EXHIBIT 10.6

 

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AGREEMENT RELATING TO RELOCATION AND

PURCHASE OF KDES-FM

DATED AS OF NOVEMBER 9, 2007

BETWEEN

LIBERMAN BROADCASTING OF CALIFORNIA LLC

AND

SPECTRUM SCAN – IDYLLWILD, LLC

 

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TABLE OF CONTENTS

 

          Page

Section 1.

   DEFINITIONS    1

  1.1

   Terms Defined in this Section    1

Section 2.

   RELOCATION AND PURCHASE OF KDES-FM    1

  2.1

   Cooperation in Connection with Asset Purchase Agreement    1

  2.2

   Conditions to Asset Purchase Agreement    1

  2.3

   Conditions Dependant Upon Spectrum Scan    2

  2.4

   Spectrum Scan’s Financial Obligations    2

  2.5

   Payment by LBI    2

  2.6

   Notification Upon Amendment or Termination of the Asset Purchase Agreement   
2

Section 3.

   MISCELLANEOUS    3

  3.1

   Enforceability    3

  3.2

   Notices    3

  3.3

   Expenses    4

  3.4

   Choice of Law    4

  3.5

   Assignment    4

  3.6

   Entire Agreement    4

  3.7

   Waivers of Compliance; Consents    4

  3.8

   Counterparts    5

 

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AGREEMENT RELATING TO RELOCATION AND PURCHASE OF KDES-FM

This AGREEMENT RELATING TO RELOCATION AND PURCHASE OF KDES-FM (this “Agreement”)
is dated November 9, 2007, by and between LIBERMAN BROADCASTING OF CALIFORNIA
LLC, a California limited liability company (“LBI”), and SPECTRUM
SCAN-IDYLLWILD, LLC, a Kentucky limited liability company (“Spectrum Scan”). LBI
and Spectrum Scan are sometimes referred to herein as the “Parties” and each as
a “Party.”

This Agreement confirms the terms on which LBI and Spectrum Scan have agreed to
proceed with respect to the proposed relocation and subsequent acquisition by
LBI of FM broadcast station KDES-FM, Channel 284B, 104.7 MHz, currently licensed
by the Federal Communications Commission (“FCC”) to serve Palm Springs,
California (such relocation and acquisition referred to herein as the “KDES
Transactions”).

AGREEMENTS:

NOW, THEREFORE, in consideration of the mutual covenants and promises contained
herein and for other good and valuable consideration, the receipt and adequacy
of which are hereby acknowledged, the Parties agree as follows:

Section 1. DEFINITIONS

1.1 Terms Defined in this Section. The following terms, as used in this
Agreement, have the meanings set forth in this Section:

“Asset Purchase Agreement” means that certain asset purchase agreement dated
November 9, 2007 pursuant to which LBI or its affiliate(s) will acquire from R&R
Radio Corporation certain assets including the license issued by the FCC to
operate FM broadcast station KDES-FM for a purchase price of Ten Million Five
Hundred Thousand Dollars ($10,500,000).

“KDES Transactions” has the meaning set forth above in the second paragraph of
this Agreement.

“R&R” means R&R Radio Corporation, a California corporation.

Section 2. RELOCATION AND PURCHASE OF KDES-FM

2.1 Cooperation in Connection with Asset Purchase Agreement. With Spectrum
Scan’s assistance and cooperation, LBI, through an affiliate, is entering into
the Asset Purchase Agreement.

2.2 Conditions to Asset Purchase Agreement. LBI’s agreement to purchase KDES-FM
from R&R is subject to the satisfaction of a number of conditions specified in
the Asset Purchase Agreement, including, but not limited to:

(a) FCC approval of the relocation of KDES-FM from Palm Springs, California to
Redlands, California or another community reasonably satisfactory to LBI (the
“KDES-FM Relocation”), and

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(b) Grant of a construction permit for modification of the facilities of KDES-FM
to specify operation on Channel 284A with a transmitter site co-located with
that of FM station KRQB (formerly KWIE), San Jacinto, California (N 34° 02’ 13”,
W 116° 58’ 07”) (the “KDES-FM Relocation CP”).

