaid 30 feet wide drainage easement, 421.52 feet to an iron pin a corner of lands now or late of Hownet Corporation; thence extending along the same the next two following courses and distances, viz: (1) North 48 degrees 50 minutes 07 seconds East 67.95 feet to a point of curve; and (2) along the arc of a circle curving to the left having a radius of 535 feet the arc distance of 248.67 feet to the first mentioned point and place of beginning.
BEING Lot No. 8 on the above mentioned Plan.
BEING Parcel No. 33-00-02752-00-5.
BEING the same premises which Mid-Central Associates, Inc., a Pennsylvania corporation, by Indenture bearing date the 12th day of September, A.D., 1967, recorded in the Office for the Recording of Deeds, in and for the County of Montgomery, at Norristown, Pennsylvania, in Deed Book 3484 page 806, granted and conveyed unto WTEL, Inc., a Delaware corporation, its successors and assigns, in fee and being on the same premises acquired by Grantor by deed dated
October 31, 1986, recorded in Deed Book 4818 page 1634 in the Office of the Recorder of Deeds, County of Montgomery, Pennsylvania.
EXHIBIT C
[DIAGRAM OR DESCRIPTION OF LESSEE'S
SPACE IN THE TRANSMITTER BUILDING]
EXHIBIT 10.18
AGREEMENT OF SALE (OT/LL)
This Agreement of Sale (the "Agreement") is made this ___ day of February, 2000, between Beasley Broadcasting of Coastal Carolina, Inc., a Delaware corporation (the "Seller"), and Beasley Family Towers Inc., a Delaware corporation (the "Buyer") (together, the "Parties").
WITNESSETH:
WHEREAS, Seller owns certain communications towers used in the operation of radio broadcast station WNCT-AM (the "Towers"), such Towers situated on a certain tract of land which Seller leases from a third party (such tract of land called herein the "Tower Site"), the Towers and the Tower Site are more particularly described on Exhibit A hereto attached hereto;
WHEREAS, Seller desires to sell and Buyer desires to purchase the Towers certain personal property belonging to Seller and associated with the Tower Site;
NOW, THEREFORE, in consideration of the mutual premises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
1. Agreement to Sell and Purchase.
Seller agrees to sell, transfer, assign, convey and deliver to Buyer and Buyer agrees to purchase and accept from Seller, the following assets upon the terms and conditions contained herein (collectively, the "Assets"):
(a) The Tower; and
(b) The ground lease for the Tower Site (the "Ground Lease"), such Ground Lease attached as Exhibit B hereto and incorporated herein.
2. Assumption of Liabilities
(a) Upon the terms and subject to the conditions contained herein, Buyer shall assume and become responsible for any and all liabilities and obligations arising out of, or relating to events occurring after 12:01 am Eastern Standard Time on the Closing Date (the "Adjustment Time"), under the Ground Lease, and with respect to the ownership of the Tower, and the operation of the business relating to the Assets (collectively, the "Assumed Liabilities").
(b) Subject to the provisions of Section 13 hereof, it is understood and agreed that all liabilities to third parties relating to the Assets that arise out of any act, event, or transaction of Seller or the ownership of the Assets or the operation of the business relating to the Assets prior to the Closing Date (the "Retained Liabilities") shall remain the responsibility of Seller. Buyer shall not be required to defend any suit or claim arising out of any Retained Liabilities, and subject to Section 13 hereof Seller shall and hereby agrees to satisfy in due course all such Retained Liabilities, and Seller shall protect and forever hold Buyer harmless from all
claims with respect to such Retained Liabilities. Subject to the provisions of
Section 13 hereof, it is understood and agreed that all liabilities relating to
the Assets that arise out of any act, event, or transaction of Buyer following
the Closing Date (the "Assumed Liabilities") shall be the responsibility of
Buyer. Seller shall not be required to defend any suit or claim arising out of
any Assumed Liabilities, and Buyer shall and hereby agrees to satisfy in due
course all such Assumed Liabilities, and subject to Section 13 hereof Buyer
shall protect and forever hold Seller harmless from all claims with respect to
such Assumed Liabilities.
3. Purchase Price.
(a) The purchase price for the Assets shall be the amount of Two Hundred Seventy-Six Thousand Seven Hundred and Sixty Dollars ($276,760.00) (the "Purchase Price"). The Purchase Price shall be adjusted at the Closing by the amount of any prorations derived by operation of Section 6 hereof, and for any other normal income and expense items related to the operation of the Tower Site as of 12:01 am on the day on which the Closing occurs. The Purchase Price shall be allocated among the Assets in accordance with Section 3(b).
(b) Buyer and Seller agree to allocate the aggregate of the Purchase Price, the Assumed Liabilities and other relevant items among the Assets in accordance with section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"). Buyer and Seller will each report the federal, state, and local and other tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Form 8594) in a manner consistent with such allocation.
4. Delivery of Purchase Price.
(a) The Purchase Price shall be payable at Closing (as defined in Section 8 below) in the manner set forth in Section 4(b).
(b) As payment of the Purchase, Price Buyer shall deliver to Seller at Closing an unsecured promissory note of Buyer in the aggregate principal amount of Two Hundred Seventy-Six Thousand Seven Hundred and Sixty Dollars ($276,760.00), substantially in the form of Exhibit C (the "Purchase Note").
5. Transfer of Assets.
(a) Transfer of ownership of the Tower and assumption of the Assumed Liabilities (except for the Ground Lease, which shall be transferred according to Section 5(c) below) pursuant to Section 2 hereof shall be pursuant to the Assignment, Bill of Sale and Assumption Agreement from the Seller to Buyer in the form of Exhibit D attached hereto and incorporated herein (the "Assignment, Bill of Sale and Assumption Agreement").
(b) The Assets shall be transferred to Buyer free and clear of all liens, encumbrances other than Permitted Encumbrances, if any. "Permitted Encumbrances" shall mean: (i) encumbrances for taxes, assessments, or governmental charges or levies which are not yet due and payable, or that, subject to adequate security for payment, are being contested; (ii) existing building restrictions, ordinances, easements of roads, privileges, or rights of public
service companies or other rights of way, other restrictions or conditions of
record, if any or other encumbrances disclosed in this Agreement (including the
Exhibits attached hereto); (iii) easements, rights of way or other encumbrances
that do not have a material adverse effect on the Assets or the operation of the
business relating to the Assets as currently operated; (iv) encumbrances imposed
by law, such as materialmen's, mechanic's, carrier's, workmen's, or repairmen's
liens or other similar encumbrances attaching in the ordinary course of business
or securing obligations that are not overdue; (v) encumbrances securing
indebtedness, which will be removed prior to or at the Closing; and (vi)
encumbrances pursuant to contracts and leases to be assumed by Buyer pursuant to
Section 2.
(c) Assumption of the Ground Lease pursuant to Section 2 hereof shall be pursuant to the Ground Lease Assignment and Assumption Agreement from Seller to Buyer in the form of Exhibit E attached hereto and incorporated herein (the "Ground Lease Assignment and Assumption Agreement").
6. Apportionment of Real Estate Taxes, Rent, Utilities.
(a) Current real estate taxes, rent, utilities and all other normal income and expense items related to the Assets shall be apportioned between the parties to reflect the principle that all expenses and income arising from the operation of the Assets up through the Adjustment Time shall be for the account of Seller, and all expenses and income arising from the operation of the business relating to the Assets acquired by Buyer after the Adjustment Time shall be for the account of Buyer.
(b) As soon as practicable following the Closing Date, or
at such other time as the parties agree, Buyer shall deliver to Seller a
certificate from Buyer which sets forth as of the Adjustment Time, all
adjustments to be made as provided in Section 6(a) above (the "Buyer's
Certificate"). Buyer shall provide Seller or its representatives access to
copies of such portions of books and records Seller may reasonably request
solely for the purposes of verifying such adjustments. The Buyer's Certificate
shall be final and conclusive unless objected to by Seller in writing within
ninety (90) days after delivery. Buyer and Seller shall attempt jointly to reach
agreement as to the amount of the adjustments to be made hereunder within thirty
(30) days after receipt of such written objection, which agreement, if achieved,
shall be binding upon all parties to this Agreement and not subject to dispute
or review.
(c) In the event of a disagreement between Buyer and Seller with respect to the accounting to be made hereunder, the parties agree that a public accounting firm chosen jointly by Buyer and Seller shall be the final arbiter of such disagreement.
(d) Any amounts due for the adjustments provided for herein shall be paid within thirty (30) business days after final determination.
7. Expenses. All costs and expenses incurred by the Parties in this transaction, including, but not limited to attorneys' fees, shall be paid by the party incurring them.
8. Closing; Closing Conditions.
(a) Closing of the transactions contemplated by this Agreement (the "Closing") shall occur at a place and time mutually agreeable to Seller and Buyer (the "Closing Date"). Seller and Buyer shall both make a good faith effort to close under this Agreement promptly.
(b) Seller's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Buyer being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or warranty is made as of a specified date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Buyer or any of its affiliates, which would render it unlawful as of the Closing Date to effect the transactions contemplated by this Agreement in accordance with its terms, (iv) the delivery by Buyer of the Purchase Price in the manner set forth in Section 4(b) above, and (v) the delivery by Buyer of Buyer's Closing Documents (as defined in Section 9 hereof) on or before the Closing Date.
(c) Buyer's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Seller being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or warranty is made as of a specific date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Seller or any of its affiliates, which would render it unlawful as of the Closing Date to effect that transactions contemplated by this Agreement in accordance with its terms, and (iv) the delivery by Seller of Seller's Closing Documents as set forth in Section 9 hereof.
9. Closing Deliveries.
(a) At Closing, Seller shall execute and/or deliver to Buyer the following (collectively "Seller's Closing Documents"):
(i) The Assignment, Bill of Sale and Assumption Agreement;
(ii) The Ground Lease Assignment and Assumption Agreement;
(iii) A certificate from an officer of Seller reasonably acceptable to Buyer confirming the accuracy of the representations and warranties in Section 10 as of the Closing Date;
(iv) Authorizing resolutions or minutes from Seller approving this Agreement and the transactions contemplated herein;
(v) A FIRPTA affidavit to the effect that Seller
is not a "foreign person" (as defined in
Section 1445(f)(3) of the Code and the
regulations issued thereunder); and
(vi) A lease agreement, by and between Buyer as lessor, and Seller, as lessee, substantially in the form of Exhibit F (the "Lease Agreement").
(b) At Closing, Buyer shall execute and/or deliver to Seller the following (collectively "Buyer's Closing Documents"):
(i) Authorizing resolutions from Buyer approving this Agreement and the transactions contemplated herein;
(ii) A certificate from an officer of Buyer reasonably acceptable to Seller confirming the accuracy of the representations and warranties in Section 11 as of the Closing Date;
(iii) The Purchase Note executed by a duly authorized officer of Buyer;
(iv) A lease agreement, by and between Buyer as lessor, and Seller, as lessee, substantially in the form of Exhibit F (the "Lease Agreement"); and
(v) The Ground Lease Assignment and Assumption Agreement.
(c) Seller's Closing Documents and Buyer's Closing Documents shall be collectively called herein the "Closing Documents". Buyer and Seller agree that such other documents as may be legally necessary or appropriate to carry out the terms of this Agreement or as reasonably requested by the other party shall be executed and delivered by the appropriate party at Closing.
10. Representations and Warranties of Seller.
As a material inducement to Buyer to enter into this Agreement, Seller represents and warrants to Buyer as follows:
(a) Seller has good and marketable title to the Tower, and the Assets are free and clear of liens, encumbrances, restrictions and security interests other than Permitted Encumbrances.
(b) Seller has full power and authority to execute and deliver this Agreement and Seller's Closing Documents, and to perform its obligations hereunder and thereunder.
(c) This Agreement and Seller's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Seller, enforceable against Seller in accordance with their terms.
(d) The sale of the Assets shall not materially conflict with, or result in, a breach of the terms of any agreements or instruments to which the Seller is a party which would result in the creation or imposition of any lien, charge or encumbrance on, or give to others any interest in or right to, any of the Assets.
(e) Seller has paid or will pay, at or prior to Closing, all outstanding obligations for utilities and taxes through the Closing Date, except for such items as are covered by the proration of items of income and expense as set forth in Section 6 hereof.
(f) No third-party authorization or approval of, or filing with, any person, entity, or authority will be required in connection with the execution and delivery of this Agreement or the transactions contemplated by this Agreement.
(g) Assuming all consents and approvals required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Seller's compliance with, the terms and provisions of this Agreement will conflict with, or result in, a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Seller, or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Seller is subject or any material agreement or contract to which Seller is a party or to which it is subject, or constitute a material default thereunder.
(h) Seller is not a foreign person within the meaning of
Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and the
regulations issued thereunder.
11. Representations and Warranties of Buyer.
As a material inducement to Seller to enter into this Agreement, Buyer represents and warrants to Seller as follows:
(a) Buyer has full power and authority to execute and deliver this Agreement and Buyer's Closing Documents, and to perform its respective obligations hereunder and thereunder.
(b) This Agreement and Buyer's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Buyer enforceable against Buyer, in accordance with their terms.
(c) Assuming all consents and approvals required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Buyer's compliance with, the terms and provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Buyer or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Buyer is subject or any material agreement or contract to which Buyer is a party or to which it is subject, or constitute a material default thereunder.
(d) Buyer acknowledges that the Tower is located on land which is leased and subject to the Ground Lease. Buyer acknowledges that it has received a copy of the Ground Lease and that there are no assurances that such Ground Lease will be extended or, if extended, whether the terms and conditions of any such extension will be the same as the terms and conditions of the current Ground Lease.
12. Representations and Warranties Survive Closing.
All of the provisions of this Agreement and of the Closing Documents
and all of the representations, warranties, considerations, and agreements
contained herein and in the Closing Documents shall survive Closing and continue
in full force and effect for a period of twelve (12) months from the Closing
Date; provided that if a claim for indemnification is made by either party under
Section 13 hereof within such twelve (12) month period, the provisions of
Section 13 shall survive until the resolution of such claim. No claim may be
brought under this Agreement unless written notice describing in reasonable
detail the nature of the claim is given on or prior to the last day of the
twelve (12) month period following the Closing Date.
13. Indemnification.
(a) For a period of one (1) year from the date of this Agreement, Seller shall indemnify, defend, and hold Buyer, its affiliates, partners, employees, officers, directors, agents, and representatives harmless from and against any and all reasonable losses, costs, expenses, liabilities, penalties, claims, and other damages including, but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigation, reasonably incurred and resulting from:
(i) any breach of Seller's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Seller of any of its covenants or agreements contained herein or in any Seller's Closing Document;
(iii) the Retained Liabilities; and
(iv) any and all losses, liabilities or damages resulting from Sellers' operations or ownership of any Tower prior to the Closing Date, including any and all liabilities arising under the Assets which relate to events occurring prior to the Closing Date.
(b) For a period of one (1) year from the date of this Agreement, Buyer shall indemnify, defend and hold Seller, its affiliates, employees, officers, directors, agents and representatives harmless from and against any and all losses, costs, expenses, liabilities, penalties, claims, and other damages, including but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigations, reasonably incurred and resulting from:
(i) any breach of Buyer's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Buyer of any of its covenants or agreements contained herein or in any Buyer's Closing Document;
(iii) the Assumed Liabilities; and
(iv) any and all losses, liabilities or damages resulting from Buyer's operations or ownership of any Tower subsequent to the Closing Date, including any and all liabilities arising under the Assets which related to events occurring subsequent to the Closing Date.
(c) In the event either Buyer or Seller (the "Indemnified Party") becomes aware of circumstances which would entitle such party to indemnification by the other party hereunder (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party prompt written notice, with reasonable detail, of such claim. Upon receipt of such notice by the Indemnified Party to the Indemnifying Party, the Indemnifying Party shall have the option of defending against such pending litigation through engagement of legal counsel of its choice, provided, however, that the Indemnifying Party's choice of legal counsel must be acceptable to the Indemnified Party in its reasonable discretion. In the event the Indemnifying Party elects to defend, the Indemnifying Party shall keep the Indemnified Party fully informed on a timely basis of the status of the pending litigation. In the event that the Indemnifying Party elects to defend and is unsuccessful in such defense, it shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages as described above, including but not limited to, reasonable attorney's fees and other costs and expenses associated with the pending litigation being so defended. In the event the Indemnifying Party elects not to defend and the Indemnified Party defends, but is unsuccessful, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages, as described above, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation.
In the event that Indemnifying Party elects not to defend and the Indemnified Party defends successfully, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all costs and expenses incurred, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. The Indemnifying Party shall reimburse the Indemnified Party upon demand for any payment made by the Indemnified Party at any time after Closing, based on the final judgement of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands or actions in respect to any damages to which the foregoing indemnification relates.
(d) Notwithstanding anything in this Agreement to the contrary, Seller's obligation to indemnify Buyer shall be subject to all of the following limitations:
(i) The amount of any losses, costs, expenses, liabilities, penalties, claims, and other damages ("Losses") incurred by Buyer shall be reduced by (A) the amount Buyer recovers (after deducting all attorneys' fees, expenses, and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Buyer shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Buyer shall be entitled to indemnification only for Losses as to which Buyer has given Seller written notice describing in reasonable detail the nature and basis for such indemnification ("Notice of Claim") on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Buyer by Seller pursuant to this Section 13 shall be limited to Thirty Thousand Dollars ($30,000.00) and Seller shall have no other liability or responsibility for indemnification hereunder.
(e) Subsequent to the Closing, indemnification under this
Section 13 shall be the exclusive remedy of Buyer with respect to any legal,
equitable or other claim for relief based upon this Agreement or arising
hereunder.
(f) Notwithstanding anything in this Agreement to the contrary, Buyer's obligation to indemnify Seller shall be subject to all of the following limitations:
(i) The amount of any Losses incurred by Seller shall be reduced by (A) the amount Seller recovers (after deducting all attorneys' fees, expenses and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Seller shall use commercially reasonable
efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Seller shall be entitled to indemnification only for Losses as to which Seller has given Buyer a Notice of Claim on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Seller by Buyer pursuant to this Section 13 shall be limited to Thirty Thousand Dollars ($30,000.00) and Buyer shall have no other liability or responsibility for Indemnification hereunder.
(g) Subsequent to the Closing, indemnification under this
Section 13 shall be the exclusive remedy of Seller with respect to any legal,
equitable or other claim for relief based upon this Agreement or arising
hereunder.
14. Termination; Liquidated Damages.
(a) Right of Termination. This Agreement may be terminated prior to Closing:
(i) By written notice from a party that is not then in material breach of this Agreement if:
(A) The other party has continued in material breach of this Agreement for twenty (20) days after written notice of such breach from the terminating party;
(B) Closing does not occur by May 31, 2000 or such other date as is mutually agreed to by Buyer and Seller.
(b) Obligations Upon Termination.
(i) Upon termination of this Agreement, each party shall thereafter remain liable for breach of this Agreement prior to such termination and remain liable to pay and perform any obligation under Section 13.
(ii) If Closing shall not have occurred, Seller's
sole remedy at law or in equity for any
breach or default by Buyer described in
Section 14(a)(i)(A) shall be the termination
by Seller of this Agreement by giving of
written notice to Buyer pursuant to Section
14(a)(i)(A).
(c) Termination Notice. Each notice given by a party pursuant to Section 14(a) to terminate this Agreement shall specify the subsection of Section 14(a) pursuant
to which such notice is given. If at the time a party gives a termination notice, such party is entitled to give such notice pursuant to more than one subsection of Section 14(a), the subsection pursuant to which such notice is given and termination is effected shall be deemed to be the subsection specified in such notice provided that the party giving such notice is at such time entitled to terminate this Agreement pursuant to the specified subsection.
15. Default; Disputes.
If Seller fails to perform under this Agreement, the Buyer may exercise any right it has against the Seller, including bringing an action for specific performance. The remedies provided by this Section are in addition to any right or remedies provided elsewhere in this Agreement or at law or in equity. In the event a dispute arises between the Parties over the interpretation of this Agreement, or the performance, alleged non-performance or breach by either Party hereunder, the Parties hereby agree to seek resolution of such dispute in good faith through an alternative dispute resolution process mutually agreeable to the Parties prior to the institution of any legal proceedings related thereto.
16. Liabilities.
Buyer shall not, in connection with the purchase and sale of Assets contemplating herein, assume any liabilities or obligations of the Seller except as specifically set forth herein.
17. Third Party Brokerage.
Seller and Buyer hereby represent and warrant to each other that neither Seller or Buyer has dealt with any broker or finder in connection with the transaction which is the subject of this Agreement. Each party hereby agrees to indemnify, save harmless and defend the other from and against all claims, losses, liabilities and expenses, including reasonable attorney's fees, arising out of any claim made by any broker, finder or other intermediary who claims to have dealt with such party in connection with the transaction which is the subject of this Agreement. The provisions of the paragraph shall survive Closing hereunder.
18. Entire Agreement.
This Agreement (which includes the exhibits and schedules attached hereto) constitutes the entire agreement between the Parties and there are no other understandings, representations or warranties, oral or written, relating to the subject matter hereof.
19. Amendment.
This Agreement may not be changed, modified or amended, in whole or in part, except in writing, signed by all parties.
20. Notice.
Notices given pursuant to this Agreement shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth
below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this Section. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Seller: Beasley Broadcasting of Coastal Carolina, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George Beasley
President
Phone: (941) 263-5000
Fax: (941) 434-8950
If to the Buyer: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
|
Phone: (941) 263-5000 Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
21. Construction.
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Whenever used in this Agreement the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.
22. Assignment and Recording.
Seller hereby covenants not to assign or record this Agreement except with the prior written consent of the Buyer. Buyer may assign this Agreement freely to any affiliated entity, provided such assignment shall not relieve Buyer of its obligations hereunder.
23. Binding Effect.
This Agreement and all of its terms and conditions shall extend to and be binding upon the Parties hereto and upon their respective heirs, executors, administrators, successors and assigns.
24. Further Assurances.
Seller and Buyer agree to execute and deliver any further documents or assurances that in law or otherwise are necessary, desirable or proper to consummate the transactions contemplated by this Agreement and to vest, perfect, assign or confirm, of record or otherwise, in Buyer title to the Assets.
25. Governing Law.
This Agreement is made and shall be governed by and construed in accordance with the internal laws of the State of North Carolina.
26. Headings.
The headings and captions in this Agreement are for convenience only and are not part of this Agreement.
27. Interpretation.
Neither this Agreement nor any provision contained herein shall be interpreted for or against either party solely because that party or that party's legal representative drafted the provision.
28. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute the same Agreement.
29. Severability.
If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be severed from this Agreement and the remainder shall remain in full force and effect.
[Signature page follows]
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound, have caused this Agreement to be duly executed on the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF COASTAL CAROLINA,
INC.
By:
------------------------------------
Name: George G. Beasley
Title: President
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BUYER:
BEASLEY FAMILY TOWERS, INC.
By:
------------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
INDEX OF EXHIBITS
Exhibit A Description of Tower and Tower Site
Exhibit B Ground Lease
Exhibit C Form of Purchase Note
Exhibit D Form of Assignment, Bill of Sale and Assumption
Agreement
Exhibit E Form of Ground Lease Assignment and Assumption
Agreement
Exhibit F Form of Lease Agreement
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EXHIBIT A
DESCRIPTION OF TOWER AND TOWER SITE
WNCT-AM
That certain AM directional array consisting of 6 towers situated on a tract of land more particularly described as follows:
That certain tract of land situated, lying and being Greenville Township, Pitt County, State of North Carolina more particularly described as follows:
Commencing at a point in the center of NC Highway 43, said point being North 46 degrees 12'38" West 2467.67 feet from the center line of the intersection of NC Highway 43 and State Road 1204, thence North 42 degrees 00'00" East 1755.00 feet along the property line of Graham Flanagan and Joyner Heirs Lands, to the Point and Place of Beginning, an existing iron pipe on the line with Michael David Weaver, thence North 42 degrees 00'00" East 399.99 feet to an existing iron pipe, thence North 44 degrees 30'04" West 800.10 feet to an existing iron pipe, thence South 41 degrees 59'24" West 400.02 feet to an existing iron pipe, thence South 44 degrees 30'13" East 800.02 feet to the Point and Place of Beginning, containing 7.33 acres more or less.
Together with the right, privilege and easement over, through and across the lands of the O.L. Joyner Jr. Heirs lands as recorded in Deed Book A42, Page 374, Pitt County Registry more particularly described as follows: the center line of said 30 foot easement beginning at a point in the northern right-of-way of NC Highway No. 43 leading from Greenville, North Carolina to Falkland, North Carolina shown as point "A" on map prepared by W.B. Duke R.L.S. dated March 18, 1973 and running thence North 32 degrees 15' East 165.00 feet to a point, thence South 74 degrees 30' East 132.00 feet to a point, thence South 54 degrees 35' East 89.1 feet to a point, thence South 79 degrees 29' East 112.00 feet to a point, thence North 56 degrees 50' East 171.60 feet to a point, thence North 88 degrees 00' East 333.50 feet to a point shown as point "B" on the aforesaid map. Thence North 41 degrees 55' East 1102.80 feet +/- to a point on the southern boundary of the above described Tract.
Tax Parcel No. 17565
EXHIBIT B
GROUND LEASE
EXHIBIT C
FORM OF PURCHASE NOTE
PROMISSORY NOTE
$276,760.00 February ___, 2000
BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Payor"), for value received, promises to pay to the order of Beasley Broadcasting of Coastal Carolina, Inc., ("Payee"), the principal amount of TWO HUNDRED SEVENTY-SIX THOUSAND SEVEN HUNDRED AND SIXTY THOUSAND ($276,760.00), together with accrued interest thereon, calculated and payable as set forth below in this Note. The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement of Sale (the "Sale Agreement"), dated February ____, 2000, by and among Payor and Payee.
1. Payment of Principal and Interest
(a) Calculation and Payment of Interest. Interest on the principal balance of this Note outstanding from time to time until paid in full shall accrue at the rate of six and seventy-seven one hundredths percent (6.77%), compounded annually (the "Rate"), computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof.
(b) Payments Prior to Maturity Date. On the first day of each month Maker shall pay, in advance, Two Thousand Ninety-Five Dollars and Eighty-Five Cents ($2,095.85). All remaining principal, together with accrued and unpaid interest thereon shall be due and payable on the "Maturity Date" (defined below). Each monthly payment shall be credited first to interest then accrued and the remainder, if any, to principal, and interest shall thereupon cease to accrue upon the principal paid.
(c) Payment on Maturity Date. The principal balance of, and any accrued and unpaid interest on, this Note shall be payable twenty (20) years from the effective date of this Note (such date the "Maturity Date").
(d) Prepayment.
(i) Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this
Note.
(ii) Any prepayment of this Note shall be applied as follows: first, to payment of accrued interest; and second, to payment of principal.
2. Events of Default.
The following shall constitute "Events of Default" under this Note:
(a) Failure by Payor to make any payment required under this Note when the same shall become due and payable (whether at maturity or otherwise) and the continuation of such failure for a period of ninety (90) days; or
(b) Payor pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for all or any substantial portion of its property or assets;
(iv) makes a general assignment for the benefit of its creditors; or
(c) an involuntary case or proceeding is commenced against Payor under any Bankruptcy Law and is not dismissed, bonded or discharged within ninety (90) days thereafter, or a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against Payor in an involuntary case or proceeding;
(ii) appoints a Custodian of Payor or for all or substantially all of its properties; or
(iii) orders the liquidation of Payor; and in each case the order or decree remains unstayed and in effect for ninety (90) days.
If any Event of Default shall have occurred and be continuing, Payee may proceed to protect and enforce its rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to Payee under this Note.
(b) Assignment.
The holders of this Note may not assign or otherwise transfer all or any portion of their rights and obligations under this Note to any other person or entity, without the prior written consent of the Payor, which consent shall not be unreasonably withheld.
3. Certain Definitions.
"Bankruptcy Law" means Title 11, United States Code, or any similar federal, state or foreign law for the relief of debtors or any arrangement, reorganization, assignment for the benefit of creditors or any other marshalling of the assets and liabilities of Payor.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
"Event of Default" means any of the occurrences specified in
Section 2 of this Note.
4. Miscellaneous
(a) Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
(b) Amendment and Waiver. No provision of this Note may be amended or waived unless Payor shall have obtained the written agreement of Payee. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c) Successors, Assigns and Transferors. The foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
(d) Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of North Carolina, without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction.
(e) Notices. Any notice, request, instruction or other document to be given hereunder by either party to the other shall be in writing and shall be deemed given when received and shall be (i) delivered personally or (ii) mailed by certified mail, postage prepaid, return receipt requested or (iii) delivered by Federal Express or a similar overnight courier or (iv) sent via facsimile transmission to the fax number given below, as follows:
If to Payor, addressed to:
Beasley Family Towers, Inc. 3033 Riviera Drive, Suite 200 Naples, FL 34103 Attn: Ms. B. Caroline Beasley Fax: (941) 434-8950
With a copy to:
Latham & Watkins 1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Attn: Joseph D. Sullivan, Esq.
Fax: (202) 637-2201
If to Payee, addressed to:
Beasley Broadcasting of Coastal Carolina, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Fax: (941) 434-8950
or to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
BEASLEY FAMILY TOWERS, INC.
