EXHIBIT 10.1

 

ASSET PURCHASE AGREEMENT

 

dated as of September 8, 2011

 

by and among

 

FOUR POINTS MEDIA GROUP OF WEST PALM BEACH, INC.,
FOUR POINTS MEDIA GROUP OF SALT LAKE CITY, INC.,
FOUR POINTS MEDIA GROUP OF PROVIDENCE, INC.,
FOUR POINTS MEDIA GROUP OF AUSTIN, INC.,
FOUR POINTS MEDIA GROUP SERVICES, INC.,
WPB TV LICENSEE CORP.,
SLC TV LICENSEE CORP.,
PROVIDENCE TV LICENSEE CORP.,
AUSTIN TV LICENSEE CORP.,
FOUR POINTS MEDIA GROUP LLC

 

and

 

SINCLAIR TELEVISION GROUP, INC.

 

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TABLE OF CONTENTS

 

ARTICLE I DEFINITIONS

2

 

 

 

Section 1.01

Definitions

2

 

 

 

Section 1.02

Other Defined Terms

8

 

 

 

Section 1.03

Terms Generally

9

 

 

 

ARTICLE II PURCHASE AND SALE

10

 

 

 

Section 2.01

Purchase and Sale

10

 

 

 

Section 2.02

Excluded Assets

11

 

 

 

Section 2.03

Assumed Liabilities

12

 

 

 

Section 2.04

Excluded Liabilities

13

 

 

 

Section 2.05

Assignment of Contracts and Rights

14

 

 

 

Section 2.06

Purchase Price

14

 

 

 

Section 2.07

Escrow

14

 

 

 

Section 2.08

Closing

14

 

 

 

Section 2.09

General Proration

16

 

 

 

Section 2.10

Effect of LMA

19

 

 

 

ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER

20

 

 

 

Section 3.01

Corporate Existence and Power

20

 

 

 

Section 3.02

Corporate Authorization

20

 

 

 

Section 3.03

Governmental Authorization

21

 

 

 

Section 3.04

Noncontravention

21

 

 

 

Section 3.05

Contracts

21

 

 

 

Section 3.06

Intangible Property

22

 

 

 

Section 3.07

Real Property

23

 

 

 

Section 3.08

Financial Information

24

 

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Section 3.09

Absence of Certain Changes or Events

25

 

 

 

Section 3.10

Absence of Litigation

26

 

 

 

Section 3.11

Compliance with Laws

26

 

 

 

Section 3.12

FCC Matters; Qualifications

26

 

 

 

Section 3.13

Cable and Satellite Matters

27

 

 

 

Section 3.14

Employees; Labor Matters

27

 

 

 

Section 3.15

Employee Benefit Plans

28

 

 

 

Section 3.16

Environmental Matters

29

 

 

 

Section 3.17

Equipment

29

 

 

 

Section 3.18

Brokers

30

 

 

 

Section 3.19

Taxes

30

 

 

 

Section 3.20

Purchased Assets

31

 

 

 

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER

31

 

 

 

Section 4.01

Existence and Power

31

 

 

 

Section 4.02

Corporate Authorization

31

 

 

 

Section 4.03

Governmental Authorization

31

 

 

 

Section 4.04

Noncontravention

31

 

 

 

Section 4.05

Absence of Litigation

32

 

 

 

Section 4.06

FCC Qualifications

32

 

 

 

Section 4.07

Brokers

32

 

 

 

Section 4.08

Financing

32

 

 

 

Section 4.09

Projections and Other Information

32

 

 

 

ARTICLE V COVENANTS OF SELLER

33

 

 

 

Section 5.01

Operations Pending Closing

33

 

 

 

Section 5.02

Access to Information

35

 

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Section 5.03

Title Commitments, Surveys

36

 

 

 

Section 5.04

Risk of Loss

36

 

 

 

Section 5.05

Intentionally Omitted

37

 

 

 

Section 5.06

Management Agreement

37

 

 

 

Section 5.07

No Negotiation

37

 

 

 

ARTICLE VI COVENANTS OF BUYER

37

 

 

 

Section 6.01

Access to Information

37

 

 

 

Section 6.02

Accounts Receivable

38

 

 

 

Section 6.03

Letters of Credit

39

 

 

 

ARTICLE VII COVENANTS OF BUYER AND SELLER

39

 

 

 

Section 7.01

Commercially Reasonable Efforts; Further Assurances

39

 

 

 

Section 7.02

Confidentiality

40

 

 

 

Section 7.03

Certain Filings; Further Actions

40

 

 

 

Section 7.04

Control Prior to Closing

40

 

 

 

Section 7.05

Public Announcements

41

 

 

 

Section 7.06

Notices of Certain Events

41

 

 

 

ARTICLE VIII PENSION, EMPLOYEE AND UNION MATTERS

42

 

 

 

Section 8.01

Employment

42

 

 

 

Section 8.02

Savings Plan

42

 

 

 

Section 8.03

Employee Welfare Plans

43

 

 

 

Section 8.04

Vacation

43

 

 

 

Section 8.05

Sick Leave

43

 

 

 

Section 8.06

No Further Rights

43

 

 

 

ARTICLE IX TAX MATTERS

44

 

 

 

Section 9.01

Bulk Sales

44

 

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Section 9.02

Transfer Taxes

44

 

 

 

Section 9.03

FIRPTA Certificate

44

 

 

 

Section 9.04

Taxpayer Identification Numbers

44

 

 

 

Section 9.05

Taxes and Tax Returns

44

 

 

 

Section 9.06

Purchase Price Allocation

44

 

 

 

ARTICLE X CONDITIONS TO CLOSING

45

 

 

 

Section 10.01

Conditions to Obligations of Buyer and Seller

45

 

 

 

Section 10.02

Conditions to Obligations of Seller

45

 

 

 

Section 10.03

Conditions to Obligations of Buyer

46

 

 

 

ARTICLE XI TERMINATION

47

 

 

 

Section 11.01

Termination

47

 

 

 

Section 11.02

Effect of Termination

48

 

 

 

ARTICLE XII SURVIVAL; INDEMNIFICATION

49

 

 

 

Section 12.01

Survival

49

 

 

 

Section 12.02

Indemnification by Buyer

49

 

 

 

Section 12.03

Indemnification by Seller and FPMG LLC

50

 

 

 

Section 12.04

Indemnification Holdback

51

 

 

 

Section 12.05

Notification of Claims

53

 

 

 

Section 12.06

Net Losses; Subrogation; Mitigation

54

 

 

 

Section 12.07

Computation of Indemnifiable Losses

54

 

 

 

Section 12.08

Exclusive Remedies

55

 

 

 

Section 12.09

Specific Performance

55

 

 

 

ARTICLE XIII GENERAL PROVISIONS

55

 

 

 

Section 13.01

Expenses

55

 

 

 

Section 13.02

Notices

55

 

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Section 13.03

Headings

56

 

 

 

Section 13.04

Severability

56

 

 

 

Section 13.05

Entire Agreement

56

 

 

 

Section 13.06

Successors and Assigns

56

 

 

 

Section 13.07

No Recourse

57

 

 

 

Section 13.08

No Third-Party Beneficiaries

57

 

 

 

Section 13.09

Amendments and Waivers

57

 

 

 

Section 13.10

Governing Law; Jurisdiction

58

 

 

 

Section 13.11

WAIVER OF JURY TRIAL

58

 

 

 

Section 13.12

Counterparts

58

 

 

 

Section 13.13

No Presumption

58

 

 

 

Section 13.14

Disclosure Schedules

58

 

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ASSET PURCHASE AGREEMENT

 

This ASSET PURCHASE AGREEMENT (this “Agreement”) dated as of September 8, 2011
is between Four Points Media Group of West Palm Beach, Inc., a Delaware
corporation (“West Palm”), Four Points Media Group of Salt Lake City, Inc., a
Delaware corporation (“Salt Lake”), Four Points Media Group of Providence, Inc.,
a Delaware corporation (“Providence”), Four Points Media Group of Austin, Inc.,
a Delaware corporation (“Austin”), Four Points Media Group Services, Inc., a
Delaware corporation (“FPMG Service”), WPB TV Licensee Corp, a Delaware
corporation (“WPB”), SLC TV Licensee Corp., a Delaware corporation (“SLC”),
Providence TV Licensee Corp, a Delaware corporation (“Providence TV”), and
Austin TV Licensee Corp, a Delaware corporation (“Austin TV”, together with West
Palm, Salt Lake, Providence, Austin, FPMG Service, SLC, WPB and Providence TV,
the “Seller”), Four Points Media Group LLC, a Delaware limited liability company
(“FPMG LLC”) (solely with respect to Article XII) on the one hand, and Sinclair
Television Group, Inc., a Maryland corporation (“Buyer”), on the other hand.

 

RECITALS

 

Seller is the owner and licensee of the following broadcast television stations
(each a “Station” and collectively, the “Stations”), pursuant to licenses issued
by the Federal Communications Commission (the “FCC”):

 

Austin

KEYE-TV, Austin, Texas, Facility ID No. 33691

Salt Lake

KUTV(TV), Salt Lake City, Utah, Facility ID No. 35823

Salt Lake

KMYU(TV), St. George, Utah, Facility ID No. 35822

Providence

WLWC(TV), New Bedford, Massachusetts, Facility ID No. 3978

West Palm

WTCN-CA, Palm Beach, Florida, Facility ID No. 70865

West Palm

WTVX(TV), Fort Pierce, Florida, Facility ID No. 35575

West Palm

WWHB-CA, Stuart, Florida, Facility ID No. 63557

 

Buyer desires to purchase from Seller substantially all of the assets and assume
certain of the liabilities, and Seller desires to sell to Buyer substantially
all of the assets and transfer certain of the liabilities, related to, used or
held for use in the conduct of each Station on the terms and subject to the
conditions hereinafter set forth; and

 

Seller and Buyer are, simultaneously with the execution and delivery of this
Agreement, entering a local marketing agreement pursuant to which Buyer shall
purchase time from Seller on the Stations to present Buyer’s programming and to
sell advertising time for inclusion in such programming (the “LMA”) pending and
through the closing of the transactions contemplated in this Agreement.

 

NOW, THEREFORE, in consideration of the mutual covenants and agreements to be
derived from this Agreement, Buyer and Seller hereby agree as follows:

 

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ARTICLE I
DEFINITIONS

 

Section 1.01          Definitions.  As used in this Agreement, the following
terms shall have the following meanings:

 

“Accounting Firm” means (a) an independent certified public accounting firm in
the United States of national recognition mutually acceptable to Seller and
Buyer or (b) if Seller and Buyer are unable to agree upon such a firm, then the
regular independent auditors for Seller and Buyer shall mutually agree upon a
third independent certified public accounting firm, in which event, “Accounting
Firm” shall mean such third firm.

 

“Accounts Receivable” means all accounts receivable (other than accounts
receivable relating to Tradeout Agreements or film and program barter
agreements), and all rights to receive payments under any notes, bonds and other
evidences of indebtedness and all other rights to receive payments, arising out
of sales occurring in the conduct of the Business prior to the earlier of the
LMA Commencement Date and the Effective Time for services performed (e.g., the
actual broadcast of commercials sold) or delivered by the Business prior to the
earlier of the LMA Commencement Date and the Effective Time.

 

“Action” means any claim, action, suit, arbitration, inquiry, proceeding or
investigation by or before any Governmental Authority.

 

“Affiliate” means, with respect to any Person, any other Person directly or
indirectly Controlling, Controlled by or under common Control with such other
Person.

 

“Ancillary Agreements” means the LMA, the Escrow Agreement and any other
certificate, agreement, document or other instrument to be executed and
delivered in connection with the transactions contemplated by this Agreement.

 

“Antitrust Laws” means the Sherman Act, as amended, the Clayton Act, as amended,
the HSR Act, the Federal Trade Commission Act, as amended, and all other
federal, state and foreign, if any, Laws that are designed or intended to
prohibit, restrict or regulate actions having the purpose or effect of
monopolization or restraint of trade or lessening of competition through merger
or acquisition.

 

“Balance Sheet Date” means December 31, 2010.

 

“Business” means the conduct and operation of the Stations.

 

“Business Day” means any day that is not a Saturday, a Sunday or other day on
which banks are required or authorized by Law to be closed (or actually closed)
in the City of New York.

 

“Cash and Cash Equivalents” means those items which are required by GAAP to be
included as “cash” or “cash equivalents” on the Financial Statements as of the
Effective Time (plus interest, if any, accruing on such amount at the prime rate
(as reported by The Wall Street

 

2

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Journal or, if not reported thereby, by another authoritative source) from such
date until the Closing Date).

 

“Code” means the Internal Revenue Code of 1986, as amended.

 

“Communications Act” means collectively, the Communications Act of 1934, as
amended, the Telecommunications Act of 1996, the Children’s Television Act of
1990, and the rules and regulations promulgated under the foregoing, in each
case, as in effect from time to time.

 

“Confidentiality Agreement” means the confidentiality agreement between Cerberus
Capital Management, L.P., and Sinclair Television Group, Inc., dated as of April
29, 2011.

 

“Contracts” means contracts, agreements, leases, non-governmental licenses,
sales and purchase orders and other agreements (including Leases, Real Property
Leases and employment agreements), written or oral (including any amendments or
modifications thereto).

 

“Control” means, as to any Person, 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, by contract or
otherwise.  The terms “Controlled” and “Controlling” shall have a correlative
meaning.

 

“Copyrights” means all copyrights and copyright applications and registrations
therefor used exclusively by Seller in connection with the Business.

 

“Effective Time” means 12:01 a.m., New York City time, on the Closing Date.

 

“Employees” means the full-time, part-time and per diem employees employed by
the Seller.

 

“Employee Plan” means any (a) employee benefit plan, arrangement or policy
subject to ERISA, including any retirement, pension, deferred compensation,
severance, profit sharing, savings, group health, dental, life insurance,
disability or cafeteria plan, policy or arrangement; (b) any equity or
equity-based compensation plan; (c) any bonus or incentive arrangement; and (d)
any severance or termination agreements, policies or arrangements that are not
covered by ERISA; in each case, maintained or contributed to or required to be
maintained or contributed to by Seller for the benefit of any current or former
Employee.

 

“Environmental Laws” means any Law in effect on the date of this Agreement
whether local, state, or federal relating to: (a) Releases or threatened
Releases of Hazardous Materials into the environment; (b) the use, treatment,
storage, disposal, handling, discharging or shipment of Hazardous Material; (c)
the regulation of storage tanks; or (d) otherwise relating to pollution or
protection of human health, occupational safety and the environment.

 

“Equipment” means all machinery, equipment, computers, motor vehicles,
furniture, fixtures, furnishings, towers, antennas, transmitters, tools,
toolings, parts, blank films and tapes and other items of tangible personal
property owned or leased by Seller (other than

 

3

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such items that are no longer in use at the Stations as a result of obsolescence
or having been replaced by other property).