2.3 Conditions Dependant Upon Spectrum Scan. The parties acknowledge and agree
that in order for the closing of the transactions contemplated in the Asset
Purchase Agreement to occur, Spectrum Scan must cancel, surrender and terminate
its option to purchase FM broadcast station KWXY-FM, Channel 253, 98.5 MHz,
Cathedral City, California (the “Option”). The Option is an extremely valuable
asset of Spectrum Scan, and Spectrum Scan would not be willing to cancel the
Option (which cancellation will allow LBI to acquire KDES-FM from R&R) without
LBI agreeing to make the payment to Spectrum Scan referenced in Section 2.5
below.

2.4 Spectrum Scan’s Financial Obligations. Spectrum Scan will be responsible for
the payment of all costs associated with the provision of engineering plans, the
submission of applications to the FCC, and any associated FCC filing fees
relating to the KDES-FM Relocation and the KDES-FM Relocation CP.

2.5 Payment by LBI. Subject to and on the same day as the closing under the
Asset Purchase Agreement, in consideration of Spectrum Scan’s cancellation,
surrender or termination of the Option, LBI shall pay to Spectrum Scan the sum
of Seven Million Dollars ($7,000,000). If the transaction contemplated by the
Asset Purchase Agreement is not consummated, such sum shall not be payable to
Spectrum Scan. Notwithstanding the foregoing sentence, in the event that
(i) Spectrum Scan complies with all of its obligations under this Agreement,
(ii) all of the conditions precedent to LBI’s obligation to consummate the
transaction contemplated by the Asset Purchase Agreement are fulfilled prior to
the expiration or earlier termination of the Asset Purchase Agreement in
accordance with its terms, (iii) LBI enters into an amendment to the license
agreement with Dickinson Investments Co. dated April 11, 2000 which was assigned
to LBI on September 21, 2007 to accommodate the co-location of the KDES-FM
transmitter site with that of FM broadcast station KRQB (FM), and (iv) the
necessary revision to the existing conditional use permit for such transmitter
site to accommodate the KDES-FM relocation has been granted, but LBI fails to
consummate the transaction contemplated by the Asset Purchase Agreement for any
reason other than a material breach by R&R, then LBI shall pay to Spectrum Scan
the sum of Five Hundred Thousand Dollars ($500,000.00). Such payment shall be
made ten (10) business days after the satisfaction or waiver of all the
conditions set forth in the Asset Purchase Agreement.

2.6 Notification Upon Amendment or Termination of the Asset Purchase Agreement.
In the event the Asset Purchase Agreement is amended or terminated, LBI will
promptly notify Spectrum Scan of all changes or the termination, as the case may
be. LBI shall follow the notice procedures outlined in Section 3.2 of this
Agreement.

 

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Section 3. MISCELLANEOUS

3.1 Enforceability. Each of the undersigned represents and warrants:

(a) that it has the requisite legal power and authority to enter into this
Agreement, and

(b) that this Agreement is enforceable against it in accordance with its terms.

3.2 Notices. All notices, demands, and requests required or permitted to be
given under the provisions of this Agreement shall be (i) in writing, may be
sent by telecopy (with automatic machine confirmation), delivered by personal
delivery, or sent by commercial delivery service or certified mail, return
receipt requested, (ii) deemed to have been given on the date of actual receipt,
which may be conclusively evidenced by the date set forth in the records of any
commercial delivery service or on the return receipt, and (iii) addressed to the
recipient at the address specified below, or with respect to any party, to any
other address that such party may from time to time designate in a writing
delivered in accordance with this Section 4.2:

 

If to LBI:

 

Liberman Broadcasting of California LLC

Attn: Lenard Liberman, Executive Vice President

1845 Empire Avenue

Burbank, CA 91504

Telephone: 818-563-5722

Telecopy: 818-558-4244

With a copy (which shall not constitute notice) to:

 

James R. Bayes

Wiley Rein LLP

1776 K St., NW

Washington, DC 20006

202-719-7000

If to Spectrum Scan:

 

Spectrum Scan-Idyllwild, LLC

Attn: Rod Burbridge

10,000 Shelbyville Road

Suite 221

Louisville, KY 40223

Telecopy: 502-253-6574

 

With a copy (which shall not constitute notice) to:

 

John Dowds

 

PVM Management, LLC

10,000 Shelbyville Road

Suite 100

Louisville, KY 40223

Telecopy: 502-245-4792

 

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3.3 Expenses. Except as otherwise provided in this Agreement, Spectrum Scan and
LBI shall each be liable for its own fees and expenses incurred in connection
with the negotiation, preparation, execution or performance of this Agreement
and the consummation of the transactions contemplated herein.

3.4 Choice of Law. THIS AGREEMENT SHALL BE CONSTRUED, INTERPRETED AND THE RIGHTS
OF THE PARTIES DETERMINED IN ACCORDANCE WITH THE LAWS OF THE STATE OF
CALIFORNIA, WITHOUT GIVING EFFECT TO THE PRINCIPLES OF CONFLICTS OF LAW OF SUCH
STATE.

3.5 Assignment. Neither this Agreement nor any of the rights or obligations
hereunder may be assigned by Spectrum Scan or LBI without the prior written
consent of the other Party hereto. Subject to the foregoing, this Agreement
shall be binding upon and inure to the benefit of the Parties hereto and their
respective successors and assigns, and no other person shall have any right,
benefit or obligation hereunder.

3.6 Entire Agreement. This Agreement and all documents and certificates to be
delivered by the Parties pursuant hereto, collectively represent the entire
understanding and agreement between the Parties hereto with respect to the
subject matter of this Agreement. This Agreement supersedes all prior
negotiations, letters of intent, term sheets or other writings between the
Parties and their respective representatives with respect to the subject matter
hereof and cannot be amended, supplemented, or modified except by an agreement
in writing that makes specific reference to this Agreement or an agreement
delivered pursuant hereto, as the case may be, and which is signed by the Party
against which enforcement of any such amendment, supplement, or modification is
sought. Notwithstanding the foregoing, however, the Confidentiality and
Non-Disclosure Agreement dated as of July     , 2007 between Spectrum Scan, LLC
and LBI Radio License Corp. shall survive the Parties’ execution and delivery of
this Agreement.

3.7 Waivers of Compliance; Consents. Except as otherwise provided in this
Agreement, any failure of any of the Parties to comply with any obligation,
representation, warranty, covenant, agreement, or condition herein may be waived
by the Party entitled to the benefits thereof only by a written instrument
signed by the Party granting such waiver, but such waiver or failure to insist
upon strict compliance with such obligation, representation, warranty, covenant,
agreement, or condition shall not operate as a waiver of, or estoppel with
respect to, any subsequent or other failure. Whenever this Agreement requires or
permits consent by or on behalf of any Party hereto, such consent shall be given
in writing in a manner consistent with the requirements for a waiver of
compliance as set forth in this Section.

 

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3.8 Counterparts. This Agreement may be executed in two counterparts, each of
which, when so executed and delivered, shall be an original, and both of which
counterparts together shall constitute one and the same fully executed
instrument.

 

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IN WITNESS WHEREOF, this Agreement has been executed by the Parties hereto as of
the date first above written.

 

SPECTRUM SCAN-IDYLLWILD, LLC By:   /s/ Rodney Burbridge Name:   Rodney Burbridge
Title:   President of Rodco, Inc., member LIBERMAN BROADCASTING OF CALIFORNIA
LLC By:   /s/ Lenard D. Liberman Name:   Lenard D. Liberman Title:  

Executive Vice President, Chief

Financial Office and Secretary

 

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