By:
-----------------------------
Name: B. Caroline Beasley
Title: Secretary
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EXHIBIT D
FORM OF ASSIGNMENT, BILL OF SALE AND ASSUMPTION AGREEMENT
This Assignment, Bill of Sale and Assumption Agreement (this "Agreement") is made effective as of 12:01 a.m. Eastern Time, on the ____ day of February, 2000 by and between BEASLEY BROADCASTING OF COASTAL CAROLINA, INC.
("Seller") and BEASLEY FAMILY TOWERS, INC. ("Purchaser").
RECITALS
A. Reference is made to that certain Agreement of Sale (the "Asset Purchase Agreement") dated as of February ___, 2000 by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings given such terms in the Asset Purchase Agreement.
B. The Asset Purchase Agreement provides that Seller shall sell, convey and assign to Purchaser all of Seller's right, title and interest to the Tower and Tower Leases and Purchaser shall assume the Assumed Liabilities, as defined in Section 2 of the Asset Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows (capitalized terms used herein but not defined herein shall have the meaning given to them in the Asset Purchase Agreement):
1. Seller hereby bargains, sells, conveys, assigns and delivers all of Seller's right, title and interest in and to:
a. The Tower, such Tower more particularly described in Exhibit A of the Asset Purchase Agreement; and
b. The Tower Leases.
Items a. and b. above are hereinafter referred to as the "Assigned Assets."
2. Purchaser hereby accepts the sale, conveyance and assignment of the Assigned Assets, effective as of 12:01 a.m. Eastern Time on February __, 2000.
3. Purchaser hereby assumes and agrees to pay and perform the Assumed Liabilities pursuant to Section 2 of the Asset Purchase Agreement, effective as of 12:01 a.m. Eastern Time on February __, 2000.
4. After the date hereof, Purchaser and Seller will, at the request of the other party, promptly obtain, execute and deliver, or cause to be obtained, executed and delivered, to the other party such assignments, bills of sale, endorsements, and other such instruments or documents to be executed by Seller or Purchaser, as the case may be, in addition to this
Agreement, in form and substance reasonably satisfactory to the other party, as such other party may reasonably deem necessary or desirable so as (i) to vest in Purchaser title to and possession of the Assigned Assets and (ii) to perfect and record, if necessary, the sale, assignment, conveyance, transfer and delivery to Purchaser of the Assigned Assets.
5. This Agreement is made pursuant to, and is subject to all of the terms, representations, warranties and covenants of, the Asset Purchase Agreement, the terms of which are hereby incorporated by reference. In the event of any conflict between this Agreement and the Asset Purchase Agreement, the terms of the Asset Purchase Agreement shall govern.
[Signature page follows]
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this Agreement as of the day and year first written above.
SELLER:
BEASLEY BROADCASTING OF COASTAL CAROLINA,
INC.
By:
-------------------------------------
Name: George G. Beasley
Title: President
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PURCHASER:
BEASLEY FAMILY TOWERS, INC.
By:
-------------------------------------
Name: B. Caroline Beasley
Title: Secretary
|
EXHIBIT E
FORM OF GROUND LEASE
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION OF LEASE ("Assignment") is
entered into as of this _____ day of February, 2000 by and between BEASLEY
BROADCASTING OF COASTAL CAROLINA, INC. ("Assignor"), and BEASLEY FAMILY TOWERS,
INC., ("Assignee").
WHEREAS, Assignor and Beasley Broadcasting of Greenville, Inc. ("Greenville"), entered into that certain Lease Agreement, dated June 4, 1996, where Greenville leased certain real property to Storz (such Lease Agreement called herein the "Lease");
WHEREAS, Assignor intends to sell and convey to Assignee certain tower assets used and held for use in the operation of broadcast station WNCT-AM, Greenville, North Carolina, pursuant to the terms of that certain Agreement of Sale (the "Purchase Agreement"), dated as of February ___, 2000, by and between Assignor and Assignee;
WHEREAS, in connection with such transaction, Assignor is required to assign to Assignee all of Assignor's right, title and interest, as lessee, in and to the Lease.
NOW, THEREFORE, in consideration of the mutual promises contained herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Assignment. Assignor hereby transfers, conveys and assigns to Assignee all of Assignor's right, title and interest in, to and under the Lease.
2. Assumption of Lease Liabilities. Assignee assumes the liabilities, duties and obligations of Assignor under the Lease which accrue on or after the date hereof, and Assignor shall have no further liability or responsibility therefor.
4. Counterparts. This Assignment may be executed in counterparts.
[Signature pages follow]
IN WITNESS WHEREOF, the undersigned have executed this Assignment as of the day and year first written above.
[SEAL] ASSIGNOR:
BEASLEY BROADCASTING OF COASTAL CAROLINA, INC.
ATTEST: By:
--------------------------------
Name: George G. Beasley
Title: President
----------------------------------
Name: B. Caroline Beasley
Title: Secretary
STATE OF: )
--------------------------------------------
) ss.
COUNTY OF )
--------------------------------------------
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This is to certify that on the _____ day of February, 2000, before me personally appeared George G. Beasley with whom I am personally acquainted, who, being by me duly sworn, says:
That he is President and B. Caroline Beasley is the Secretary of BEASLEY BROADCASTING OF COASTAL CAROLINA, INC., the corporation described in and which executed the foregoing instrument; that he knows the common seal of said corporation; that the seal affixed to the foregoing instrument is said common seal, and the name of the corporation was subscribed thereto by the said President, attested by said Secretary, and said common seal was affixed, all by authority duly conferred, and that said instrument is the act and deed of said corporation.
WITNESS, my hand and notarial seal, this ____ day of February, 2000.
My commission expires:
[SEAL] ASSIGNEE:
BEASLEY FAMILY TOWERS, INC.
ATTEST: By:
------------------------------------
Name: George G. Beasley
Title: Chief Executive Officer
-------------------------------------
Name: B. Caroline Beasley
Title: Secretary
STATE OF: )
--------------------------------------------
) ss.
COUNTY OF )
--------------------------------------------
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This is to certify that on the _____ day of February, 2000, before me personally appeared George G. Beasley with whom I am personally acquainted, who, being by me duly sworn, says:
That he is Chief Executive Officer and B. Caroline Beasley is the Secretary of BEASLEY FAMILY TOWERS, INC., the corporation described in and which executed the foregoing instrument; that she knows the common seal of said corporation; that the seal affixed to the foregoing instrument is said common seal, and the name of the corporation was subscribed thereto by the said Chief Executive Officer, attested by said Secretary and said common seal was affixed, all by authority duly conferred, and that said instrument is the act and deed of said corporation.
WITNESS, my hand and notarial seal, this ____ day of February, 2000.
My commission expires:
EXHIBIT F
FORM OF LEASE AGREEMENT
LEASE AGREEMENT (O&L WNCT-AM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY BROADCASTING OF COASTAL CAROLINA, INC., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns six communications towers, as such Towers are described on Exhibit A attached hereto (the "Towers"), on a certain tract of real estate located at Greenville, North Carolina, as such land is more fully described in Exhibit B attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements on such land);
WHEREAS, Lessor desires to lease the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower from Lessor therefor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 TOWER. Lessor hereby leases to Lessee, and Lessee leases from Lessor, the Tower for the purposes of the broadcast transmission of WNCT-AM, Greenville, North Carolina.
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" as defined below, all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Tower after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto which are
permitted hereunder, shall be and remain Lessee's property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Tower at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Tower for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Tower may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Tower. Lessee may repair and maintain equipment as it deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. The Tower, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to
Lessee in this Lease and with prior notice to Lessee and no loss of service or
interruption (beyond a temporary, non-recurring and de minimis amount), Lessor
reserves the right to use the Tower, at its own expense, as it sees fit and to
fasten additional equipment to the Tower for any purpose, including the right to
install transmitting and/or receiving antennas of others; provided that Lessor
shall use reasonable efforts to restrict any loss of Lessee's service or
interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00
a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have an initial term of twenty
(20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made, without any setoff or deduction whatever, according to the following schedule:
----------------------------------------------------------------------
Lease Year Rent Per Lease Year Monthly Rent
----------------------------------------------------------------------
1 $25,150.20 $2,095.85
----------------------------------------------------------------------
2 $25,150.20 $2,095.85
----------------------------------------------------------------------
3 $25,150.20 $2,095.85
----------------------------------------------------------------------
4 $25,150.20 $2,095.85
----------------------------------------------------------------------
5 $25,150.20 $2,095.85
----------------------------------------------------------------------
6 $25,150.20 $2,095.85
----------------------------------------------------------------------
7 $25,150.20 $2,095.85
----------------------------------------------------------------------
8 $25,150.20 $2,095.85
----------------------------------------------------------------------
9 $25,150.20 $2,095.85
----------------------------------------------------------------------
10 $25,150.20 $2,095.85
----------------------------------------------------------------------
11 $25,150.20 $2,095.85
----------------------------------------------------------------------
12 $25,150.20 $2,095.85
----------------------------------------------------------------------
13 $25,150.20 $2,095.85
----------------------------------------------------------------------
14 $25,150.20 $2,095.85
----------------------------------------------------------------------
15 $25,150.20 $2,095.85
----------------------------------------------------------------------
16 $25,150.20 $2,095.85
----------------------------------------------------------------------
17 $25,150.20 $2,095.85
----------------------------------------------------------------------
18 $25,150.20 $2,095.85
----------------------------------------------------------------------
19 $25,150.20 $2,095.85
----------------------------------------------------------------------
20 $25,150.20 $2,095.85
----------------------------------------------------------------------
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated _______________, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal
to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Tower, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Tower except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF TOWER AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to Tower. All such maintenance shall be conducted by the parties in accordance with good engineering
standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Tower or the Tower Site, or the prevention of interference with Lessor or any other user of the Tower or any other broadcaster, Lessor may, at its option, make such emergency repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Tower or Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Tower unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Tower (including any ascension of the Tower), or in or about the Tower Site. Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Tower to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. MAINTENANCE OF TOWER.
9.01 MAINTENANCE OF TOWER.
(a) Lessor shall maintain the Tower in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the Tower. Lessor shall maintain the Tower and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs, alterations, or improvements are necessary or desirable to the Tower or the leased spaces of other tenants, Lessor may, upon reasonable notice and for the shortest practical period of time (except for emergency situations), close entrance doors, common areas, drive-ways, rights-of-way, service areas, parking areas, or any other facilities at its discretion without being liable to Lessee; provided that if any of the above would restrict Lessee's ability to broadcast, Lessor shall use reasonable efforts to restrict any closure or interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00 a.m.. The closing of entrances, doors, common areas, parking areas, or other facilities for the making of the repairs, alterations, or improvements described herein shall, under no circumstances, constitute an eviction of the Lessee or be grounds for termination of this Lease or the withholding of any rental payments or other payments or performances required to be paid or made by Lessee under the terms hereof, provided, Lessor shall use reasonable efforts to ensure that any action taken in accordance with this paragraph shall not adversely affect the rights of Lessee hereunder. Under no such circumstances shall Lessee be entitled to terminate this Lease nor shall it be entitled to compensation for any loss or damage it may sustain (including loss of use, loss of advertising/sponsorship revenues, and consequential damages) by reason of such changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Tower, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's
Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine Tower loading capacity, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Tower after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Tower whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph. 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is
referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Tower shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Tower shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes, assessments, or levies assessed or imposed against the Tower Site (including the Tower), and all taxes which may be assessed against the Tower and any buildings thereon. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall pay all personal property or other taxes assessed or imposed on Lessee's Property, and shall cooperate with Lessor
to ensure that such property is properly separated from that of Lessor or other tenants for assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain
comprehensive public liability insurance, naming Lessor as an additional insured
as its interests shall appear, covering all of the Lessee's operations and
activities on the Tower, including but not limited to, the operations of
contractors and subcontractors and the operation of vehicles and equipment
(including the Tower elevator), with limits of liability for the term of this
Lease of not less than [Five Million Dollars ($5,000,000.00)] in the aggregate
for personal injury or death in any occurrence and not less than [Five Million
Dollars ($5,000,000.00)] to cover property damage, with a liability umbrella of
not less than [One Million Dollars ($1,000,000.00).] Certificates evidencing
such insurance shall be furnished to Lessor upon its request. The amounts
specified hereunder shall be revised every [five (5) years] to such amounts as
Lessor may reasonably require upon the advice of its insurance consultants.
[Foregoing obligation is subject to $200,000 12-month limit when aggregated with
other borrowers under Credit Agreement per 1.5D of First Amendment to Credit
Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWER INSURANCE. Lessee shall procure and maintain physical damage insurance on the Tower in an amount sufficient to repair or replace the Tower with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWER DAMAGE. In the event that the Tower is
destroyed or damaged by fire, lightning, windstorm, flood, earthquake,
explosion, collapse, aircraft, or other vehicle damage or other casualty covered
by insurance, Lessor shall promptly reconstruct or repair the Tower to such good
condition as existed before the destruction or damage, and give possession to
Lessee of substantially the same space leased hereunder. Lessee shall promptly
pay over to Lessor any insurance proceeds it receives from insurance policies
Lessee is required to procure under Section 14.03 hereof for the purpose of use
by Lessor to fund reconstruction of the Tower as required of Lessor under this
Section 14.04. If the Tower is in need of such repair or is so damaged by fire,
lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle
damage, collapse, or other casualty that reconstruction or repair cannot
reasonably be undertaken without dismantling Lessee's antenna, then upon written
notice to Lessee, Lessor may remove any such antenna and interrupt the signal
activity of Lessee, but will use its best efforts to have
the antenna replaced as soon as reasonably possible. Lessor agrees to provide
Lessee an alternative tower, if available, during such reconstruction/repair
period. If such tower is not available, then Lessee shall be responsible for
procuring its own alternative tower. No monetary or other rental shall be due
pursuant to the terms of this Lease for such time as Lessee is unable to conduct
its broadcasting activities on the Tower without significant diminution of
signal quality as a result of such total or partial destruction or damage or
need of repair, and Lessor shall refund to Lessee any rent paid in advance for
such time. Should Lessor not either (a) inform Lessee in writing within ninety
(90) days of the date of destruction of Lessor's intent to replace the Tower or
(b) replace the Tower within one (1) year if Lessor has provided the notice
described in clause (a) above, of the date of destruction, or repair the same
within such shorter time period after the casualty as may be reasonable, then
Lessee, upon thirty (30) days' written notice to Lessor, may terminate this
Lease, provided if Lessor has provided the notice described in clause (a) above,
Lessee must make such election within one hundred twenty (120) days prior to the
expiration of said repair or replacement period. Lessee agrees that it shall
maintain adequate business interruption insurance at all times during the term
of this Lease to adequately protect it from any interruption of signal
activities due to Tower damage (including costs of reinstallation of its
equipment and lines), and Lessor shall have no liability on account of such
business interruption or reinstallation costs due to damage or destruction under
this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower (or any portion of the Tower necessary for the guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for the Tower on the condemned property, Lessor agrees to lease the new tower on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other
person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Tower within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Tower after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any
payment herein provided for and any such default shall continue for a period of
ten (10) business days after written notice to Lessee, or if Lessee shall make
default in the performance of any obligation of Lessee herein (other than as to
payment of money) and any such default shall continue for a period of thirty
(30) days after written notice to Lessee, or if Lessee shall file a voluntary
petition in bankruptcy, or if Lessee shall file any petition or institute any
proceedings under any Insolvency or Bankruptcy Act or any amendment thereto
hereafter made, seeking to effect its reorganization or a composition with its
creditors, or if, in any proceedings based on the insolvency of Lessee or
relating to bankruptcy proceedings, a receiver or trustee shall be
appointed for Lessee or the Tower, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Tower by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Tower. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Tower (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of North Carolina at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Tower by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this
Lease; (b) out of the use, management, or occupancy of the Tower by Lessor, its
agents, or invitees; (c) out of any omissions, negligence or willful misconduct
of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of
failure of Lessor to comply with any laws, statutes, ordinances, or regulations;
(e) out of Lessor's failure to maintain equipment in proper working order; and
(f) out of Lessor's failure to comply with any of its other obligations under
the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for indemnity,
and the Indemnifying Party shall have the right and opportunity to undertake the
legal defense of such claims. The Indemnified Party and its counsel may
nevertheless participate in (but not control) such proceedings, negotiations, or
defense at its own expense. In all such cases, the Indemnified Party will give
all reasonable assistance to the Indemnifying Party, including making the
Indemnified Party's employees and documents available as reasonably requested
without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after
either party's request, the other party shall deliver, executed in recordable
form, a declaration to any person designated by the requesting party (a)
ratifying this Lease; (b) stating the commencement and termination dates; and
(c) certifying (i) that this Lease is in full force and effect, and has not been
assigned, modified, supplemented, or amended (except by such writings as shall
be stated); (ii) that all conditions under this Lease to be performed have been
satisfied (stating exceptions, if any); (iii) that no defenses or offsets
against the enforcement of this Lease by the requesting party exist (or stating
those claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which
rent has been paid; (vi) the amount of security deposited with Lessor (if
hereafter applicable for any reason); and (vii) such other information as the
requesting party reasonably requires. Persons receiving such statements shall be
entitled to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Tower, or, if any of the Tower comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of North Carolina.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one-half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite Naples, FL 34103 Attn: Ms. B. Caroline Beasley Secretary |
Phone: (941) 263-5000 Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley Broadcasting of Coastal Carolina, Inc.
3033 Riviera Drive, Suite
Naples, FL 34103
Attn: Mr. George Beasley
Chief Executive Officer
|
Phone: (941) 263-5000 Fax: (941) 434-8950
21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Tower, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Tower; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Tower and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Tower or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
--------------------------- -------------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
|
LESSEE:
BEASLEY BROADCASTING OF COASTAL
CAROLINA, INC.
By: (SEAL)
---------------------------- -------------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
|
EXHIBIT A
DESCRIPTION OF WNCT-AM TOWERS
That certain AM directional array consisting of 6 towers situated on a tract of land more particularly described as follows:
That certain tract of land situated, lying and being Greenville Township, Pitt County, State of North Carolina more particularly described as follows:
Commencing at a point in the center of NC Highway 43, said point being North 46 degrees 12'38" West 2467.67 feet from the center line of the intersection of NC Highway 43 and State Road 1204, thence North 42 degrees 00'00" East 1755.00 feet along the property line of Graham Flanagan and Joyner Heirs Lands, to the Point and Place of Beginning, an existing iron pipe on the line with Michael David Weaver, thence North 42 degrees 00'00" East 399.99 feet to an existing iron pipe, thence North 44 degrees 30'04" West 800.10 feet to an existing iron pipe, thence South 41 degrees 59'24" West 400.02 feet to an existing iron pipe, thence South 44 degrees 30'13" East 800.02 feet to the Point and Place of Beginning, containing 7.33 acres more or less.
Together with the right, privilege and easement over, through and across the lands of the O.L. Joyner Jr. Heirs lands as recorded in Deed Book A42, Page 374, Pitt County Registry more particularly described as follows: the center line of said 30 foot easement beginning at a point in the northern right-of-way of NC Highway No. 43 leading from Greenville, North Carolina to Falkland, North Carolina shown as point "A" on map prepared by W.B. Duke R.L.S. dated March 18, 1973 and running thence North 32 degrees 15' East 165.00 feet to a point, thence South 74 degrees 30' East 132.00 feet to a point, thence South 54 degrees 35' East 89.1 feet to a point, thence South 79 degrees 29' East 112.00 feet to a point, thence North 56 degrees 50' East 171.60 feet to a point, thence North 88 degrees 00' East 333.50 feet to a point shown as point "B" on the aforesaid map. Thence North 41 degrees 55' East 1102.80 feet +/- to a point on the southern boundary of the above described Tract.
Tax Parcel No. 17565
EXHIBIT B
DESCRIPTION OF WNCT-AM TOWER SITE
That certain tract of land situated, lying and being Greenville Township, Pitt County, State of North Carolina more particularly described as follows:
Commencing at a point in the center of NC Highway 43, said point being North 46 degrees 12'38" West 2467.67 feet from the center line of the intersection of NC Highway 43 and State Road 1204, thence North 42 degrees 00'00" East 1755.00 feet along the property line of Graham Flanagan and Joyner Heirs Lands, to the Point and Place of Beginning, an existing iron pipe on the line with Michael David Weaver, thence North 42 degrees 00'00" East 399.99 feet to an existing iron pipe, thence North 44 degrees 30'04" West 800.10 feet to an existing iron pipe, thence South 41 degrees 59'24" West 400.02 feet to an existing iron pipe, thence South 44 degrees 30'13" East 800.02 feet to the Point and Place of Beginning, containing 7.33 acres more or less.
Together with the right, privilege and easement over, through and across the lands of the O.L. Joyner Jr. Heirs lands as recorded in Deed Book A42, Page 374, Pitt County Registry more particularly described as follows: the center line of said 30 foot easement beginning at a point in the northern right-of-way of NC Highway No. 43 leading from Greenville, North Carolina to Falkland, North Carolina shown as point "A" on map prepared by W.B. Duke R.L.S. dated March 18, 1973 and running thence North 32 degrees 15' East 165.00 feet to a point, thence South 74 degrees 30' East 132.00 feet to a point, thence South 54 degrees 35' East 89.1 feet to a point, thence South 79 degrees 29' East 112.00 feet to a point, thence North 56 degrees 50' East 171.60 feet to a point, thence North 88 degrees 00' East 333.50 feet to a point shown as point "B" on the aforesaid map. Thence North 41 degrees 55' East 1102.80 feet +/- to a point on the southern boundary of the above described Tract.
Tax Parcel No. 17565
EXHIBIT 10.19
AGREEMENT OF SALE (OT/LL)
This Agreement of Sale (the "Agreement") is made this ___ day of February, 2000, between Beasley Reed Acquisition Partnership, a Delaware general partnership (the "Seller") and Beasley Family Towers, Inc., a Delaware corporation (the "Buyer") (together, the "Parties").
WITNESSETH:
WHEREAS, Seller owns a communications tower used in the operation of radio broadcast station WQAM-AM (the "Tower"), such Tower situated on a certain tract of land which Seller leases from a third party (such tract of land called herein the "Tower Site"), such Tower and the Tower Site described on Exhibit A attached hereto);
WHEREAS, Seller desires to sell and Buyer desires to purchase the Tower and certain personal property belonging to Seller and associated with the Tower Site;
NOW, THEREFORE, in consideration of the mutual premises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
1. Agreement to Sell and Purchase.
Seller agrees to sell, transfer, assign, convey and deliver to Buyer and Buyer agrees to purchase and accept from Seller, the following assets upon the terms and conditions contained herein (collectively, the "Assets"):
(a) The Tower;
(b) The ground lease for the Tower Site (the "Ground Lease"), such Ground Lease attached as Exhibit B1 hereto and incorporated herein;
(c) That certain Access Agreement, dated August 3, 1998, by and between The Miami Herald Publishing Company, a division of Knight-Ridder, Inc. ("Miami Herald"), and Seller (the "Access Agreement"), allowing Seller certain rights of access to and through neighboring property owned by Miami Herald, such Access Agreement attached as Exhibit B2 hereto and incorporated herein; and
2. Assumption of Liabilities.
(a) Upon the terms and subject to the conditions contained herein, Buyer shall assume and become responsible for any and all liabilities and obligations arising out of, or relating to events occurring after 12:01 am Eastern Standard Time on the Closing Date (the "Adjustment Time"), under the Ground Lease, and with respect to the ownership of the Tower, and the operation of the business relating to the Assets (collectively, the "Assumed Liabilities").
(b) Subject to the provisions of Section 13, hereof, it is understood and agreed that all liabilities to third parties relating to the Assets that arise out of any act, event, or transaction of Seller or the ownership of the Assets or the operator of the business relating to the Assets prior to the Closing Date (the "Retained Liabilities") shall remain the responsibility of Seller. Buyer shall not be required to defend any suit or claim arising out of any Retained Liabilities, and Seller shall and hereby agrees to satisfy in due course all such Retained Liabilities, and subject to the provisions of Section 13 hereof Seller shall protect and forever hold Buyer harmless from all claims with respect to such Retained Liabilities. Subject to the provisions of Section 13, hereof, it is understood and agreed that all liabilities relating to the Assets that arise out of any act, event, or transaction of Buyer following the Closing Date (the "Assumed Liabilities") shall be the responsibility of Buyer. Seller shall not be required to defend any suit or claim arising out of any Assumed Liabilities, and Buyer shall and hereby agrees to satisfy in due course all such Assumed Liabilities, and subject to the provisions of Section 13 hereof Buyer shall protect and forever hold Seller harmless from all claims with respect to such Assumed Liabilities.
3. Purchase Price.
(a) The purchase price for the Assets shall be the amount of Four Hundred Fourteen Thousand Three Hundred Twenty One Dollars ($414,321.00) (the "Purchase Price"). The Purchase Price shall be adjusted at the Closing by the amount of any prorations derived by operation of Section 6 hereof, and for any other normal income and expense items related to the operation of the Tower Site as of 12:01 am on the day on which the Closing occurs. The Purchase Price shall be allocated among the Assets in accordance with Section 3(b)).
(b) Buyer and Seller agree to allocate the aggregate of the Purchase Price, the Assumed Liabilities and other relevant items among the Assets in accordance with section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"). Buyer and Seller will each report the federal, state, and local and other tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Form 8594) in a manner consistent with such allocation.
4. Delivery of Purchase Price.
(a) The Purchase Price shall be payable at Closing (as defined in
Section 8 below) in the manner set forth in Section 4(b).
(b) As payment of the Purchase Price, Buyer shall deliver to Seller at Closing an unsecured promissory note of Buyer in the aggregate principal amount of Four Hundred Fourteen Thousand Three Hundred Twenty One Dollars ($414,321.00), substantially in the form of Exhibit C (the "Purchase Note").
5. Transfer of Assets.
(a) Transfer of ownership of the Tower and assumption of the Assumed Liabilities (except for the Ground Lease, which shall be transferred according to Section 5(c) below) pursuant to Section 2 hereof shall be pursuant to the Assignment, Bill of Sale and Assumption Agreement from the Seller to Buyer in the form of Exhibit D attached hereto and incorporated herein (the "Assignment, Bill of Sale and Assumption Agreement").
(b) The Assets shall be transferred to Buyer free and clear of all liens, encumbrances other than Permitted Encumbrances, if any. "Permitted Encumbrances" shall mean: (i) encumbrances for taxes, assessments, or governmental charges or levies which are not yet due and payable, or that, subject to adequate security for payment, are being contested; (ii) existing building restrictions, ordinances, easements of roads, privileges, or rights of public service companies or other rights of way, other restrictions or conditions of record, if any or other encumbrances disclosed in this Agreement (including the Exhibits attached hereto); (iii) easements, rights of way or other encumbrances that do not have a material adverse effect on the Assets or the operation of the business relating to the Assets as currently operated; (iv) encumbrances imposed by law, such as materialmen's, mechanic's, carrier's, workmen's, or repairmen's liens or other similar encumbrances attaching in the ordinary course of business or securing obligations that are not overdue; (v) encumbrances securing indebtedness, which will be removed prior to or at the Closing; and (vi) encumbrances pursuant to contracts and leases to be assumed by Buyer pursuant to Section 2.
(c) Assumption of the Ground Lease pursuant to Section 2 hereof shall be pursuant to the Ground Lease Assignment and Assumption Agreement in the form of Exhibit E attached hereto and incorporated herein (the "Ground Lease Assignment and Assumption Agreement").
6. Apportionment of Real Estate Taxes, Rent, Utilities.
(a) Current real estate taxes, rent, utilities and all other normal income and expense items related to the Assets shall be apportioned between the parties to reflect the principle that all expenses and income arising from the operation of the Assets up through the Adjustment Time shall be for the account of Seller, and all expenses and income arising from the operation of the business relating to the Assets acquired by Buyer after the Adjustment Time shall be for the account of Buyer.
(b) As soon as practicable following the Closing Date, or at such other time as the parties agree, Buyer shall deliver to Seller a certificate from Buyer which sets forth as of the Adjustment Time, all adjustments to be made as provided in Section 6(a) above (the "Buyer's Certificate"). Buyer shall provide Seller or its representatives access to copies of such
portions of books and records Seller may reasonably request solely for the purposes of verifying such adjustments. The Buyer's Certificate shall be final and conclusive unless objected to by Seller in writing within ninety (90) days after delivery. Buyer and Seller shall attempt jointly to reach agreement as to the amount of the adjustments to be made hereunder within thirty (30) days after receipt of such written objection, which agreement, if achieved, shall be binding upon all parties to this Agreement and not subject to dispute or review.
(c) In the event of a disagreement between Buyer and Seller with respect to the accounting to be made hereunder, the parties agree that a public accounting firm chosen jointly by Buyer and Seller shall be the final arbiter of such disagreement. (d) Any amounts due for the adjustments provided for herein shall be paid within thirty (30) business days after final determination.
7. Expenses.
All costs and expenses incurred by the Parties in this transaction, including, but not limited to attorneys' fees, shall be paid by the party incurring them.
8. Closing; Closing Conditions.
(a) Closing of the transactions contemplated by this Agreement (the "Closing") shall occur at a place and time mutually agreeable to Seller and Buyer (the "Closing Date"). Seller and Buyer shall both make a good faith effort to close under this Agreement promptly.