 

“ERISA” means the Employee Retirement Income Security Act of 1974, as amended,
and the rules and regulations promulgated thereunder.

 

“Estimated Adjustment” shall mean, with respect to the Estimated Settlement
Statement, an amount equal to the Buyer Prorated Amount minus the Seller
Prorated Amount, which amount shall be expressed as a positive or negative
number.

 

“Final Adjustment” shall mean, with respect to the Final Settlement Statement,
an amount equal to the Buyer Prorated Amount minus the Seller Prorated Amount,
which amount shall be expressed as a positive or negative number.

 

“FCC Consent” means the FCC’s grant of its consent to the assignment of each of
the FCC Licenses identified on Disclosure Schedule Section 3.12(a)(1) from
Seller to Buyer.

 

“FCC Licenses” means the FCC licenses, permits and other authorizations issued
by the FCC for use in the operation of the Stations, each of which is identified
on Disclosure Schedule Section 3.12(a)(1), and any other license, permit or
other authorization, including any temporary waiver or special temporary
authorization and any renewals thereof or any transferable pending application
therefor.

 

“Final Order” means an action by the FCC (a) that has not been vacated,
reversed, stayed, enjoined, set aside, annulled or suspended; (b) with respect
to which no request for stay, motion or petition for rehearing, reconsideration
or review, or application or request for review or notice of appeal or sua
sponte review by the FCC is pending; and (c) as to which the time for filing any
such request, motion, petition, application, appeal or notice, and for the entry
of orders staying, reconsidering or reviewing on the FCC’s own motion has
expired.

 

“GAAP” means United States generally accepted accounting principles as in effect
on the Balance Sheet Date, consistently applied.

 

“Governmental Authority” means any federal, state or local or any foreign
government, legislature, governmental, regulatory or administrative authority,
agency or commission or any court, tribunal, or judicial or arbitral body.

 

“Governmental Order” means any order, writ, judgment, injunction, decree,
stipulation, determination or award entered by or with any Governmental
Authority.

 

“Hazardous Material” means hazardous or toxic wastes, chemicals, substances,
constituents, pollutants or related material, whether solids, liquids, or gases,
defined or regulated under § 101(14) of CERCLA; the Resource Conservation and
Recovery Act, 42 U.S.C. §§ 6901 et seq.; the Toxic Substances Control Act, 15
U.S.C. §§ 2601 et seq.; the Safe Drinking Water Act, 42 U.S.C. §§ 300(f) et
seq.; the Clean Air Act, as amended, 42 U.S.C. §§ 7401 et seq.; the Federal
Water Pollution Control Act, 33 U.S.C. §§ 1251 et seq.; the Emergency Planning
and Community Right-to-Know Act of 1986, 42 U.S.C. §§ 11001 et seq.; the
Occupational Safety

 

4

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and Health Act of 1970, 29 U.S.C. §§ 651 et seq. or any similar applicable
federal, state or local Environmental Laws.

 

“HSR Act” means the Hart-Scott-Rodino Antitrust Improvements Act of 1976, as
amended, and the rules and regulations thereunder.

 

“Indebtedness” means, with regard to any Person, any liability or obligation,
whether or not contingent, (i) in respect of borrowed money or evidenced by
bonds, monies, debentures, or similar instruments or upon which interest
payments are normally made, (ii) for the payment of any deferred purchase price
of any property, assets or services (including pursuant to capital leases) but
excluding trade payables, (iii) guaranties, direct or indirect, in any manner,
of all or any part of any Indebtedness of any Person, (iv) all obligations under
acceptance, standby letters of credit or similar facilities, (v) all matured
obligations to purchase, redeem, retire, defease or otherwise make any payment
in respect of any membership interests, shares of capital stock or other
ownership or profit interest or any warrants, rights or options to acquire such
membership interests, shares or such other ownership or profit interest,
(vi) all accrued interest of all obligations referred to in (i) — (v) and
(vii) all obligations referred to in (i) — (vi) of a third party secured by any
Lien on property or assets; provided, that in no event shall any Indebtedness
between or among the entities within Seller be considered “Indebtedness” for
purposes of this Agreement.

 

“Intangible Property” means (a) Copyrights; (b) Trademarks, including all of the
rights, if any, of Seller in and to the Stations’ call letters and any
derivative thereof; (c) Trade Secrets; (d) all domain leases and names used
exclusively by Seller; and (e) all goodwill, if any, associated therewith.

 

“Knowledge of Seller” means the actual knowledge, after due inquiry, of the
chief financial officer and the controller of FPMG LLC, and the general manager
and chief engineer (or person holding a similar position) of each Station.

 

“Law” means any United States (federal, state, local) or foreign law,
constitution, treaty statute, ordinance, regulation, rule, code, order,
judgment, injunction, writ or decree.

 

“Leases” means those leases, subleases, licenses or other occupancy agreements
(including any and all assignments, amendments and other modifications of such
leases, subleases, licenses and other occupancy agreements), pertaining to the
use or occupancy of the Real Property where Seller holds an interest as
landlord, licensor, sublandlord or sub-licensor.

 

“Lien” means, with respect to any property or asset, any mortgage, lien, pledge,
charge, easement, right of way, restrictive covenant, encroachment, security
interest or encumbrance of any kind whatsoever, whether voluntarily incurred or
arising by operation of Law or otherwise, in respect of such property or asset.

 

“LMA Commencement Date” shall have the definition as provided in the LMA.

 

“Market” means, as applicable, (a) the Austin, Texas Nielsen Designated Market
Area, (b) the Providence, Rhode Island Nielsen Designated Market Area, (c) the
Salt Lake City,

 

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Utah Nielsen Designated Market Area, or (d) the West Palm Beach, Florida Nielsen
Designated Market Area.

 

“Material Adverse Effect” means any effect or change that would, individually or
in the aggregate, have a material adverse effect on (a) the financial condition,
assets or results of operations of (i) KEYE-TV, WLWC(TV), WTVX(TV), WTCN-CA and
WWHB-CA, considered together, and/or (ii) KUTV(TV) and KMYU(TV), considered
together, and/or (iii) Seller taken as a whole or (b) the ability of Seller to
perform its obligations under this Agreement; provided, however, that any
material adverse effect primarily attributable to (i) an event or series of
events or circumstances affecting the United States or global economy generally
or capital or financial markets generally, including changes in interest or
exchange rates, (ii) any event, state of facts or circumstances or development
affecting television programming services generally or the television broadcast
industry generally (including legislative or regulatory matters), (iii) general
economic conditions, including any downturn caused by acts of war or terrorism
or a natural disaster, such as an earthquake or hurricane, (iv) the announcement
of this Agreement, (v) any failure to meet internal or published financial or
rating projections, estimates or forecasts of revenues, earnings, or other
measures of financial or operating performance for any period (provided, that
the underlying causes of such failure (subject to the other provisions of this
definition) shall not be excluded), (vi) changes in Law or GAAP or the
interpretation thereof, (vii) the ratings or performance of any network with
which a Station is affiliated or (viii) actions or inactions taken by or on
behalf of Buyer under the LMA, in each case shall not constitute a Material
Adverse Effect.

 

“Material Contract” means any Contract required to be listed on Disclosure
Schedule Section 3.05(a).

 

“MVPDs” means any multi-channel video programming distributor, including cable
systems, telephone companies and DBS systems.

 

“Permitted Liens” means, as to any property or asset of any member of Four
Points Media Group, (a) liens for Taxes, assessments and governmental charges
not yet due and payable or which are being contested in good faith and for which
appropriate reserves exist on the Financial Statements, (b) terms and conditions
of any Leases, (c) zoning laws and ordinances and similar Laws that are not
violated by any existing improvement or that do not prohibit the use of the Real
Property as currently used in the operation of the Business; (d) any right
reserved to any Governmental Authority to regulate the affected property
(including restrictions stated in any permits); (e) in the case of any leased
asset, (i) the rights of any lessor under the applicable lease agreement or any
Lien granted by any lessor, (ii) any statutory Lien for amounts that are not yet
due and payable or are being contested in good faith, (iii) any subleases and
(iv) the rights of the grantor of any easement or any Lien granted by such
grantor on such easement property; (f) easements, rights of way, restrictive
covenants and other encumbrances, encroachments or other similar matters
affecting title that do not materially adversely affect title to the property
subject thereto or materially impair the continued use of the property in the
ordinary course of the business of the Stations; (g) inchoate materialmens’,
mechanics’, workmen’s, repairmen’s or other like Liens arising in the ordinary
course of business; (h) Liens that will be discharged prior to Closing; (i) any
state of facts an accurate survey would show, provided same does not render
title unmarketable or prevent the Real Property being utilized in

 

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substantially the same manner as currently used; (j) pledges or deposits to
secure obligations under workers’ compensation Laws or similar Laws or to secure
public or statutory obligations and which pledges or deposits are reflected in
the Financial Statements to the extent required by GAAP; and (k) any other Lien,
other than a Lien securing a monetary obligation, that does not detract from,
interfere with or impair the use of or value of any such property or asset as
currently used.

 

“Person” means any natural person, general or limited partnership, corporation,
limited liability company, firm, association, trust or other legal entity or
organization, including a government or political subdivision or an agency or
instrumentality thereof.

 

“Post-Closing Tax Period” means any Tax period (or portion thereof) beginning
and ending after the Effective Time.

 

“Pre-Closing Tax Period” means any Tax period (or portion thereof) ending on or
prior to the Effective Time.

 

“Program Rights” means all rights of the Stations to broadcast television
programs or shows as part of the Stations’ programming, including all film and
program barter agreements, sports rights agreements, news rights or service
agreements, affiliation agreements and syndication agreements.

 

“Real Property” means the real property owned, leased, subleased or licensed by
or to Seller, together with all right, title and interest of Seller in all
buildings, towers, improvements, fixtures and structures located thereon.

 

“Release” means any release, spill, emission, leaking, dumping, injection,
pouring, deposit, disposal, discharge, dispersal, leaching or migration into the
environment (including ambient air, surface water, groundwater, land surface or
subsurface strata) or within any building, structure, facility or fixture.

 

“Tax” or “Taxes” means all federal, state, local or foreign income, excise,
gross receipts, ad valorem, sales, use, employment, franchise, profits, gains,
property, transfer, use, payroll, intangible or other taxes, fees, stamp taxes,
duties, charges, levies or assessments of any kind whatsoever (whether payable
directly or by withholding) imposed by a Governmental Authority, together with
any interest and any penalties, additions to tax or additional amounts imposed
by any Tax authority with respect thereto.

 

“Tax Returns” means all returns and reports (including elections, declarations,
disclosures, schedules, estimates and information returns) required to be
supplied to a Tax authority relating to Taxes.

 

“Trademarks” means all trade names, trademarks, service marks, jingles, slogans,
logos, trademark and service mark registrations and trademark and service mark
applications owned, used, licensed by or leased by Seller, including those set
forth on Disclosure Schedule Section 3.06(a), and the goodwill appurtenant
thereto.

 

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“Tradeout Agreement” means any Contract, other than film and program barter
agreements, pursuant to which Seller has agreed to sell or trade commercial air
time or commercial production services of a Station in consideration for any
property or service in lieu of or in addition to cash.

 

“Trade Secrets” means all proprietary information of Seller that is not
generally known and is used exclusively in the operation of the Business, as to
which reasonable efforts have been made to prevent unauthorized disclosure, and
which provides a competitive advantage to those who know or use it.

 

“Transfer Taxes” means all excise, sales, use, value added, registration stamp,
recording, documentary, conveyancing, franchise, property, transfer, gains and
similar Taxes, levies, charges and fees.

 

Section 1.02          Other Defined Terms.  The following terms have the
meanings defined for such terms in the Sections set forth below:

 

Active Employees

Section 8.01(a)(i)

Assumed Contracts

Section 2.01(c)

Assumed Liabilities

Section 2.03(a)

Audited Financial Statements

Section 3.09(a)

Average Unit Rate

Section 2.09(f)

Buyer

Preamble

Buyer Indemnified Parties

Section 12.03(a)

Buyer Prorated Amount

Section 2.09(a)

Buyer Warranty Breach

Section 12.02(a)(i)

Buyer’s 401(k) Plan

Section 8.02

Cap

Section 12.02(b)

Capital Leases

Section 2.03(e)

Closing

Section 2.08

Closing Date

Section 2.08

Closing Transactions

Section 2.05(b)

Collection Period

Section 6.02(a)

Commercial Spots Threshold

Section 2.09(f)

Damaged Asset

Section 5.06

De-Minimis Amount

Section 12.02(b)

DOJ

Section 7.01(d)

Employment Commencement Date

Section 8.01(a)

Escrow Agent

Section 2.06(b)

Escrow Agreement

Section 2.06(b)

Escrow Deposit

Section 2.06(b)

Estimated Settlement Statement

Section 2.09(g)

Excluded Assets

Section 2.02

Excluded Contracts

Section 2.02(n)

Excluded Liabilities

Section 2.04

Excluded Section 2.02(m) Agreements

Section 2.02(m)

Excluded Section 2.02(n) Agreements

Section 2.02(n)

 

8

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FCC

Recitals

FCC Applications

Section 7.01(c)

Final Determination

Section 12.04(b)

Final Settlement Statement

Section 2.09(k)

Financial Statements

Section 3.09(a)

Final Indemnification Holdback Payment Date

Section 12.04(a)

Final Remaining Holdback Amount

Section 12.04(a)

FPMG LLC

Preamble

FTC

Section 7.01(d)

Inactive Employees

Section 8.01(a)

Indemnification Holdback Amount

Section 12.04(a)

Initial Indemnification Holdback Payment Date

Section 12.04(a)

Initial Remaining Holdback Amount

Section 12.04(a)

Indemnified Party

Section 12.05(a)

Indemnifying Party

Section 12.05(a)

Latest Unaudited Balance Sheet

Section 3.09(a)

LMA

Recitals

Losses

Section 12.02(a)

Notice of Disagreement

Section 2.08(k)

Owned Real Property

Section 3.07

Permits

Section 3.11

Prorated Assumed Liabilities

Section 2.09(a)

Prorated Purchased Assets

Section 2.09(a)

Purchased Assets

Section 2.01

Purchase Price

Section 2.06(a)

Remaining Holdback Amount

Section 12.04(a)

Second Indemnification Holdback Payment Date

Section 12.04(a)

Second Remaining Holdback Amount

Section 12.04(a)

Seller

Preamble

Seller Indemnified Parties

Section 12.02(a)

Seller Parties

Section 13.06

Seller Prorated Amount

Section 2.09(a)

Seller Warranty Breach

Section 12.03(a)(i)

Settlement Statement

Section 2.09(h)

SLC Debt

Section 2.03(c)

Station

Recitals

Stations

Recitals

Termination Date

Section 11.01(b)(i)

Threshold

Section 12.02(b)

Transferred Employees

Section 8.01(a)

Unaudited Financial Statements

Section 3.09(a)

 

Section 1.03          Terms Generally.  Words in the singular shall be held to
include the plural and vice versa and words of one gender shall be held to
include the other gender as the context requires, (b) the terms “hereof,”
“herein,” and “herewith” and words of similar import shall, unless otherwise
stated, be construed to refer to this Agreement as a whole (including the

 

9

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Disclosure Schedules and exhibits hereto) and not to any particular provision of
this Agreement, and Article, Section, paragraph, Exhibit and Disclosure Schedule
references are to the Articles, Sections, paragraphs, Exhibits and Disclosure
Schedules to this Agreement unless otherwise specified, (c) the word “including”
and words of similar import when used in this Agreement means “including,
without limitation,” unless otherwise specified, and (d) the word “or” shall not
be exclusive.

 

ARTICLE II
PURCHASE AND SALE

 

Section 2.01          Purchase and Sale.  Pursuant to the terms and subject to
the conditions of this Agreement, Buyer agrees to purchase from Seller and
Seller agrees to sell, convey, transfer, assign and deliver, or cause to be
sold, conveyed, transferred, assigned and delivered, to Buyer at the Closing,
free of all Liens other than Permitted Liens, all of Seller’s right, title and
interest in, to and under all of its assets, other than the Excluded Assets,
including the following assets, Contracts, and properties (tangible or
intangible), as the same shall exist on the date of this Agreement and not
disposed of in accordance with Section 5.01, and all similar assets of the
Business acquired by Seller between the date hereof and the Closing, as follows
(the “Purchased Assets”):

 

(a)           all Real Property;

 

(b)           all Equipment;

 

(c)           all rights under all Contracts relating to the Business that
(i) are listed or referenced on Disclosure Schedule Section 3.05(a) or
Disclosure Schedule Section 3.13(a) (but not including, for the avoidance of
doubt, the Excluded Section 2.02(m) Agreements and the Excluded
Section 2.02(n) Agreements), (ii) are not required by the terms thereof to be
listed on Disclosure Schedule Section 3.05(a), (iii) may result from the
television broadcasting industry wide negotiations with SESAC, ASCAP and BMI,
(iv) are referenced in other subsections to this Section 2.01 or the
corresponding Section in the Disclosure Schedules, or (v) are entered into after
the date hereof by Seller pursuant to the terms and subject to the conditions of
Section 5.01 (collectively, the “Assumed Contracts”); provided, however, that
Assumed Contracts shall in no event include Excluded Contracts;

 

(d)           all prepaid expenses and deposits (other than prepaid Taxes) and
ad valorem Taxes, leases and rentals;

 

(e)           all of Seller’s rights, claims, credits, causes of action or
rights of set-off against third parties relating to the Purchased Assets,
including unliquidated rights under manufacturers’ and vendors’ warranties, in
each case only to the extent Buyer incurs Losses relating thereto;

 

(f)            all Intangible Property;

 

(g)           all Internet web sites and related agreements, content and
databases and domain name registrations, as set forth on Disclosure Schedule
Section 2.01(g);

 

10

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(h)           all FCC Licenses and all transferable municipal, state and federal
franchises, licenses, permits or other governmental authorizations relating to
the Stations;

 

(i)            all prepayments under advertising sales contracts for committed
air time for advertising on any Station that has not been aired prior to the
earlier of the LMA Commencement Date and the Closing Date;

 

(j)            all information and data, FCC logs and other compliance records,
sales and business records, books of account, files, invoices, inventory
records, general, financial, accounting and real and personal property Tax
records (but excluding all other Tax records), personnel and employment records
for Transferred Employees (to the extent permitted by Law) and all engineering
information, sales and promotional literature, manuals and data, sales and
purchase correspondence, lists of present and former suppliers and lists of
present and former customers, quality control records and manuals, blueprints,
litigation and regulatory files, and all other books, documents and records;

 

(k)           Ninety-Five Thousand Dollars ($95,000) in cash; and

 

(l)            all management and other systems (including computers and
peripheral equipment), databases, computer software, computer disks and similar
assets, as and to the extent used primarily in the operation of the Business,
and all licenses and rights in relation thereto.

 

Section 2.02          Excluded Assets.  Buyer expressly understands and agrees
that the following assets and properties of Seller (the “Excluded Assets”) shall
not be acquired by Buyer and are excluded from the Purchased Assets:

 

(a)           all of Seller’s Cash and Cash Equivalents (except for the amount
of cash referenced in clause (k) of Section 2.01);

 

(b)           all bank and other depository accounts of Seller;

 

(c)           insurance policies relating to the Stations and the Business, and
all claims, credits, causes of action or rights, including rights to insurance
proceeds, thereunder;

 

(d)           all interest in and to refunds of Taxes relating to Pre-Closing
Tax Periods;

 

(e)           any cause of action or claim relating to any event or occurrence
prior to the Effective Time (other than as specified in Section 2.01(e));

 

(f)            all Accounts Receivable;

 

(g)           intercompany accounts receivable and intercompany accounts payable
of Seller;

 

(h)           all (i) books, records, files and papers, whether in hard copy or
computer format, relating to the preparation of this Agreement or the
transactions contemplated

 

11

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hereby, (ii) all minute books and corporate records of Seller and its Affiliates
and (iii) duplicate copies of records of the Stations;

 

(i)            all rights of Seller arising under this Agreement, the Ancillary
Agreements or the transactions contemplated hereby and thereby;

 

(j)            any Purchased Asset sold or otherwise disposed of prior to
Closing as permitted hereunder;

 

(k)           Contracts that are not Assumed Contracts, including any contract
with any Employee listed on Disclosure Schedule Section 8.01, the Management and
Sales Agreement, dated as of March 19, 2009, by and between West Palm, Salt
Lake, Providence, Austin, FPMG Service and Nexstar Broadcasting, Inc., and TV
Stations Investors LLC (with respect to certain provisions therein) (the
“Management Agreement” and together with the other Contracts that are not
Assumed Contracts, the “Excluded Contracts”);

 

(l)            other than as specifically set forth in Article VIII, any
Employee Plan and any assets of any Employee Plan sponsored by Seller or any of
its Affiliates including any amounts due to such Employee Plan from Seller or
any of its Affiliates;

 

(m)          the agreements set forth on Disclosure Schedule
Section 2.02(m) (collectively, the “Excluded Section 2.02(m) Agreements”);

 

(n)           the agreements set forth on Disclosure Schedule
Section 2.02(n) (collectively, the “Excluded Section 2.02(n) Agreements”); and

 

(o)           all Tax records, other than real and personal property Tax
records.

 

Section 2.03          Assumed Liabilities.  Upon the terms and subject to the
conditions of this Agreement, Buyer agrees, effective at the Effective Time, to
assume, pay and perform only the following liabilities of Seller (the “Assumed
Liabilities”):

 

(a)           all liabilities set forth on the Financial Statements as of the
Balance Sheet Date, other than the Indebtedness (except the Indebtedness set
forth in clauses (c) and (d) below);

 

(b)           the liabilities and obligations arising with respect to the
operation of the Business on and after the Effective Time (excluding any
liability or obligation arising from, or relating to the performance or
non-performance thereof, prior to the Effective Time and except as provided in
the LMA);

 

(c)           to the extent Buyer receives a credit in the prorations pursuant
to Section 2.09, the liabilities and obligations arising under the Loan
Agreement, dated May 23, 2003, between Salt Lake City Corporation, as lender,
and KUTV Holdings, Inc., as borrower, and related security agreement and note. 
(the “SLC Debt”);

 

(d)           to the extent Buyer receives a credit in the prorations pursuant
to Section 2.09, the liabilities and obligations arising under (i) the Agreement
to Lease Equipment

 

12

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dated February 2, 2009 between Cisco Systems Capital Corporation and Four Points
Media Group of Salt Lake City, Inc. and agreements related thereto and
(ii) Agreement to Lease Equipment dated February 2, 2009 between Cisco Systems
Capital Corporation and Four Points Media Group of West Palm Beach, Inc. and
agreements related thereto (collectively, the “Capital Leases”);

 

(e)           any liability or obligation to the extent of the amount of credit
received by Buyer under Section 2.09(a); and

 

(f)            all liabilities and obligations relating to the Business or the
Purchased Assets arising out of Environmental Laws, whether or not presently
existing, except for liabilities and obligations that are required to be
disclosed on Disclosure Schedule Section 3.16, but which are not so disclosed.

 

Section 2.04          Excluded Liabilities.  Notwithstanding any provision in
this Agreement, Buyer is assuming only the Assumed Liabilities and is not
assuming any other liability or obligation of Seller or any of its Affiliates of
whatever nature, whether presently in existence or arising hereafter.  All such
other liabilities and obligations shall be retained by and remain obligations
and liabilities of Seller (all such liabilities and obligations not being
assumed being herein referred to as the “Excluded Liabilities”), and,
notwithstanding anything to the contrary in Section 2.03, none of the following
shall be Assumed Liabilities for the purposes of this Agreement:

 

(a)           any liability or obligation under or with respect to any Assumed
Contract, Permit, Governmental Order, Real Property Lease or Lease required by
the terms thereof to be discharged prior to the Effective Time;

 

(b)           any liability or obligation for which Seller has already received
or will receive the partial or full benefit of the asset to which such liability
or obligation relates, but only to the extent of such benefit received;

 

(c)           the liability related to the Indebtedness, including, without
limitation, as set forth on Disclosure Schedule Section 2.04(c), except any
liability or obligation relating to or arising under the SLC Debt or the Capital
Leases;

 

(d)           any liability or obligation relating to or arising out of any of
the Excluded Assets or any Employee Plan (other than an Employee Plan included
as a Purchased Asset pursuant to Section 2.01(c));

 

(e)           any Tax liability or obligation (except as expressly provided in
Section 2.08(b) or Section 9.02);

 

(f)            any liability to indemnify, reimburse or advance amounts to any
officer, director, employee or agent of Seller or FPMG, LLC;

 

(g)           the liabilities and obligations arising with respect to the
operation of the Business prior to the Effective Time (excluding any liability
or obligation expressly assumed by Buyer hereunder or as provided in the LMA);
and

 

13

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(h)           any liability of Seller under this Agreement or any document
executed in connection therewith, including the Ancillary Agreements.

 

Section 2.05          Assignment of Contracts and Rights.  Anything in this
Agreement to the contrary notwithstanding, this Agreement shall not constitute
an agreement to assign any Purchased Asset or any claim or right or any benefit
arising thereunder or resulting therefrom if such assignment, without the
consent of a third party thereto, would constitute a breach or other
contravention of such Purchased Asset or in any way adversely affect the rights
of Buyer or Seller thereunder.  Seller and Buyer shall use their commercially
reasonable efforts to obtain such consents after the execution of this Agreement
until each such consent is obtained.  If any such consent is not obtained prior
to the Closing Date, Seller and Buyer shall use their commercially reasonable
efforts to obtain such consent as soon as possible after the Closing Date.  In
addition, Seller and Buyer will cooperate in a mutually agreeable arrangement
under which Buyer would obtain the benefits and assume the obligations
thereunder in accordance with this Agreement, including sub-contracting,
sub-licensing, occupancy and/or use agreements or sub-leasing to Buyer and
enforcement by Seller for the benefit of Buyer of any and all rights of such
Seller against a third party thereto.  Notwithstanding the foregoing, neither
Seller, Buyer nor any of their Affiliates shall be required to pay consideration
to any third party to obtain any consent.

 

Section 2.06          Purchase Price.  In consideration for the sale of the
Purchased Assets, Buyer shall, at the Closing, in addition to assuming the
Assumed Liabilities, pay to Seller the sum of Two Hundred Million Dollars
($200,000,000) (the “Purchase Price”) by wire transfer of immediately available
federal funds pursuant to wire instructions that Seller shall provide to Buyer.

 

Section 2.07          Escrow.  Simultaneous with the execution of this
Agreement, Buyer has delivered to JPMorgan Chase, National Association (the
“Escrow Agent”) $20,000,000 to be held as an earnest money deposit (“Escrow
Deposit”) pursuant to an Escrow Agreement of even date herewith (the “Escrow
Agreement”).  The Escrow Deposit (together with interest earned thereon) shall
be paid to Seller as partial payment of the cash Purchase Price due at Closing
to Seller, or shall otherwise be made available to Seller or released to Buyer
at Closing unless earlier released to Seller in accordance with
Section 11.02(b) and Section 11.02(d) hereof.

 

Section 2.08          Closing.  The closing of the transactions contemplated by
this Agreement (the “Closing”) shall take place at the offices of Schulte Roth &
Zabel LLP, 919 Third Avenue, New York, New York 10022, at 10:00 a.m. on the
fifth Business Day to occur following full satisfaction or waiver of all of the
closing conditions set forth in Article X hereof (other than those required to
be satisfied at the Closing) or on such other date or at such other location as
is mutually agreeable to Buyer and Seller.  The date and time of the Closing are
herein referred to as the “Closing Date.”  Subject to the terms and conditions
set forth in this Agreement, the parties hereto shall consummate the following
“Closing Transactions” at the Closing:

 

(a)           Buyer shall deliver to Seller:

 

(i)            the certificate described in Section 10.02(a);

 

14

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(ii)           the documents described in Section 10.02(b); and

 

(iii)          the Purchase Price in accordance with Section 2.06 by wire
transfer; and

 

(iv)          such other documents and instruments as the Seller has determined
to be reasonably necessary to sell the Purchased Assets and for the Buyer to
assume the Assumed Liabilities.

 

(b)           Seller shall deliver to Buyer:

 

(i)            the certificate described in Section 10.03(a);

 

(ii)           the documents described in Section 10.03(b);

 

(iii)          a duly executed Bill of Sale, substantially in the form of
Exhibit A-1 from the appropriate Seller entity;

 

(iv)          a duly executed Assignment for the FCC Licenses, substantially in
the form of Exhibit A-2 from the appropriate Seller entity;

 

(v)           a duly executed Assignment for the Intangible Property,
substantially in the form of Exhibit A-3 from the appropriate Seller entity, if
any owned and registered Intangible Property is included in the Purchased
Assets; and

 

(vi)          a duly executed special warranty deed for each Owned Real
Property, as defined below, substantially in the form of Exhibit A-4 from the
appropriate Seller entity;

 

(vii)         such other documents and instruments as the Buyer has determined
to be reasonably necessary to for it acquire the Purchased Assets and assume the
Assumed Liabilities; and

 

(c)           Seller and Buyer shall enter into and deliver to each other:

 

(i)            a duly executed Assignment and Assumption Agreement,
substantially in the form of Exhibit A-5;

 

(ii)           a duly executed Assignment and Assumption Agreement for the
Leases and the Real Property Leases, substantially in the form of Exhibit A-6
from the appropriate Seller entity, or, in the event that necessary consents to
assignment have not been obtained prior to the Closing, appropriate subleases,
occupancy or use agreements pursuant to Section 2.05 hereof; and

 

(iii)          such other documents as set forth in Section 10.02 and
Section 10.03.