(b) Seller's obligation to close hereunder shall be conditioned upon
(i) all representations and warranties of Buyer being then true and complete in
all material respects as if made on and as of the Closing Date, except to the
extent that any such representation or warranty is made as of a specified date,
in which case such representation or warranty shall have been true and correct
as of such date, (ii) all consents of third parties required for Buyer to
consummate the transactions contemplated under this Agreement shall have been
obtained, (iii) no order, decree or judgment of any court, agency or other
governmental authority shall have been issued based on or arising out of the
conduct, action, inaction, qualifications or status of Buyer or any of its
affiliates, which would render it unlawful as of the Closing Date to effect the
transactions contemplated by this Agreement in accordance with its terms, (iv)
the delivery by Buyer of the Purchase Price in the manner set forth in Section
4(b) above, and (v) the delivery by Buyer of Buyer's Closing Documents (as
defined in Section 9 hereof) on or before the Closing Date.
(c) Buyer's obligation to close hereunder shall be conditioned upon
(i) all representations and warranties of Seller being then true and complete in
all material respects as if made on and as of the Closing Date, except to the
extent that any such representation or warranty is made as of a specific date,
in which case such representation or warranty shall have been true and correct
as of such date, (ii) all consents of third parties required for Seller to
consummate the transactions contemplated under this Agreement shall have been
obtained, (iii)
no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Seller or any of its affiliates, which would render it unlawful as of the Closing Date to effect that transactions contemplated by this Agreement in accordance with its terms, and (iv) the delivery by Seller of Seller's Closing Documents as set forth in Section 9 hereof.
9. Closing Deliveries.
(a) At Closing, Seller shall execute and/or deliver to Buyer the following (collectively "Seller's Closing Documents"):
(i) The Assignment, Bill of Sale and Assumption Agreement;
(ii) The Ground Lease Assignment and Assumption Agreement;
(iii) A certificate from an officer of Seller reasonably acceptable to Buyer confirming the accuracy of the representations and warranties in Section 10 as of the Closing Date;
(iv) Authorizing resolutions or minutes from Seller approving this Agreement and the transactions contemplated herein;
(v) A FIRPTA affidavit to the effect that Seller is not a "foreign person" (as defined in Section 1445(f)(3) of the Code and the regulations issued thereunder);
(vi) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit F (the "Lease Agreement").
(b) At Closing, Buyer shall execute and/or deliver to Seller the following (collectively "Buyer's Closing Documents"):
(i) Authorizing resolutions from Buyer approving this Agreement and the transactions contemplated herein;
(ii) A certificate from an officer of Buyer reasonably acceptable to Seller confirming the accuracy of the representations and warranties in Section 11 as of the Closing Date;
(iii) The Purchase Note executed by a duly authorized officer of Buyer;
(iv) A lease agreement, by and between Buyer, as lessor, and Seller, as lessee, substantially in the form of Exhibit F (the "Lease Agreement"); and
(v) The Assignment, Bill of Sale and Assumption Agreement;
(c) Seller's Closing Documents and Buyer's Closing Documents shall be collectively called herein the "Closing Documents". Buyer and Seller agree that such other documents as may be legally necessary or appropriate to carry out the terms of this Agreement or as reasonably requested by the other party shall be executed and delivered by the appropriate party at Closing.
10. Representations and Warranties of Seller.
As a material inducement to Buyer to enter into this Agreement, Seller represents and warrants to Buyer as follows:
(a) Seller has good and marketable title to the Towers, and the Assets are free and clear of liens, encumbrances, restrictions and security interests other than Permitted Encumbrances.
(b) Seller has full power and authority to execute and deliver this Agreement and Seller's Closing Documents, and to perform its obligations hereunder and thereunder.
(c) This Agreement and Seller's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Seller, enforceable against Seller in accordance with their terms.
(d) The sale of the Assets shall not materially conflict with, or result in, a breach of the terms of any agreements or instruments to which the Seller is a party which would result in the creation or imposition of any lien, charge or encumbrance on, or give to others any interest in or right to, any of the Assets.
(e) Seller has paid or will pay, at or prior to Closing, all outstanding obligations for utilities and taxes through the Closing Date, except for such items as are covered by the proration of items of income and expense as set forth in Section 6 hereof.
(f) Except for the consent of the lessor under the Ground Lease, no third-party authorization or approval of, or filing with, any person, entity, or authority will be required in connection with the execution and delivery of this Agreement or the transactions contemplated by this Agreement.
(g) Assuming all consents and approvals required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Seller's compliance with, the terms and provisions of this Agreement will conflict with, or result in, a breach of any of the terms, conditions, or provisions of the Partnership Agreement of Seller, or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Seller is subject or any material agreement or contract to which Seller is a party or to which it is subject, or constitute a material default thereunder.
(h) Seller is not a foreign person within the meaning of Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and the regulations issued thereunder.
11. Representations and Warranties of Buyer.
As a material inducement to Seller to enter into this Agreement, Buyer represents and warrants to Seller as follows:
(a) Buyer has full power and authority to execute and deliver this Agreement and Buyer's Closing Documents, and to perform its respective obligations hereunder and thereunder.
(b) This Agreement and Buyer's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Buyer enforceable against Buyer, in accordance with their terms.
(c) Assuming all consents and approvals required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Buyer's compliance with, the terms and provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Buyer or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Buyer is subject or any material agreement or contract to which Buyer is a party or to which it is subject, or constitute a material default thereunder.
(d) Buyer acknowledges that the Tower is located on land which is leased and subject to the Ground Lease. Prior to the expiration of the term of Buyer acknowledges that it has received copies of such Ground Lease and that there are no assurances that such Ground Lease will be extended or, if extended, whether the terms and conditions of any such extension will be the same as the terms and conditions of the current Ground Lease.
12. Representations and Warranties Survive Closing.
All of the provisions of this Agreement and of the Closing Documents and
all of the representations, warranties, considerations, and agreements contained
herein and in the Closing Documents shall survive Closing and continue in full
force and effect for a period of twelve (12) months from the Closing Date;
provided that if a claim for indemnification is made by either party under
Section 13 hereof within such twelve (12) month period, the provisions of
Section 13 shall survive until the resolution of such claim. No claim may be
brought under this Agreement unless written notice describing in reasonable
detail the nature of the claim is given on or prior to the last day of the
twelve (12) month period following the Closing Date.
13. Indemnification.
(a) Seller shall indemnify, defend, and hold Buyer, its affiliates, partners, employees, officers, directors, agents, and representatives harmless from and against
any and all reasonable losses, costs, expenses, liabilities, penalties, claims, and other damages including, but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigation, reasonably incurred and resulting from:
(i) any breach of Seller's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Seller of any of its covenants or agreements contained herein or in any Seller's Closing Document;
(iii) the Retained Liabilities;
(iv) any and all losses, liabilities or damages resulting from Sellers' operations or ownership of any Tower prior to the Closing Date, including any and all liabilities arising under the Assets which relate to events occurring prior to the Closing Date.
(b) For a period of one (1) year from the date of this Agreement, Buyer shall indemnify, defend and hold Seller, its affiliates, employees, officers, directors, agents and representatives harmless from and against any and all losses, costs, expenses, liabilities, penalties, claims, and other damages, including but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigations, reasonably incurred and resulting from:
(i) any breach of Buyer's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Buyer of any of its covenants or agreements contained herein or in any Buyer's Closing Document;
(iii) the Assumed Liabilities;
(iv) any and all losses, liabilities or damages resulting from Buyer's operations or ownership of any Tower subsequent to the Closing Date, including any and all liabilities arising under the Assets which related to events occurring subsequent to the Closing Date.
(c) In the event either Buyer or Seller (the "Indemnified Party") becomes aware of circumstances which would entitle such party to indemnification by the other party hereunder (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party prompt written notice, with reasonable detail, of such claim. Upon receipt of such notice by the Indemnified Party to the Indemnifying Party, the Indemnifying Party shall have the option of defending against such pending litigation through engagement of legal counsel of its choice,
provided, however, that the Indemnifying Party's choice of legal counsel must be acceptable to the Indemnified Party in its reasonable discretion. In the event the Indemnifying Party elects to defend, the Indemnifying Party shall keep the Indemnified Party fully informed on a timely basis of the status of the pending litigation. In the event that the Indemnifying Party elects to defend and is unsuccessful in such defense, it shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages as described above, including but not limited to, reasonable attorney's fees and other costs and expenses associated with the pending litigation being so defended. In the event the Indemnifying Party elects not to defend and the Indemnified Party defends, but is unsuccessful, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages, as described above, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. In the event that Indemnifying Party elects not to defend and the Indemnified Party defends successfully, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all costs and expenses incurred, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. The Indemnifying Party shall reimburse the Indemnified Party upon demand for any payment made by the Indemnified Party at any time after Closing, based on the final judgement of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands or actions in respect to any damages to which the foregoing indemnification relates.
(d) Notwithstanding anything in this Agreement to the contrary, Seller's obligation to indemnify Buyer shall be subject to all of the following limitations:
(i) The amount of any losses, costs, expenses, liabilities, penalties, claims, and other damages ("Losses") incurred by Buyer shall be reduced by (A) the amount Buyer recovers (after deducting all attorneys' fees, expenses, and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Buyer shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Buyer shall be entitled to indemnification only for Losses as to which Buyer has given Seller written notice describing in reasonable detail the nature and basis for such indemnification ("Notice of Claim") on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Buyer by Seller pursuant to this
Section 13 shall be limited to Fifty Thousand Dollars
($50,000.00) and Seller shall have no other liability or
responsibility for indemnification hereunder.
(e) Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Buyer with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
(f) Notwithstanding anything in this Agreement to the contrary, Buyer's obligation to indemnify Seller shall be subject to all of the following limitations:
(i) The amount of any Losses incurred by Seller shall be reduced by (A) the amount Seller recovers (after deducting all attorneys' fees, expenses and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Seller shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Seller shall be entitled to indemnification only for Losses as to which Seller has given Buyer a Notice of Claim on or prior to the first anniversary of the Closing Date.
(iii) Any amounts owed to Seller by Buyer pursuant to this
Section 13 shall be limited to Fifty Thousand Dollars
($50,000.00) and Buyer shall have no other liability or
responsibility for Indemnification hereunder.
(g) Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Seller with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
14. Termination; Liquidated Damages.
(a) Right of Termination. This Agreement may be terminated prior to Closing:
(i) By written notice from a party that is not then in material breach of this Agreement if:
(A) The other party has continued in material breach of this Agreement for twenty (20) days after written notice of such breach from the terminating party;
(B) Closing does not occur by May 31, 2000 or such other date as is mutually agreed to by Buyer and Seller.
(b) Obligations Upon Termination.
(i) Upon termination of this Agreement, each party shall thereafter remain liable for breach of this Agreement prior to such termination and remain liable to pay and perform any obligation under Section 13.
(ii) If Closing shall not have occurred, Seller's sole remedy at law or in equity for any breach or default by Buyer described in Section 14(a)(i)(A) shall be the termination by Seller of this Agreement by giving of written notice to Buyer pursuant to Section 14(a)(i)(A).
(c) Termination Notice. Each notice given by a party pursuant to
Section 14(a) to terminate this Agreement shall specify the subsection of
Section 14(a) pursuant to which such notice is given. If at the time a party
gives a termination notice, such party is entitled to give such notice pursuant
to more than one subsection of Section 14(a), the subsection pursuant to which
such notice is given and termination is effected shall be deemed to be the
subsection specified in such notice provided that the party giving such notice
is at such time entitled to terminate this Agreement pursuant to the specified
subsection.
15. Default; Disputes.
If Seller fails to perform under this Agreement, the Buyer may exercise any right it has against the Seller, including bringing an action for specific performance. The remedies provided by this Section are in addition to any right or remedies provided elsewhere in this Agreement or at law or in equity. In the event a dispute arises between the Parties over the interpretation of this Agreement, or the performance, alleged non-performance or breach by either Party hereunder, the Parties hereby agree to seek resolution of such dispute in good faith through an alternative dispute resolution process mutually agreeable to the Parties prior to the institution of any legal proceedings related thereto.
16. Liabilities.
Buyer shall not, in connection with the purchase and sale of Assets contemplating herein, assume any liabilities or obligations of the Seller except as specifically set forth herein.
17. Third Party Brokerage.
Seller and Buyer hereby represent and warrant to each other that neither Seller or Buyer has dealt with any broker or finder in connection with the transaction which is the subject of this Agreement. Each party hereby agrees to indemnify, save harmless and defend the other from and against all claims, losses, liabilities and expenses, including reasonable attorney's fees, arising out of any claim made by any broker, finder or other intermediary who claims to have dealt with such party in connection with the transaction which is the subject of this Agreement. The provisions of the paragraph shall survive Closing hereunder.
18. Entire Agreement.
This Agreement (which includes the exhibits and schedules attached hereto) constitutes the entire agreement between the Parties and there are no other understandings, representations or warranties, oral or written, relating to the subject matter hereof.
19. Amendment.
This Agreement may not be changed, modified or amended, in whole or in part, except in writing, signed by all parties.
20. Notice.
Notices given pursuant to this Agreement shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this Section. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Seller: Beasley Reed Acquisition Partnership
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
If to the Buyer: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
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Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
21. Construction.
Whenever used in this Agreement the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.
22. Assignment and Recording.
Seller hereby covenants not to assign or record this Agreement except with the prior written consent of the Buyer. Buyer may assign this Agreement freely to any affiliated entity, provided such assignment shall not relieve Buyer of its obligations hereunder.
23. Binding Effect.
This Agreement and all of its terms and conditions shall extend to and be binding upon the Parties hereto and upon their respective heirs, executors, administrators, successors and assigns.
24. Further Assurances.
Seller and Buyer agree to execute and deliver any further documents or assurances that in law or otherwise are necessary, desirable or proper to consummate the transactions contemplated by this Agreement and to vest, perfect, assign or confirm, of record or otherwise, in Buyer title to the Assets.
25. Governing Law.
This Agreement is made and shall be governed by and construed in accordance with the internal laws of the State of Florida.
26. Headings.
The headings and captions in this Agreement are for convenience only and are not part of this Agreement.
27. Interpretation.
Neither this Agreement nor any provision contained herein shall be interpreted for or against either party solely because that party or that party's legal representative drafted the provision.
28. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute the same Agreement.
29. Severability.
If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be severed from this Agreement and the remainder shall remain in full force and effect.
[Signature page follows]
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound, have caused this Agreement to be duly executed on the day and year first written above.
SELLER:
BEASLEY REED ACQUISITION PARTNERSHIP
By: BEASLEY FM ACQUISITION CORP.,
its general partner
BUYER:
BEASLEY FAMILY TOWERS, INC.
INDEX OF EXHIBITS
Exhibit A Description of Tower and Tower Site
Exhibit B1 Ground Lease
Exhibit B2 Access Agreement
Exhibit C Form of Purchase Note
Exhibit D Form of Assignment, Bill of Sale and
Assumption Agreement
Exhibit E Form of Ground Lease Assignment and
Assumption Agreement
Exhibit F Form of Lease Agreement
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EXHIBIT A
DESCRIPTION OF TOWER AND TOWER SITE
WQAM-AM
That certain three hundred eighty (380) foot high self-supporting communications tower, manufactured by LeHigh, situated on a tract of submerged land in Biscayne Bay, such land more particularly described as follows:
Commence at the northeast corner of Tract "A" of Herald Park, according to the plat thereof recorded in Plat Book 121 at Page 4 of the Public Records of Dade County, Florida; thereof run South 02 degrees 12'25" West along the East line of said Tract "A" and the Dade County Bulkhead line, according to the Plat thereof recorded in Plat Book 74 at Page 18 of the Public Records of Dade County, Florida for a distance of 210.83' to the P.O.B. of the hereinafter described submerged lands; thence continue South 02 degrees 12'25" West along the East line of said Tract "A" for a distance of 11.17 feet to a point; thence run South 87 degrees 29'05" East for a distance of 189.61 feet to a point; thence run South 00 degrees 10'42" West for a distance of 22.52 feet to a point; thence run South 89 degrees 49'18" East for a distance of 65.30 feet to a point; thence run North 00 degrees 10'42" West for a distance of 65.30 feet to a point; thence run South 00 degrees 10'42" West for a distance of 31.61 feet to a point; thence run North 87 degrees 29'05" West for a distance of 189.22 to the point of beginning.
EXHIBIT B1
GROUND LEASE
EXHIBIT B2
ACCESS AGREEMENT
EXHIBIT C
FORM OF PURCHASE NOTE
PROMISSORY NOTE
$414,321.00 February ____, 2000
BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Payor"), for value received, promises to pay to the order of BEASLEY REED ACQUISITION PARTNERSHIP, a Delaware general partnership, ("Payee"), the principal amount of FOUR HUNDRED FOURTEEN THOUSAND THREE HUNDRED TWENTY ONE DOLLARS ($414,321.00), together with accrued interest thereon, calculated and payable as set forth below in this Note. The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement of Sale (the "Sale Agreement"), dated February ____, 2000, by and among Payor and Payee.
1. Payment of Principal and Interest.
(a) Calculation and Payment of Interest. Interest on the principal balance of this Note outstanding from time to time until paid in full shall accrue at the rate of six and seventy-seven one hundredths percent (6.77%) compounded annually (the "Rate"), computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof.
(b) Payments Prior to Maturity Date. On the first day of each month Maker shall pay, in advance, Three Thousand One Hundred Thirty Seven Dollars and Fifty Eight Cents ($3,137.58). All remaining principal, together with accrued and unpaid interest thereon shall be due and payable on the "Maturity Date" (defined below). Each monthly payment shall be credited first to interest then accrued and the remainder, if any, to principal, and interest shall thereupon cease to accrue upon the principal paid.
(c) Payment on Maturity Date. The principal balance of, and any accrued and unpaid interest on, this Note shall be payable twenty (20) years from the effective date of this Note (such date the "Maturity Date").
(d) Prepayment.
(i) Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this Note.
(ii) Any prepayment of this Note shall be applied as follows:
first, to payment of accrued interest; and second, to
payment of principal.
2. Events of Default.
The following shall constitute "Events of Default" under this Note:
(a) Failure by Payor to make any payment required under this Note when the same shall become due and payable (whether at maturity or otherwise) and the continuation of such failure for a period of ninety (90) days; or
(b) Payor pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for all or any substantial portion of its property or assets;
(c) makes a general assignment for the benefit of its creditors; or
(i) an involuntary case or proceeding is commenced against Payor under any Bankruptcy Law and is not dismissed, bonded or discharged within ninety (90) days thereafter, or a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(ii) is for relief against Payor in an involuntary case or proceeding;
(iii) appoints a Custodian of Payor or for all or substantially all of its properties; or
(iv) orders the liquidation of Payor; and in each case the order or decree remains unstayed and in effect for ninety (90) days.
(d) The following terms used in this Note have the meanings assigned below:
"Bankruptcy Law" means Title 11, United States Code, or any similar federal, state or foreign law for the relief of debtors or any arrangement, reorganization, assignment for the benefit of creditors or any other marshalling of the assets and liabilities of Payor.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
"Event of Default" means any of the occurrences specified in Section 2 of this Note.
If any Event of Default shall have occurred and be continuing, Payee may proceed to protect and enforce its rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to Payee under this Note.
3. Assignment.
The holders of this Note may not assign or otherwise transfer all or any portion of their rights and obligations under this Note to any other person or entity, without the prior written consent of the Payor, which consent shall not be unreasonably withheld.
4. Miscellaneous.
(a) Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
(b) Amendment and Waiver. No provision of this Note may be amended or waived unless Payor shall have obtained the written agreement of Payee. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c) Successors, Assigns and Transferors. The foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
(d) Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of Florida, without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction.
(e) Notices. Any notice, request, instruction or other document to be given hereunder by either party to the other shall be in writing and shall be deemed given when received and shall be (i) delivered personally or (ii) mailed by certified mail, postage prepaid, return receipt requested or (iii) delivered by Federal Express or a similar overnight courier or (iv) sent via facsimile transmission to the fax number given below, as follows:
If to Payor, addressed to:
Beasley Family Towers, Inc. 3033 Riviera Drive, Suite 200 Naples, FL 34103 Attn: Ms. B. Caroline Beasley Fax: 941) 434-8950
With a copy to:
Latham & Watkins 1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Attn: Joseph D. Sullivan, Esq.
Fax: (202) 637-2201
If to Payee, addressed to:
Beasley Reed Acquisition Partnership
3303 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Fax: (941) 434-8950
or to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
BEASLEY FAMILY TOWERS, INC.
EXHIBIT D
FORM OF ASSIGNMENT, BILL OF SALE AND ASSUMPTION AGREEMENT
This Assignment, Bill of Sale and Assumption Agreement (this "Agreement") is made effective as of 12:01 a.m. Eastern Time, on the ____ day of February, 2000 by and between BEASLEY REED ACQUISITION PARTNERSHIP ("Seller") and BEASLEY FAMILY TOWERS, INC. ("Purchaser").
RECITALS
A. Reference is made to that certain Agreement of Sale (the "Asset Purchase Agreement") dated as of February ___, 2000 by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings given such terms in the Asset Purchase Agreement.
B. The Asset Purchase Agreement provides that Seller shall sell, convey and assign to Purchaser all of Seller's right, title and interest to the Tower and Tower Leases and Purchaser shall assume the Assumed Liabilities, as defined in Section 2 of the Asset Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows (capitalized terms used herein but not defined herein shall have the meaning given to them in the Asset Purchase Agreement).
1. Seller hereby bargains, sells, conveys, assigns and delivers all of Seller's right, title and interest in and:
a. The Tower, such Tower more particularly described in Exhibit A of the Asset Purchase Agreement; and
b. The Access Agreement attached as Exhibit B1 of the Asset Purchase Agreement.
Items a. and b. above are hereinafter referred to as the "Assigned Assets."
2. Purchaser hereby accepts the sale, conveyance and assignment of the Assigned Assets, effective as of 12:01 a.m. Eastern Time on February __, 2000.
3. Purchaser hereby assumes and agrees to pay and perform the Assumed Liabilities pursuant to Section 2 of the Asset Purchase Agreement, effective as of 12:01 a.m. Eastern Time on February __, 2000.
4. After the date hereof, Purchaser and Seller will, at the request of the other party, promptly obtain, execute and deliver, or cause to be obtained, executed and delivered, to the other party such assignments, bills of sale, endorsements, and other such instruments or
documents to be executed by Seller or Purchaser, as the case may be, in addition to this Agreement, in form and substance reasonably satisfactory to the other party, as such other party may reasonably deem necessary or desirable so as (i) to vest in Purchaser title to and possession of the Assigned Assets and (ii) to perfect and record, if necessary, the sale, assignment, conveyance, transfer and delivery to Purchaser of the Assigned Assets.
5. This Agreement is made pursuant to, and is subject to all of the terms, representations, warranties and covenants of, the Asset Purchase Agreement, the terms of which are hereby incorporated by reference. In the event of any conflict between this Agreement and the Asset Purchase Agreement, the terms of the Asset Purchase Agreement shall govern.
[Signature page follows]
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this Agreement as of the day and year first written above.
SELLER:
BEASLEY REED ACQUISITION
PARTNERSHIP
By: BEASLEY FM ACQUISITION CORP.,
its general partner
PURCHASER:
BEASLEY FAMILY TOWERS, INC.
EXHIBIT E
FORM OF GROUND LEASE
ASSIGNMENT AND ASSUMPTION AGREEMENT
THIS ASSIGNMENT AND ASSUMPTION OF LEASE ("Assignment") is entered into as
of this _____ day of February, 2000 by and between BEASLEY REED ACQUISITION
PARTNERSHIP ("Assignor"), BEASLEY FAMILY TOWERS, INC., ("Assignee"), and THE
MIAMI HERALD PUBLISHING COMPANY, a division of KNIGHT-RIDDER NEWSPAPERS, INC.
("Lessor").
WHEREAS, Lessor and Storz Broadcasting Co. ("Storz"), entered into that certain Lease Agreement, dated January 9, 1985, leasing certain real property to Storz (such Lease Agreement called herein the "Lease");
WHEREAS, Storz assigned its right, title and interest in and to the Lease to Sunshine Wireless Company, Inc. ("Sunshine"), pursuant to that certain Assignment of Lease, dated September 23, 1985, by and between Storz and Sunshine;
WHEREAS, Sunshine assigned its right, title and interest in and to the Lease to Assignor, pursuant to that certain Assignment of Lessee's Interest in Leases and Assumption Agreement, dated October 8, 1996, by and between Sunshine and Assignor;
WHEREAS, Assignor intends to sell and convey to Assignee certain tower assets used and held for use in the operation of broadcast station WQAM-AM, Miami, Florida, pursuant to the terms of that certain Agreement of Sale (the "Purchase Agreement"), dated as of February ___, 2000, by and between Assignor and Assignee;
WHEREAS, in connection with such transaction, Assignor is required to assign to Assignee all of Assignor's right, title and interest, as lessee, in and to the Lease; and
WHEREAS, Lessor's consent is required to validly effectuate such assignment.
NOW, THEREFORE, in consideration of the mutual promises contained herein, the receipt and sufficiency of which are hereby acknowledged, the parties hereto agree as follows:
1. Assignment. Assignor hereby transfers, conveys and assigns to Assignee all of Assignor's right, title and interest in, to and under the Lease.
2. Assumption of Lease Liabilities. Assignee hereby assumes the liabilities, duties and obligations of Assignor under the Lease which accrue on or after the date hereof, and Assignor shall have no further liability or responsibility therefor.
3. Lessor's Consent. Lessor hereby consents to Assignor's assignment of its right, title and interest in, to and under the Lease.
4. Counterparts. This Assignment of Lease may be executed in counterparts.
[Signature pages follow]
IN WITNESS WHEREOF, the undersigned have executed this Assignment as of the day and year first written above.
[SEAL] ASSIGNOR:
BEASLEY REED ACQUISITION PARTNERSHIP
ATTEST: By: BEASLEY FM ACQUISITION
CORP., its general partner
By:
--------------------------
Name: George G. Beasley
Its: Chief Executive Officer
----------------------------
Name: B. Caroline Beasley
Title: Secretary
STATE OF: )
------------------
) ss.
COUNTY OF )
-----------------
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This is to certify that on the _____ day of February, 2000, before me personally appeared George G. Beasley with whom I am personally acquainted, who, being by me duly sworn, says:
That he is Chief Executive Officer and B. Caroline Beasley is Secretary of BEASLEY FM ACQUISITION CORP., the corporation described in and which executed the foregoing instrument; that he knows the common seal of said corporation; that the seal affixed to the foregoing instrument is said common seal, and the name of the corporation was subscribed thereto by the said Chief Executive Officer, attested by said Secretary, and said common seal was affixed, all by authority duly conferred, and that said instrument is the act and deed of said corporation.
WITNESS, my hand and notarial seal, this ____ day of February, 2000.
My commission expires:
[SEAL] ASSIGNEE:
BEASLEY FAMILY TOWERS, INC.
ATTEST: By:
--------------------------
Name: George G. Beasley
Its: Chief Executive Officer
----------------------------
Name: B. Caroline Beasley
Title: Secretary
STATE OF: )
------------------
) ss.
COUNTY OF )
-----------------
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This is to certify that on the _____ day of February, 2000, before me personally appeared George G. Beasley with whom I am personally acquainted, who, being by me duly sworn, says:
That he is Chief Executive Officer and B. Caroline Beasley is the Secretary of BEASLEY FAMILY TOWERS, INC., the corporation described in and which executed the foregoing instrument; that she knows the common seal of said corporation; that the seal affixed to the foregoing instrument is said common seal, and the name of the corporation was subscribed thereto by the said Chief Executive Officer, attested by said Secretary, and said common seal was affixed, all by authority duly conferred, and that said instrument is the act and deed of said corporation.
WITNESS, my hand and notarial seal, this ____ day of February, 2000.
My commission expires:
[SEAL] LESSOR:
THE MIAMI HERALD PUBLISHING
COMPANY, a division of KNIGHT-RIDDER
NEWSPAPERS, INC.
ATTEST: By:
--------------------------
Name:
Its:
----------------------------
Name:
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Title:
STATE OF: )
------------------
) ss.
COUNTY OF )
-----------------
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This is to certify that on the _____ day of February, 2000, before me personally appeared ____________ with whom I am personally acquainted, who, being by me duly sworn, says:
That ____________ is ____________ and ____________ is the ____________ of
THE MIAMI HERALD PUBLISHING COMPANY, a division of KNIGHT RIDDER NEWSPAPERS,
INC., the corporation described in and which executed the foregoing instrument;
that she knows the common seal of said corporation; that the seal affixed to the
foregoing instrument is said common seal, and the name of the corporation was
subscribed thereto by the said ____________, attested by said ____________, and
said common seal was affixed, all by authority duly conferred, and that said
instrument is the act and deed of said corporation.
WITNESS, my hand and notarial seal, this ____ day of February, 2000.
My commission expires:
EXHIBIT F
FORM OF LEASE AGREEMENT
LEASE AGREEMENT (O&L - WQAM-AM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY REED ACQUISITION PARTNERSHIP, a Delaware general partnership ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns a communications tower described on Exhibit A hereto ("Tower"), on a certain tract of real estate located at Miami, Florida, as such land is more fully described in Exhibit B attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements on such land);
WHEREAS, Lessor desires to lease the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower from Lessor therefor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 TOWER. Lessor hereby leases to Lessee, and Lessee leases from Lessor, the Tower, for the purposes of the broadcast transmission of WQAM-AM, Miami, Florida.