 

15

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Section 2.09          General Proration.

 

(a)           All Purchased Assets that would be classified as current assets in
accordance with GAAP, and all Assumed Liabilities that would be classified as
liabilities in accordance with GAAP, shall be prorated between Buyer and Seller
as of the earlier of the LMA Commencement Date and the Effective Time, including
by taking into account the elapsed time or consumption of an asset during the
month in which the LMA Commencement Date or the Effective Time, as the case may
be, occurs (respectively, the “Prorated Purchased Assets” and the “Prorated
Assumed Liabilities”).  Such Prorated Purchased Assets and Prorated Assumed
Liabilities relating to the period prior to the earlier of the LMA Commencement
Date and the Effective Time shall be for the account of Seller and those
relating to the period on and after the earlier of the LMA Commencement Date and
the Effective Time for the account of Buyer and shall be prorated accordingly. 
In accordance with this Section 2.09, (i) Buyer shall be required to pay to
Seller the amount of any Prorated Purchased Asset previously paid for by Seller,
to the extent Buyer will receive a current benefit on and after the earlier of
the LMA Commencement Date and the Effective Time, provided that such amount
should not have been recognized as an expense in accordance with GAAP prior to
the earlier of the LMA Commencement Date and the Effective Time (the “Buyer
Prorated Amount”); and (ii) Seller shall be required to pay to Buyer the amount
of any Prorated Assumed Liabilities to the extent they arise with respect to the
operation of the Business prior to the earlier of the LMA Commencement Date and
the Effective Time and are not assumed or paid for by Seller (the “Seller
Prorated Amount”).  Such payment by Buyer or Seller, as the case may be, shall
be made within 10 Business Days after the Final Settlement Statement (as defined
below) becomes final and binding upon the parties.

 

(b)           Such prorations shall include all ad valorem and other property
Taxes, FCC regulatory fees, utility expenses, liabilities and obligations under
Contracts, rents and similar prepaid and deferred items, reimbursable expenses
and all other expenses and obligations, such as deferred revenue and prepayments
and sales commissions, attributable to the ownership and operation of the
Stations that straddle the period before and after the Effective Time. 
Notwithstanding anything in this Section 2.09 to the contrary, (i) except as set
forth in this clause (b), with respect to Tradeout Agreements for the sale of
time for goods or services assumed by Buyer, if at the earlier of the Effective
Time or the LMA Commencement Date, the Stations have an aggregate negative
barter balance (i.e., the amount by which the value of air time to be provided
by the Stations after the earlier of the Effective Time or LMA Commencement Date
exceeds the fair market value of corresponding goods and services to be received
after such date), there shall be no proration or adjustment, unless the
aggregate negative barter balance of the Stations (including any in-kind
obligation required under the SLC Debt) exceeds $100,000, in which event such
excess shall be treated as prepaid time sales of Seller, and adjusted for as a
proration in Buyer’s favor.  In determining barter balances, the value of air
time shall be based upon Seller’s rates as of the earlier of the Effective Time
or LMA Commencement Date, and corresponding goods and services shall include
those to be received by the Stations after the earlier of the Effective Time or
LMA Commencement Date plus those received by the Stations before the earlier of
the Effective Time or LMA Commencement Date to the extent conveyed by Seller to
Buyer as part of the Purchased Assets, (ii) there shall be no proration under
this Section 2.09 to the extent there is an aggregate positive barter balance
with respect to Tradeout Agreements and (iii) there shall be no proration under
this Section 2.09 for Program Rights agreements except to the extent that any
payments or performance due under such Program Rights agreements relate to a
payment period that straddles the Effective Time.

 

16

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(c)           Accrued vacation and sick leave for Transferred Employees shall be
included in the prorations.

 

(d)           There shall be a proration in Buyer’s favor to the extent that
Buyer assumes any remaining liability under the SLC Debt and/or the Capital
Leases; provided that, except as provided in clause (b) of this Section 2.09,
with respect to the SLC Debt, the proration in Buyer’s favor shall only be with
respect to any cash amounts outstanding and shall not include or reflect any
payments in kind (such as advertising spots) either (i) made after the earlier
of the LMA Commencement Date and the Effective Time or (ii) which remain
outstanding as of the earlier of such dates in connection with the SLC Debt.

 

(e)           There shall be a proration in Buyer’s favor with respect to a pro
rata portion of any Inducement Payments made to Seller and FPMG LLC by TeleRep
LLC pursuant to (and as such term is defined in) the letter agreement between
such parties dated as of June 25, 2007.

 

(f)            There shall be a proration in Buyer’s favor to the extent that
the value of the commercial spots for bonus weight advertising and ADUs as of
the end of business of the date immediately preceding the LMA Commencement Date
as set forth in a report generated as of the end of business on such date is
greater than 125% of the value of such commercial spots set forth in the
schedule (the “Commercial Spots Threshhold”) delivered by Seller to Buyer in
conjunction with the execution of this Agreement, which proration shall be with
respect to the value of the commercial spots in excess of the Commercial Spots
Threshold.  For purposes of this Section 2.09(f), commercial spots shall be
valued at the Average Unit Rate realized by Seller in the applicable market for
the year to date through the end of October 2011 as measured as of the close of
business on the last day of October 2011.  “Average Unit Rate” means 75% of a
number equal to (a) the total booked net revenue for commercial spots in a
period divided by (b) the total number of commercial spots booked (including in
such number bonus weight advertising spots granted in connection with such
booked commercial spots) by third party advertising customers in such period.

 

(g)           At least five Business Days prior to the Closing Date, Seller
shall provide Buyer with a good faith estimate of the prorations contemplated by
this Section 2.09 (the “Estimated Settlement Statement”).  Any payment required
to be made by either party pursuant to such preliminary estimate shall be made
by the appropriate party at the Closing in accordance therewith, absent manifest
error.  Seller will afford Buyer reasonable access to all records and work
papers used in preparing the Estimated Settlement Statement, and Buyer shall
notify Seller of any good faith disagreement with such calculation within two
Business Days of receiving the Estimated Settlement Statement.  At the Closing,
(i) Buyer shall be required to pay to Seller the amount equal to the Estimated
Adjustment if the Estimated Adjustment is a positive number or (ii) Seller shall
be required to pay to Buyer the amount equal to the Estimated Adjustment if the
Estimated Adjustment is a negative number.

 

(h)           Within 60 days after the Closing Date, Buyer shall prepare and
deliver to Seller a proposed proration of assets and liabilities in the manner
described in this Section 2.09 (the “Settlement Statement”) setting forth the
Seller Prorated Amount and the Buyer

 

17

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Prorated Amount, together with a schedule setting forth, in reasonable detail,
the components thereof.

 

(i)            Seller shall provide reasonable access to such employees, books,
records, financial statements, and its independent auditors as Buyer reasonably
believes is necessary or desirable in connection with its preparation of the
Settlement Statement.

 

(j)            During the 30-day period following the receipt of the Settlement
Statement (i) Seller and its independent auditors shall be permitted to review
and make copies reasonably required of, (w) the financial statements relating to
the Settlement Statement, (x) the working papers relating to the Settlement
Statement, (y) the books and records relating to the Settlement Statement and,
(z) any supporting schedules, analyses and other documentation relating to the
Settlement Statement.

 

(k)           The Settlement Statement shall become final and binding (the
“Final Settlement Statement”) upon the parties on the 45th day following
delivery thereof, unless Seller gives written notice of its disagreement with
the Settlement Statement (the “Notice of Disagreement”) to Buyer prior to such
date.  The Notice of Disagreement shall specify in reasonable detail the nature
of any disagreement so asserted.  If a Notice of Disagreement is given to Buyer
in the period specified, then the Final Settlement Statement (as revised in
accordance with clause (i) or (ii) below) shall become final and binding upon
the parties on the earlier of (i) the date Buyer and Seller resolve in writing
any differences they have with respect to the matters specified in the Notice of
Disagreement or (ii) the date any disputed matters are finally resolved in
writing by the Accounting Firm.

 

(l)            Within ten Business Days after the Final Settlement Statement
becomes final and binding upon the parties, (i) Buyer shall be required to pay
to Seller the amount, if any, by which the Final Adjustment is higher than the
Estimated Adjustment or (ii) Seller shall be required to pay to Buyer the
amount, if any, by which the Estimated Adjustment is higher than the Final
Adjustment, as the case may be.  All payments made pursuant to this
Section 2.09(l) must be made via wire transfer in immediately available funds to
an account designated by the recipient party, together with interest thereon at
the prime rate (as reported by The Wall Street Journal or, if not reported
thereby, by another authoritative source) as in effect from time to time from
the Effective Time to the date of actual payment.

 

(m)          Notwithstanding the foregoing, in the event that Seller delivers a
Notice of Disagreement, Seller or Buyer shall be required to make a payment of
any undisputed amount to the other regardless of the resolution of the disputed
items contained in the Notice of Disagreement.  Seller or Buyer, as applicable,
shall within ten Business Days of the receipt of the Notice of Disagreement make
payment to the other by wire transfer in immediately available funds of such
undisputed amount owed by Seller or Buyer to the other, as the case may be,
together with interest thereon, calculated as described above.

 

(n)           During the 30-day period following the delivery of a Notice of
Disagreement to Buyer that complies with the preceding paragraphs, Buyer and
Seller shall seek in good faith to resolve in writing any differences they may
have with respect to the matters specified in the Notice of Disagreement. 
During such period (i) Buyer and its independent

 

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auditors, at Buyer’s sole cost and expense, shall be, and Seller and its
independent auditors, at Seller’s sole cost and expense, shall be, in each case
permitted to review and make copies reasonably required of (w) the financial
statements of Seller, in the case of Buyer, and Buyer, in the case of Seller,
relating to the Notice of Disagreement, (x) the working papers of Seller, in the
case of Buyer, and Buyer, in the case of Seller, and such other party’s
auditors, if any, relating to the Notice of Disagreement, (y) the books and
records of Seller, in the case of Buyer, and Buyer, in the case of Seller,
relating to the Notice of Disagreement, and (z) any supporting schedules,
analyses and documentation relating to the Notice of Disagreement; and
(ii) Seller, in the case of Buyer, and Buyer, in the case of Seller, shall
provide reasonable access, upon reasonable advance notice and during normal
business hours, to such employees of such other party and such other party’s
independent auditors, as such first party reasonably believes is necessary or
desirable in connection with its review of the Notice of Disagreement.

 

(o)           If, at the end of such 30-day period, Buyer and Seller have not
resolved such differences, Buyer and Seller shall submit to the Accounting Firm
for review and resolution any and all matters that remain in dispute and that
were properly included in the Notice of Disagreement.  Within 60 days after
selection of the Accounting Firm, Buyer and Seller shall submit their respective
positions to the Accounting Firm, in writing, together with any other materials
relied upon in support of their respective positions.  Buyer and Seller shall
use commercially reasonable efforts to cause the Accounting Firm to render a
decision resolving the matters in dispute within 30 days following the
submission of such materials to the Accounting Firm.  Buyer and Seller agree
that judgment may be entered upon the determination of the Accounting Firm in
any court having jurisdiction over the party against which such determination is
to be enforced.  Except as specified in the following sentence, the cost of any
arbitration (including the fees and expenses of the Accounting Firm) pursuant to
this Section 2.09 shall be borne by Buyer and Seller in inverse proportion as
they may prevail on matters resolved by the Accounting Firm, which proportional
allocations shall also be determined by the Accounting Firm at the time the
determination of the Accounting Firm is rendered on the matters submitted.  The
fees and expenses (if any) of Buyer’s independent auditors and attorneys
incurred in connection with the review of the Notice of Disagreement shall be
borne by Buyer, and the fees and expenses (if any) of Seller’s independent
auditors and attorneys incurred in connection with their review of the
Settlement Statement shall be borne by Seller.

 

Section 2.10           Effect of LMA.

 

(a)           Simultaneously with the execution of this Agreement, Seller and
Buyer are executing and delivering the LMA.  To the extent that any Purchased
Assets are assigned, any Assumed Liabilities are assumed or assets and
liabilities are prorated under the LMA, any obligation of (i) Seller under this
Agreement to assign such Purchased Assets, (ii) Buyer to assume such Assumed
Liabilities or (iii) the parties to prorate such Purchased Assets and Assumed
Liabilities, shall be deemed satisfied.  Notwithstanding anything contained
herein to the contrary, Seller shall not be deemed to have breached any of its
representations, warranties, covenants or agreements contained herein or to have
failed to satisfy any condition precedent to Buyer’s obligation to perform under
this Agreement (nor shall Seller have any liability or responsibility to Buyer
in respect of any such representations, warranties, covenants, agreements or
conditions precedent), in each case, to the extent that the inaccuracy of any
such representations, the breach of any such warranty, covenant or agreement or
the inability to satisfy

 

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any such condition precedent arises out of or otherwise relates to (i) any
actions taken by or under the authorization of Buyer or its Affiliates (or any
of their respective officers, directors, employees, agents or representatives)
in connection with Buyer’s performance of its obligations under the LMA or
otherwise, or (ii) the failure of Buyer to perform any of its obligations under
the LMA.  Buyer acknowledges and agrees that Seller shall not be deemed
responsible for or have authorized or consented to any action or failure to act
on the part of Buyer or its Affiliates (or any of their respective officers,
directors, employees, agents or representatives) in connection with the LMA
solely by reason of the fact that prior to Closing, Seller directly or
indirectly shall have the legal right to control, manage, and supervise the
operation of the Stations and the conduct of the Business, except to the extent
Seller actually exercises control, management or supervision of the operation of
the Stations or the conduct of the Business.

 

(b)           The Estimated Settlement Statement, the Settlement Statement and
the Final Settlement Statement prepared in accordance with Section 2.09 shall
include, in addition to the items identified in Section 2.09, (i) a proration as
of the Effective Time of the monthly LMA fee as provided in paragraph 1 of
Schedule 1.5 of the LMA, and (ii) any unreimbursed Station Expenses (as defined
in the LMA) as of the Effective Time.

 

ARTICLE III
REPRESENTATIONS AND WARRANTIES OF SELLER

 

Seller, jointly and severally, represents and warrants to Buyer as follows:

 

Section 3.01           Corporate Existence and Power.  Each Seller is duly
organized, validly existing and in good standing under the laws of the state of
its organization.  Each Seller is qualified to do business and is in good
standing in each jurisdiction where such qualification is necessary, except
where the failure to so qualify would not reasonably be expected to have a
Material Adverse Effect.  Each Seller has the requisite power and authority to
own and operate the Stations as currently operated.

 

Section 3.02           Corporate Authorization.

 

(a)           The execution and delivery by Seller of this Agreement and the
Ancillary Agreements (to which Seller is or will be a party), the performance by
Seller of its obligations hereunder and thereunder and the consummation by
Seller of the transactions contemplated hereby and thereby are within Seller’s
corporate powers and have been duly authorized by all requisite corporate action
on the part of Seller.

 

(b)           This Agreement has been, and the Ancillary Agreements (to which
Seller is or will be a party) will be, duly executed and delivered by Seller. 
This Agreement (assuming due authorization, execution and delivery by Buyer)
constitutes, and each Ancillary Agreement (to which Seller is or will be a
party) will constitute when executed and delivered by Seller, the legal, valid
and binding obligation of Seller, enforceable against Seller in accordance with
its terms, except as such enforceability may be limited by applicable
bankruptcy, insolvency, reorganization, fraudulent conveyance, moratorium or
other similar Laws affecting or relating to enforcement of creditors’ rights
generally and general principles of equity (regardless of whether enforcement is
considered in a proceeding at law or in equity).

 

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Section 3.03           Governmental Authorization.  The execution, delivery and
performance by Seller of this Agreement and each Ancillary Agreement (to which
Seller is or will be a party) and the consummation of the transactions
contemplated hereby and thereby require no action by or in respect of, or filing
with or notification to, any Governmental Authority other than (a) compliance
with any applicable requirements of the HSR Act, and (b) compliance with the
Communications Act and with the rules and regulations of the FCC.

 

Section 3.04           Noncontravention.  Except as disclosed in Disclosure
Schedule Section 3.04, the execution, delivery and performance of this Agreement
and each Ancillary Agreement (to which Seller is or will be a party) by Seller
and the consummation of the transactions contemplated hereby and thereby do not
and will not (a) violate or conflict with the organizational documents of
Seller; (b) assuming compliance with the matters referred to in Section 3.03,
conflict with or violate, in any material respect, any material Law or
Governmental Order applicable to Seller or any of the Purchased Assets;
(c) require any consent or other action by or notification to any Person under,
constitute a material default under, give to any Person any rights of
termination, amendment, acceleration, cancellation of any right or obligation of
Seller under, any provision of any material Assumed Contract; or (d) result in
the creation or imposition of any Lien on any of the Purchased Assets, except
for Permitted Liens.

 

Section 3.05           Contracts.

 

(a)           Disclosure Schedule Section 3.05(a) sets forth all of the
following Contracts (other than Contracts which are Excluded Assets) to which
Seller is a party related to the Business as of the date hereof:

 

(i)            any Contract for the sale of broadcast time for advertising or
other purposes for cash that was not made in the ordinary course of business
consistent with past practices;

 

(ii)           any Contract relating to Program Rights;

 

(iii)          any Contract involving the purchase or sale of Real Property;

 

(iv)          any Contract relating to the acquisition or disposition of any
material portion of the Business (whether by merger, sale of stock, sale of
assets or otherwise);

 

(v)           any Contract involving construction, architecture, engineering or
other agreements relating to uncompleted construction projects, in each case
that involve payments in excess of $100,000;

 

(vi)          any mortgage, pledge or security agreement, deed of trust or other
instrument granting a Lien (other than Permitted Liens) upon any Purchased
Asset;

 

(vii)         any Contract involving a partnership, joint venture or similar
agreement with another party;

 

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(viii)        any Contract involving compensation to any employee, independent
contractor, or consultant in excess of $50,000;

 

(ix)           any Contract involving any labor agreement or collective
bargaining agreement of Seller;

 

(x)            any Contract that contains a covenant restricting the ability of
Seller to compete in any business or with any Person or in any geographic area;

 

(xi)           any Contract with any Affiliate of Seller (other than among
members of Sellers and other than employment or compensation-related Contracts);

 

(xii)          any Contract that is a local marketing agreement, joint sales
agreement or similar agreement;

 

(xiii)         any Contract with a Governmental Authority (other than ordinary
course Contracts with Governmental Authorities as a customer) which imposes any
material obligation or restriction on Seller;

 

(xiv)        any Contract pursuant to which any Indebtedness for borrowed money
of Seller is outstanding or may be incurred or pursuant to which Seller has
guaranteed any Indebtedness for borrowed money of any other Person (other than a
member of Seller and excluding trade payables arising in the ordinary course of
business);

 

(xv)         any Contract relating to the non-broadcast use of the Station’s
digital bit stream; and

 

(xvi)        all other Contracts (including all programming contracts)  that
(A) involve the payment or potential payment, pursuant to the terms of any such
Contract, by or to Seller of more than $100,000 annually and (B) cannot be
terminated within one hundred and eighty (180) days after giving notice of
termination without resulting in any material cost or penalty to Seller.

 

(b)           No Seller and, to the Knowledge of Seller, no other party, is in
material breach or default under any material Assumed Contract.

 

(c)           Each material Assumed Contract is in full force and effect and
constitutes a legal, valid and binding obligation of Seller and, to the
Knowledge of Seller, of each other party thereto (except to the extent that the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent conveyance or other Laws from time to
time in effect relating to creditors’ rights and remedies generally and general
principles of equity).

 

Section 3.06           Intangible Property.

 

(a)           All material owned and registered Copyrights, Trademarks and
domain names used in connection with the Business are described, listed or set
forth on Disclosure Schedule Section 3.06(a).

 

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(b)           Except as set forth on Disclosure Schedule Section 3.06(b), Seller
has received no notice of any material claims, demands or proceedings pending by
any third party challenging Seller’s right to use any of the Intangible Property
or that any Intangible Property or any services provided or process used by
Seller conflict with, infringe or otherwise violate the material rights of third
parties.

 

(c)           The Purchased Assets include all material Intangible Property,
including rights in and to call letters used in the operation of the Stations
and to Seller’s Knowledge no third party has infringed or is infringing on any
of the Intangible Property.

 

(d)           Seller has not received any written notice that any of the owned
Intangible Property is the subject of an outstanding judicial or administrative
finding, opinion or office action materially restricting the use thereof by
Seller or has been adjudged invalid, unenforceable or unregistrable in whole or
in part.

 

Section 3.07           Real Property.

 

(a)           The Seller entity set forth on Disclosure Schedule
Section 3.07(a)(i) has valid fee simple title to the owned Real Property
identified therein, which constitutes each parcel of real property which is
owned by the Seller and such real property, together with all buildings,
structures, fixtures and other improvements thereon, (the “Owned Real Property”)
free and clear of all Liens other than Permitted Liens.  Disclosure Schedule
Section 3.07(a)(ii) includes a list of each Lease.  Each applicable Seller has a
valid leasehold interest in, or a valid license to occupy, the Real Property
conveyed by the Leases and the Real Property Leases as of the date of this
Agreement.  The Real Property includes sufficient access to the Stations’
facilities.  Seller (i) has received no notice of any material violation of
material law affecting the Real Property or the Seller’s use thereof, (ii) is
not in material default under any Lease or Real Property Lease, (iii) has
received no notice of material default under or termination of any Leases or
Real Property Leases and (iv) has no knowledge of any material default by any
third party under any Lease or Real Property Lease.  Seller has made available
to Buyer true and correct copies of the Leases and Real Property Leases,
together with all amendments thereto.

 

(b)           Seller has not received written notice of any existing plan or
study by any Governmental Authority or by any other Person that challenges or
otherwise adversely affects the continuation of the use or operation of any Real
Property and has no Knowledge of any such plan or study with respect to which it
has not received written notice.  Except as set forth in the Leases to the
Knowledge of Seller there is no Person in possession of any Owned Real Property
other than Seller.  Except as identified in Disclosure Schedule Section 3.07(b),
no Person has any right to acquire the interests in any of the Owned Real
Property.

 

(c)           Except as disclosed on Disclosure Schedule Section 3.07(c) and
Disclosure Schedule Section 3.17(b), with respect to the Owned Real Property,
all material improvements, installations, equipment and facilities utilized in
connection with the business of each applicable Station, including material
studios, towers and transmission equipment, are (i) located entirely on the
Owned Real Property, (ii) maintained on the Owned Real Property in compliance in
all material respects with all applicable material Laws, Permits or other

 

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arrangements or requirements and (iii) in condition sufficient in all material
respects for the current use thereof.

 

(d)           Disclosure Schedule 3.07(d) includes a list of each lease,
sublease, license, or similar agreement (including any and all assignments,
amendments, and other modifications of such leases, subleases, licenses and
other occupancy agreements) pertaining to the use or occupancy of the Real
Property in which Seller has an interest as a tenant, licensee, subtenant or
sub-licensee (“Real Property Leases”).

 

(e)           Except as disclosed on Disclosure Schedule Section 3.07(e), to the
Knowledge of Seller, the Owned Real Property is in material compliance with all
applicable material building, zoning, subdivision, health and safety and other
land use Laws, including The Americans with Disabilities Act of 1990, as
amended.

 

(f)            (i) each parcel of Owned Real Property has access (e.g. ingress
and egress) to a public street adjoining such parcel of Owned Real Property, or
has ingress and egress to a public street via Real Property Leases or easements,
and (ii) such access is not dependent on any land or other real property
interest which is not included in the Real Property.

 

(g)           To the Knowledge of the Seller the current use and occupancy of
the Owned Real Property and the operation of the business of the Seller as
currently conducted thereon does not violate in any material respect any
easement, covenant, condition, restriction or similar provision in any
instrument of record or other unrecorded agreement affecting such Owned Real
Property or Seller’s use and occupancy thereof.

 

Section 3.08           Financial Information.

 

(a)           Seller has furnished Buyer with copies of:  (i) the audited
consolidated balance sheets as of December 31, 2009 and December 31, 2010 of
FPMG LLC the indirect parent of Seller and the related audited statements of
operations and cash flow for the fiscal years ended December 31, 2009 and
December 31, 2010 (such statements, the “Audited Financial Statements”) and
(ii) the unaudited consolidated balance sheet as of June 30, 2011 of FMPG LLC
and Seller (the “Latest Unaudited Balance Sheet”) and the related statements of
operations and cash flow for the six months ended June 30, 2011 (such
statements, together with the Latest Unaudited Balance Sheet, the “Unaudited
Financial Statements”).  Except as set forth in Disclosure Schedule
Section 3.08(a), the Audited Financial Statements and the Unaudited Financial
Statements (collectively, the “Financial Statements”) have been based upon the
information contained in the books and records of FMPG LLC and Seller have been
prepared in accordance with GAAP applied on a consistent basis and fairly
present in all material respects the consolidated financial condition and the
consolidated results of operations of FMPG LLC and Seller as of the dates and
for the periods referred to therein, subject, in the case of Unaudited Financial
Statements, to normal, year-end adjustments, the lack of footnotes and other
presentation items.  The books and records of Seller and FMPG LLC have been, and
are being, maintained in all material respects in accordance with applicable
accounting requirements, and the Financial Statements are consistent in all
material respects with such books and records.

 

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(b)           Except as set forth on Disclosure Schedule Section 3.08(b),
neither FMPG LLC or the Seller has any liabilities that relate to the Business
or to which the Purchased Assets would be subject which would be required to be
reflected or reserved against on a consolidated balance sheet of the FPMG LLC
prepared in accordance with GAAP or the notes thereto, except liabilities
(i) reflected or reserved against on the consolidated audited balance sheet of
FPMG LLC as of December 31, 2010, (ii) incurred after December 31, 2010 in the
ordinary course of business, (iii) that are Excluded Liabilities,
(iv) liabilities to be performed after the date hereof pursuant to the Material
Contracts or (v) as contemplated by this Agreement.

 

Section 3.09           Absence of Certain Changes or Events.

 

(a)           Except as disclosed in Disclosure Schedule Section 3.09(a), since
the Balance Sheet Date, Seller has operated the Stations in the ordinary course
of business consistent with past practices.

 

(b)           Since the Balance Sheet Date through the date hereof, and except
as set forth in Disclosure Schedule Section 3.09(b) or as contemplated by this
Agreement, there has not been:

 

(i)            any Material Adverse Effect;

 

(ii)           any damage, destruction or loss, whether or not covered by
insurance, with respect to any of its property and assets having a replacement
cost of more than $100,000 per Market;

 

(iii)          any individual transaction over $50,000 or individual commitment
over $75,000 made, or any individual contract or agreement over $75,000 entered
into by Seller (including the acquisition or disposition of any assets), or any
relinquishment by Seller of any contract or other right valued at over $100,000,
in either case, other than transactions and commitments in the ordinary course
of business, including renewals or amendments to existing contracts, and those
contemplated by this Agreement;

 

(iv)          any material change in the programming policies of the Stations;

 

(v)           the creation or other incurrence by Seller of any Lien on any
Purchased Asset other than Permitted Liens;

 

(vi)          any (x) establishment of any bonus, employment, severance,
deferred compensation, retirement or other employee benefit plan (or any
amendment to any such existing agreement), (y) grant of any severance or
termination pay to any officer or employee of Seller, or (z) increase or change
to the rate or nature of the compensation (including wages, salaries and
bonuses) payable to any Person employed by Seller, except in each case, (A) as
may be required by Law or existing contracts or applicable collective bargaining
agreements and (B) in the ordinary course of business consistent with past
practices;

 

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(vii)         any labor dispute, other than routine individual grievances, or
any activity or proceeding by a labor union or representative thereof to
organize any employees of Seller, which employees were not subject to a
collective bargaining agreement at the Balance Sheet Date, or any lockouts,
strikes, slowdowns, work stoppages or threats thereof by or with respect to any
employees of Seller;

 

(viii)        any sale of Owned Real Property, Leases or other transfer,
conveyance or termination of leasehold rights in, such Owned Real Property or
Real Property Leases;

 

(ix)           any change in any method of accounting or accounting practice by
Seller except for any such change required by reason of a concurrent change in
GAAP; or

 

(x)            any agreement or commitment to do anything set forth in this
Section 3.09(b).

 

Section 3.10           Absence of Litigation.  Except as set forth on Disclosure
Schedule Section 3.10, there is no material Action pending against or, to the
Knowledge of Seller, threatened against or affecting Seller, any of the Stations
or the Businesses, that would be reasonably expected to restrain, enjoin or
otherwise prevent the consummation of the transactions contemplated by this
Agreement or the Ancillary Agreements or that would, as of the date of this
Agreement, reasonably be expected to result in damages in excess of $100,000.

 

Section 3.11           Compliance with Laws.  Except as set forth in Disclosure
Schedule Section 3.11, Seller is not in material violation of, and, to the
Knowledge of Seller, is not under investigation with respect to and has not been
threatened in writing to be charged with, any material violation of any material
applicable Law or Governmental Order.  Seller holds all material licenses,
franchises, permits, certificates, approvals and authorizations from
Governmental Authorities necessary for the lawful conduct of its business
(collectively, “Permits”), and all such Permits are valid and in full force and
effect.  Except as set forth in Disclosure Schedule Section 3.11, Seller is in
material compliance with the terms of such Permits.