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" as defined below, all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Tower after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto which are permitted hereunder, shall be and remain Lssee's Property, and are hereinafter referred
to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Tower at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Tower for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Tower may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Tower. Lessee may repair and maintain equipment as it deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. The Tower, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to Lessee in this
Lease and with prior notice to Lessee and no loss of service or interruption
(beyond a temporary, non-recurring and de minimis amount), Lessor reserves the
right to use the Tower, at its own expense, as it sees fit and to fasten
additional equipment to the Tower for any purpose, including the right to
install transmitting and/or receiving antennas of others; provided that Lessor
shall use reasonable efforts to restrict any loss of Lessee's service or
interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00
a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
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Lease Year Rent Per Lease Year Monthly Rent
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1 $37,650.96 $3,137.58
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2 $37,650.96 $3,137.58
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3 $37,650.96 $3,137.58
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4 $37,650.96 $3,137.58
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5 $37,650.96 $3,137.58
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6 $37,650.96 $3,137.58
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7 $37,650.96 $3,137.58
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8 $37,650.96 $3,137.58
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9 $37,650.96 $3,137.58
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10 $37,650.96 $3,137.58
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11 $37,650.96 $3,137.58
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12 $37,650.96 $3,137.58
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13 $37,650.96 $3,137.58
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14 $37,650.96 $3,137.58
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15 $37,650.96 $3,137.58
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16 $37,650.96 $3,137.58
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17 $37,650.96 $3,137.58
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18 $37,650.96 $3,137.58
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19 $37,650.96 $3,137.58
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20 $37,650.96 $3,137.58
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by the Lessee by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated ___________, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal
to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Tower, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in
connection with the Tower except that Lessee shall obtain, at its own expense,
any and all necessary licenses or permits from such governmental authorities as
shall have jurisdiction in connection with the (b) the operations, installation,
repair, alteration, or replacement of Lessee's equipment (including, without
limitation, Lessee's antenna and transmission and/or receiving equipment); or
(c) with any of Lessee's activities thereon or contemplated by this Lease. At
Lessor's request, Lessee shall furnish Lessor with copies of same, and shall
abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF TOWER AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to Tower. All such maintenance shall be conducted by the parties in accordance with good engineering
standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Tower or the Tower Site, or the prevention of interference with Lessor or any other user of the Tower or any other broadcaster, Lessor may, at its option, make such emergency repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Tower or Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Tower unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Tower (including any ascension of the Tower), or in or about the Tower Site. Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Tower to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. MAINTENANCE OF TOWER.
9.01 MAINTENANCE OF TOWER.
(a) Lessor shall maintain the Tower in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the Tower. Lessor shall maintain the Tower and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs, alterations, or improvements are necessary or desirable to the Tower or the leased spaces of other tenants, Lessor may, upon reasonable notice and for the shortest practical period of time (except for emergency situations), close entrance doors, common areas, drive-ways, rights-of-way, service areas, parking areas, or any other facilities at its discretion without being liable to Lessee; provided that if any of the above would restrict Lessee's ability to broadcast, Lessor shall use reasonable efforts to restrict any closure or interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00 a.m.. The closing of entrances, doors, common areas, parking areas, or other facilities for the making of the repairs, alterations, or improvements described herein shall, under no circumstances, constitute an eviction of the Lessee or be grounds for termination of this Lease or the withholding of any rental payments or other payments or performances required to be paid or made by Lessee under the terms hereof, provided, Lessor shall use reasonable efforts to ensure that any action taken in accordance with this paragraph shall not adversely affect the rights of Lessee hereunder. Under no such circumstances shall Lessee be entitled to terminate this Lease nor shall it be entitled to compensation for any loss or damage it may sustain (including loss of use, loss of advertising/sponsorship revenues, and consequential damages) by reason of such changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Tower, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine Tower loading capacity, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Tower after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Tower whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph. 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by
such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Tower shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Tower shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes, assessments, or levies assessed or imposed against the Tower Site (including the Tower), and all taxes which may be assessed against the Tower and any buildings thereon. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall pay all personal
property or other taxes assessed or imposed on Lessee's Property, and shall cooperate with Lessor to ensure that such property is properly separated from that of Lessor or other tenants for assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Tower, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Tower elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWER INSURANCE. Lessee shall procure and maintain physical damage insurance on the Tower in an amount sufficient to repair or replace the Tower with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWER DAMAGE. In the event that the Tower is destroyed or damaged by fire, lightning, windstorm, flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or other casualty covered by insurance, Lessor shall promptly reconstruct or repair the Tower to such good condition as existed before the destruction or damage, and give possession to Lessee of substantially the same space leased hereunder. Lessee shall promptly pay over to Lessor any insurance proceeds it receives from insurance policies Lessee is required to procure under Section 14.03 hereof for the purpose of use by Lessor to fund reconstruction of the Tower as required of Lessor under this Section 14.04. If the Tower is in need of such repair or is so damaged by fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle damage, collapse, or other casualty that reconstruction or repair cannot reasonably be undertaken without dismantling Lessee's antenna, then upon written notice to Lessee, Lessor may remove
any such antenna and interrupt the signal activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably possible. Lessor agrees to provide Lessee an alternative tower, if available, during such reconstruction/repair period. If such tower is not available, then Lessee shall be responsible for procuring its own alternative tower. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Tower without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Tower or (b) replace the Tower within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to Tower damage (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower (or any portion of the Tower necessary for the guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for the Tower on the condemned property, Lessor agrees to lease the new tower on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other
person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Tower within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Tower after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be
appointed for Lessee or the Tower, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Tower by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Tower. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Tower (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of Florida at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority
to enter into this Lease and to grant the rights it grants hereunder, and that
performance of its obligations pursuant to this Lease will not violate the
rights of any third party whatsoever. Lessee agrees to indemnify and defend
Lessor against any claim for damages, losses, liabilities, costs, or expenses,
including reasonable attorney's fees, arising (a) out of any breach by Lessee of
its warranties, representations, or covenants under this Lease; (b) out of the
use, management, or occupancy of the Tower by Lessee, its agents, or invitees;
(c) out of any omissions, negligence or willful misconduct of Lessee, its
agents, servants, employees, licensees, or invitees; (d) out of failure of
Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of
Lessee's failure to maintain equipment in proper working order; and (f) out of
Lessee's failure to comply with any of its other obligations under the terms of
this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this
Lease; (b) out of the use, management, or occupancy of the Tower by Lessor, its
agents, or invitees; (c) out of any omissions, negligence or willful misconduct
of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of
failure of Lessor to comply with any laws, statutes, ordinances, or regulations;
(e) out of Lessor's failure to maintain equipment in proper working order; and
(f) out of Lessor's failure to comply with any of its other obligations under
the terms of this Lease.
(c) Any party seeking indemnification hereunder ("Indemnified Party") shall provide the other party ("Indemnifying Party") reasonably prompt notice of known claims giving rise to any claim for indemnity, and the Indemnifying Party shall have the right and opportunity to undertake the legal defense of such claims. The Indemnified Party and its counsel may nevertheless participate in (but not control) such proceedings, negotiations, or defense at its own expense. In all such cases, the Indemnified Party will give all reasonable assistance to the Indemnifying Party, including making the Indemnified Party's employees and documents available as reasonably requested without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after either party's
request, the other party shall deliver, executed in recordable form, a
declaration to any person designated by the requesting party (a) ratifying this
Lease; (b) stating the commencement and termination dates; and (c) certifying
(i) that this Lease is in full force and effect, and has not been assigned,
modified, supplemented, or amended (except by such writings as shall be stated);
(ii) that all conditions under this Lease to be performed have been satisfied
(stating exceptions, if any); (iii) that no defenses or offsets against the
enforcement of this Lease by the requesting party exist (or stating those
claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which rent
has been paid; (vi) the amount of security deposited with Lessor (if hereafter
applicable for any reason); and (vii) such other information as the requesting
party reasonably requires. Persons receiving such statements shall be entitled
to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Tower, or, if any of the Tower comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of Florida.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one-half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200 Naples, FL 34103 Attn: Ms. B. Caroline Beasley Secretary Phone: (941) 263-5000 |
Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley Reed Acquisition Partnership
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
|
Fax: (941) 434-8950
21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Tower, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Tower; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Tower and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor
shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Tower or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
------------------------------ -------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
|
LESSEE:
BEASLEY REED ACQUISITION PARTNERSHIP
By: Beasley FM Acquisition Corp.,
a general partner
By:
----------------------------- -------------------------
Witness Name: George G. Beasley
Title: Chief Executive
Officer
By: BRAP HOLDINGS, INC.
a general partner
Witness By:
---------------------------
Name: B. Caroline Beasley
Title: Secretary
|
EXHIBIT A
DESCRIPTION OF TOWER
That certain three hundred eighty (380) foot high self-supporting communications tower manufactured by LeHigh situated on a tract of submerged land in Biscayne Bay and described on Exhibit B herein.
EXHIBIT B
DESCRIPTION OF TOWER SITE
That certain tract of submerged land in Biscayne Bay, such land more particularly described as follows:
Commence at the northeast corner of Tract "A" of Herald Park, according to the plat thereof recorded in Plat Book 121 at Page 4 of the Public Records of Dade County, Florida; thereof run South 02 degrees 12'25" West along the East line of said Tract "A" and the Dade County Bulkhead line, according to the Plat thereof recorded in Plat Book 74 at Page 18 of the Public Records of Dade County, Florida for a distance of 210.83' to the P.O.B. of the hereinafter described submerged lands; thence continue South 02 degrees 12'25" West along the East line of said Tract "A" for a distance of 11.17 feet to a point; thence run South 87 degrees 29'05" East for a distance of 189.61 feet to a point; thence run South 00 degrees 10'42" West for a distance of 22.52 feet to a point; thence run South 89 degrees 49'18" East for a distance of 65.30 feet to a point; thence run North 00 degrees 10'42" West for a distance of 65.30 feet to a point; thence run South 00 degrees 10'42" West for a distance of 31.61 feet to a point; thence run North 87 degrees 29'05" West for a distance of 189.22 to the point of beginning.
EXHIBIT 10.20
AGREEMENT OF SALE (O&O)
This Agreement of Sale (the "Agreement") is made this ___ day of February, 2000, between Beasley FM Acquisition Corp., a Delaware corporation (the "Seller") and Beasley Family Towers, Inc., a Delaware corporation (the "Buyer") (together, the "Parties").
WITNESSETH:
WHEREAS, Seller owns certain real and personal property comprising multiple parcels of real property and three (3) communications tower facilities (the "Towers") located in Grantsboro, North Carolina and Fayetteville, North Carolina used in the operation of radio broadcast stations WMGV-FM, WUKS-FM and WAZZ-AM (collectively, the "Tower Sites" and each, a "Tower Site");
WHEREAS, Seller desires to sell and Buyer desires to purchase the Towers and certain real and personal property belonging to Seller and associated with the Tower Sites;
NOW, THEREFORE, in consideration of the mutual premises contained herein, and for other good and valuable consideration, the receipt and sufficiency of which is hereby acknowledged, the Parties, intending to be legally bound hereby, agree as follows:
1. Agreement To Sell And Purchase.
Seller agrees to sell, transfer, assign, convey and deliver to Buyer and Buyer agrees to purchase and accept from Seller, the following assets upon the terms and conditions contained herein (collectively, the "Assets"):
(a) Those certain tracts of land, and easements or appurtenances incident to such tracts of land, that are associated with the Tower Sites (collectively, such land, easements and appurtenances, the "Land"), and the Towers, each such Tower and its corresponding parcel of Land more particularly described in Exhibit A attached hereto; and
(b) The leases for use of space on certain of the Towers located at the Tower Sites as more particularly discussed in Section 5(d) of this Agreement.
2. Assumption of Liabilities.
(a) Upon the terms and subject to the conditions contained herein, Buyer shall assume and become responsible for any and all liabilities and obligations arising out of, or relating to events occurring after 12:01 am Eastern Standard Time on the Closing Date (the "Adjustment Time") under the Tower Leases (as defined in Section 5(d) hereof), and with respect to the ownership of the Land and Towers, and the operation of the business relating to the Assets (collectively, the "Assumed Liabilities").
(b) Subject to the provisions of Section 13 hereof, it is understood and agreed that all liabilities to third parties relating to the Assets that arise out of any act, event, or transaction of Seller or the ownership of the Assets or the operation of the business relating to the
Assets prior to the Closing Date (the "Retained Liabilities") shall remain the
responsibility of Seller. Buyer shall not be required to defend any suit or
claim arising out of any Retained Liabilities, and Seller shall and hereby
agrees to satisfy in due course all such Retained Liabilities, and subject to
Section 13 hereof Seller shall protect and forever hold Buyer harmless from all
claims with respect to such Retained Liabilities. It is understood and agreed
that all liabilities relating to the Assets that arise out of any act, event, or
transaction of Buyer following the Closing Date (the "Assumed Liabilities")
shall be the responsibility of Buyer. Seller shall not be required to defend any
suit or claim arising out of any Assumed Liabilities, and Buyer shall and hereby
agrees to satisfy in due course all such Assumed Liabilities, and subject to
Section 13 hereof Buyer shall protect and forever hold Seller harmless from all
claims with respect to such Assumed Liabilities.
3. Purchase Price.
(a) The purchase price for the Assets shall be the amount of One Million One Hundred Thirty Five Thousand Two Hundred Eight Dollars ($1,135,208.00) (the "Purchase Price"). The Purchase Price shall be adjusted at the Closing by the amount of any prorations derived by operation of Section 6 hereof, and for any other normal income and expense items related to the operation of the Tower Sites as of 12:01 am on the day on which the Closing occurs. The Purchase Price shall be allocated among the Assets in accordance with Section 3(b).
(b) Buyer and Seller agree to allocate the aggregate of the Purchase Price, the Assumed Liabilities and other relevant items among the Assets in accordance with section 1060 of the Internal Revenue Code of 1986, as amended (the "Code"). Buyer and Seller will each report the federal, state, and local and other tax consequences of the purchase and sale contemplated hereby (including the filing of IRS Form 8594) in a manner consistent with such allocation.
4. Delivery of Purchase Price.
(a) The Purchase Price shall be payable at Closing (as defined in Section 8 below) in the manner set forth in Section 4(b).
(b) As payment of the Purchase Price, Buyer shall deliver to Seller at Closing an unsecured promissory note of Buyer in the aggregate principal amount of One Million One Hundred Thirty Five Thousand Two Hundred Eight Dollars ($1,135,208.00), substantially in the form of Exhibit B (the "Purchase Note").
5. Transfer of Towers; Title Insurance.
(a) Transfer of title to each parcel of Land shall be by deed from the Seller to the Buyer (each, a "Deed"), which Deeds shall be in the form of Exhibit C attached hereto and incorporated herein. Transfer of ownership of the Towers and assumption of the Assumed Liabilities pursuant to Section 2 hereof shall be pursuant to the Assignment, Bill of
Sale and Assumption Agreement from the Seller to Buyer in the form of Exhibit D attached hereto and incorporated herein (the "Assignment, Bill of Sale and Assumption Agreement").
(b) The Assets shall be transferred to Buyer free and clear of
all liens, encumbrances other than Permitted Encumbrances, if any; otherwise the
title to the Land shall be good and marketable or such as will be insured by a
reputable title insurance company at regular rates. "Permitted Encumbrances"
shall mean: (i) encumbrances for taxes, assessments, or governmental charges or
levies which are not yet due and payable, or that, subject to adequate security
for payment, are being contested; (ii) existing building restrictions,
ordinances, easements of roads, privileges, or rights of public service
companies or other rights of way, other restrictions or conditions of record, if
any or other encumbrances disclosed in this Agreement (including the Exhibits
attached hereto); (iii) easements, rights of way or other encumbrances that do
not have a material adverse effect on the Assets or the operation of the
business relating to the Assets as currently operated; (iv) encumbrances imposed
by law, such as materialmen's, mechanic's, carrier's, workmen's, or repairmen's
liens or other similar encumbrances attaching in the ordinary course of business
or securing obligations that are not overdue; (v) encumbrances securing
indebtedness, which will be removed prior to or at the Closing; and (vi)
encumbrances pursuant to contracts and leases to be assumed by Buyer pursuant to
Section 2.
(c) As soon as practicable following the Closing, or at such other time as the parties agree, Seller, at its expense, shall obtain and deliver to Buyer a commitment for title insurance (the "Title Commitment") issued by a nationally recognized title company in the ALTA Owner's Form Policy of Title Insurance (each a "Title Policy" and collectively, "Title Policies") covering each tract of Land, setting forth the current status of title thereto, showing all recorded liens, claims, encumbrances, easements, rights-of-way, encroachments, reservations, restrictions and any other matters of public record affecting title to the Land pursuant to which such title company agrees to issue to Buyer the Title Policies. The cost of the Title Policies shall be borne by the BUYER. Seller shall execute such customary documents as the title company reasonably requests, including, but not limited to, an affidavit of debts and liens and customary closing statements.
(d) Buyer and Seller acknowledge that certain of the Towers are occupied, or will be occupied, by various tenants pursuant to tower leases between third party lessees and the Seller, for space on certain of the Towers, such tower leases all made effective prior to the effective date of this Agreement (the "Tower Leases"). Buyer acknowledges receipt of copies of the Tower Leases from Seller. At Closing, Seller will assign all of its right, title, and interest in the Tower Leases to Buyer, and Buyer shall assume the obligations under such Tower Leases, in the Assignment, Bill of Sale and Assumption Agreement. In the event that the Buyer receives after Closing any lease payment from tenants pursuant to Tower Leases for rent that accrued prior to Closing, Buyer shall remit such lease payment promptly to Seller. Conversely, in the event Seller receives after Closing any lease payments from tenants pursuant to the Tower Leases for rent that accrued after Closing, Seller shall remit such lease payments promptly to Buyer.
6. Apportionment of Real Estate Taxes, Rent, Utilities.
(a) Current real estate taxes, rent, utilities and all other normal income and expense items related to the Assets shall be apportioned between the parties to reflect the principle that all expenses and income arising from the operation of the Assets up through the Adjustment Time shall be for the account of Seller, and all expenses and income arising from the operation of the business relating to the Assets acquired by Buyer after the Adjustment Time shall be for the account of Buyer.
(b) As soon as practicable following the Closing Date, or at
such other time as the parties agree, Buyer shall deliver to Seller a
certificate from Buyer which sets forth as of the Adjustment Time, all
adjustments to be made as provided in Section 6(a) above (the "Buyer's
Certificate"). Buyer shall provide Seller or its representatives access to
copies of such portions of books and records Seller may reasonably request
solely for the purposes of verifying such adjustments. The Buyer's Certificate
shall be final and conclusive unless objected to by Seller in writing within
ninety (90) days after delivery. Buyer and Seller shall attempt jointly to reach
agreement as to the amount of the adjustments to be made hereunder within thirty
(30) days after receipt of such written objection, which agreement, if achieved,
shall be binding upon all parties to this Agreement and not subject to dispute
or review.
(c) In the event of a disagreement between Buyer and Seller with respect to the accounting to be made hereunder, the parties agree that a public accounting firm chosen jointly by Buyer and Seller shall be the final arbiter of such disagreement.
(d) Any amounts due for the adjustments provided for herein shall be paid within thirty (30) business days after final determination.
7. Expenses.
(a) Seller shall pay the costs of preparation of the Deeds, acknowledgement of the Deeds, Federal, state and local revenue stamps, and real estate transfer taxes.
(b) All other costs and expenses incurred by the Parties in this transaction, including, but not limited to attorneys' fees, shall be paid by the party incurring them.
8. Closing; Closing Conditions.
(a) Closing of the transactions contemplated by this Agreement (the "Closing") shall occur at a place and time mutually agreeable to Seller and Buyer (the "Closing Date"). Seller and Buyer shall both make a good faith effort to close under this Agreement promptly.
(b) Seller's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Buyer being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or
warranty is made as of a specified date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Buyer or any of its affiliates, which would render it unlawful as of the Closing Date to effect the transactions contemplated by this Agreement in accordance with its terms, (iv) the delivery by Buyer of the Purchase Price in the manner set forth in Section 4(b), and (v) the delivery by Buyer of Buyer's Closing Documents (as defined in Section 9 hereof) on or before the Closing Date.
(c) Buyer's obligation to close hereunder shall be conditioned upon (i) all representations and warranties of Seller being then true and complete in all material respects as if made on and as of the Closing Date, except to the extent that any such representation or warranty is made as of a specific date, in which case such representation or warranty shall have been true and correct as of such date, (ii) all consents of third parties required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, (iii) no order, decree or judgment of any court, agency or other governmental authority shall have been issued based on or arising out of the conduct, action, inaction, qualifications or status of Seller or any of its affiliates, which would render it unlawful as of the Closing Date to effect that transactions contemplated by this Agreement in accordance with its terms, and (iv) the delivery by Seller of Seller's Closing Documents as set forth in Section 9 hereof.
9. Closing Deliveries.
(a) At Closing, Seller shall execute and/or deliver to Buyer the following (collectively "Seller's Closing Documents"):
(i) The Deeds;
(ii) The Assignment, Bill of Sale and Assumption Agreement;
(iii) A certificate from an officer of Seller reasonably acceptable to Buyer confirming the accuracy of the representations and warranties in Section 10 as of the Closing Date;
(iv) Authorizing resolutions or minutes from Seller approving this Agreement and the transactions contemplated herein;
(v) A FIRPTA affidavit to the effect that Seller is not a "foreign person" (as defined in Section 1445(f)(3) of the Code and the regulations issued thereunder); and
(vi) Three (3) lease agreements, each lease agreement by and between Buyer, as lessor, and Seller, as lessee, and each lease agreement substantially in the form of Exhibit E (the "Lease Agreements").
(b) At Closing, Buyer shall execute and/or deliver to Seller the following (collectively "Buyer's Closing Documents"):
(i) Authorizing resolutions from Buyer approving this Agreement and the transactions contemplated herein; and
(ii) A certificate from an officer of Buyer reasonably acceptable to Seller confirming the accuracy of the representations and warranties in Section 11 as of the Closing Date;
(iii) The Purchase Note executed by a duly authorized officer of Buyer;
(iv) Three (3) lease agreements, each lease agreement by and between Buyer, as lessor, and Seller, as lessee, and each lease agreement substantially in the form of Exhibit E (the "Lease Agreements"); and
(v) The Assignment, Bill of Sale and Assumption Agreement.
(c) Seller's Closing Documents and Buyer's Closing Documents shall be collectively called herein the "Closing Documents". Buyer and Seller agree that such other documents as may be legally necessary or appropriate to carry out the terms of this Agreement or as reasonably requested by the other party shall be executed and delivered by the appropriate party at Closing.
10. Representations and Warranties of Seller.
As a material inducement to Buyer to enter into this Agreement, Seller represents and warrants to Buyer as follows:
(a) Seller has good and marketable title to the Towers and the Land (or such condition of title as will be insured by any reputable title insurance company at their regular rates), and the Assets are free and clear of liens, encumbrances, restrictions and security interests other than Permitted Encumbrances.
(b) Seller has full power and authority to execute and deliver this Agreement and Seller's Closing Documents, and to perform its obligations hereunder and thereunder.
(c) This Agreement and Seller's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Seller, enforceable against Seller in accordance with their terms.
(d) The sale of the Assets shall not materially conflict with, or result in, a breach of the terms of any agreements or instruments to which the Seller is a party or which
would result in the creation or imposition of any lien, charge or encumbrance on, or give to others any interest in or right to, any of the Assets.
(e) Seller has paid or will pay, at or prior to Closing, all outstanding obligations for utilities and taxes through the Closing Date except for such items as are covered by the proration of items of income and expense as set forth in Section 6 hereof.
(f) No third-party authorization or approval of, or filing with, any person, entity, or authority will be required in connection with the execution and delivery of this Agreement or the transactions contemplated by this Agreement.
(g) Assuming all consents and approvals required for Seller to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Seller's compliance with, the terms and provisions of this Agreement will conflict with, or result in, a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Seller, or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Seller is subject or any material agreement or contract to which Seller is a party or to which it is subject, or constitute a material default thereunder.
(h) Seller is not a foreign person within the meaning of
Section 1445(f)(3) of the Internal Revenue Code of 1986, as amended, and the
regulations issued thereunder.
11. Representations and Warranties of Buyer.
As a material inducement to Seller to enter into this Agreement, Buyer represents and warrants to Seller as follows:
(a) Buyer has full power and authority to execute and deliver this Agreement and Buyer's Closing Documents, and to perform its respective obligations hereunder and thereunder.
(b) This Agreement and Buyer's Closing Documents, when executed and delivered, will constitute valid and binding agreements of Buyer enforceable against Buyer, in accordance with their terms.
(c) Assuming all consents and approvals required for Buyer to consummate the transactions contemplated under this Agreement shall have been obtained, neither the execution, delivery, and performance of, nor Buyer's compliance with, the terms and provisions of this Agreement will conflict with or result in a breach of any of the terms, conditions, or provisions of the Articles of Incorporation or Bylaws of Buyer or any judgment, order, injunction, decree, regulation, or ruling of any court or any other governmental authority to which Buyer is subject or any material agreement or contract to which Buyer is a party or to which it is subject, or constitute a material default thereunder.
12. Representations and Warranties Survive Closing.
All of the provisions of this Agreement and of the Closing Documents and
all of the representations, warranties, considerations, and agreements contained
herein and in the Closing Documents shall survive Closing and continue in full
force and effect for a period of twelve (12) months from the Closing Date;
provided that if a claim for indemnification is made by either party under
Section 13 hereof within such twelve (12) month period, the provisions of
Section 13 shall survive until the resolution of such claim. No claim may be
brought under this Agreement unless written notice describing in reasonable
detail the nature of the claim is given on or prior to the last day of the
twelve (12) month period following the Closing Date.
13. Indemnification.
(a) For a period of one (1) year from the date of this Agreement, Seller shall indemnify, defend, and hold Buyer, its affiliates, partners, employees, officers, directors, agents, and representatives harmless from and against any and all reasonable losses, costs, expenses, liabilities, penalties, claims, and other damages including, but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigation, reasonably incurred and resulting from:
(i) any breach of Seller's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Seller of any of its covenants or agreements contained herein or in any Seller's Closing Document;
(iii) the Retained Liabilities;
(iv) any and all losses, liabilities or damages resulting from Sellers' operations or ownership of any Tower Site prior to the Closing Date, including any and all liabilities arising under the Assets which relate to events occurring prior to the Closing Date.
(b) For a period of one (1) year from the date of this Agreement, Buyer shall indemnify, defend and hold Seller, its affiliates, employees, officers, directors, agents and representatives harmless from and against any and all losses, costs, expenses, liabilities, penalties, claims, and other damages, including but not limited to, reasonable attorney's fees and other costs and expenses, including reasonable costs of investigations, reasonably incurred and resulting from:
(i) any breach of Buyer's representations or warranties, or the breach of any other provision contained in this Agreement;
(ii) nonfulfillment by Buyer of any of its covenants or agreements contained herein or in any Buyer's Closing Document;
(iii) the Assumed Liabilities;
(iv) any and all losses, liabilities or damages resulting from Buyer's operations or ownership of any Tower Site subsequent to the Closing Date, including any and all liabilities arising under the Assets which related to events occurring subsequent to the Closing Date.
(c) In the event either Buyer or Seller (the "Indemnified Party") becomes aware of circumstances which would entitle such party to indemnification by the other party hereunder (the "Indemnifying Party"), the Indemnified Party shall give the Indemnifying Party prompt written notice, with reasonable detail, of such claim. Upon receipt of such notice by the Indemnified Party to the Indemnifying Party, the Indemnifying Party shall have the option of defending against such pending litigation through engagement of legal counsel of its choice, provided, however, that the Indemnifying Party's choice of legal counsel must be acceptable to the Indemnified Party in its reasonable discretion. In the event the Indemnifying Party elects to defend, the Indemnifying Party shall keep the Indemnified Party fully informed on a timely basis of the status of the pending litigation. In the event that the Indemnifying Party elects to defend and is unsuccessful in such defense, it shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages as described above, including but not limited to, reasonable attorney's fees and other costs and expenses associated with the pending litigation being so defended. In the event the Indemnifying Party elects not to defend and the Indemnified Party defends, but is unsuccessful, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all losses, costs, expenses, liabilities, penalties, claims and other damages, as described above, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. In the event that Indemnifying Party elects not to defend and the Indemnified Party defends successfully, then the Indemnifying Party shall promptly pay to the Indemnified Party any and all costs and expenses incurred, including, but not limited to, reasonable attorney's fees and other costs and expenses incurred, including reasonable costs of investigation. The Indemnifying Party shall reimburse the Indemnified Party upon demand for any payment made by the Indemnified Party at any time after Closing, based on the final judgement of any court of competent jurisdiction or pursuant to a bona fide compromise or settlement of claims, demands or actions in respect to any damages to which the foregoing indemnification relates.
(d) Limitations on Seller Indemnification. Notwithstanding anything in this Agreement to the contrary, Seller's obligation to indemnify Buyer shall be subject to all of the following limitations:
(i) The amount of any losses, costs, expenses,
liabilities, penalties, claims, and other damages
("Losses") incurred by Buyer shall be reduced by (A)
the amount Buyer recovers
(after deducting all attorneys' fees, expenses, and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Buyer shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Buyer shall be entitled to indemnification only for Losses as to which Buyer has given Seller written notice describing in reasonable detail the nature and basis for such indemnification ("Notice of Claim") on or prior to the first anniversary of the Closing Date.
(iii) Seller shall not be required to make any
indemnification under clause of Section 13(a) until
the aggregate amount of Losses resulting from or
arising out of the matters referred to in Section
13(a)(i) exceeds Ten Thousand Dollars ($10,000.00);
provided that if the aggregate amount of such Losses
exceeds such amount, Seller shall be required to
indemnify Buyer for all Losses indemnifiable under
Section 13(a)(i) without regard to such Ten Thousand
Dollar ($10,000.00) limitation.
(iv) Any amounts owed to Buyer by Seller pursuant to this
Section 13 shall be limited to One Hundred
Twenty-Five Thousand Dollars ($125,000.00) and
Seller shall have no other liability or
responsibility for indemnification hereunder.
(e) Buyer's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Buyer with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
(f) Limitation on Buyer's Indemnification. Notwithstanding anything in this Agreement to the contrary, Buyer's obligation to indemnify Seller shall be subject to all of the following limitations:
(i) The amount of any Losses incurred by Seller shall be reduced by (A) the amount Seller recovers (after deducting all attorneys' fees, expenses and other out-of-pocket costs of recovery) from any insurer or other party liable for such Losses, and Seller shall use commercially reasonable efforts to effect any such recovery and (B) any tax benefit realized by Buyer or its owners as a result of any such Loss.
(ii) Seller shall be entitled to indemnification only for Losses as to which Seller has given Buyer a Notice of Claim on or prior to the first anniversary of the Closing Date.
(iii) Buyer shall not be required to make any
indemnification under clause (i) of Section 13(b)
until the aggregate amount of Losses resulting from
or arising out of the matters referred to in Section
13(b)(i) exceeds Ten Thousand Dollars ($10,000.00);
provided that if the aggregate amount of such Losses
exceeds such amount, Buyer shall be required to
indemnify Seller for all Losses indemnifiable under
Section 13(b)(i) without regard to such Ten Thousand
Dollar ($10,000.00) limitation.
(iv) Any amounts owed to Seller by Buyer pursuant to this
Section 13 shall be limited to One Hundred
Twenty-Five Thousand Dollars ($125,000.00) and Buyer
shall have no other liability or responsibility for
Indemnification hereunder.
(g) Seller's Exclusive Remedy. Subsequent to the Closing, indemnification under this Section 13 shall be the exclusive remedy of Seller with respect to any legal, equitable or other claim for relief based upon this Agreement or arising hereunder.
14. Termination; Liquidated Damages.
(a) Right of Termination. This Agreement may be terminated prior to Closing:
(i) By written notice from a party that is not then in material breach of this Agreement if:
(A) The other party has continued in material breach of this Agreement for twenty (20) days after written notice of such breach from the terminating party;
(B) Closing does not occur by May 31, 2000 or such other date as is mutually agreed to by Buyer and Seller.
(b) Obligations Upon Termination.
(i) Upon termination of this Agreement, each party shall
thereafter remain liable for breach of this
Agreement prior to such termination and remain
liable to pay and perform any obligation under
Section 13.
(ii) If Closing shall not have occurred, Seller's sole
remedy at law or in equity for any breach or default
by Buyer described in Section 14(a)(i)(A) shall be
the termination by Seller of this Agreement by
giving of written notice to Buyer pursuant to
Section 14(a)(i)(A).
(c) Termination Notice. Each notice given by a party pursuant
to Section 14(a) to terminate this Agreement shall specify the subsection of
Section 14(a) pursuant to which such notice is given. If at the time a party
gives a termination notice, such party is entitled to give such notice pursuant
to more than one subsection of Section 14(a), the subsection pursuant to which
such notice is given and termination is effected shall be deemed to be the
subsection specified in such notice provided that the party giving such notice
is at such time entitled to terminate this Agreement pursuant to the specified
subsection.
15. Default; Disputes.
If Seller fails to perform under this Agreement, the Buyer may exercise any right he has against the Seller, including bringing an action for specific performance. The remedies provided by this Section are in addition to any right or remedies provided elsewhere in this Agreement or at law or in equity. In the event a dispute arises between the Parties over the interpretation of this Agreement, or the performance, alleged non-performance or breach by either Party hereunder, the Parties hereby agree to seek resolution of such dispute in good faith through an alternative dispute resolution process mutually agreeable to the Parties prior to the institution of any legal proceedings related thereto.
16. Liabilities.
Buyer shall not, in connection with the purchase and sale of Assets contemplating herein, assume any liabilities or obligations of the Seller except as specifically set forth herein.
17. Third Party Brokerage.
Seller and Buyer hereby represent and warrant to each other that neither Seller or Buyer has dealt with any broker or finder in connection with the transaction which is the subject of this Agreement. Each party hereby agrees to indemnify, save harmless and defend the other from and against all claims, losses, liabilities and expenses, including reasonable attorney's fees, arising out of any claim made by any broker, finder or other intermediary who claims to have dealt with such party in connection with the transaction which is the subject of this Agreement. The provisions of the paragraph shall survive Closing hereunder.
18. Entire Agreement.
This Agreement (which includes the exhibits and schedules attached hereto) constitutes the entire agreement between the Parties and there are no other understandings, representations or warranties, oral or written, relating to the subject matter hereof.
19. Amendment.
This Agreement may not be changed, modified or amended, in whole or in part, except in writing, signed by all parties.
20. Notice.
Notices given pursuant to this Agreement shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this Section. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Seller: Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
If to the Buyer: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
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Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
21. Construction.
Whenever used in this Agreement the singular shall include the plural, the plural the singular, and the use of any gender shall be applicable to all genders.
22. Assignment and Recording.
Seller hereby covenants not to assign or record this Agreement except with the prior written consent of the Buyer. Buyer may assign this Agreement freely to any affiliated entity, provided such assignment shall not relieve Buyer of its obligations hereunder.
23. Binding Effect.
This Agreement and all of its terms and conditions shall extend to and be binding upon the Parties hereto and upon their respective heirs, executors, administrators, successors and assigns.
24. Further Assurances.
Seller and Buyer agree to execute and deliver any further documents or assurances that in law or otherwise are necessary, desirable or proper to consummate the transactions contemplated by this Agreement and to vest, perfect, assign or confirm, of record or otherwise, in Buyer title to the Assets.
25. Governing Law.
This Agreement is made and shall be governed by and construed in accordance with the internal laws of the State of North Carolina.
26. Headings.
The headings and captions in this Agreement are for convenience only and are not part of this Agreement.
27. Interpretation.
Neither this Agreement nor any provision contained herein shall be interpreted for or against either party solely because that party or that party's legal representative drafted the provision.
28. Counterparts.
This Agreement may be executed in one or more counterparts, each of which shall be deemed an original and all of which shall constitute the same Agreement.
29. Severability.
If any provision of this Agreement is found by a court of competent jurisdiction to be invalid or unenforceable, then such provision shall be severed from this Agreement and the remainder shall remain in full force and effect.
30. Covenant of Seller.
Seller shall make all commercially reasonable efforts to resolve any title or restriction issues prior to the Closing, but will continue these efforts subsequent to the Closing to the extent reasonably necessary.
IN WITNESS WHEREOF, the Parties hereto, intending to be legally bound, have caused this Agreement to be duly executed on the day and year first written above.
SELLER:
BEASLEY FM ACQUISITION CORP.
BUYER:
BEASLEY FAMILY TOWERS, INC.
INDEX OF EXHIBITS
Exhibit A Description of Land and Towers
Exhibit B Form of Purchase Note
Exhibit C Form of Deeds
Exhibit D Form of Assignment, Bill of Sale and
Assumption Agreement
Exhibit E Form of Lease Agreements
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EXHIBIT A
DESCRIPTION OF LAND AND TOWERS
WMGV-FM
PARCEL 1:
That certain communications tower situated on that certain tract of land more particularly described as follows:
BEGINNING at a point in the southern right of way line of NC Highway 55 which point of beginning is located South 77 degrees 59' 05" West 259.23 feet and North 88 degrees 03' 16" West 171.67 feet from NCGS Monument "Brown", said beginning also being the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the office of the Register of Deeds of Pamlico County. Thence from this point of beginning so located along and with the southern right of way line of NC Highway 55 South 88 degrees 03' 16" East 171.67 feet to the northwestern corner of the property conveyed to Credle by deed recorded in Book 176 at Page 508 in the Pamlico County Registry; thence along and with the Credle western lie South 07 degrees 04' 02" West 298.91 feet to an iron pipe; thence along the Credle southern line North 87 degrees 03' 42" East 124.68 feet to an iron pipe; thence along the Credle eastern line North 07 degrees 12' 35" East 100.04 feet by an iron pipe; thence North 83 degrees 04' 37" East 99.16 feet to a point thence North 79 degrees 59' 30" East 103.67 feet to a point; thence North 75 degrees 04' 32" East 210.37 feet to an iron pipe; thence South 15 degrees 01' 10" West 1044.05 feet along and with the eastern line of Lot No. 11 as is shown and delineated on a map recorded in Map Book 1 at Page 20 in the Office of the Register of Deeds of Pamlico County to a point; thence North 62 degrees 39' 53" West 359.92 feet to an iron axle; thence North 75 degrees 34' 52" West 346.40 feet to an iron pipe in the eastern line of the T.G. Wylie Field Road; thence along and with the eastern line of said road North 06 degrees 30' 15" East 592.27 feet to an iron pipe in the southwestern corner of the McGlone lot; thence along and with the southern line of the McGlone Lot South 83 degrees 29' 48" East 149.99 feet to an iron pipe; thence along and with the eastern line of the McGlone lot; North 06 degrees 30' 26" East 300.00 feet to the southern right of way line of NC Highway 55, the point and place of beginning. Said property contains 14.09 acres more or less according to a survey dated October 25, 1995 prepared by James I. Phillips, RLS and Associates.
PARCEL 2:
A non-exclusive easement and right of way for the purposes of locating a radio tower guidewire or guidewires over the following described property: BEGINNING at a point in the eastern line of the T.G. Wylie Field Road which said point of beginning lies the following courses and distances from the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the Pamlico County Registry; South 06 degrees 30' 26" West 300.00 feet, thence North 83 degrees 29' 48" West 149.99 feet; thence South 06 degrees 30' 15" West 568.73 feet; thence from this point of beginning so located along and with the eastern line of the T.G. Wylie Field Road South 06 degrees 30' 15" West 83.52 feet to a point, thence crossing the T.G. Wylie Field Road
and running South 70 degrees 23' 56" West 485.69 feet to a point; thence North 19 degrees 36' 02" West 75.00 feet to a point; thence North 70 degrees 23' 56" East 522.44 feet to the point of beginning. This easement is appurtenant to Parcel 1. The aforesaid tract is a portion of the Lot No. 11 and Lot No. 12 as the same are shown and delineated on a map recorded in Map Book 1 at Page 20 in the Office of the Register of Deeds of Pamlico County.
PARCEL 3:
A non-exclusive right of way and easement for the purpose of ingress, egress,
regress, access, installation and maintenance of utilities to and from Parcel 1
and Parcel 3 as the same are shown and delineated on a map entitled "Survey for
Brown Distributing Company, Inc. and said easement is appurtenant to Parcel 1
and Parcel 3 as shown on the aforesaid map as well as in the adjoining property
hereafter acquired by the owner of Parcel 1. Said easement runs over the T.G.
Wylie Field Road as the same is shown and delineated on the aforesaid map the
eastern line of said easement being more particularly described as follows:
Beginning at the northwestern corner of the property deeded to McGlone which
property is described in the deed recorded in Book 140 at Page 734 in the Office
of the Register of Deeds of Pamlico County, which point is also in the southern
right of way line of NC Highway 55. Thence running along and with the eastern
line of said easement South 06 degrees 30' 15" West 350.12 feet to a point;
thence continuing along the same course 652.25 feet to a point. Said easement
being 40 feet in width and is for the purpose of ingress, egress, regress,
access and the installation and maintenance of utilities and further
subdivision.
PARCEL 4:
All that certain tract or parcel of land lying and being situate in Number One Township, Pamlico County, North Carolina and being more particularly described as follows:
BEGINNING at a point in the eastern line of the T.G. Wylie Field Road which said point of beginning lies the following course and distances from the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the Office of the Register of Deeds of Pamlico County; South 06 degrees 30' 26" West 300.00 feet; North 83 degrees 29' 48" West 149.99 feet; south 06 degrees 30' 15" West 592.27 feet to the point of beginning. THENCE FROM THIS POINT OF BEGINNING SO LOCATED along and with the eastern line of the T. G. Wylie Field Road South 06 degrees 30' 15" West 59.98 feet to a point; thence South 64 degrees 05' 58" East 908.62 feet to a point; thence North 40 degrees 23' 56" East 114.03 feet to a point; thence North 62 degrees 44' 22" West 257.89 feet to a point; thence North 62 degrees 39' 53" West 359.92 feet to an axle; thence North 75 degrees 34' 542" West 346.40 feet to the point of beginning.
The above-described parcels of land are all of the same parcels described in the deed from Frederick J. McCune, etc. al. to Grantsboro Tower Company, which deed is recorded in Book 286 at Page 174 in the Pamlico County Registry. And being the same that was acquired by Grantor by instrument dated October 31, 1996, recorded November 15, 1996 in Book 0317 Page 0880 in the Pamlico County, North Carolina Registry.
THIS CONVEYANCE IS MADE SUBJECT TO THE FOLLOWING EXCEPTIONS:
Ad Valorem Taxes for the year 2000, and subsequent years, not yet delinquent
Easement recorded in Book 272, Page 199.
Easement to Carolina Power and Light Company recorded in Book 190, Page 569 and Book 154, Page 82.
General right-of-way to Pamlico Beaufort Electric Membership Corporation, recorded in Book 135, Page 867.
Right-of-way easement to Tideland Electric Membership Corporation, recorded in Book 210, Page 867.
General right-of-way to Tide Water Power Company recorded on Book 107, Page 301.
WUKS-FM
That certain six hundred fifty (650) foot uniform cross-section guyed communications tower with three (3) foot fact situated on that certain single parcel of land as more particularly described as follows:
Lying and being in Shannon, Robeson County, State of North Carolina, identified with the Robeson County tax collector's office as 66862-300 and being 1.5 miles north on Road 1001.
WAZZ-AM
That certain communications tower situated on that certain tract of land (not including the studio building thereon) more particularly described as follows:
BEGINNING at a point in the eastern margin of Lot 6 as shown in Section II and
Section III of Huske Heights as recorded in Plat Book 11, Page 4, Cumberland
County Registry, said point being located North 34 degrees 34 minutes West 71.02
feet from the northeast corner of said Lot 6; thence South 31 degrees 59 minutes
West 300.75 feet to a point in the eastern margin of Bragg Boulevard; thence
running with the eastern margin of said Bragg Boulevard North 58 degrees 21
minutes West 10.00 feet to a point; thence running along the northwest line of
said Lot 6 North 31 degrees 59 minutes East 200.00 feet to a point; thence
running along a north east line of Franchise Realty Corporation property as
recorded in Deed Book 933, Page 1, North 58 degrees 01 minutes West 172.38 feet
to a point; thence North 31 degrees 55 minutes East 160.59 feet to an old iron
pipe; thence running along the eastern margin of a portion of Lot 9, Lot B, Lot
7 and a portion of Lot 6, South 34 degrees 34 minutes East 199.03 feet to the
point and place of BEGINNING, and containing .634 acres, more or less, and being
a portion of Lots 6, 7, 8, 9, of Section II and Section III, of Huske Heights,
as recorded in Plat Book 11, Page 4, Cumberland County Registry, North Carolina.
The above description as prepared by William Larry King, Registered Land
Surveyor L 13339, August 6, 1981.
Included within and as a part of the above described property is the following described strip of land which is an easement and not a part of the property owned in fee simple.
Being the northwestern most ten (10.0') feet of Lot Six (6) of the Huske Heights Subdivision, Section III, per plat of same duly recorded in Plat Book 11, Page 4, and being described by metes and bounds as follows:
BEGINNING at a stake in the northern margin of Bragg Boulevard, the westernmost
corner of Lot Six (6) of the said Huske Heights Subdivision, Section III, and
runs thence with the northwestern line of said Lot Six (6) of the Huske Heights
Subdivision, Section III, North 31 degrees 35 minutes East 307.30 feet to an
iron stake, the northernmost corner of said Lot Six (6) of the Huske Heights
Subdivision, Section III; and runs thence along the northwestern line of said
Lot Six (6) of the Huske Heights Subdivision, Section III, South 34 degrees 34
minutes East 10.93 feet to a point in said line; and runs thence, a new line
that is located parallel to and 10.0 feet measured southeastwardly and
perpendicularly from the northwestern line of said Lot Six (6), South 31 degrees
35 minutes West 302.89 feet to a point in the northern margin of Bragg Boulevard
in the southwestern line of said Lot Six (6) of the Huske Heights Subdivision,
Section III; and runs thence along the northern margin of Bragg Boulevard in the
southwestern line of said Lot Six (6) of the Huske Heights Subdivision, Section
III; and runs thence along the northern margin of Bragg Boulevard, North 59
degrees 25 minutes West 10.0 feet to an iron stake, the point of BEGINNING.
BEGINNING at an existing iron pipe in the southwestern property line of the City of Fayetteville property as recorded in Book 640, Page 227, and also being in the northeastern line of Lot 9 as shown in a Plat of Section II and III of Huske Heights as recorded in Plat Book II, Page 4, and also being the northernmost corner of the property described in the deed from N. Hunter Wyche, Jr., Trustee, to Chesapeake Holdings - Nottoway Limited as recorded in Book 4041, Page 192, and also being a corner of the Mao Yun Lin property as recorded in Book 3673, Page 673; and proceeding thence for a FIRST CALL along the dividing line between the properties recorded in Book 4041 Page 192 and Book 3673, Page 673, South 31 degrees, 59 minutes West 180.11 feet to the westernmost corner of the property described in Book 4041, Page 192; an thence a new line, an extension of the southwestern line of the property described in Book 4041, Page 192, North 58 degrees, 01 minutes West 12.00 feet to a point; thence parallel with and 12.00 feet perpendicular to the first call herein, North 31 degrees, 59 minutes East 185.33 feet to a point in the aforesaid City of Fayetteville property said point also being in the northeastern line of the aforementioned Lot 9; thence along that line South 34 degrees, 30 minutes East 13.09 feet to THE POINT AND PLACE OF BEGINNING containing 2,192.63 square feet and being a portion of the aforementioned property conveyed to Mao Yun Lin as recorded in Book 3673, Page 673.
The property hereinabove described was acquired by Grantor by Deed dated November 27, 1996, recorded March 6, 1997, in Book 4625 Page 0178 in the Cumberland County, North Carolina Registry.
The real property conveyed hereunder shall be exclusive of the building used as a studio for radio broadcast stations WAZZ and WFLB-FM, and inclusive of the transmitter building situated near the base of the WAZZ-AM tower on the Tower site.
EXHIBIT B
FORM OF PURCHASE NOTE
PROMISSORY NOTE
$1,135,208.00 February ___, 2000
BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Payor"), for value received, promises to pay to the order of BEASLEY FM ACQUISITION CORP., a Delaware corporation, ("Payee"), the principal amount of ONE MILLION ONE HUNDRED THIRTY FIVE THOUSAND TWO HUNDRED EIGHT DOLLARS ($1,135,208.00), together with accrued interest thereon, calculated and payable as set forth below in this Note. The principal and interest on this Note is payable in lawful money of the United States of America in immediately available funds at such place in the United States as Payee may from time to time designate in writing to Payor.
This Note is made pursuant to that certain Agreement of Sale (the "Sale Agreement"), dated February ____, 2000, by and among Payor and Payee.
1. Payment of Principal and Interest.
(a) Calculation and Payment of Interest. Interest on the principal balance of this Note outstanding from time to time until paid in full shall accrue at the rate of six and seventy-seven one hundredths percent (6.77%) compounded annually (the "Rate"), computed on the basis of a 365 or 366-day year, as appropriate, for the actual number of days elapsed, commencing on the date hereof.
(b) Payments Prior to Maturity Date. On the first day of each month Maker shall pay in advance Seven Thousand One Hundred Eighty-Eight Dollars and Two Cents ($7,188.02). All remaining principal, together with accrued and unpaid interest thereon shall be due and payable on the "Maturity Date" (defined below). Each monthly payment shall be credited first to interest then accrued and the remainder, if any, to principal, and interest shall thereupon cease to accrue upon the principal paid.
(c) Payment on Maturity Date. The principal balance of, and any accrued and unpaid interest on, this Note shall be payable twenty (20) years from the effective date of this Note (such date the "Maturity Date").
2. Prepayment.
(a) Payor may, at its option at any time, without premium or penalty, prepay all or any portion of this Note.
(b) Any prepayment of this Note shall be applied as follows:
first, to payment of accrued interest; and second, to payment of principal.
3. Events of Default.
The following shall constitute "Events of Default" under this Note:
(a) Failure by Payor to make any payment required under this Note when the same shall become due and payable (whether at maturity or otherwise) and the continuation of such failure for a period of ninety (90) days; or
(b) Payor pursuant to or within the meaning of any Bankruptcy Law:
(i) commences a voluntary case or proceeding;
(ii) consents to the entry of an order for relief against it in an involuntary case or proceeding;
(iii) consents to the appointment of a Custodian of it or for all or any substantial portion of its property or assets;
(iv) makes a general assignment for the benefit of its creditors; or
(c) an involuntary case or proceeding is commenced against Payor under any Bankruptcy Law and is not dismissed, bonded or discharged within ninety (90) days thereafter, or a court of competent jurisdiction enters an order or decree under any Bankruptcy Law that:
(i) is for relief against Payor in an involuntary case or proceeding;
(ii) appoints a Custodian of Payor or for all or substantially all of its properties; or
(iii) orders the liquidation of Payor; and in each case the order or decree remains unstayed and in effect for ninety (90) days.
(d) The following terms used in this Note have the meaning, assigned below:
"Bankruptcy Law" means Title 11, United States Code, or any similar federal, state or foreign law for the relief of debtors or any arrangement, reorganization, assignment for the benefit of creditors or any other marshalling of the assets and liabilities of Payor.
"Custodian" means any receiver, trustee, assignee, liquidator, custodian or similar official under any Bankruptcy Law.
"Event of Default" means any of the occurrences specified in
Section 2 of this Note.
If any Event of Default shall have occurred and be continuing, Payee may proceed to protect and enforce its rights either by suit in equity or by action at law, or both, whether for specific performance of any provision of this Note or in aid of the exercise of any power granted to Payee under this Note.
4. Assignment.
The holders of this Note may not assign or otherwise transfer all or any portion of their rights and obligations under this Note to any other person or entity, without the prior written consent of the Payor, which consent shall not be unreasonably withheld.
5. Miscellaneous.
(a) Section Headings. The section headings contained in this Note are for reference purposes only and shall not affect the meaning or interpretation of this Note.
(b) Amendment and Waiver. No provision of this Note may be amended or waived unless Payor shall have obtained the written agreement of Payee. No failure or delay in exercising any right, power or privilege hereunder shall imply or otherwise operate as a waiver of any rights of Payee, nor shall any single or partial exercise thereof preclude any other or future exercise thereof or the exercise of any other right, power or privilege. The remedies herein provided are cumulative and not exclusive of any remedies provided by law.
(c) Successors, Assigns and Transferors. The foregoing, the obligations of Payor and Payee under this Note shall be binding upon, and inure to the benefit of, and be enforceable by, Payor and Payee, and their respective successors and permitted assigns, whether or not so expressed.
(d) Governing Law. This Note shall be governed by, and construed in accordance with, the laws of the State of North Carolina, without giving effect to any conflicts of laws principles thereof that would otherwise require the application of the law of any other jurisdiction.
(e) Notices. Any notice, request, instruction or other document to be given hereunder by either party to the other shall be in writing and shall be deemed given when received and shall be (i) delivered personally or (ii) mailed by certified mail, postage prepaid, return receipt requested or (iii) delivered by Federal Express or a similar overnight courier or (iv) sent via facsimile transmission to the fax number given below, as follows:
If to Payor, addressed to:
Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Fax: (941) 434-8950
With a copy to:
Latham & Watkins
1001 Pennsylvania Avenue, N.W.
Washington, DC 20004-2505
Attn: Joseph D. Sullivan, Esq.
Fax: (202) 637-2201
If to Payee, addressed to:
Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. Caroline Beasley
Secretary
Fax: (941) 434-8950
or to such other place and with such other copies as either party may designate as to itself by written notice to the other party.
IN WITNESS WHEREOF, Payor has executed and delivered this Note as of the date hereinabove first written.
BEASLEY FAMILY TOWERS, INC.
EXHIBIT C
FORM OF DEEDS
EXHIBIT D
FORM OF ASSIGNMENT, BILL OF
SALE AND ASSUMPTION AGREEMENT
This Assignment, Bill of Sale and Assumption Agreement (this "Agreement") is made effective as of 12:01 a.m. Eastern Time, on the ____ day of February, 2000 by and between Beasley FM Acquisition Corp. ("Seller") and BEASLEY FAMILY TOWERS, INC. ("Purchaser").
RECITALS
A. Reference is made to that certain Agreement of Sale (the "Asset Purchase Agreement") dated as of February __, 2000 by and between Seller and Purchaser. Capitalized terms used but not defined herein shall have the meanings given such terms in the Asset Purchase Agreement.
B. The Asset Purchase Agreement provides that Seller shall sell, convey and
assign to Purchaser all of Seller's right, title and interest to the Towers and
Tower Leases and Purchaser shall assume the Assumed Liabilities, as defined in
Section 2 of the Asset Purchase Agreement.
NOW, THEREFORE, for good and valuable consideration, the receipt and sufficiency of which are hereby acknowledged by the parties hereto, the parties hereto agree as follows (capitalized terms used herein but not defined herein shall have the meaning given to them in the Asset Purchase Agreement):
1. Seller hereby bargains, sells, conveys, assigns and delivers all of Seller's right, title and interest in and to:
a. The Towers, such Towers more particularly described in Exhibit A of the Asset Purchase Agreement; and
b. The Tower Leases.
Items a. and b. above are hereinafter referred to as the "Assigned Assets."
2. Purchaser hereby accepts the sale, conveyance and assignment of the Assigned Assets, effective as of 12:01 a.m. Eastern Time on February __, 2000.
3. Purchaser hereby assumes and agrees to pay and perform the Assumed Liabilities pursuant to Section 2 of the Asset Purchase Agreement, effective as of 12:01 a.m. Eastern Time on February __, 2000.
4. After the date hereof, Purchaser and Seller will, at the request of the other party, promptly obtain, execute and deliver, or cause to be obtained, executed and delivered, to the other party such assignments, bills of sale, endorsements, and other such instruments or documents to be executed by Seller or Purchaser, as the case may be, in addition to this
Agreement, in form and substance reasonably satisfactory to the other party, as such other party may reasonably deem necessary or desirable so as (i) to vest in Purchaser title to and possession of the Assigned Assets and (ii) to perfect and record, if necessary, the sale, assignment, conveyance, transfer and delivery to Purchaser of the Assigned Assets.
5. This Agreement is made pursuant to, and is subject to all of the terms, representations, warranties and covenants of, the Asset Purchase Agreement, the terms of which are hereby incorporated by reference. In the event of any conflict between this Agreement and the Asset Purchase Agreement, the terms of the Asset Purchase Agreement shall govern.
IN WITNESS WHEREOF, Seller and Purchaser have executed and delivered this Agreement as of the day and year first written above.
SELLER:
BEASLEY FM ACQUISITION CORP.
PURCHASER:
BEASLEY FAMILY TOWERS, INC.
EXHIBIT E
FORM OF LEASE AGREEMENTS
LEASE AGREEMENT (O&O -WMGV-FM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY FM ACQUISITION CORP., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns a communications tower as such tower is described on Exhibit B (the "Tower"), together with other improvements on a certain tract of real estate located at Grantsboro, North Carolina, as such land is more fully described in Exhibit A attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements or improvements on such land, including, without limitation, any buildings or other structures);
WHEREAS, Lessor desires to lease the Tower Site and space on the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower Site and space on the Tower from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee leases from Lessor, with a right of access thereto and parking therefor in accordance with Section 9:
(a) Space on the Tower as more fully described in Exhibit C hereto, for the purposes of the broadcast transmission of WMGV-FM;
(b) Space in the transmitter building on the Tower Site as such space is more fully described in Exhibit D hereto (the "Transmitter Building"), for the purposes of the housing, operation and maintenance of Lessee's transmitter and related equipment, (such space "Lessee's Transmitter Building Space"); and
(c) All interior space in the building on the Tower Site housing an electrical power generator (the "Generator Building," the Generator Building and the Transmitter Building, the "Buildings" and the interior space of the Generator Building, "Lessee's Generator Building Space," and Lessee's Transmitter Building Space and Lessee's Generator Building Space, "Lessee's Building Space").
(d) All of the property leased under this Paragraph 2.01 shall hereinafter be called the "Leased Premises".