 

Section 3.12           FCC Matters; Qualifications.  With respect to the main
station FCC Licenses:

 

(a)           Disclosure Schedule Section 3.12(a)(1) contains a true and
complete list of all FCC Licenses, including antenna structure registrations of
towers owned by Seller.  Seller has made available true, correct and complete
copies of the FCC Licenses to Buyer, including any and all amendments and
modifications thereto.  The FCC Licenses are validly held by Seller and are in
full force and effect.  The FCC Licenses have been issued for the full terms
customarily issued to a broadcast television station in the state in which the
Station’s community of license is located, and the FCC Licenses are not subject
to any condition except for those conditions appearing on the face of the FCC
Licenses and conditions applicable to broadcast television licenses generally or
otherwise disclosed in Disclosure Schedule Section 3.12(a)(2).

 

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(b)           Except as set forth on Disclosure Schedule Section 3.12(b), Seller
has no applications pending before the FCC relating to the operation of the
Stations.

 

(c)           Except as set forth on Disclosure Schedule Section 3.12(c)(1),
Seller has operated each Station in compliance with the Communications Act and
the FCC Licenses in all material respects, has timely filed all material
registrations and reports and has paid all FCC regulatory fees due in respect to
each Station and has completed the construction of all facilities or changes
contemplated by any of the FCC Licenses or construction permits issued to the
Stations.  Except as set forth in Disclosure Schedule Section 3.12(c)(2), there
are no applications, petitions, complaints, proceedings, investigations or other
actions pending or to the Knowledge of Seller, threatened before the FCC
relating to the Stations, other than proceedings affecting broadcast television
stations generally.  Neither Seller nor any of the Stations has entered into a
tolling agreement or otherwise waived any statute of limitations during which
the FCC may assess any fine or forfeiture or take any other action or agreed to
any extension of time with respect to any FCC investigation or proceeding.

 

(d)           Seller is qualified under the Communications Act to assign the FCC
Licenses to Buyer.  To the Knowledge of Seller, there is no fact or circumstance
relating to the Stations or Seller or any of its Affiliates that would cause the
FCC to deny the FCC Applications.  Except as set forth on Disclosure Schedule
Section 3.12(d), Seller has no reason to believe that the FCC Applications might
be challenged or might not be granted by the FCC in the ordinary course due to
any fact or circumstance relating to Seller’s operation of the Stations or
Seller or any of its Affiliates.

 

Section 3.13           Cable and Satellite Matters.

 

(a)           Disclosure Schedule Section 3.13(a) contains a list of all
retransmission consent or copyright indemnification agreements with MVPDs with
more than 5,000 subscribers with respect to each Station as of the date of this
Agreement.  Seller has timely made must-carry elections or entered into
retransmission consent agreements with respect to each MVPD with more than 5,000
subscribers in any of the Markets.  Since January 1, 2011, no such MVPD has
provided written notice to Seller of any signal quality issue or failed to
respond to a request for carriage or to the Knowledge of Seller sought any form
of relief from carriage of the Station from the FCC.  Since January 1, 2010,
Seller has not received any written notice of any MVPD’s intention to delete a
Station from carriage or to change a Station’s channel position.

 

(b)           Disclosure Schedule Section 3.13(b) contains a list as of the date
hereof, including the channel position where known, of the MVPDs that, to the
Knowledge of Seller, carry any Station outside such Station’s market.

 

Section 3.14           Employees; Labor Matters.

 

(a)           Seller has made available to Buyer a list, dated as of a date no
earlier than five (5) days prior to the date of this Agreement, attached as
Disclosure Schedule Section 3.14(a), of all Employees, including the names, date
of hire, current rate of compensation, employment status (i.e., active,
disabled, on authorized leave and reason therefor),

 

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department, title, whether covered by a collective bargaining agreement and
whether full-time, part-time or per-diem.

 

(b)           Except as set forth in Disclosure Schedule Section 3.14(b), none
of the Stations are subject to or bound by any labor agreement or collective
bargaining agreement.  To the Knowledge of Seller, there is no activity
involving any Employee seeking to certify a collective bargaining unit or
engaging in any other organizational activity.

 

Section 3.15           Employee Benefit Plans.  With respect to Employee Plans
that are applicable to any individual who is or has been employed by or provided
services to any of the Stations:

 

(a)           Disclosure Schedule Section 3.15(a) identifies each material
Employee Plan immediately prior to the date of this Agreement.

 

(b)           The Employee Plans are in compliance with all applicable
requirements of ERISA, the Code, and other applicable laws and have been
administered in accordance with their terms and such laws, disregarding for this
purpose any failure to so comply or administer that does not:  (i) have a
Material Adverse Effect, or (ii) impose upon Buyer any carryover or other
liability with respect thereto.  Each Employee Plan that is intended to be
qualified within the meaning of Section 401(a) of the Code has received a
favorable determination letter as to its qualification, and nothing has occurred
that could reasonably be expected to adversely affect such qualification.

 

(c)           Except as set forth on Disclosure Schedule Section 3.15(c), there
is no contract, plan or arrangement (written or otherwise) covering any employee
or former employee of the Stations that, individually or collectively, could
give rise to the payment of any amount that would not be deductible pursuant to
the terms of Section 280G of the Code.

 

(d)           Except as set forth in Disclosure Schedule Section 3.15(d), there
is no pending or, to the Knowledge of Seller, threatened legal action, suit or
claim relating to the Employee Plans (other than routine claims for benefits)
that could reasonably be expected to have a Material Adverse Effect.

 

(e)           No Employee Plan that is, or has ever been, maintained or
contributed to (or required to be contributed to) by Seller is:  (i) a defined
benefit pension plan within the meaning of Section 414(j) of the Code, or
(ii) subject to Title IV of ERISA or to the minimum funding standard within the
meaning of Section 412 of the Code or Section 302 of ERISA, and Seller has no
liability under any such plan.

 

(f)            With respect to each material Employee Plan, Seller has provided
or made available to Buyer true and complete copies of the following documents: 
(i) the most recent Employee Plan document and all amendments thereto; (ii) the
most recent summary plan description; and (iii) with respect to any Employee
Plan to which Section 401(a) of the Code is applicable, the most recent
determination letter issued by the IRS.

 

(g)           Except as set forth on Disclosure Schedule Section 3.15(g), the
consummation of the transactions contemplated by this Agreement will not result
in the

 

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acceleration of the vesting or timing of payment of any compensation or benefits
payable under any Employee Plan to or in respect of any employee of Seller.

 

(h)           Except as set forth in Disclosure Schedule Section 3.15(h),
(i) Seller is not engaged in any unfair labor practice that would reasonably be
expected to result in a Material Adverse Effect; (ii) there are no labor
strikes, material labor disputes, concerted work stoppages or lockouts pending
or, to the Knowledge of Seller, threatened; (iii) there are no grievances,
complaints or other legal proceedings pending, or to the Knowledge of Seller,
threatened, against Seller in connection with the employment of their respective
employees, except that would not reasonably be expected to result in a material
liability; and (iv) Seller is in compliance with all applicable labor and
employment laws in connection with the employment of their respective employees,
except for any failure to comply that would not reasonably be expected to result
in a material liability.

 

Section 3.16           Environmental Matters. Except as otherwise disclosed on
Disclosure Schedule Section 3.16:

 

(a)           no citation, written notice, request for information, order,
complaint or penalty has been received, and, to the Knowledge of Seller, no
Action has been brought by any Governmental Authority alleging a material
violation of, or liability under, any Environmental Laws for Releases at any
Real Property owned, leased or operated by the Company;

 

(b)           Seller holds all environmental permits, registrations or other
authorizations necessary for the operation of Seller to comply with applicable
material Environmental Laws in all material respects and Seller is in material
compliance with the terms of such Environmental Permits;

 

(c)           Seller is in compliance with Environmental Laws in all material
respects, including those relating to generation, storage, treatment, recycling,
removal, cleanup, transport or disposal of Hazardous Materials;

 

(d)           to the Knowledge of Seller, there have been no Releases of
Hazardous Materials at, from, to, on or under any Owned Real Property that give
rise to an affirmative reporting or cleanup obligation under Environmental Law;
and

 

(e)           to the Knowledge of Seller, there are no underground storage tanks
at the Owned Real Property and Seller does not utilize any underground storage
tanks at the Real Property subject to the Real Property Leases.

 

Section 3.17           Equipment.  Disclosure Schedule Section 3.17(a) lists all
material items of Equipment included in the Purchased Assets.  Except as
otherwise set forth in Disclosure Schedule Section 3.17(b), all such material
items of Equipment are in normal operating condition (ordinary wear and tear
excepted), and to the Knowledge of Seller, are free from material defects
(patent or latent) and have been maintained in accordance with normal industry
practice.  Seller owns or leases all Equipment included in the Purchased Assets,
free and clear of all Liens, except Permitted Liens.  No Person other than a
Seller has any rights to use any of the Equipment or other tangible personal
property included in the Purchased Assets, whether

 

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by lease, sublease, license or other instrument, other than set forth on
Disclosure Schedule Section 3.17(c).

 

Section 3.18           Brokers.  There is no broker, finder, investment banker
or other intermediary that has been retained by or is authorized to act on
behalf of Seller who or that might be entitled to any fee or commission from
Buyer or any of its Affiliates in connection with the transactions contemplated
by this Agreement or the Ancillary Agreements.

 

Section 3.19           Taxes.

 

(a)           With respect to Taxes, other than Taxes based on net income,
relating primarily to the Purchased Assets or the Business, Seller has filed (or
was included in ) or will have filed on a timely basis all material Tax Returns
in connection with any such material federal, state or local Tax required to be
filed by it, all such Tax Returns are or will be, correct and complete in all
material respects and prepared in substantial compliance with all applicable
laws and regulations, and Seller has or will have timely paid all such Taxes due
(whether or not shown thereon) except as contested upon audit by appropriate
proceedings and which either (i) constitute Excluded Liabilities or (ii) are
disclosed on Disclosure Schedule Section 3.19(a).  None of the Purchased Assets
is subject to any lien in favor of the United States pursuant to Section 6321 of
the Code for nonpayment of federal Taxes, or any Tax lien in favor of any state
or locality pursuant to any comparable provision of state or local Law, or,
except for the SLC Debt, any other U.S. federal, state or local Tax Law under
which transferee liability might be imposed upon Buyer as a buyer of such
Purchased Assets.

 

(b)           The transactions contemplated by this Agreement will not give rise
to (i) the creation of any Liens against the Purchased Assets or the Business in
respect of any Taxes or (ii) the assertion of any additional Taxes against the
Purchased Assets or the Business, other than Transfer Taxes.

 

(c)           There is no material action or proceeding or unresolved claim for
assessment or collection, pending or threatened by any Governmental Authority
for assessment or collection from Seller of any Taxes of any nature affecting
the Purchased Assets or the Business.

 

(d)           Except for the SLC Debt, none of the Purchased Assets have been
financed with, or directly or indirectly secures, any industrial revenue bonds
or debt, the interest on which is tax exempt under Section 103(a) of the Code. 
None of the Purchased Assets consists of stock in a corporation.  None of the
Purchased Assets are tax-exempt use property within the meaning of
Section 168(h) of the Code.

 

(e)           Except as set forth on Disclosure Schedule Section 3.19(e), none
of the Sellers currently is the beneficiary of any extension of time within
which to file any material Tax Return relating primarily to the Purchased Assets
or the Business.

 

(f)            There is no material dispute or claim concerning any Tax
liability of any of the Sellers relating primarily to the Purchased Assets or
the Business either (A) claimed or raised by any Governmental Authority in
writing or (B) as to which Sellers has Knowledge.

 

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(g)           None of the Sellers has waived any statute of limitations in
respect of material Taxes relating primarily to the Purchased Assets or the
Business or agreed to any extension of time with respect to a material Tax
assessment or deficiency which extension is currently in effect relating
primarily to the Purchased Assets or the Business.

 

Section 3.20           Purchased Assets.  The Purchased Assets include all
assets that are owned or leased by Seller and used or held for use in the
operation of the Stations in all material respects as currently operated, except
for the Excluded Assets.

 

ARTICLE IV
REPRESENTATIONS AND WARRANTIES OF BUYER

 

Buyer represents and warrants to Seller as follows:

 

Section 4.01           Existence and Power.  Buyer is a corporation duly formed,
validly existing and in good standing under the Laws of the State of Maryland
and has all corporate powers and all governmental licenses, authorizations,
permits, consents and approvals required to carry on its business as now
conducted.

 

Section 4.02           Corporate Authorization.

 

(a)           The execution and delivery by Buyer of this Agreement and the
Ancillary Agreements (to which Buyer will be a party), the performance by Buyer
of its obligations hereunder and thereunder and the consummation by Buyer of the
transactions contemplated hereby and thereby are within Buyer’s corporate powers
and have been duly authorized by all requisite organizational action on the part
of Buyer.

 

(b)           This Agreement has been, and each Ancillary Agreement (to which
Buyer is or will be a party) will be, duly executed and delivered by Buyer. 
This Agreement (assuming due authorization, execution and delivery by Seller)
constitutes, and each Ancillary Agreement (to which Buyer is or will be a party)
will constitute when executed and delivered by Buyer, the legal, valid and
binding obligation of Buyer, enforceable against Buyer in accordance with its
terms, except as such enforceability may be limited by applicable bankruptcy,
insolvency, reorganization, fraudulent conveyance, moratorium or other similar
Laws affecting or relating to enforcement of creditors’ rights generally and
general principles of equity (regardless of whether enforcement is considered in
a proceeding at law or in equity).

 

Section 4.03           Governmental Authorization.  The execution, delivery and
performance by Buyer of this Agreement and each Ancillary Agreement and the
consummation of the transactions contemplated hereby and thereby require no
action by or in respect of, or filing with or notification to, any Governmental
Authority other than (a) compliance with any applicable requirements of the HSR
Act and (b) compliance with the Communications Act and with the rules and
regulations of the FCC.

 

Section 4.04           Noncontravention.  The execution, delivery and
performance of this Agreement by Buyer and each Ancillary Agreement to which
Buyer will be a party and the consummation of the transactions contemplated
hereby and thereby do not and will not (a) violate or conflict with the
organizational documents of Buyer, (b) assuming compliance with the

 

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matters referred to in Section 4.03, conflict with or violate any Law or
Governmental Order applicable to Buyer, (c) require any consent or other action
by or notification to any Person under, constitute a default under, or give to
any Person any rights of termination, amendment, acceleration or cancellation of
any right or obligation of Buyer or to a loss of any benefit relating to Seller
to which Buyer is entitled under, any provision of any note, bond, mortgage,
indenture, contract, agreement, lease, license, permit, franchise or other
agreement or instrument to which Buyer is a party or by which any of Buyer’s
assets is or may be bound or (d) result in the creation or imposition of any
Lien on any asset of Buyer, except for Permitted Liens, except, in the cases of
clauses (b), (c) and (d), for any such violations, consents, actions, defaults,
rights or losses as could not have, individually or in the aggregate, a material
adverse effect on Buyer or on Buyer’s ability to perform its obligations under
this Agreement or the Ancillary Agreements.