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below), all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Leased Premises after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, including, without limitation, that certain electrical power generator housed in the Generator Building, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain lessee's property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Leased Premises at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Leased Premises for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Leased Premises may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Tower. Lessee may repair and maintain equipment as it reasonably deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. Lessee's space on the Tower, Lessee's Building Space, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to Lessee in
this Lease and with prior notice to Lessee and no loss of service or
interruption (beyond a temporary, non-recurring and de minimis amount), Lessor
reserves the right to use the Tower, at its own expense, as it sees fit and to
fasten additional equipment to the Tower for any purpose, including the right to
install transmitting and/or receiving antennas of others; provided that Lessor
shall use reasonable efforts to restrict any loss of Lessee's service or
interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00
a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space on the Tower or in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
--------------------------------------------------------------------------------
Lease Year Rent Per Lease Year Monthly Rent
--------------------------------------------------------------------------------
1 $63,910.80 $5,325.90
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2 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
3 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
4 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
5 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
6 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
7 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
8 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
9 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
10 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
11 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
12 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
13 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
14 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
15 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
16 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
17 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
18 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
19 $63,910.80 $5,325.90
--------------------------------------------------------------------------------
20 $63,910.80 $5,325.90
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|
5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated ______, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and
stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Leased Premises, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Tower and Building except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF LEASED PREMISES AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to Lessor's Tower and Buildings. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Tower, the Buildings, and Tower Site, or the prevention of interference with Lessor or any other user of the Tower or
any other broadcaster, Lessor may, at its option, make such emergency repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which
Lessor, in its reasonable discretion, determines that Lessee should make to
maintain Lessee's Property and equipment in good order, and that such repairs
are necessary for the safety of the Tower, the Buildings, and Tower Site, or the
prevention of interference with Lessor, in violation of the terms of this
Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance
and repairs required to be performed by Lessee. In the event that, within ten
(10) business days following such written notice (or such longer period as may
be reasonably necessary taking into account all facts and circumstances), Lessee
shall not have performed such maintenance and repairs, Lessor may, at its sole
option, make such repairs as it deems reasonably necessary, and any amount
expended by Lessor therefor shall be deemed additional rent. Lessor shall not be
liable for inconvenience, disturbance, loss of business, or other damage to
Lessee by reason of repairing the property and equipment of Lessee which Lessee
has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Tower unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Tower (including any ascension of the Tower), in the Buildings, or in or about the Tower Site, Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency
radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Leased Premises to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. USE AND MAINTENANCE OF COMMON PREMISES.
9.01 USE OF COMMON PREMISES. Lessee, at its own risk, shall have
the right to use in common with Lessor and its licensees, invitees, and other
tenants, and in connection with Lessee's permissible activities and operations
(a) any access road from any public highway to the Tower Site or to any building
on the Tower Site; (b) any parking lot on the Tower Site; and (c) all common
areas in the Transmitter Building (such items (a), (b) and (c) called
collectively herein the "Common Premises").
9.02 MAINTENANCE OF COMMON PREMISES.
(a) Lessor shall maintain the Common Premises and any fence around the Tower in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the
Tower. Lessor shall maintain the Tower and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs,
alterations, or improvements are necessary or desirable to the Tower or any
building or structure constructed by Lessor on the Tower Site, any common areas,
or the leased spaces of other tenants, Lessor may, upon reasonable notice and
for the shortest practical period of time (except for emergency situations),
close entrance doors, common areas, drive-ways, rights-of-way, service areas,
parking areas, or any other facilities at its discretion without being liable to
Lessee; provided that if any of the above would restrict Lessee's ability to
broadcast, Lessor shall use reasonable efforts to restrict any closure or
interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00
a.m.. The closing of entrances, doors, common areas, parking areas, or other
facilities for the making of the repairs, alterations, or improvements described
herein shall, under no circumstances, constitute an eviction of the Lessee or be
grounds for termination of this Lease or the withholding of any rental payments
or other payments or performances required to be paid or made by Lessee under
the terms hereof, provided, Lessor shall use reasonable efforts to ensure that
any action taken in accordance with this paragraph shall not adversely affect
the rights of Lessee hereunder. Under no such circumstances shall Lessee be
entitled to terminate this Lease nor shall it be entitled to compensation for
any loss or damage it may sustain (including loss of use, loss of
advertising/sponsorship revenues, and consequential damages) by reason of such
changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Tower, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine Tower loading capacity, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Leased Premises or on the Tower after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of Tower space whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Tower, Tower Site or any building on the Tower Site shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct
such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower, Tower Site or any buildings on the Tower Site shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Tower shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes,
assessments, or levies assessed or imposed against the Leased Premises.
[Foregoing obligation is subject to $200,000 12-month limit when aggregated with
other borrowers under Credit Agreement per 1.5D of First Amendment to Credit
Agreement]. Lessee shall pay all personal property or other taxes assessed or
imposed on Lessee's Property, and shall cooperate with Lessor to ensure that
such property is properly separated from that of Lessor or other tenants for
assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Leased Premises,
including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Tower elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWER AND BUILDING INSURANCE. Lessee shall procure and maintain physical damage insurance on the Tower and any building on the Tower Site used or leased by Lessee pursuant to this Lease in an amount sufficient to repair or replace the Tower and any such building with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWER AND/OR BUILDING DAMAGE. In the event that the Tower
and/or the Buildings is destroyed or damaged by fire, lightning, windstorm,
flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or
other casualty covered by insurance, Lessor shall promptly reconstruct or repair
the Tower and/or the Buildings affected to such good condition as existed before
the destruction or damage, and give possession to Lessee of substantially the
same space leased hereunder. Lessee shall promptly pay over to Lessor any
insurance proceeds it receives from insurance policies Lessee is required to
procure under Section 14.03 hereof for the purpose of use by Lessor to fund
reconstruction of the Towers and/or Buildings as required of Lessor under this
Section 14.04. If the Tower and/or one or both of the Buildings is in need of
such repair or is so damaged by fire, lightning, windstorm, flood, earthquake,
explosion, aircraft or other vehicle damage, collapse, or other casualty that
reconstruction or repair cannot reasonably be undertaken without dismantling
Lessee's antenna, then upon written notice to Lessee, Lessor may remove any such
antenna and interrupt the signal activity of Lessee, but will use its best
efforts to have the antenna replaced as soon as reasonably possible. Lessor
agrees to provide Lessee alternative space, if available, on the Tower and/or in
such building during such reconstruction/repair period. If such space is not
available, then Lessee shall be responsible for procuring its own alternative
space. No monetary or other rental shall be due pursuant to the terms of this
Lease for such time as Lessee is unable to conduct its broadcasting activities
on the Tower without significant diminution of signal quality as a result of
such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Tower and/or one or both of the Buildings or (b) replace the Tower and/or the affected Buildings within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to Tower and/or damage to one or both of the Buildings (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower Site (or any portion of the Tower Site necessary for the Tower, guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for the Tower on the condemned property, Lessor agrees to lease space to Lessee on the new tower and space in one or more new buildings reasonably comparable to the space leased to Lessee pursuant to this Lease and on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Leased Premises within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Leased Premises after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Leased Premises, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby
shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Leased Premises by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Leased Premises. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Leased Premises (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of North Carolina at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any
laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for indemnity,
and the Indemnifying Party shall have the right and opportunity to undertake the
legal defense of such claims. The Indemnified Party and its counsel may
nevertheless participate in (but not control) such proceedings, negotiations, or
defense at its own expense. In all such cases, the Indemnified Party will give
all reasonable assistance to the Indemnifying Party, including making the
Indemnified Party's employees and documents available as reasonably requested
without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after either
party's request, the other party shall deliver, executed in recordable form, a
declaration to any person designated by the requesting party (a) ratifying this
Lease; (b) stating the commencement and termination dates; and (c) certifying
(i) that this Lease is in full force and effect, and has not been assigned,
modified, supplemented, or amended (except by such writings as shall be stated);
(ii) that all conditions under this Lease to be performed have been satisfied
(stating exceptions, if any); (iii) that no defenses or offsets against the
enforcement of this Lease by the requesting party exist (or stating those
claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which rent
has been paid; (vi) the amount of security deposited with Lessor (if hereafter
applicable for any reason); and (vii) such other information as the requesting
party reasonably requires. Persons receiving such statements shall be entitled
to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Leased Premises, or, if any of the Leased Premises or any building thereon comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of North Carolina.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200 Naples, FL 34103 Attn: Ms. B. Caroline Beasley Secretary Phone: (941) 263-5000 |
Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
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21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Tower, Building, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Leased Premises; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Tower, Building, and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor
shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Leased Premises or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: ` LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
---------------------------- ----------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
LESSEE:
BEASLEY FM ACQUISITION CORP.
By: (SEAL)
---------------------------- ----------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
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EXHIBIT A
DESCRIPTION OF WMGV-FM TOWER SITE
PARCEL 1:
That certain tract of land more particularly described as follows:
BEGINNING at a point in the southern right of way line of NC Highway 55 which point of beginning is located South 77 degrees 59' 05" West 259.23 feet and North 88 degrees 03' 16" West 171.67 feet from NCGS Monument "Brown", said beginning also being the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the office of the Register of Deeds of Pamlico County. Thence from this point of beginning so located along and with the southern right of way line of NC Highway 55 South 88 degrees 03' 16" East 171.67 feet to the northwestern corner of the property conveyed to Credle by deed recorded in Book 176 at Page 508 in the Pamlico County Registry; thence along and with the Credle western lie South 07 degrees 04' 02" West 298.91 feet to an iron pipe; thence along the Credle southern line North 87 degrees 03' 42" East 124.68 feet to an iron pipe; thence along the Credle eastern line North 07 degrees 12' 35" East 100.04 feet by an iron pipe; thence North 83 degrees 04' 37" East 99.16 feet to a point thence North 79 degrees 59' 30" East 103.67 feet to a point; thence North 75 degrees 04' 32" East 210.37 feet to an iron pipe; thence South 15 degrees 01' 10" West 1044.05 feet along and with the eastern line of Lot No. 11 as is shown and delineated on a map recorded in Map Book 1 at Page 20 in the Office of the Register of Deeds of Pamlico County to a point; thence North 62 degrees 39' 53" West 359.92 feet to an iron axle; thence North 75 degrees 34' 52" West 346.40 feet to an iron pipe in the eastern line of the T.G. Wylie Field Road; thence along and with the eastern line of said road North 06 degrees 30' 15" East 592.27 feet to an iron pipe in the southwestern corner of the McGlone lot; thence along and with the southern line of the McGlone Lot South 83 degrees 29' 48" East 149.99 feet to an iron pipe; thence along and with the eastern line of the McGlone lot; North 06 degrees 30' 26" East 300.00 feet to the southern right of way line of NC Highway 55, the point and place of beginning. Said property contains 14.09 acres more or less according to a survey dated October 25, 1995 prepared by James I. Phillips, RLS and Associates.
PARCEL 2:
A non-exclusive easement and right of way for the purposes of locating a radio tower guidewire or guidewires over the following described property: BEGINNING at a point in the eastern line of the T.G. Wylie Field Road which said point of beginning lies the following courses and distances from the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the Pamlico County Registry; South 06 degrees 30' 26" West 300.00 feet, thence North 83 degrees 29' 48" West 149.99 feet; thence South 06 degrees 30' 15" West 568.73 feet; thence from this point of beginning so located along and with the eastern line of the T.G. Wylie Field Road South 06 degrees 30' 15" West 83.52 feet to a point, thence crossing the T.G. Wylie Field Road and running South 70 degrees 23' 56" West 485.69 feet to a point; thence North 19 degrees 36' 02" West 75.00 feet to a point; thence North 70 degrees 23' 56" East 522.44 feet to the point of beginning. This easement is appurtenant to Parcel 1. The aforesaid tract is a portion of the Lot No. 11 and Lot
No. 12 as the same are shown and delineated on a map recorded in Map Book 1 at Page 20 in the Office of the Register of Deeds of Pamlico County.
PARCEL 3:
A non-exclusive right of way and easement for the purpose of ingress, egress,
regress, access, installation and maintenance of utilities to and from Parcel 1
and Parcel 3 as the same are shown and delineated on a map entitled "Survey for
Brown Distributing Company, Inc. and said easement is appurtenant to Parcel 1
and Parcel 3 as shown on the aforesaid map as well as in the adjoining property
hereafter acquired by the owner of Parcel 1. Said easement runs over the T.G.
Wylie Field Road as the same is shown and delineated on the aforesaid map the
eastern line of said easement being more particularly described as follows:
Beginning at the northwestern corner of the property deeded to McGlone which
property is described in the deed recorded in Book 140 at Page 734 in the Office
of the Register of Deeds of Pamlico County, which point is also in the southern
right of way line of NC Highway 55. Thence running along and with the eastern
line of said easement South 06 degrees 30' 15" West 350.12 feet to a point;
thence continuing along the same course 652.25 feet to a point. Said easement
being 40 feet in width and is for the purpose of ingress, egress, regress,
access and the installation and maintenance of utilities and further
subdivision.
PARCEL 4:
All that certain tract or parcel of land lying and being situate in Number One Township, Pamlico County, North Carolina and being more particularly described as follows:
BEGINNING at a point in the eastern line of the T.G. Wylie Field Road which said point of beginning lies the following course and distances from the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the Office of the Register of Deeds of Pamlico County; South 06 degrees 30' 26" West 300.00 feet; North 83 degrees 29' 48" West 149.99 feet; south 06 degrees 30' 15" West 592.27 feet to the point of beginning. THENCE FROM THIS POINT OF BEGINNING SO LOCATED along and with the eastern line of the T. G. Wylie Field Road South 06 degrees 30' 15" West 59.98 feet to a point; thence South 64 degrees 05' 58" East 908.62 feet to a point; thence North 40 degrees 23' 56" East 114.03 feet to a point; thence North 62 degrees 44' 22" West 257.89 feet to a point; thence North 62 degrees 39' 53" West 359.92 feet to an axle; thence North 75 degrees 34' 542" West 346.40 feet to the point of beginning.
The above-described parcels of land are all of the same parcels described in the deed from Frederick J. McCune, etc. al. to Grantsboro Tower Company, which deed is recorded in Book 286 at Page 174 in the Pamlico County Registry. And being the same that was acquired by Grantor by instrument dated October 31, 1996, recorded November 15, 1996 in Book 0317 Page 0880 in the Pamlico County, North Carolina Registry.
EXHIBIT B
DESCRIPTION OF TOWER
WMGV-FM
PARCEL 1:
That certain communications tower situated on that certain tract of land more particularly described as follows:
BEGINNING at a point in the southern right of way line of NC Highway 55 which point of beginning is located South 77 degrees 59' 05" West 259.23 feet and North 88 degrees 03' 16" West 171.67 feet from NCGS Monument "Brown", said beginning also being the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the office of the Register of Deeds of Pamlico County. Thence from this point of beginning so located along and with the southern right of way line of NC Highway 55 South 88 degrees 03' 16" East 171.67 feet to the northwestern corner of the property conveyed to Credle by deed recorded in Book 176 at Page 508 in the Pamlico County Registry; thence along and with the Credle western lie South 07 degrees 04' 02" West 298.91 feet to an iron pipe; thence along the Credle southern line North 87 degrees 03' 42" East 124.68 feet to an iron pipe; thence along the Credle eastern line North 07 degrees 12' 35" East 100.04 feet by an iron pipe; thence North 83 degrees 04' 37" East 99.16 feet to a point thence North 79 degrees 59' 30" East 103.67 feet to a point; thence North 75 degrees 04' 32" East 210.37 feet to an iron pipe; thence South 15 degrees 01' 10" West 1044.05 feet along and with the eastern line of Lot No. 11 as is shown and delineated on a map recorded in Map Book 1 at Page 20 in the Office of the Register of Deeds of Pamlico County to a point; thence North 62 degrees 39' 53" West 359.92 feet to an iron axle; thence North 75 degrees 34' 52" West 346.40 feet to an iron pipe in the eastern line of the T.G. Wylie Field Road; thence along and with the eastern line of said road North 06 degrees 30' 15" East 592.27 feet to an iron pipe in the southwestern corner of the McGlone lot; thence along and with the southern line of the McGlone Lot South 83 degrees 29' 48" East 149.99 feet to an iron pipe; thence along and with the eastern line of the McGlone lot; North 06 degrees 30' 26" East 300.00 feet to the southern right of way line of NC Highway 55, the point and place of beginning. Said property contains 14.09 acres more or less according to a survey dated October 25, 1995 prepared by James I. Phillips, RLS and Associates.
PARCEL 2:
A non-exclusive easement and right of way for the purposes of locating a radio tower guidewire or guidewires over the following described property: BEGINNING at a point in the eastern line of the T.G. Wylie Field Road which said point of beginning lies the following courses and distances from the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the Pamlico County Registry; South 06 degrees 30' 26" West 300.00 feet, thence North 83 degrees 29' 48" West 149.99 feet; thence South 06 degrees 30' 15" West 568.73 feet; thence from this point of beginning so located along and with the eastern line of the T.G. Wylie Field Road South 06 degrees 30' 15" West 83.52 feet to a point, thence crossing the T.G. Wylie Field Road and running South 70 degrees 23' 56" West 485.69 feet to a point; thence North 19 degrees 36' 02" West 75.00
feet to a point; thence North 70 degrees 23' 56" East 522.44 feet to the point of beginning. This easement is appurtenant to Parcel 1. The aforesaid tract is a portion of the Lot No. 11 and Lot No. 12 as the same are shown and delineated on a map recorded in Map Book 1 at Page 20 in the Office of the Register of Deeds of Pamlico County.
PARCEL 3:
A non-exclusive right of way and easement for the purpose of ingress, egress,
regress, access, installation and maintenance of utilities to and from Parcel 1
and Parcel 3 as the same are shown and delineated on a map entitled "Survey for
Brown Distributing Company, Inc. and said easement is appurtenant to Parcel 1
and Parcel 3 as shown on the aforesaid map as well as in the adjoining property
hereafter acquired by the owner of Parcel 1. Said easement runs over the T.G.
Wylie Field Road as the same is shown and delineated on the aforesaid map the
eastern line of said easement being more particularly described as follows:
Beginning at the northwestern corner of the property deeded to McGlone which
property is described in the deed recorded in Book 140 at Page 734 in the Office
of the Register of Deeds of Pamlico County, which point is also in the southern
right of way line of NC Highway 55. Thence running along and with the eastern
line of said easement South 06 degrees 30' 15" West 350.12 feet to a point;
thence continuing along the same course 652.25 feet to a point. Said easement
being 40 feet in width and is for the purpose of ingress, egress, regress,
access and the installation and maintenance of utilities and further
subdivision.
PARCEL 4:
All that certain tract or parcel of land lying and being situate in Number One Township, Pamlico County, North Carolina and being more particularly described as follows:
BEGINNING at a point in the eastern line of the T.G. Wylie Field Road which said point of beginning lies the following course and distances from the northeastern corner of the property conveyed to McGlone by deed recorded in Book 140 at Page 734 in the Office of the Register of Deeds of Pamlico County; South 06 degrees 30' 26" West 300.00 feet; North 83 degrees 29' 48" West 149.99 feet; south 06 degrees 30' 15" West 592.27 feet to the point of beginning. THENCE FROM THIS POINT OF BEGINNING SO LOCATED along and with the eastern line of the T. G. Wylie Field Road South 06 degrees 30' 15" West 59.98 feet to a point; thence South 64 degrees 05' 58" East 908.62 feet to a point; thence North 40 degrees 23' 56" East 114.03 feet to a point; thence North 62 degrees 44' 22" West 257.89 feet to a point; thence North 62 degrees 39' 53" West 359.92 feet to an axle; thence North 75 degrees 34' 542" West 346.40 feet to the point of beginning.
The above-described parcels of land are all of the same parcels described in the deed from Frederick J. McCune, etc. al. to Grantsboro Tower Company, which deed is recorded in Book 286 at Page 174 in the Pamlico County Registry. And being the same that was acquired by Grantor by instrument dated October 31, 1996, recorded November 15, 1996 in Book 0317 Page 0880 in the Pamlico County, North Carolina Registry.
EXHIBIT C
[TOWER SPACE DIAGRAM OR DESCRIPTION]
EXHIBIT D
[TRANSMITTER BUILDING SPACE DIAGRAM OR DESCRIPTION]
LEASE AGREEMENT (O&O - WUKS-FM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY FM ACQUISITION CORP., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns a communications tower as such tower is described on Exhibit B hereto (the "Tower"), together with other improvements on a certain tract of real estate located at Fayetteville, North Carolina, as such land is more fully described in Exhibit A attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements or improvements on such land, including, without limitation, any buildings or other structures);
WHEREAS, Lessor desires to lease the Tower Site and space on the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower Site and space on the Tower from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee leases from Lessor, with a right of access thereto and parking therefor in accordance with Section 9:
(a) Space on the Tower as more fully described in Exhibit C hereto;
(b) Space in the transmitter building on the Tower Site, as such space is more fully described in Exhibit D hereto (the "Transmitter Building"), for the purposes of the housing, operation and maintenance of Lessee's transmitter and related equipment (such space "Lessee's Building Space"); and
(c) That ____ by ____ foot portion of the real property within the fence surrounding the Transmitter Building on which Lessee's electrical power generator is located ("Lessee's Generator Real Property").
(d) All of the property leased under this Paragraph 2.01 shall hereinafter be called the "Leased Premises".
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below), all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Leased Premises after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto which are permitted hereunder, shall be and remain Lessee's property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Leased Premises at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Leased Premises for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Leased Premises may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Tower. Lessee may repair and maintain equipment as it reasonably deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. Lessee's space on the Tower, Lessee's Building Space, Lessee's Generator Real Property, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to Lessee in this Lease and with prior notice to Lessee and no loss of service or interruption (beyond a temporary,
non-recurring and de minimis amount), Lessor reserves the right to use the
Tower, at its own expense, as it sees fit and to fasten additional equipment to
the Tower for any purpose, including the right to install transmitting and/or
receiving antennas of others; provided that Lessor shall use reasonable efforts
to restrict any loss of Lessee's service or interruption pursuant to this
Section 3.02(a) to the hours of 1:00 a.m. to 5:00 a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space on the Tower or in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
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Lease Year Rent Per Lease Year Monthly Rent
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1 $14,281.44 $1,190.12
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2 $14,281.44 $1,190.12
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3 $14,281.44 $1,190.12
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4 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
5 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
6 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
7 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
8 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
9 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
10 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
11 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
12 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
13 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
14 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
15 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
16 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
17 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
18 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
19 $14,281.44 $1,190.12
--------------------------------------------------------------------------------
20 $14,281.44 $1,190.12
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid by the Lessee in advance on the first day of each month during the term of this Lease by the Lessee by crediting the payment owed to Lessee by Lessor under that certain Promissory Note made by Lessor in favor of Lessee dated _________, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and
stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Leased Premises, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Tower and Building except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF LEASED PREMISES AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to Lessor's Tower and the Transmitter Building. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Tower, the Transmitter Building, and Tower Site, or the prevention of interference with Lessor or any other
user of the Tower or any other broadcaster, Lessor may, at its option, make such emergency repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Tower, the Transmitter Building, and Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Tower unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Tower (including any ascension of the Tower), in the Transmitter Building, or in or about the Tower Site, Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor shall be carried out (i) in a good and workmanlike manner; (ii) in accordance with established engineering standards and public ordinances, rules, and regulations applicable to such work, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the
National Environmental Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation; (iii) in accordance with plans and specifications, including mechanical and electrical drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Leased Premises to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. USE AND MAINTENANCE OF COMMON PREMISES.
9.01 USE OF COMMON PREMISES. Lessee, at its own risk, shall have
the right to use in common with Lessor and its licensees, invitees, and other
tenants, and in connection with Lessee's permissible activities and operations
(a) any access road from any public highway to the Tower Site or to any building
on the Tower Site; (b) any parking lot on the Tower Site; and (c) all common
areas in the Transmitter Building (such items (a), (b) and (c) called
collectively herein the "Common Premises").
9.02 MAINTENANCE OF COMMON PREMISES.
(a) Lessor shall maintain the Common Premises and any fence around the Tower in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the Tower. Lessor shall maintain the Tower and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs,
alterations, or improvements are necessary or desirable to the Tower or any
building or structure constructed by Lessor on the Tower Site, any common areas,
or the leased spaces of other tenants, Lessor may, upon reasonable notice and
for the shortest practical period of time (except for emergency situations),
close entrance doors, common areas, drive-ways, rights-of-way, service areas,
parking areas, or any other facilities at its discretion without being liable to
Lessee; provided that if any of the above would restrict Lessee's ability to
broadcast, Lessor shall use reasonable efforts to restrict any closure or
interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00
a.m.. The closing of entrances, doors, common areas, parking areas, or other
facilities for the making of the repairs, alterations, or improvements described
herein shall, under no circumstances, constitute an eviction of the Lessee or be
grounds for termination of this Lease or the withholding of any rental payments
or other payments or performances required to be paid or made by Lessee under
the terms hereof, provided, Lessor shall use reasonable efforts to ensure that
any action taken in accordance with this paragraph shall not adversely affect
the rights of Lessee hereunder. Under no such circumstances shall Lessee be
entitled to terminate this Lease nor shall it be entitled to compensation for
any loss or damage it may sustain (including loss of use, loss of
advertising/sponsorship revenues, and consequential damages) by reason of such
changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Tower, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine Tower loading capacity, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed
change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Leased Premises or on the Tower after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Tower whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Tower, Tower Site, Transmitter Building or any building on the Tower Site shall provide that, should the installation,
operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower, Tower Site or any buildings on the Tower Site shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Tower shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes,
assessments, or levies assessed or imposed against the Leased Premises.
[Foregoing obligation is subject to $200,000 12-month limit when aggregated with
other borrowers under Credit Agreement per 1.5D of First Amendment to Credit
Agreement]. Lessee shall pay all personal property or other taxes assessed or
imposed on Lessee's Property, and shall cooperate with Lessor to ensure that
such property is properly separated from that of Lessor or other tenants for
assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Leased Premises, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and equipment (including the Tower elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 TOWER AND BUILDING INSURANCE. Lessee shall procure and maintain physical damage insurance on the Tower and any building on the Tower Site used or leased by Lessee pursuant to this Lease in an amount sufficient to repair or replace the Tower and any such building with such coverage to be on an "All Risks" basis, including, without limitation, coverage for the perils of fire, lightning, windstorm, hall, flood, earthquake, collapse, explosion, aircraft and vehicle damage, vandalism, and malicious mischief. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall be solely responsible for its insurance on Lessee's Property, together with business interruption insurance.
14.04 TOWER AND/OR BUILDING DAMAGE. In the event that the Tower and/or the Transmitter Building is destroyed or damaged by fire, lightning, windstorm, flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or other casualty covered by insurance, Lessor shall promptly reconstruct or repair the Tower and/or the Transmitter Building to such good condition as existed before the destruction or damage, and give possession to Lessee of substantially the same space leased hereunder. Lessee shall promptly pay over to Lessor any insurance proceeds it receives from insurance policies Lessee is required to procure under Section 14.03 hereof for the purpose of use by Lessor to fund reconstruction of the Towers and/or Transmitter Buildings as required of Lessor under this Section 14.04. If the Tower and/or the Transmitter Building is in need of such repair or is so damaged by fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle damage, collapse, or other casualty that reconstruction or repair cannot reasonably be undertaken without dismantling Lessee's antenna, then upon written notice to Lessee, Lessor may remove any such antenna and interrupt the signal activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably
possible. Lessor agrees to provide Lessee alternative space, if available, on the Tower and/or in such building during such reconstruction/repair period. If such space is not available, then Lessee shall be responsible for procuring its own alternative space. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Tower without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Tower and/or the Transmitter Building or (b) replace the Tower and/or the Transmitter Building within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to Tower damage and/or damage to the Transmitter Building (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower Site (or any portion of the Tower Site necessary for the Tower, Transmitter Building guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for the Tower on the condemned property, Lessor agrees to lease space to Lessee on the new tower and space in the new transmitter building and the generator building (if any) reasonably comparable to the space leased to Lessee pursuant to this Lease and on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Leased Premises within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Leased Premises after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its
reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Leased Premises, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option, terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Leased Premises by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Leased Premises. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Leased Premises (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of North Carolina at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for indemnity,
and the Indemnifying Party shall have the right and opportunity to undertake the
legal defense of such claims. The Indemnified Party and its counsel may
nevertheless participate in (but not control) such proceedings, negotiations, or
defense at its own expense. In all such cases, the Indemnified Party will give
all reasonable assistance to the Indemnifying Party, including making the
Indemnified Party's employees and documents available as reasonably requested
without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after either
party's request, the other party shall deliver, executed in recordable form, a
declaration to any person designated by the requesting party (a) ratifying this
Lease; (b) stating the commencement and termination dates; and (c) certifying
(i) that this Lease is in full force and effect, and has not been assigned,
modified, supplemented, or amended (except by such writings as shall be stated);
(ii) that all conditions under this Lease to be performed have been satisfied
(stating exceptions, if any); (iii) that no defenses or offsets against the
enforcement of this Lease by the requesting party exist (or stating those
claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which rent
has been paid; (vi) the amount of security deposited with Lessor (if hereafter
applicable for any reason); and (vii) such other information as the requesting
party reasonably requires. Persons receiving such statements shall be entitled
to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Leased Premises, or, if any of the Leased Premises or any building thereon comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph
20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of North Carolina.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one-half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
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Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
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21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Tower, Transmitter Building, or Tower Site, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower or the Transmitter Building, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Leased Premises; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's
operations, by the activities of any other tenants or users of the Tower, Transmitter Building, and Tower Site, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Leased Premises or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: ` LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
---------------------------- ----------------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
LESSEE:
BEASLEY FM ACQUISITION CORP.
By: (SEAL)
---------------------------- ----------------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
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EXHIBIT A
DESCRIPTION OF WUKS-FM TOWER SITE
That certain single parcel of land as more particularly described as follows:
Lying and being in Shannon, Robeson County, State of North Carolina, identified with the Robeson County tax collector's office as 66862-300 and being 1.5 miles north on Road 1001.
EXHIBIT B
DESCRIPTION OF TOWER
That certain six hundred fifty (650) foot uniform cross-section guyed communications tower situated on that certain single parcel of land as more particularly described as follows:
Lying and being in Shannon, Robeson County, State of North Carolina, identified with the Robeson County tax collector's office as 66862-300 and being 1.5 miles north on Road 1001.
EXHIBIT C
[TOWER SPACE DIAGRAM OR DESCRIPTION]
EXHIBIT D
[TRANSMITTER BUILDING SPACE DIAGRAM OR DESCRIPTION]
LEASE AGREEMENT (O&O - WAZZ-AM)
THIS LEASE AGREEMENT ("Lease"), made this ____ day of February, 2000 by and between BEASLEY FAMILY TOWERS, INC., a Delaware corporation ("Lessor"), and BEASLEY FM ACQUISITION CORP., a Delaware corporation ("Lessee").
WITNESSETH:
WHEREAS, Lessor owns a communications tower as such tower is described on Exhibit C hereto ("Tower"), on a certain tract of real estate located at Fayetteville, North Carolina, as such land is more fully described in Exhibit A attached hereto (hereinafter referred to as the "Tower Site"; the term "Tower Site" shall also include any appurtenant easements or improvements on such land except for the WAZZ/WFLB studio building on the Tower Site owned by Lessee);
WHEREAS, Lessor desires to lease the Tower for the purpose of Lessee's radio broadcast transmission activities; and
WHEREAS, Lessee wishes to lease such Tower from Lessor.
NOW, THEREFORE, IN CONSIDERATION OF the foregoing and the mutual covenants herein contained, the parties hereto agree as follows:
1. LEASE COMMENCEMENT.
1.01 COMMENCEMENT OF TERM. The term of this Lease and the payment of rent and other performances in accordance with the terms of this Lease shall commence on the date hereof.
1.02 EXHIBITS. All Exhibits referred to in this Lease are incorporated herein by reference.
2. DESCRIPTION OF THE LEASEHOLD.
2.01 LEASED PREMISES. Lessor hereby leases to Lessee, and Lessee leases from Lessor, with a right of access thereto and parking therefor in accordance with Section 9:
(a) The Tower [subject to any rights under that certain Lease Agreement, dated __________, by and between Beasley FM Acquisition Corp. and Beasley FM Acquisition Corp., for tower space for the antenna of radio broadcast station WFLB-FM];
(b) Space in the transmitter building on the Tower Site as more fully described in Exhibit C hereto (the "Transmitter Building"), for the purposes of the housing, operation and maintenance of Lessee's transmitter and related equipment, (such space "Lessee's Building Space"); and
(c) The Tower Site.
(d) All of the property leased under this Paragraph 2.01 shall hereinafter be called the "Leased Premises."
2.02 OWNERSHIP OF PROPERTY; ACCESS.
(a) Except for "Lessee's Property" (as defined below); all tenant improvements including all fixtures and trade fixtures shall become the property of the Lessor, and shall remain with the Tower after the Lessee vacates same.
(b) The Lessee's antenna, transmission line, and other equipment, together with any replacements thereof and modifications and additions thereto, which are permitted hereunder, shall be and remain Lessee's Property, and are hereinafter referred to as "Lessee's Property". Lessee will be solely responsible for the maintenance of Lessee's Property, including all expenses associated with such repair.
(c) Lessee shall have reasonable right of access to the Tower at all times in emergency situations and whenever reasonably necessary for equipment maintenance and repair. Lessee shall also have reasonable rights of access at any time to the Tower for ingress, egress, utilities, the locating and usage of cabling and related equipment, operations, maintenance, repair or remodeling, or other engineering purposes.
3. PERMITTED USES.
3.01 BY LESSEE.
(a) Subject to all appropriate government approvals, including the Federal Communications Commission ("FCC"), the Tower may be used only for activities related to the operation of radio broadcast stations. Such operations, shall be conducted in accordance with the standards imposed by the FCC and any other governmental body with authority over such transmission and operations.
(b) Except as expressly permitted by this Lease and unless prior written approval of Lessor has been given, Lessee shall not construct or make any improvements or install any equipment on the Tower. Lessee may repair and maintain equipment as it deems necessary to its operations within Lessee's space in all respects in compliance with the terms hereof. The Tower, Lessee's interior and exterior equipment, and all other improvements shall be maintained in an orderly and professional manner.
3.02 BY LESSOR.
(a) Subject to the rights elsewhere granted to Lessee in this Lease and with prior notice to Lessee and no loss of service or interruption (beyond a temporary, non-recurring and de minimis amount), Lessor reserves the right to use the Tower, at its own expense, as it sees fit and to fasten additional equipment to the Tower for any purpose, including the right to install transmitting and/or receiving antennas of others; provided that Lessor shall use
reasonable efforts to restrict any loss of Lessee's service or interruption pursuant to this Section 3.02(a) to the hours of 1:00 a.m. to 5:00 a.m.
(b) Subject to the rights elsewhere granted to Lessee in this Lease, Lessor shall have the right to use for itself or lease to others the remainder of the Tower Site or use of any of the improvements thereon, space in any building constructed by Lessor for any purpose, including, but not limited to, any kind of broadcasting or communication, simultaneous transmissions on AM, FM, SSB, VBIF, UHF, and/or microwave frequencies, and all rental revenues received therefrom shall belong exclusively to Lessor. Prior to permitting the fastening of a material amount of additional equipment, Lessor shall cause a structural analysis of the Tower to be conducted by a reputable mechanical consultant chosen by Lessor in order to ensure that any such additions conform to recognized engineering standards.
(c) Except as expressly provided for herein, Lessor shall have no liability for any action or omission taken in exercise of its rights hereunder upon reasonable reliance on recommendation of its engineering personnel.
(d) Subject to the terms of this Lease, Lessor also reserves the right to erect one (1) or more additional towers on the Tower Site.
4. TERM.
4.01 TERM. This Lease shall have a term of twenty (20) years from the Commencement Date established in Paragraph 1.01 hereof.
5. RENT.
5.01 RENTAL. Lessee shall pay rent for each consecutive twelve-month period beginning on the Commencement Date (each a "Lease Year") during the term of this Lease. Such rental payment shall be payable in equal and successive monthly installments in advance beginning with the Commencement Date and continuing thereafter on the first day of each month during the term of this Lease, such rental payments to be made according to the following schedule:
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Lease Year Rent Per Lease Year Monthly Rent
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1 $4,421.76 $368.48
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2 $4,421.76 $368.48
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3 $4,421.76 $368.48
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4 $4,421.76 $368.48
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5 $4,421.76 $368.48
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6 $4,421.76 $368.48
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7 $4,421.76 $368.48
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8 $4,421.76 $368.48
--------------------------------------------------------------------------------
9 $4,421.76 $368.48
--------------------------------------------------------------------------------
10 $4,421.76 $368.48
--------------------------------------------------------------------------------
11 $4,421.76 $368.48
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12 $4,421.76 $368.48
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13 $4,421.76 $368.48
--------------------------------------------------------------------------------
14 $4,421.76 $368.48
--------------------------------------------------------------------------------
15 $4,421.76 $368.48
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16 $4,421.76 $368.48
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17 $4,421.76 $368.48
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18 $4,421.76 $368.48
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19 $4,421.76 $368.48
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20 $4,421.76 $368.48
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5.02 PAYMENT OF RENTALS. Rentals to be paid hereunder shall be paid monthly in lawful money of the United States of America and shall be paid in advance on the first day of each month during the term of this Lease by crediting the payment owed to Lessee by Lessor, under that certain Promissory Note made by Lessor in favor of Lessee, dated ________, 2000, on the first day of each month during the term of this Lease. In the event of prepayment of the Promissory Note by Lessor or other action resulting in amounts equal to any monthly rental payment not being concurrently due from Lessor under the Promissory Note, then Lessee shall pay the monthly rental amount in advance on the first day of the month in question by mailing payment to the Lessor c/o Beasley Family Tower, Inc., 3303 Riviera Drive, Suite 200, Naples, FL 34103, Attn: Ms. Caroline Beasley, or to such other person or address as Lessor may in writing direct. The payment of the monthly rental for the first month of the term of this Lease shall be prorated based on the number of days remaining in such month, including the first day on which this Lease become effective.
5.03 ELECTRICITY AND OTHER UTILITIES. In addition to the payments prescribed under Section 5.01 of this Lease, Lessee shall pay for its own telephone lines and service, electrical service (including electrical service to the Tower used by Lessee as measured by a separate electrical meter at Lessee's expense). Lessor shall pay for the electrical service to the Tower for the Tower lighting.
6. AUTHORITY.
6.01 QUIET ENJOYMENT. Lessor represents and warrants that it has the full power and authority to enter into this Lease, and covenants and agrees that Lessee, upon paying the rents described herein and observing and keeping the covenants, agreements, and
stipulations of this Lease on Lessee's part to be observed and kept, shall lawfully, peaceably, and quietly hold, occupy, and enjoy the Tower, and all other rights and privileges granted herein, without hindrance, eviction, or molestation by Lessor or any party claiming by or through Lessor.
6.02 LESSEE'S APPROVAL. Lessee represents and warrants that it has the full power and authority to enter into and perform this Lease. Any and all necessary corporate resolutions, encumbrance certificates, etc., shall be supplied by Lessee upon the request of Lessor.
7. PERMITS.
7.01 PERMITS. Lessor shall obtain all necessary licenses or permits in connection with the Tower except that Lessee shall obtain, at its own expense, any and all necessary licenses or permits from such governmental authorities as shall have jurisdiction in connection with the (b) the operations, installation, repair, alteration, or replacement of Lessee's equipment (including, without limitation, Lessee's antenna and transmission and/or receiving equipment); or (c) with any of Lessee's activities thereon or contemplated by this Lease. At Lessor's request, Lessee shall furnish Lessor with copies of same, and shall abide by the terms and provisions of such licenses and permits.
8. MAINTENANCE OF LEASED PREMISES AND LESSEE'S PROPERTY.
8.01 DURING TERM OF LEASE.
(a) Lessee, at its own cost and expense, shall maintain and repair Lessee's Property, including specifically its antenna, related equipment, transmission lines, transmitters, and other equipment. Lessor shall perform the same tasks with respect to the Tower and the Transmitter Building. All such maintenance shall be conducted by the parties in accordance with good engineering standards and in conformity with the requirements of the FCC or any other body having jurisdiction over the Lessee and its property, including, without limitation, any rules, regulations, or guidelines of the FCC implementing the National Environmental Policy Act of 1969 pertaining to electromagnetic or radio frequency radiation. Each of Lessor and Lessee shall take all reasonable precautions to avoid interference or hindrance to and with the operations of the other party hereto. In this regard, each party hereto agrees to eliminate, without cost to the other party hereto, any interference or hindrance to such other party's operation. Maintenance and repair of Lessee's Property shall be performed only by a reputable contractor and in accordance with the provisions of subsections (d), (e), and (f) hereof.
(b) Lessor retains the right to inspect Lessee's Property during normal business hours upon reasonable notice to Lessee, except that, in the event of an emergency, as determined by Lessor, Lessor may enter at any time, giving notice of such emergency to Lessee as soon as is practical. In the event that Lessor reasonably determines that Lessee has not maintained Lessee's Property and equipment in good order and repair according to industry standards, and that such repairs are necessary for the safety of the Tower, the Transmitter Building or the Tower Site, or the prevention of interference with Lessor or any other user of the Tower or any other broadcaster, Lessor may, at its option, make such emergency
repairs to the property as it deems reasonably necessary, and any amount expended by Lessor therefor shall be reimbursed to it by Lessee immediately upon presentation of a statement and shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing any of Lessee's Property which Lessee has failed to properly maintain.
(c) With respect to the non-emergency repairs which Lessor, in its reasonable discretion, determines that Lessee should make to maintain Lessee's Property and equipment in good order, and that such repairs are necessary for the safety of the Tower, the Transmitter Building or Tower Site, or the prevention of interference with Lessor, in violation of the terms of this Agreement, Lessor shall so notify Lessee in writing, specifying the maintenance and repairs required to be performed by Lessee. In the event that, within ten (10) business days following such written notice (or such longer period as may be reasonably necessary taking into account all facts and circumstances), Lessee shall not have performed such maintenance and repairs, Lessor may, at its sole option, make such repairs as it deems reasonably necessary, and any amount expended by Lessor therefor shall be deemed additional rent. Lessor shall not be liable for inconvenience, disturbance, loss of business, or other damage to Lessee by reason of repairing the property and equipment of Lessee which Lessee has failed to properly maintain.
(d) No work (including electrical work), except for emergency repairs that Lessee shall perform to return to, or maintain the station on air in the event of a failure, will be performed by the Lessee in connection with the installation, alteration, maintenance, repair, or removal of any of Lessee's transmission lines, antenna, and other equipment on the Tower unless the Lessee submits to Lessor a copy of the proposed contract and also detailed plans and specifications of the work to be done, and both the contract and the plans and specifications have been approved in writing by Lessor not to be unreasonably withheld, delayed or conditioned. Lessee, upon demand therefor by Lessor, agrees to pay Lessor as additional rent all amounts reasonably expended by Lessor in connection with review of any such contract, plans, and specifications.
(e) With respect to any work to be performed by or on behalf of Lessee in connection with the installation, alteration, maintenance, repair, or removal of any equipment on the Tower (including any ascension of the Tower), in the Transmitter Building, or in or about the Tower Site. Lessee may only employ a contractor who has been approved in writing and in advance by Lessor. Lessor agrees that it will not unreasonably withhold its approval of any contractor who has the requisite experience and industry standard insurance coverage and who will, at the sole option of Lessor, provide a bond to cover any work which it has been retained to perform. Lessor agrees to consult on call in any emergency situation and immediately give its approval or disapproval.
(f) All work by or on behalf of the Lessee or Lessor
shall be carried out (i) in a good and workmanlike manner; (ii) in accordance
with established engineering standards and public ordinances, rules, and
regulations applicable to such work, including, without limitation, any rules,
regulations, or guidelines of the FCC implementing the National Environmental
Policy Act of 1969, pertaining to electromagnetic or radio frequency radiation;
(iii) in accordance with plans and specifications, including mechanical and
electrical
drawings, which have been submitted to and approved in writing and in advance by Lessor; and (iv) in accordance with Lessor's security procedures with respect to protection of the Tower Site.
(g) Notwithstanding the receipt of the approvals by Lessor as required in this paragraph, Lessee shall not be relieved of its responsibilities and liabilities for interference or otherwise as herein provided, nor shall said approval be deemed a waiver of any other rights of Lessor under this Lease.
(h) In the event that any notice of lien or lien shall be filed against any part of the Tower Site for work claimed to have been done or materials claimed to have been furnished to Lessee, the same shall be dismissed, withdrawn, discharged or bonded (to Lessor's reasonable satisfaction) by Lessee within thirty (30) days thereafter at Lessee's expense; and if Lessee shall fail to take such action as shall cause such lien to be discharged within thirty (30) days, Lessor may, at its option, discharge the same by deposit or by bonding proceedings. Lessor may require the lienor to prosecute the appropriate action to enforce the lienor's claim. In such case, Lessor shall give immediate notice to Lessee of such pending action or proceeding so that Lessee may have an opportunity to legally contest or defend the action or proceeding. If, after such notice to Lessee, a judgment is recovered on the claim, Lessor, at its sole option, may pay the judgment. Any reasonable amount paid or expense incurred or sum of money paid by Lessor (including reasonable attorney's fees) by reason of the failure of Lessee to comply with the foregoing provisions of this paragraph, or in defending any such action, shall be paid to Lessor by Lessee, and shall be treated as additional rent hereunder.
8.02 AT EXPIRATION OR TERMINATION. At the expiration or termination of this Lease, Lessee shall promptly surrender possession of the Leased Premises to Lessor in as good a condition as the same were received at the commencement of the term, reasonable wear and tear and damage by fire or other casualty beyond Lessee's reasonable control excepted.
9. USE AND MAINTENANCE OF COMMON PREMISES.
9.01 USE OF COMMON PREMISES. Lessee, at its own risk, shall have
the right to use in common with Lessor and its licensees, invitees, and other
tenants, and in connection with Lessee's permissible activities and operations
(a) any access road from any public highway to the Tower Site or to the
Transmitter Building or any other building on the Tower Site; (b) any parking
lot on the Tower Site; and (c) all common areas in the Transmitter Building
(such items (a), (b) and (c) called collectively herein the "Common Premises").
9.02 MAINTENANCE OF COMMON PREMISES.
(a) Lessor shall maintain the Common Premises and any fence around the Tower in good repair. Lessee shall comply with any security policies reasonably established from time to time by Lessor.
(b) Lessor assumes the obligation and responsibility for complying with the requirements of the FCC regarding obstruction, marking and lighting of the
Tower. Lessor shall maintain the Tower and support systems in good repair and in good operating condition in accordance with the requirements of governmental authorities.
(c) In the event that Lessor determines that repairs, alterations, or improvements are necessary or desirable to the Tower, the Transmitter Building or the leased spaces of other tenants, Lessor may, upon reasonable notice and for the shortest practical period of time (except for emergency situations), close entrance doors, common areas, drive-ways, rights-of-way, service areas, parking areas, or any other facilities at its discretion without being liable to Lessee; provided that if any of the above would restrict Lessee's ability to broadcast, Lessor shall use reasonable efforts to restrict any closure or interruption pursuant to this Section 9.02 to the hours of 1:00 a.m. to 5:00 a.m.. The closing of entrances, doors, common areas, parking areas, or other facilities for the making of the repairs, alterations, or improvements described herein shall, under no circumstances, constitute an eviction of the Lessee or be grounds for termination of this Lease or the withholding of any rental payments or other payments or performances required to be paid or made by Lessee under the terms hereof, provided, Lessor shall use reasonable efforts to ensure that any action taken in accordance with this paragraph shall not adversely affect the rights of Lessee hereunder. Under no such circumstances shall Lessee be entitled to terminate this Lease nor shall it be entitled to compensation for any loss or damage it may sustain (including loss of use, loss of advertising/sponsorship revenues, and consequential damages) by reason of such changes or alterations.
10. ALTERATIONS BY LESSEE.
10.01 ALTERATIONS.
(a) Lessee shall have the right, at its own expense, to make such changes and alterations in the Lessee's Property situated on the Tower, subject to Paragraph 8.01 and Paragraph 11 hereof, as its operations may require, including the renovation, replacement, or removal of its antenna; provided, however, that such changes or alterations conform with recognized engineering standards and, if necessary, have been approved by the FCC and any other authority having jurisdiction over Lessee; and provided further, that plans and specifications are first submitted to and approved in writing by Lessor. Lessee shall make no changes in the equipment or equipment position without such approval, and Lessor shall not unreasonably fail to give such approval within ten (10) business days.
(b) This Lease is based upon carefully computed tower loading capacity. If any change proposed by Lessee in the type, location, or positioning of Lessee's Property should, in Lessor's judgment, require a computer or other type of feasibility study to determine Tower loading capacity, such study shall be performed by an engineer chosen by Lessor, and approved by Lessee (such approval not to be unreasonably withheld, delayed or conditioned) whose decision shall be final and binding upon both parties. The cost of such study or any other costs reasonably incurred by Lessor in determining the feasibility of any proposed change or alteration in the type, location, or positioning of Lessee's Property shall be borne entirely by Lessee.
11. INTERFERENCE.
11.01 PRELIMINARY STEPS TO AVOID INTERFERENCE.
Before Lessee shall make any new installation on the Tower after the date hereof, notification of the particulars of such proposed installation shall be submitted to Lessor hereto and any other lessees or users of space on the Tower whose names and addresses are supplied to Lessee by Lessor in writing, and the Lessor and such other users will be requested to advise, in writing, the Lessee and Lessor, as applicable, within ten (10) days after receipt of such notification, whether they have any reasonable objections thereto on the grounds that objectionable interference may result; provided, this Section 11.01 shall not apply to any currently installed Lessee's Property or its replacement, maintenance or repair. If the Lessor or any other user shall reasonably object within this period to such plans and Lessee is unwilling to alter its plans to meet the objections, the dispute shall be submitted to an independent professional engineer chosen by Lessor, and such engineers decision shall be final and binding upon all parties. The cost of any such studies shall be borne by Lessee.
11.02 INTERFERENCE WITH LESSOR, LESSEE, OR OTHERS. Notwithstanding the provisions of Paragraph 11.01, should any change, after the date hereof, in the facilities or mode of operation of Lessee or Lessee's failure to comply with the Maintenance Standards, as defined in Paragraph 11.04, cause any objectionable electrical or physical interference (including interference from any other structure erected on the Tower Site) to the television and/or radio broadcasting and/or receiving operations of any other lessee, then, promptly after written notification of such interference, the Lessee, at its sole expense, will take such steps as may be reasonably required to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filters or other equipment, provided that, if such interference is caused, after the date hereof, by the failure of the Lessor or any other lessee suffering the interference to comply with the Maintenance Standards, as defined in Paragraph 11.04, then Lessor shall, or shall cause the other lessee suffering the interference, at its sole expense, to comply with such Maintenance Standards. Any dispute as to the cause of interference, or the steps reasonably required to correct it, arising under this Paragraph 11.02, shall be submitted to an independent professional engineer chosen by Lessor, and such engineer's decision shall be final and binding upon the parties. If such interference is found to be caused by such changed facilities or operation, the fees and charges of the engineer to whom the dispute is referred shall be borne by the party whose changed facilities or mode of operations gave rise to the claimed interference. If such interference is found not to be caused by such changed facilities or operations, the fees and charges of the engineer to whom the dispute is referred shall be borne by the objecting party. All other leases and/or agreements to lease space at the Tower Site shall contain this language.
11.03 INTERFERENCE BY OTHER USER. Any subsequent agreement under which Lessor allows any other person to occupy any portion of the Tower shall provide that, should the installation, operation, or maintenance of the equipment or the activities of such other person cause any objectionable interference with the operations of Lessor or Lessee, then, promptly after written notification of such, such other tenant or user, at its sole expense, will take such steps as may be reasonably necessary to correct such interference, including, but not limited
to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment, provided that if such interference is caused by the failure of any other lessee to comply with the Maintenance Standards, as defined in Paragraph 11.04, such other lessee will, at its sole expense, comply with such Maintenance Standards. To the best of its ability, Lessor shall not permit any operations by other tenants, the effect of which would be to prohibit Lessee from operating in the manner contemplated herein, without the prior written consent of Lessee. Lessor shall have no liability for any action or omission taken upon reasonable reliance on the recommendation of qualified engineering personnel. Lessor agrees that it will take commercially reasonable efforts to ensure that the installation, operation or maintenance of its equipment which is installed after the commencement date of this Lease on, in or around the Tower shall not cause any objectionable interference with the operations of Lessee. Immediately upon notification of such interference by Lessee, Lessor shall at its sole expense take such steps as may be reasonably necessary to correct such interference, including, but not limited to, changing frequency, ceasing transmission, reducing power, and/or the installation of any filter or other equipment.
11.04 DEFINITION OF "MAINTENANCE STANDARDS". For the purposes of this Lease, compliance with "Maintenance Standards" shall mean that a tenant or user of the Tower shall (a) maintain and operate its equipment in accordance with the requirements, rules, regulations, and guidelines of the FCC, and the standards of manufacturers of the equipment; and (b) maintain and operate its equipment in accordance with good engineering practice.
12. UTILITIES.
12.01 UTILITIES. Subject to the required approvals and cooperation of any governmental authority or public utilities, Lessee shall arrange and be responsible for the installation and provision of electrical and telephone lines serving Lessee's Property at any building on the Tower Site owned by Lessor. Lessee shall be responsible for procurement of and payment for all telephone services as described in Paragraph 5.03 and used by Lessee.
13. TAXES.
13.01 PAYMENT OF TAXES. Lessee shall pay all real estate taxes, assessments, or levies assessed or imposed against the Tower Site (including the Tower), and all taxes which may be assessed against the Tower and any buildings thereon. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement]. Lessee shall pay all personal property or other taxes assessed or imposed on Lessee's Property, and shall cooperate with Lessor to ensure that such property is properly separated from that of Lessor or other tenants for assessment purposes.
14. INSURANCE.
14.01 PUBLIC LIABILITY. Lessee shall procure and maintain comprehensive public liability insurance, naming Lessor as an additional insured as its interests shall appear, covering all of the Lessee's operations and activities on the Tower, including but not limited to, the operations of contractors and subcontractors and the operation of vehicles and
equipment (including the Tower elevator), with limits of liability for the term of this Lease of not less than Five Million Dollars ($5,000,000.00) in the aggregate for personal injury or death in any occurrence and not less than Five Million Dollars ($5,000,000.00) to cover property damage, with a liability umbrella of not less than One Million Dollars ($1,000,000.00). Certificates evidencing such insurance shall be furnished to Lessor upon its request. The amounts specified hereunder shall be revised every five (5) years to such amounts as Lessor may reasonably require upon the advice of its insurance consultants. [Foregoing obligation is subject to $200,000 12-month limit when aggregated with other borrowers under Credit Agreement per 1.5D of First Amendment to Credit Agreement].
14.02 CONTRACTOR LIABILITY. Lessee shall also cause the contractors erecting, installing, or maintaining Lessee's Property or performing any other work for Lessee on the Tower Site to procure reasonable public liability insurance acceptable to Lessor and naming the Lessee and Lessor as named insureds. Certificates evidencing such insurance shall be furnished to Lessor in advance of any work being performed.
14.03 INSURANCE ON THE LEASED PREMISES. Lessee shall procure and
maintain physical damage insurance on the Leased Premises in an amount
sufficient to repair or replace any of the Leased Premises with such coverage to
be on an "All Risks" basis, including, without limitation, coverage for the
perils of fire, lightning, windstorm, hall, flood, earthquake, collapse,
explosion, aircraft and vehicle damage, vandalism, and malicious mischief.
[Foregoing obligation is subject to $200,000 12-month limit when aggregated with
other borrowers under Credit Agreement per 1.5D of First Amendment to Credit
Agreement]. Lessee shall be solely responsible for its insurance on Lessee's
Property, together with business interruption insurance.
14.04 TOWER AND/OR BUILDING DAMAGE. In the event that the Tower and/or the Transmitter Building is destroyed or damaged by fire, lightning, windstorm, flood, earthquake, explosion, collapse, aircraft, or other vehicle damage or other casualty covered by insurance, Lessor shall promptly reconstruct or repair the Tower and/or the Transmitter Building to such good condition as existed before the destruction or damage, and give possession to Lessee of substantially the same space leased hereunder. Lessee shall promptly pay over to Lessor any insurance proceeds it receives from insurance policies Lessee is required to procure under Section 14.03 hereof for the purpose of use by Lessor to fund reconstruction of the Towers and/or Transmitter Buildings as required of Lessor under this Section 14.04. If the Tower and/or the Transmitter Building is in need of such repair or is so damaged by fire, lightning, windstorm, flood, earthquake, explosion, aircraft or other vehicle damage, collapse, or other casualty that reconstruction or repair cannot reasonably be undertaken without dismantling Lessee's antenna, then upon written notice to Lessee, Lessor may remove any such antenna and interrupt the signal activity of Lessee, but will use its best efforts to have the antenna replaced as soon as reasonably possible. Lessor agrees to provide Lessee an alternative tower or transmitter building, if available, during such reconstruction/repair period. If such tower or transmitter building is not available, then Lessee shall be responsible for procuring its own alternative tower. No monetary or other rental shall be due pursuant to the terms of this Lease for such time as Lessee is unable to conduct its broadcasting activities on the Tower without significant diminution of signal quality as a result of such total or partial destruction or damage or need of repair, and Lessor shall refund to Lessee any rent paid in advance for such time. Should Lessor not either (a) inform
Lessee in writing within ninety (90) days of the date of destruction of Lessor's intent to replace the Tower and/or the Transmitter Building or (b) replace the Tower and/or the Transmitter Building within one (1) year if Lessor has provided the notice described in clause (a) above, of the date of destruction, or repair the same within such shorter time period after the casualty as may be reasonable, then Lessee, upon thirty (30) days' written notice to Lessor, may terminate this Lease, provided if Lessor has provided the notice described in clause (a) above, Lessee must make such election within one hundred twenty (120) days prior to the expiration of said repair or replacement period. Lessee agrees that it shall maintain adequate business interruption insurance at all times during the term of this Lease to adequately protect it from any interruption of signal activities due to Tower or Transmitter Building damage (including costs of reinstallation of its equipment and lines), and Lessor shall have no liability on account of such business interruption or reinstallation costs due to damage or destruction under this paragraph.
15. EMINENT DOMAIN.
(a) In the event that all of the Tower Site (or any portion of the Tower Site necessary for the guy wires, or other appurtenances necessary to Lessee's broadcasting operations) is acquired or transferred or condemned pursuant to eminent domain proceedings (or the threat thereof), the obligation of the parties under this Lease shall be terminated as of the date of acquisition or transfer. Lessor shall be entitled to the entire condemnation award. If Lessor determines to build a new tower as a replacement for the Tower and/or Transmitter Building on the condemned property, Lessor agrees to lease the new tower and/or transmitter building on terms reasonably equivalent to the terms of this Lease.