 

Section 4.05           Absence of Litigation.  There are no Actions pending
against or, to Buyer’s knowledge, threatened against Buyer before any
Governmental Authority that in any manner challenges or seeks to prevent,
enjoin, alter or delay materially the transactions contemplated by this
Agreement.

 

Section 4.06           FCC Qualifications.  Buyer is legally, financially and
otherwise qualified under the Communications Act (as in effect on the date
hereof) to acquire the FCC Licenses and own and operate each Station and to be
the programmer of the Stations under the LMA.  There are no facts known to
Buyer, after due inquiry, that would disqualify Buyer as the assignee of the FCC
Licenses or as owner and operator of the Stations or as programmer under the
LMA, and no waiver or exemption, whether temporary or permanent of the
Communications Act is necessary for the FCC Consent to be obtained.  Except as
set forth on Disclosure Schedule Section 4.06, Buyer has no reason to believe,
after due inquiry, that (a) the FCC Applications might be challenged or might
not be granted by the FCC in the ordinary course due to any fact or circumstance
relating to Buyer or any of its Affiliates or any of their respective officers,
directors, shareholder, members or partners or (b) the parties hereto will not
be able to obtain early termination of the applicable waiting period under the
HSR Act without any request for additional information from the FTC or the DOJ. 
No waiver of or exemption, whether temporary or permanent, from any provision of
the Communications Act is necessary for the FCC Consent to be obtained.

 

Section 4.07           Brokers.  There is no broker, finder, investment banker
or other intermediary that has been retained by or is authorized to act on
behalf of Buyer who or that might be entitled to any fee or commission from
either Buyer or any of its Affiliates upon consummation of the transactions
contemplated by this Agreement and the Ancillary Agreements for which Seller
could become liable.

 

Section 4.08           Financing.  At Closing Buyer will have sufficient cash,
available lines of credit or other sources of immediately available funds to
enable it to make payment of the Purchase Price, all related fees and expenses
in connection with the transactions contemplated by this Agreement and any other
amounts to be paid by it in accordance with the terms of this Agreement.

 

Section 4.09           Projections and Other Information.  Buyer acknowledges
that, with respect to any projections, forecasts, business plans, budget
information and similar

 

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documentation or information relating to Seller and the Business that Buyer has
received from Seller or any of its Affiliates, (a) there are uncertainties
inherent in attempting to make such projections, forecasts, plans and budgets,
(b) Buyer is familiar with such uncertainties, (c) Buyer is taking full
responsibility for making its own evaluation of the adequacy and accuracy of all
estimates, projections, forecasts, plans and budgets so furnished to it, and (d)
Buyer does not have, and will not assert, any claim against Seller or any of its
directors, officers, employees, Affiliates or representatives, or hold Seller or
any such persons liable, with respect thereto.  Buyer represents that neither of
Seller nor any of its Affiliates nor any other Person has made any
representation or warranty, express or implied, as to the accuracy or
completeness of any information regarding Seller, or the transactions
contemplated by this Agreement not expressly set forth in this Agreement, and
neither Seller nor any of its Affiliates or any other Person will have or be
subject to any liability to Buyer or any other Person resulting from the
distribution to Buyer or its representatives or Buyer’s use of, any such
information, including any confidential memoranda distributed on behalf of
Seller relating to Seller or other publications or data room information
provided to Buyer or its representatives, or any other document or information
in any form provided to Buyer or its representatives in connection with the sale
of the Purchased Assets and the transactions contemplated hereby. 
Notwithstanding anything herein to the contrary, nothing in this Section 4.09
will in any way limit Buyer’s rights (including under Section 10.03(a) and
Article XII) with respect to representations and warranties of Seller explicitly
included herein.

 

ARTICLE V
COVENANTS OF SELLER

 

Section 5.01                                Operations Pending Closing.  Except
as otherwise set forth in this Agreement or in the LMA, or with the prior
written consent of Buyer, which consent may not be unreasonably withheld in the
case of clauses (g), (h), (i), (l), or as it relates to the foregoing (s)) and
may otherwise be withheld in Buyer’s sole discretion, and subject to the
provisions of Section 7.03 regarding control of each Station, from and after the
date of this Agreement until the Closing, Seller shall, subject to the LMA and
Section 2.10 hereof:

 

(a)                                  operate the Business in compliance in all
material respects with the Communications Act, the FCC Licenses, the FCC rules
and regulations and all applicable Laws;

 

(b)                                 not cause or permit, or agree or commit to
cause or permit, by act or failure to act, any of the FCC Licenses to expire or
to be revoked, suspended or adversely modified, or take or fail to take any
action that would cause the FCC or any other Governmental Authority to institute
proceedings for the suspension, revocation or adverse modification of any of the
FCC Licenses listed on Disclosure Schedule Section 3.12(a)(1);

 

(c)                                  not sell, lease, license or otherwise
dispose of or encumber any assets of the Business except (i) pursuant to
existing contracts or commitments set forth on Disclosure Schedule Section
3.05(a) or (ii) immaterial assets in the ordinary course of business consistent
with past practices;

 

(d)                                 except as set forth on Disclosure Schedule
Section 5.01(d), operate the Business in the ordinary course consistent with
past practices (except where such conduct

 

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would conflict with the following covenants or with Seller’s other obligations
under this Agreement) and use commercially reasonable efforts to preserve
substantially intact the relationships of Seller with its respective customers,
employees, suppliers, licensors, licensees, distributors and others with whom
Seller deals;

 

(e)                                  not make any change in any method of
accounting or accounting practice utilized in the preparation of the Audited
Financial Statements except for any such change required by reason of a
concurrent change in GAAP;

 

(f)                                    maintain the Equipment in normal
operating condition in conformity in all material respects with all applicable
FCC technical regulations, ordinary wear and tear excepted;

 

(g)                                 (i) not increase the rate or nature of, or
prepay, the compensation (including wages, salaries and bonuses) or severance
that is paid or payable to any Employee, except in the ordinary course of
business consistent with past practices or pursuant to existing compensation and
fringe benefit plans, Employee Plans, practices and arrangements; (ii) not enter
into, renew or allow the renewal of or entering into, any employment or
consulting agreement or other contract or arrangement with respect to the
performance of personal services for a Station that is not terminable at will
except in the ordinary course of business consistent with past practice; and
(iii) not agree or commit to do any of the foregoing;

 

(h)                                 except as set forth on Disclosure Schedule
Section 5.01(h), not enter into, or become obligated under, any agreement or
commitment except for: (x) any individual Program Rights agreement with a term
of one year or less or that involve payments or receipts of $100,000 or less;
provided, however, that in no event may Seller enter into Program Rights
agreements that in the aggregate involve payments or receipts of $250,000 or
more; and (y) any other agreement or commitment (other than advertising sales
contracts for cash only) with a term of one year or less or that involve
payments or receipts of $75,000 or less; provided, however, that in no event may
Seller enter into such other agreements or commitments that in the aggregate
involve payments or receipts of $250,000 or more; and (z) any exercise of a
renewal option under a Lease or Real Property Lease that would otherwise
terminate or expire, or where the deadline to exercise such renewal option would
lapse, within one year of the anticipated date of Closing;

 

(i)                                     not enter into or agree or commit to
enter into any new Tradeout Agreement relating to a specific Station with a
value in excess of $40,000 individually, and, $100,000 in the aggregate, prior
to Closing that will not be fully performed prior to the Closing;

 

(j)                                     (i) utilize the Program Rights only in
the ordinary course of business consistent with past practices and (ii) not sell
or otherwise dispose of any such Program Rights;

 

(k)                                  promptly notify Buyer of any attempted or
actual collective bargaining organizing activity with respect to the applicable
Employees;

 

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(l)                                     except as set forth on Disclosure
Schedule Section 5.01(l), not make or agree or commit to make any capital
expenditure greater than $40,000 in connection with any particular project
relating to a Station, or greater than $200,000 in total per Station;

 

(m)                               keep in full force and effect insurance
comparable in amount and scope of coverage to that now maintained;

 

(n)                                 not enter into any arrangement or Contract
with any Affiliate of Seller;

 

(o)                                 except as set forth on Disclosure Schedule
Section 5.01(o), not enter into or become obligated under any new Contract which
would be required to be listed on Disclosure Schedule Section 3.05(a) by virtue
of Section 3.05(a) hereof or amend, modify, terminate or waive any material
right under any Assumed Contract (including any Lease, Real Property Lease or
employment Contract), other than as expressly permitted hereunder;

 

(p)                                 not extend credit to advertisers other than
in accordance with the Stations’ usual and customary policy with respect to
extending credit for the sale of broadcast time and collecting accounts
receivable;

 

(q)                                 promote the programming of the Stations
(both on-air and using third party media) in a manner consistent with historical
practice;

 

(r)                                    timely make retransmission consent
elections with all MVPDs located in or serving the Stations’ Markets; and

 

(s)                                  not agree or commit, whether in writing or
otherwise, to take any of the actions specified in the foregoing clauses.

 

Section 5.02                                Access to Information.

 

(a)                                  From the date hereof until the Closing
Date, upon reasonable notice, Seller shall (i) subject to Section 5.05, give
Buyer, its counsel, financial advisors, auditors and other authorized
representatives reasonable access during normal business hours to the offices,
properties, books and records of each Station, including access to conduct Phase
I Environmental Site Assessments of the properties, provided Buyer and its
representatives may not conduct any environmental sampling or other intrusive
investigation unless permitted by Seller in its sole discretion, (ii) furnish to
Buyer, its counsel, financial advisors, auditors, and other authorized
representatives such financial and operating data and other information relating
to each Station with respect to the periods prior to the Closing Date as such
Persons may reasonably request and (iii) instruct the employees, counsel and
financial advisors of Seller to cooperate with Buyer in its investigation of
each Station; provided, however, that Buyer may not communicate with Employees
other than each Station’s general manager, chief engineer, chief financial
officer and the Person primarily responsible for employment and labor matters,
in each case, without Seller’s prior written consent, not to be unreasonably
withheld or delayed.  Any investigation pursuant to this Section 5.02(a) shall
be conducted in such manner as not to unreasonably interfere with the conduct of
the Business or any of the businesses or operations of Seller or any of its
Affiliates.

 

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(b)                                 For a period of two years after the Closing
Date, Seller and its Affiliates will hold, and will use their commercially
reasonable efforts to cause their respective officers, directors, employees,
accountants, counsel, consultants, advisors and agents to hold, in confidence,
unless compelled to disclose by judicial or administrative process or by other
requirements of law, all confidential documents and information concerning the
Stations and the Business.

 

(c)                                  On and after the Closing Date, Seller will
afford promptly to Buyer and its agents reasonable access to its books of
account, financial and other records (including accountant’s work papers),
information, employees and auditors to the extent necessary for Buyer in
connection with any audit, investigation, dispute or litigation or any other
reasonable business purpose relating to the Stations; provided that any such
access by Buyer shall not unreasonably interfere with the conduct of the
businesses or operations of Seller or any of its Affiliates.

 

(d)                                 After Closing, Buyer shall cooperate with
Seller in the investigation, defense or prosecution of any action which is
pending or threatened against Seller or its Affiliates with respect to the
Stations or Seller, whether or not any party has notified the other of a claim
for indemnification with respect to such matter.  Without limiting the
generality of the foregoing, Buyer shall make available its employees to give
depositions or testimony and shall preserve and furnish all documentary or other
evidence that Seller may reasonably request.

 

Section 5.03                                Title Commitments, Surveys.  Seller
shall deliver to Buyer, within 30 days of the date of this Agreement, title
commitments on the Owned Real Property sufficient in form to allow Buyer to
obtain, at Buyer’s sole cost and expense, a standard form of title insurance
policy insuring the fee simple interest in the Owned Real Property, subject only
to Permitted Liens and those matters set forth in Disclosure Schedule Section
5.03.  If Buyer elects to obtain a title insurance policy, the premiums for such
policy, including the attorney fees for examination of the abstract and survey
(if required by the company issuing the title insurance policy) shall be paid
100% by Buyer, and all abstracting costs in excess of the title insurance
abstracting cost shall be paid by Buyer.  Seller shall reasonably cooperate with
Buyer (provided that Seller shall not be required to pay any consideration to
Buyer or any third party) so that Buyer can promptly obtain, at its sole cost
and expense, surveys of the Owned Real Property as of a date subsequent to the
date hereof which shall evidence that (i) there are no encroachments upon the
Owned Real Property or adjoining parcels by buildings, structures or
improvements which would materially adversely affect title or materially
interfere with or impair the use of the Owned Real Property for the purpose for
which it is currently used and (ii) there is access to the Owned Real Property
from a public street or indirect access to a public street over recorded
easements or pursuant to Real Property Leases.

 

Section 5.04                                Risk of Loss.  Seller shall bear the
risk of casualty loss or damage to any of the Purchased Assets prior to the
earlier of the LMA Commencement Date and the Effective Time, and Buyer shall
bear such risk on and after the earlier of the LMA Commencement Date and Closing
Date.  In the event of any casualty loss or damage to the Purchased Assets prior
to the earlier of the LMA Commencement Date and the Closing Date, Seller shall
use commercially reasonable efforts to repair or replace (as appropriate under
the circumstances) any lost or damaged Purchased Asset (the “Damaged Asset”)
unless such

 

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Damaged Asset was obsolete and unnecessary for the continued operation of the
Stations consistent with Seller’s past practice and the FCC Licenses.  If Seller
is unable to repair or replace a Damaged Asset by the LMA Commencement Date or
the Closing Date, as applicable, Seller shall reimburse Buyer for all reasonable
out-of-pocket costs incurred by Buyer in repairing or replacing the Damaged
Assets or assign to Buyer the applicable portion of any insurance proceeds not
previously expended by Seller to repair or replace the damaged or destroyed
property, after the LMA Commencement Date or the Closing Date, as the case may
be.

 

Section 5.05                                Intentionally Omitted.

 

Section 5.06                                Management Agreement.  Sellers will
terminate the Management Agreement effective on or prior to the earlier of the
LMA Commencement Date and the Closing Date, without any liability to Buyer
thereunder or hereunder; provided that the provisions regarding Termination
Assistance Services (as defined in the Management Agreement) shall continue to
the extent requested by Buyer in writing in accordance with the terms of the
Management Agreement.