(b) In the event that this Lease is terminated due to eminent domain proceedings, then Lessee shall be relieved of any further obligations to make any rental payments or performances for any period after the date of such termination of this Lease; and subject to offset or withholding by Lessor to cover any unpaid additional rent or other authorized charges which may be owed through the date of termination, Lessee shall be entitled to a refund of any advance rental sums which it has paid in proportion to the period of the Lease through such date of termination.
16. SUCCESSORS AND ASSIGNMENT.
16.01 SUCCESSORS. All rights and liabilities herein given to or imposed upon the respective parties hereto shall, to the extent that such are assignable, extend to and bind the several and respective successors and assigns of the parties hereto.
16.02 ASSIGNMENT. Lessee shall not assign, sublet, or transfer this Lease or any interest therein, or permit or allow through any act or default of itself, or of any other person, any transfer thereof by operations of law or otherwise without the prior written consent of Lessor except:
(a) Lessee may assign this Lease to any bona fide third party purchaser of substantially all the assets comprising of Lessee's radio station broadcasting from
the Tower Site, who shall execute an assignment and assumption agreement in form reasonably acceptable to Lessor; and
(b) Lessee may assign or transfer all or a portion of the assets of Lessee, including this Lease, to any corporation controlling, controlled by, or under common control with, Lessee.
(c) Any assignment or subletting by Lessee except as permitted herein shall be void and of no effect. Any permitted assignment shall not relieve Lessee of any of its liabilities hereunder. A change in control of Lessee, but not the mortgaging by Lessee of its rights hereunder, shall constitute an assignment of this Lease. Lessor agrees to enter into documentation reasonably requested by any lender to Lessee in connection with Lessee's mortgaging of its rights hereunder.
(d) Lessor may assign or transfer this Lease without the consent of Lessee, but shall notify Lessee following any transfer or assignment.
17. RIGHT TO REMOVE LESSEE'S PROPERTY IN EVENT OF TERMINATION. In the event either party elects to terminate this Lease in accordance with the provisions herein or at the expiration of the term hereof, Lessee or its mortgagee shall have the right to remove Lessee's Property, except any fixtures (it being specifically understood and agreed that Lessee's antenna, transmitters, transmission line, and similar broadcasting equipment shall not be deemed fixtures) on the Leased Premises within thirty (30) days of such termination. Such removal shall be conducted in accordance with Paragraph 8.01 hereof Lessee shall promptly repair any and all damage caused by such removal. Any of Lessee's Property remaining on the Leased Premises after the expiration of the thirty (30) day period shall be deemed to be the property of Lessor, which Lessor may have removed at Lessee's expense.
18. LESSOR'S PROTECTION.
18.01 DEFAULT BY LESSEE.
(a) If Lessee shall make default in making any payment herein provided for and any such default shall continue for a period of ten (10) business days after written notice to Lessee, or if Lessee shall make default in the performance of any obligation of Lessee herein (other than as to payment of money) and any such default shall continue for a period of thirty (30) days after written notice to Lessee, or if Lessee shall file a voluntary petition in bankruptcy, or if Lessee shall file any petition or institute any proceedings under any Insolvency or Bankruptcy Act or any amendment thereto hereafter made, seeking to effect its reorganization or a composition with its creditors, or if, in any proceedings based on the insolvency of Lessee or relating to bankruptcy proceedings, a receiver or trustee shall be appointed for Lessee or the Leased Premises, or if any proceedings shall be commenced for the reorganization of Lessee (which, in the case of involuntary proceedings, are not dismissed or stayed within 30 days of the commencement thereof), or if the leasehold estate created hereby shall be taken on execution or by any process of law, or if Lessee shall admit in writing its inability to pay its obligations generally as they become due, then Lessor may, at its option,
terminate this Lease without notice, and declare all amounts due or to become due hereunder immediately due and payable, and Lessor's agents and servants may immediately, or any time thereafter, reenter the Leased Premises by reasonably necessary force, summary proceedings, or otherwise, and remove all persons and properly therein, without being liable to indictment, prosecution, or damage therefor, and Lessee hereby expressly waives the service of any notice in writing of intention to reenter said Leased Premises. Lessor may, in addition to any other remedy provided by law or permitted herein, at its option, relet the Leased Premises (or any part thereof) on behalf of Lessee, applying any monies collected first to the payment of expenses of resuming or obtaining possession, and, second, to the payment of the costs of placing the premises in rentable condition, including any leasing commission, and, third, to the payment of rent due hereunder, and any other damages due to the Lessor. Any surplus remaining thereafter shall be paid to Lessee, and Lessee shall remain liable for any deficiency in rental, the amount of which deficiency shall be paid upon demand therefor to Lessor.
(b) Should Lessor re-enter and terminate according to the provisions of this subparagraph, Lessor may remove and store the Lessee's Property at the expense and for the account of Lessee. Alternatively, Lessor may sell, or cause to be sold, Lessee's Property at public sale to the highest bidder for cash, and remove from the proceeds of such sale any rent or other payment then due Lessor under this Lease. Any disposition of the Lessee's Property pursuant thereto shall be subject to the rights of any lender to Lessee holding a mortgage on Lessee's Property and shall be made in a manner that is commercially reasonable within the meaning of the Uniform Commercial Code as in effect in the State of North Carolina at the time of such disposition.
19. INDEMNIFICATION.
(a) Each party warrants and represents that it has the authority to enter into this Lease and to grant the rights it grants hereunder, and that performance of its obligations pursuant to this Lease will not violate the rights of any third party whatsoever. Lessee agrees to indemnify and defend Lessor against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessee of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessee, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessee, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessee to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessee's failure to maintain equipment in proper working order; and (f) out of Lessee's failure to comply with any of its other obligations under the terms of this Lease.
(b) Lessor agrees to indemnify and defend Lessee against any claim for damages, losses, liabilities, costs, or expenses, including reasonable attorney's fees, arising (a) out of any breach by Lessor of its warranties, representations, or covenants under this Lease; (b) out of the use, management, or occupancy of the Leased Premises by Lessor, its agents, or invitees; (c) out of any omissions, negligence or willful misconduct of Lessor, its agents, servants, employees, licensees, or invitees; (d) out of failure of Lessor to comply with any laws, statutes, ordinances, or regulations; (e) out of Lessor's failure to maintain equipment in
proper working order; and (f) out of Lessor's failure to comply with any of its other obligations under the terms of this Lease.
(c) Any party seeking indemnification hereunder
("Indemnified Party") shall provide the other party ("Indemnifying Party")
reasonably prompt notice of known claims giving rise to any claim for indemnity,
and the Indemnifying Party shall have the right and opportunity to undertake the
legal defense of such claims. The Indemnified Party and its counsel may
nevertheless participate in (but not control) such proceedings, negotiations, or
defense at its own expense. In all such cases, the Indemnified Party will give
all reasonable assistance to the Indemnifying Party, including making the
Indemnified Party's employees and documents available as reasonably requested
without charge.
20. ESTOPPEL CERTIFICATE AND ATTORNMENT.
20.01 ESTOPPEL CERTIFICATE. Within ten (10) days after either
party's request, the other party shall deliver, executed in recordable form, a
declaration to any person designated by the requesting party (a) ratifying this
Lease; (b) stating the commencement and termination dates; and (c) certifying
(i) that this Lease is in full force and effect, and has not been assigned,
modified, supplemented, or amended (except by such writings as shall be stated);
(ii) that all conditions under this Lease to be performed have been satisfied
(stating exceptions, if any); (iii) that no defenses or offsets against the
enforcement of this Lease by the requesting party exist (or stating those
claimed); (iv) advance rent, if any, paid by Lessee; (v) the date to which rent
has been paid; (vi) the amount of security deposited with Lessor (if hereafter
applicable for any reason); and (vii) such other information as the requesting
party reasonably requires. Persons receiving such statements shall be entitled
to rely upon them.
20.02 ATTORNMENT. Lessee shall, in the event of a sale or assignment of Lessor's interest in any of the Leased Premises, or, if any of the Leased Premises comes into the hands of any Trustee under a Deed of Trust or a mortgagee or any other person, whether because of a foreclosure, exercise of a power of sale under a mortgage or Deed of Trust, or otherwise, attorn to the purchaser or such mortgagee, Trustee, or other person, and recognize the same as Landlord hereunder. Lessee shall execute at Lessor's request any attornment agreement reasonably required by any mortgagee, Trustee, or other such person to be executed containing such provisions as such mortgagee, Trustee, or other person reasonably requires, provided, however, that such attornment shall not modify the terms of this Lease.
20.03 FAILURE TO EXECUTE INSTRUMENTS. Either party's failure, without good and reasonable cause, to execute instruments or certificates provided for in this Paragraph 20, within fifteen (15) days after the receipt by such party of a written request, shall be a default under his Lease.
21. MISCELLANEOUS.
21.01 RELATIONSHIP OF PARTIES. Nothing contained herein and no acts of the parties herein shall be deemed or construed as creating any relationship between the parties hereto other than the relationship of Lessor and Lessee or Landlord and Tenant.
21.02 GOVERNING LAW. This Lease shall be governed and construed and enforced in accordance with the laws of the State of North Carolina.
21.03 CAPTIONS. The captions contained in this Lease are included solely for convenience and shall in no event affect or be used in connection with the interpretation of this Lease.
21.04 AMENDMENTS. This Lease only may be amended or modified as may be agreed upon by written instrument executed by the parties hereto.
21.05 INTEREST AND ATTORNEY'S FEES. All sums becoming due or payable under this Lease, including all money expended pursuant to the provisions hereof or on account of any default in the performance and observance of any agreements or covenants herein, shall bear interest at the rate of eight and one-half percent (8.5%) per annum (or at such lesser rate which is the maximum permitted by applicable law) from thirty (30) days after the date such sums become due or payable, or, in the event one of the parties expends money because of a default by the other, from thirty (30) days after the date the defaulting party received written notice that such money was expended.
The prevailing party shall be entitled to its reasonable attorney's fees to collect any payment or to compel any performance ultimately held to be due under the provisions of this Lease.
21.06 BROKERS AND THIRD PARTIES. Each party represents that it has not had dealings with any real estate broker or other person who may claim a commission or finder's fee with respect to this Lease in any manner. Each party shall hold harmless the other party from all damages resulting from any claims that may be asserted against the Indemnified Party by any broker, finder, or other person with whom the Indemnifying Party has or purportedly has dealt.
21.07 NOTICES. Notices given pursuant to this Lease shall be in writing and shall be given by actual delivery or by mailing the same to the party entitled thereto at the addresses set forth below or at any such other address as any Party may designate in writing to any other Party pursuant to the provisions of this paragraph. Notice given by mail shall be sent by United States mail, certified or registered, return receipt requested or by nationally recognized courier serviced providing receipt of delivery. Notices shall be deemed to be received on the date of actual receipt, in the case of personal delivery, or on the date of mailing, in the case of mailing. Notices shall be served or mailed to the following addresses, subject to change as provided above:
If to the Lessor: Beasley Family Towers, Inc.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Ms. B. Caroline Beasley
Secretary
Phone: (941) 263-5000
|
Fax: (941) 434-8950
With a copy (which shall not constitute notice) to:
Joseph D. Sullivan, Esq.
Latham & Watkins
1001 Pennsylvania Ave., N.W.
Washington, DC 20004-2505
Phone: (202) 637-2200
Fax: (202) 637-2201
If to the Lessee: Beasley FM Acquisition Corp.
3033 Riviera Drive, Suite 200
Naples, FL 34103
Attn: Mr. George G. Beasley
Chief Executive Officer
Phone: (941) 263-5000
Fax: (941) 434-8950
|
21.08 WAIVER. It is agreed that the waiving of any of the covenants of this Lease by either party shall be limited to the particular instance, and shall not be deemed to waive any other breaches of such covenant or any provision herein contained.
21.09 ACCORD AND SATISFACTION. No receipt of money by Lessor after the termination of this Lease or after the service of any notice or after the commencement of any suit reinstates, continues, or extends the term of this Lease or affects any such notice or suit.
21.10 LIMITATION OF LIABILITY. Except as otherwise expressly stated herein, Lessor shall not be liable or responsible to the Lessee or to anyone claiming under or through the Lessee for any loss or damage caused by the acts or omissions of any other tenants or any other users of the Leased Premises, or for any loss or damage to Lessee's Property caused by fire, water, bursting pipes, leaking gas, sewage, steam pipes, drains, ice, or materials falling from the Tower or Transmitter Building, or the malfunction of any utility, facility, or installation, or by reason of any other existing condition or defect in the Leased Premises; nor shall Lessor be liable or responsible to the Lessee for any injury or damage suffered by the Lessee and allegedly caused by technical interference with the Lessee's operations, by the activities of any other tenants or users of the Leased Premises, or any other broadcasters. Except for Lessor's own negligent acts, willful misconduct or for breaches of its obligations under this Agreement, Lessor shall not be liable to Lessee, or to any other person for property damage or personal injury, including death. Lessor shall not be liable under any circumstances for loss of use, loss of sponsorship or advertising revenue, or any other consequential damages sustained by Lessee.
21.11 PARTIAL INVALIDITY. The invalidity of any provision, clause, or phrase contained in this Lease shall not serve to render the balance of this Lease ineffective or void; and the same shall be construed as if such had not been herein set forth.
21.12 DOCUMENTARY STAMPS. Lessee shall bear the cost of any documentary stamps occasioned by this Lease should it wish to record this Lease.
21.13 RULES AND REGULATIONS. Lessor may from time to time issue such rules and regulations in writing which it may consider necessary and desirable. Lessee agrees to abide by such rules and regulations so long as they do not unreasonably interfere with Lessee's use and occupancy of the Tower or conflict with this Lease.
21.14 FORCE MAJEURE. Lessor assumes no responsibility for any losses or damages to Lessee's Property caused by acts of God, including, but not limited to, wind, lightning, rain, ice, earthquake, floods, or rising water, or by aircraft or vehicle damage. Lessor furthermore assumes no responsibility for losses or damages to Lessee's Property caused by any person other than employees and agents of Lessor. In the event that Lessor shall be delayed, hindered in or prevented from the performance of any act required hereunder by reason of acts of God (including, but not limited to, wind, lightning, rain, ice, earthquake, flood, or rising water), aircraft or vehicle damage or other casualty, unforeseen soil conditions, acts of third parties who are not employees of Lessor, strikes, lock-outs, labor troubles, inability to procure material, failure of power, governmental actions, laws or regulations, riots, insurrection, war, or other reasons beyond its control, then the performance of such act shall be excused for the period of delay and the period for performance of any such act shall be extended for a period equivalent to the period of such delay.
21.15 ENTIRE AGREEMENT. This Lease, together with its Exhibits, constitutes and sets forth the entire agreement and understanding of the parties with respect to the subject matter hereof, and supersedes all prior or contemporaneous offers, negotiations, and agreements (whether oral or written) between the parties (or any of their related entities) concerning the subject matter of this Lease.
21.16 COUNTERPARTS AND DUPLICATES. This Lease may be executed in counterparts, which, when combined, shall constitute a single instrument. The Lease may also be executed in duplicate editions, each of which shall be effective as an original.
IN WITNESS WHEREOF, the parties have hereunto set their respective hands and seals, as of the day and year first above written.
ATTEST: LESSOR:
BEASLEY FAMILY TOWERS, INC.
By: (SEAL)
---------------------------- ----------------------------
Witness Name: B. Caroline Beasley
Title: Secretary
LESSEE:
BEASLEY FM ACQUISITION CORP.
By: (SEAL)
---------------------------- ----------------------------
Witness Name: George G. Beasley
Title: Chief Executive Officer
|
EXHIBIT A
DESCRIPTION OF WAZZ-AM TOWER SITE
That certain tract of land (exclusive of the building used as a studio for radio broadcast stations WAZZ and WFLB-FM, and inclusive of the transmitter building situated near the base of the WAZZ-AM Tower on the Tower Site) more particularly described as follows:
BEGINNING at a point in the eastern margin of Lot 6 as shown in Section II and
Section III of Huske Heights as recorded in Plat Book 11, Page 4, Cumberland
County Registry, said point being located North 34 degrees 34 minutes West 71.02
feet from the northeast corner of said Lot 6; thence South 31 degrees 59 minutes
West 300.75 feet to a point in the eastern margin of Bragg Boulevard; thence
running with the eastern margin of said Bragg Boulevard North 58 degrees 21
minutes West 10.00 feet to a point; thence running along the northwest line of
said Lot 6 North 31 degrees 59 minutes East 200.00 feet to a point; thence
running along a north east line of Franchise Realty Corporation property as
recorded in Deed Book 933, Page 1, North 58 degrees 01 minutes West 172.38 feet
to a point; thence North 31 degrees 55 minutes East 160.59 feet to an old iron
pipe; thence running along the eastern margin of a portion of Lot 9, Lot B, Lot
7 and a portion of Lot 6, South 34 degrees 34 minutes East 199.03 feet to the
point and place of BEGINNING, and containing .634 acres, more or less, and being
a portion of Lots 6, 7, 8, 9, of Section II and Section III, of Huske Heights,
as recorded in Plat Book 11, Page 4, Cumberland County Registry, North Carolina.
The above description as prepared by William Larry King, Registered Land
Surveyor L 13339, August 6, 1981.
Included within and as a part of the above described property is the following described strip of land which is an easement and not a part of the property owned in fee simple.
Being the northwestern most ten (10.0') feet of Lot Six (6) of the Huske Heights Subdivision, Section III, per plat of same duly recorded in Plat Book 11, Page 4, and being described by metes and bounds as follows:
BEGINNING at a stake in the northern margin of Bragg Boulevard, the westernmost
corner of Lot Six (6) of the said Huske Heights Subdivision, Section III, and
runs thence with the northwestern line of said Lot Six (6) of the Huske Heights
Subdivision, Section III, North 31 degrees 35 minutes East 307.30 feet to an
iron stake, the northernmost corner of said Lot Six (6) of the Huske Heights
Subdivision, Section III; and runs thence along the northwestern line of said
Lot Six (6) of the Huske Heights Subdivision, Section III, South 34 degrees 34
minutes East 10.93 feet to a point in said line; and runs thence, a new line
that is located parallel to and 10.0 feet measured southeastwardly and
perpendicularly from the northwestern line of said Lot Six (6), South 31 degrees
35 minutes West 302.89 feet to a point in the northern margin of Bragg Boulevard
in the southwestern line of said Lot Six (6) of the Huske Heights Subdivision,
Section III; and runs thence along the northern margin of Bragg Boulevard in the
southwestern line of said Lot Six (6) of the Huske Heights Subdivision, Section
III; and runs thence along the northern margin of Bragg Boulevard, North 59
degrees 25 minutes West 10.0 feet to an iron stake, the point of BEGINNING.
BEGINNING at an existing iron pipe in the southwestern property line of the City of Fayetteville property as recorded in Book 640, Page 227, and also being in the northeastern line of Lot 9 as shown in a Plat of Section II and III of Huske Heights as recorded in Plat Book II, Page 4, and also being the northernmost corner of the property described in the deed from N. Hunter Wyche, Jr., Trustee, to Chesapeake Holdings - Nottoway Limited as recorded in Book 4041, Page 192, and also being a corner of the Mao Yun Lin property as recorded in Book 3673, Page 673; and proceeding thence for a FIRST CALL along the dividing line between the properties recorded in Book 4041 Page 192 and Book 3673, Page 673, South 31 degrees, 59 minutes West 180.11 feet to the westernmost corner of the property described in Book 4041, Page 192; an thence a new line, an extension of the southwestern line of the property described in Book 4041, Page 192, North 58 degrees, 01 minutes West 12.00 feet to a point; thence parallel with and 12.00 feet perpendicular to the first call herein, North 31 degrees, 59 minutes East 185.33 feet to a point in the aforesaid City of Fayetteville property said point also being in the northeastern line of the aforementioned Lot 9; thence along that line South 34 degrees, 30 minutes East 13.09 feet to THE POINT AND PLACE OF BEGINNING containing 2,192.63 square feet and being a portion of the aforementioned property conveyed to Mao Yun Lin as recorded in Book 3673, Page 673.
The property hereinabove described was acquired by Grantor by Deed dated November 27, 1996, recorded March 6, 1997, in Book 4625 Page 0178 in the Cumberland County, North Carolina Registry.
EXHIBIT B
DESCRIPTION OF THE TOWER
That certain free-standing approximately three-hundred (300) foot communications tower situated on that certain tract of land more particularly described as follows:
BEGINNING at a point in the eastern margin of Lot 6 as shown in Section II and
Section III of Huske Heights as recorded in Plat Book 11, Page 4, Cumberland
County Registry, said point being located North 34 degrees 34 minutes West 71.02
feet from the northeast corner of said Lot 6; thence South 31 degrees 59 minutes
West 300.75 feet to a point in the eastern margin of Bragg Boulevard; thence
running with the eastern margin of said Bragg Boulevard North 58 degrees 21
minutes West 10.00 feet to a point; thence running along the northwest line of
said Lot 6 North 31 degrees 59 minutes East 200.00 feet to a point; thence
running along a north east line of Franchise Realty Corporation property as
recorded in Deed Book 933, Page 1, North 58 degrees 01 minutes West 172.38 feet
to a point; thence North 31 degrees 55 minutes East 160.59 feet to an old iron
pipe; thence running along the eastern margin of a portion of Lot 9, Lot B, Lot
7 and a portion of Lot 6, South 34 degrees 34 minutes East 199.03 feet to the
point and place of BEGINNING, and containing .634 acres, more or less, and being
a portion of Lots 6, 7, 8, 9, of Section II and Section III, of Huske Heights,
as recorded in Plat Book 11, Page 4, Cumberland County Registry, North Carolina.
The above description as prepared by William Larry King, Registered Land
Surveyor L 13339, August 6, 1981.
Included within and as a part of the above described property is the following described strip of land which is an easement and not a part of the property owned in fee simple.
Being the northwestern most ten (10.0') feet of Lot Six (6) of the Huske Heights Subdivision, Section III, per plat of same duly recorded in Plat Book 11, Page 4, and being described by metes and bounds as follows:
BEGINNING at a stake in the northern margin of Bragg Boulevard, the westernmost
corner of Lot Six (6) of the said Huske Heights Subdivision, Section III, and
runs thence with the northwestern line of said Lot Six (6) of the Huske Heights
Subdivision, Section III, North 31 degrees 35 minutes East 307.30 feet to an
iron stake, the northernmost corner of said Lot Six (6) of the Huske Heights
Subdivision, Section III; and runs thence along the northwestern line of said
Lot Six (6) of the Huske Heights Subdivision, Section III, South 34 degrees 34
minutes East 10.93 feet to a point in said line; and runs thence, a new line
that is located parallel to and 10.0 feet measured southeastwardly and
perpendicularly from the northwestern line of said Lot Six (6), South 31 degrees
35 minutes West 302.89 feet to a point in the northern margin of Bragg Boulevard
in the southwestern line of said Lot Six (6) of the Huske Heights Subdivision,
Section III; and runs thence along the northern margin of Bragg Boulevard in the
southwestern line of said Lot Six (6) of the Huske Heights Subdivision, Section
III; and runs thence along the northern margin of Bragg Boulevard, North 59
degrees 25 minutes West 10.0 feet to an iron stake, the point of BEGINNING.
BEGINNING at an existing iron pipe in the southwestern property line of the City of Fayetteville property as recorded in Book 640, Page 227, and also being in the northeastern line of Lot 9 as shown in a Plat of Section II and III of Huske Heights as recorded in Plat Book II, Page 4, and also being the northernmost corner of the property described in the deed from N. Hunter Wyche, Jr., Trustee, to Chesapeake Holdings - Nottoway Limited as recorded in Book 4041, Page 192, and also being a corner of the Mao Yun Lin property as recorded in Book 3673, Page 673; and proceeding thence for a FIRST CALL along the dividing line between the properties recorded in Book 4041 Page 192 and Book 3673, Page 673, South 31 degrees, 59 minutes West 180.11 feet to the westernmost corner of the property described in Book 4041, Page 192; an thence a new line, an extension of the southwestern line of the property described in Book 4041, Page 192, North 58 degrees, 01 minutes West 12.00 feet to a point; thence parallel with and 12.00 feet perpendicular to the first call herein, North 31 degrees, 59 minutes East 185.33 feet to a point in the aforesaid City of Fayetteville property said point also being in the northeastern line of the aforementioned Lot 9; thence along that line South 34 degrees, 30 minutes East 13.09 feet to THE POINT AND PLACE OF BEGINNING containing 2,192.63 square feet and being a portion of the aforementioned property conveyed to Mao Yun Lin as recorded in Book 3673, Page 673.
The property hereinabove described was acquired by Grantor by Deed dated November 27, 1996, recorded March 6, 1997, in Book 4625 Page 0178 in the Cumberland County, North Carolina Registry.
EXHIBIT C
[TRANSMITTER BUILDING SPACE DIAGRAM OR DESCRIPTION]
EXHIBIT 21.1
BEASLEY BROADCAST GROUP, INC.
SUBSIDIARIES
(STATE OF INCORPORATION)
Beasley Mezzanine Holdings, LLC (DE)
BRAP Holdings,Inc. (DE)
Beasley Reed Acquisition Partnership (DE)
WQAM License Limited Partnership (DE)
Beasley FM Acquisition Corp. (DE)
WXTU License Limited Partnership (DE)
WEWO License Limited Partnership (DE)
WJBX License Limited Partnership (DE)
WKIS License Limited Partnership (DE)
WMGV License Limited Partnership (DE)
WAZZ License Limited Partnership (DE)
WRXK License Limited Partnership (DE)
WFLB License Limited Partnership (DE)
WDAS License Limited Partnership (DE)
WIKS License Limited Partnership (DE)
WXNR License Limited Partnership (DE)
WPOW License Limited Partnership (DE)
WAEC License Limited Partnership (DE)
Beasley Broadcasting of New Jersey, Inc. (DE)
WTMR License Limited Partnership (DE)
Beasley Broadcasting of Coastal Carolina, Inc. (DE)
WNCT License Limited Partnership (DE)
Beasley Broadcasting of Eastern North Carolina, Incorporated (NC)
Eastern North Carolina License Limited Partnership (DE)
Beasley Broadcasting of Eastern Pennsylvania, Inc. (DE)
WWDB License Limited Partnership (DE)
Beasley Broadcasting of Southwest Florida, Inc. (DE)
WXKB License Limited Partnership (DE)
Beasley Radio, Inc. (DE)
WJST License Limited Partnership (DE)
W & B Media, Inc. (NC)
WSFL License Limited Partnership (DE)
Beasley Communications, Inc. (DE)
WCHZ License, LLC (DE)
C S R A Broadcasters, Inc. (GA)
WGOR License, LLC (DE)
Beasley Broadcasting of Augusta, Inc. (DE)
WGAC License, LLC (DE)
Exhibit 23.1
Beasley FM Acquisition Corp.
3033 Riviera Drive
Suite 200
Naples, FL 34103
The Board of Directors
Beasley FM Acquisition Corp.
We consent to the use of our reports included herein and to the reference to our firm under the heading "Experts" in the prospectus.
KPMG LLP
/s/ KPMG LLP Tampa, Florida February 11, 2000 |
| ARTICLE 5 |
| THIS SCHEDULE CONTAINS SUMMARY FINANCIAL INFORMATION EXTRACTED FROM (A) BEASLEY FM ACQUISITION CORP. AND RELATED COMPANIES AS FILED IN THE BEASLEY BROADCAST GROUP, INC. S-1 #333-91683 DATED FEBRUARY 11, 2000 AND IS QUALIFIED IN ITS ENTIRETY BY REFERENCE TO SUCH (B) BEASLEY BROADCAST GROUP, INC. S-1 #333-91683 DATED FEBRUARY 11, 2000 |
| MULTIPLIER: 1,000 |
| PERIOD TYPE | 9 MOS |
| FISCAL YEAR END | DEC 31 1999 |
| PERIOD START | JAN 01 1999 |
| PERIOD END | SEP 30 1999 |
| CASH | 5,758 |
| SECURITIES | 0 |
| RECEIVABLES | 17,918 |
| ALLOWANCES | 550 |
| INVENTORY | 0 |
| CURRENT ASSETS | 27,576 |
| PP&E | 30,375 |
| DEPRECIATION | 14,261 |
| TOTAL ASSETS | 187,204 |
| CURRENT LIABILITIES | 30,882 |
| BONDS | 0 |
| PREFERRED MANDATORY | 0 |
| PREFERRED | 0 |
| COMMON | 4,530 |
| OTHER SE | (2,917) |
| TOTAL LIABILITY AND EQUITY | 187,204 |
| SALES | 0 |
| TOTAL REVENUES | 67,452 |
| CGS | 0 |
| TOTAL COSTS | 62,064 |
| OTHER EXPENSES | 243 |
| LOSS PROVISION | 0 |
| INTEREST EXPENSE | 9,962 |
| INCOME PRETAX | (4,102) |
| INCOME TAX | 0 |
| INCOME CONTINUING | 0 |
| DISCONTINUED | 0 |
| EXTRAORDINARY | 0 |
| CHANGES | 0 |
| NET INCOME | (4,102) |
| EPS BASIC | 0 |
| EPS DILUTED | 0 |