 

Section 5.07                                No Negotiation.  Until such time as
this Agreement shall be terminated pursuant to Section 11.01, neither Seller nor
FPMG LLC shall directly or indirectly solicit, initiate, encourage or entertain
any inquiries or proposals from, discuss or negotiate with, provide any
nonpublic information to or consider the merits of any inquiries or proposals
from any Person (other than Buyer) relating to any business combination
transaction involving Seller, including the sale of any of Seller’s stock or
FPMG LLC membership interests, the merger or consolidation of Seller or the sale
of Seller’s business or any of the Assets (other than in the ordinary course of
business or as provided by this Agreement); provided that this Section 5.07 will
cease to apply in the event that (a) Buyer determines in good faith that any
further reasonable efforts of Buyer requested by Seller to prosecute the FCC
Applications pursuant Section 7.01(c) should not be made, (b) Seller determines
in good faith that the FCC Consent is not likely to be granted or (c) Seller
determines in good faith that any other condition to the Closing in Article X is
not likely to be satisfied (other than as a result of Seller’s breach).  Seller
and FPMG LLC shall notify Buyer of any such inquiry or proposal within
twenty-four (24) hours of receipt or awareness of the same by Seller or FPMG
LLC.

 

ARTICLE VI
COVENANTS OF BUYER

 

Section 6.01                                Access to Information.  As soon as
practicable after the Closing Date, upon reasonable notice, Buyer will afford
promptly to Seller and its agents reasonable access to its properties, books,
records, employees and auditors to the extent necessary to permit Seller to
determine any matter relating to its rights and obligations (or those of its
Affiliates) hereunder or to any period ending on or before the Closing Date;
provided, that Seller will hold, and will cause its agents to hold, in
confidence, all confidential or proprietary information to which it has had
access to pursuant to this Section 6.01 and provided further such access shall
not unreasonably interfere with Buyer’s business or operations.

 

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Section 6.02                                Accounts Receivable.

 

(a)                                  Seller shall deliver to Buyer, promptly
after the commencement of the Collection Period, a statement of the Accounts
Receivable.  Buyer shall use commercially reasonable efforts to collect the
Accounts Receivable during the period (the “Collection Period”) beginning on the
earlier of the LMA Commencement Date or the Closing Date and ending on the 120th
day thereafter, in the ordinary course of business; provided, that Buyer shall
be under no obligation to commence or not to commence litigation or legal action
to effect collection.  Any payment received by Buyer from a customer of the
Stations that was or is also a customer of Seller and that is obligated with
respect to any Accounts Receivable and that is not specifically designated in
writing as a payment of a particular invoice or invoices shall be presumptively
applied to the accounts receivable for such customer outstanding for the longest
amount of time and, if such accounts receivable is an Accounts Receivable,
remitted to Seller in accordance with Section 6.02(b); provided further,
however, that if, prior to the date hereof, Seller or, after earlier of the LMA
Commencement Date or the Closing Date, Seller or Buyer received or receives a
written notice of dispute from a customer with respect to an Accounts Receivable
that has not been resolved, then Buyer shall apply any payments from such
customer to such customer’s oldest, non-disputed accounts receivable, whether or
not an Accounts Receivable.  Any amounts relating to the Accounts Receivable
that are paid directly to Seller shall be retained by Seller.  Buyer and its
Affiliates shall not discount, adjust or otherwise compromise any Accounts
Receivable and Buyer shall promptly refer any disputed Accounts Receivable to
Seller.

 

(b)                                 On or before the fifth day following the end
of each calendar month in the Collection Period, Buyer shall deposit into an
account identified by Seller the amounts collected during the preceding month of
the Collection Period with respect to the Accounts Receivable (without offset)
in immediately available funds by wire transfer.  Buyer shall furnish Seller
with a list of the amounts collected during such calendar month and in any prior
calendar months with respect to the Accounts Receivable and a schedule of the
amount remaining outstanding under each particular account.  Seller shall be
entitled during the 60-day period following the Collection Period to inspect
and/or audit the records maintained by Buyer pursuant to this Section 6.02, upon
reasonable advance notice and during normal business hours.

 

(c)                                  Following the expiration of the Collection
Period, Buyer shall have no further obligations under this Section 6.02, except
that Buyer shall immediately pay over to Seller any amounts subsequently paid to
it with respect to any Accounts Receivable.  Following the Collection Period,
Seller may pursue collections of all the Accounts Receivable, and Buyer shall
deliver to Seller all files, records, notes and any other materials relating to
the Accounts Receivable and shall otherwise cooperate with Seller for the
purpose of collecting any outstanding Accounts Receivable.

 

(d)                                 Buyer acknowledges that Seller may maintain
all established cash management lockbox arrangements in place at the Effective
Time for remittance until such time as Seller deems appropriate to close such
lockboxes.  Buyer agrees to update the Accounts Receivable aging reports to
reflect all Seller lockbox receipts, and Seller agrees to cooperate with Buyer
to keep the Accounts Receivable age reports current.  In addition, Seller shall,
on or before the fifth Business Day following the end of the calendar month in
which any of Buyer’s receivables are received by Seller through its lockbox,
remit to Buyer such receivable collections.

 

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(e)                                  If Buyer fails to remit any amounts
collected pursuant to this Section 6.02, such amount shall bear interest at the
prime rate (as reported by The Wall Street Journal or, if not reported thereby,
by another authoritative source) as in effect from time to time from the date
such amount was due until the date of actual payment.

 

(f)                                    All amounts received by Seller pursuant
to this Section 6.02 shall not be required to be refunded or repaid by Seller
for any circumstance including, but not limited to, any termination of this
Agreement pursuant to Section 11.01.

 

Section 6.03                                Letters of Credit.  As of the
Closing Date, Buyer shall assume all obligations of reimbursement under each
letter of credit set forth in Disclosure Schedule Section 6.03 and use its
commercially reasonable efforts to, effective as of the Closing Date, terminate
or cause to be terminated, or cause Buyer or one of its Affiliates to be
substituted in all respects for Seller in respect of all obligations of the
Seller under such letters of credit.  In the event the actions provided for in
the foregoing clause are not completed by the Closing Date, then Buyer shall
indemnify and hold harmless Seller from and against all Losses incurred by
Seller as a result of such failure and from and against any continuing
obligations and liabilities under such letters of credit.

 

ARTICLE VII
COVENANTS OF BUYER AND SELLER

 

Section 7.01                                Commercially Reasonable Efforts;
Further Assurances.

 

(a)                                  Subject to the terms and conditions of this
Agreement, Buyer and Seller will each use their commercially reasonable efforts
to take, or cause to be taken, all actions, and to do, or cause to be done, all
things reasonably necessary or desirable under applicable Law to consummate the
transactions contemplated by this Agreement.

 

(b)                                 In furtherance and not in limitation of
Section 7.01(a), Buyer and Seller agree to make appropriate filings pursuant to
applicable Antitrust Laws, including a Notification and Report Form pursuant to
the HSR Act with respect to the transactions contemplated hereby within five
Business Days after the date hereof and to supply as promptly as practicable any
additional information and documentary material that may be requested pursuant
to the HSR Act and to take all other commercially reasonable actions (but not
involving the sale of any assets) necessary to cause the expiration or
termination of the applicable waiting periods under the HSR Act as soon as
practicable.  Buyer and Seller shall each pay one-half (1/2) of all HSR Act
filing fees, irrespective of whether the transactions contemplated by this
Agreement are consummated.

 

(c)                                  Also in furtherance and not in limitation
of Section 7.01(a), Buyer and Seller each shall prepare and file with the FCC as
soon as practicable but in no event later than five Business Days after the
execution of this Agreement, the requisite applications (the “FCC Applications”)
and other necessary instruments or documents requesting the FCC Consent and
thereupon prosecute such applications with all reasonable diligence to obtain
the requisite FCC Consent; provided, however, except as provided in the
following sentence, neither Buyer nor Seller shall be required to pay
consideration to any third party to obtain the FCC Consent.

 

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Buyer and Seller shall each pay one-half (1/2) of the FCC filing fees relating
to the transactions contemplated hereby, irrespective of whether the
transactions contemplated by this Agreement are consummated.  Buyer and Seller
each shall oppose any petitions to deny or other objections filed with respect
to the FCC Applications to the extent such petition or objection relates to such
party.  Neither Seller nor Buyer shall take any intentional action that would,
or intentionally fail to take any action the failure of which to take would,
reasonably be expected to have the effect of materially delaying the receipt of
the FCC Consent.  Seller shall promptly enter into customary tolling
arrangements if necessary and requested by the FCC to resolve any complaints
with the FCC relating to any of the FCC Licenses.  If the Closing shall not have
occurred for any reason within the original effective period of the FCC Consent,
and neither party shall have terminated this Agreement under Article XI, Buyer
and Seller shall jointly request an extension of the effective period of the FCC
Consent.  No extension of the FCC Consent shall limit the right of either party
to exercise its rights under Article XI.

 

(d)                                 In connection with the efforts referenced in
Section 7.01(a), Section 7.01(b), and Section 7.01(c) to obtain (i) all
requisite approvals and authorizations for the transactions contemplated by this
Agreement under the HSR Act or any other Antitrust Law and (ii) the FCC Consent,
Buyer and Seller shall use its commercially reasonable efforts to (x) cooperate
in all respects with each other in connection with any filing or submission and
in connection with any investigation or other inquiry, including any proceeding
initiated by a private party, (y) keep the other party informed in all material
respects of any material communication received by such party from, or given by
such party to, the Federal Trade Commission (the “FTC”), the Antitrust Division
of the Department of Justice (the “DOJ”), the FCC or any other Governmental
Authority and of any material non-confidential portions of any communication
received or given in connection with any proceeding by a private party and (z)
permit the other party to review any material non-confidential portions of any
communication given by it to, and consult with each other in advance of and be
permitted to attend any meeting or conference with, the FTC, the DOJ, the FCC or
any such other Governmental Authority or, in connection with any proceeding by a
private party, with any other Person, in each case regarding any of the
transactions contemplated by this Agreement.

 

Section 7.02                                Confidentiality.  Nothing in this
Agreement should be deemed to negate or limit Seller’s rights or any obligations
under the Confidentiality Agreement, which is incorporated herein by reference.

 

Section 7.03                                Certain Filings; Further Actions. 
Seller and Buyer shall cooperate with one another (a) in determining whether any
action by or in respect of, or filing with, any Governmental Authority is
required, or any actions, consents, approvals or waivers are required to be
obtained from parties to any material Assumed Contracts, in connection with the
consummation of the transactions contemplated by this Agreement and (b) in
taking such actions or making any such filings, furnishing information required
in connection therewith and seeking timely to obtain any such actions, consents,
approvals or waivers; provided, however, that Seller and Buyer shall not be
required to pay consideration to obtain any such consent, approval or waiver.

 

Section 7.04                                Control Prior to Closing.  The
parties acknowledge and agree that, for the purposes of the Communications Act,
this Agreement and, without limitation, the

 

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covenants in Article V, are not intended to and shall not be construed to
transfer control of any Station or to give Buyer any right to, directly or
indirectly, control, supervise or direct, or attempt to control, supervise or
direct, the programming, operations, or any other matter relating to any Station
prior to the Closing Date, and Seller shall have complete control and
supervision of the programming, operations, policies and all other matters
relating to each Station up to the time of the Closing.

 

Section 7.05                                Public Announcements.  The parties
shall agree on the terms of the press release that announces the transactions
contemplated hereby and thereafter agree to obtain the other party’s prior
written consent before issuing any press release or making any public
announcement with respect to this Agreement or the transactions contemplated
hereby; provided, either party shall be permitted without the consent of the
other to issue any press releases or public statements the making of which may
be required by applicable Law or any listing agreement with any national
securities exchange; provided that prior to the issuance of such press release
or public statement, the other party shall be provided notice and an opportunity
to comment on such press release or public statement.  Notwithstanding the
foregoing, the Parties acknowledge that this Agreement and the terms hereof will
be filed with the FCC Applications and thereby become public.

 

Section 7.06                                Notices of Certain Events.  From the
date hereof until the earlier to occur of the Closing Date and such time as this
Agreement is terminated in accordance with Article XI, Seller, on the one hand,
and Buyer, on the other hand, shall each promptly notify the other of:

 

(a)                                  any notice or other communication from any
Governmental Authority in connection with the transactions contemplated by this
Agreement;

 

(b)                                   in the case of Seller, (i) the occurrence
or non-occurrence of any event which, to its knowledge, has caused any
representation or warranty made by it herein to be untrue or inaccurate in any
material respect at any time on or after the date hereof and prior to the
Closing and (ii) any material failure on the part of Seller to comply with or
satisfy any covenant, condition or agreement set forth herein to be complied
with or satisfied by Seller hereunder on or after the date hereof and prior to
the Closing, other than due to Buyer’s actions or inactions under the LMA; and

 

(c)                                  in the case of Buyer, (i) the occurrence or
non-occurrence of any event which, to its knowledge, has caused any
representation or warranty made by it herein to be untrue or inaccurate, in any
material respect, at any time on or after the date hereof and prior to the
Closing and (ii) any material failure on the part of Buyer to comply with or
satisfy any covenant, condition or agreement set forth herein to be complied
with or satisfied by Buyer hereunder on or after the date hereof and prior to
the Closing.

 

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ARTICLE VIII
PENSION, EMPLOYEE AND UNION MATTERS

 

Section 8.01                                Employment.

 

(a)                                  On or prior to the earlier of LMA
Commencement Date and the Closing Date, Buyer shall offer employment to each
Employee employed immediately prior to such date who is listed on the list
included as Disclosure Schedule Section 3.14(a) or who is hired after the date
of such list with the prior, written consent of Buyer (such consent not to be
unreasonably withheld or delayed), except the Employees listed on Section 4.1 of
the LMA and on Disclosure Schedule Section 8.01, who (i) is not on authorized
leave of absence, sick leave, short or long term disability leave, military
leave or layoff with recall rights (“Active Employees”); or (ii) is on
authorized leave of absence, sick leave, short or long term disability leave,
military leave or layoff with recall rights and who returns to active employment
immediately following such absence and within six months of the Closing Date, or
such later date as required under applicable law (“Inactive Employees”).  On the
Closing Date, Buyer shall offer employment to each Employee listed on Schedule
4.1 of the LMA.  For the purposes hereof, all Active Employees or Inactive
Employees who accept Buyer’s offer of employment and commence employment on the
applicable Employment Commencement Date are hereinafter referred to collectively
as the “Transferred Employees,” and the “Employment Commencement Date” as
referred to herein shall mean (x) as to those Transferred Employees who are
Active Employees hired upon commencement of the LMA, the LMA Commencement Date,
(y) as to those Transferred Employees who are Active Employees hired pursuant to
the second sentence of this Section 8.01, the Closing Date, and (z) those
Transferred Employees who are Inactive Employees, the date on which the
Transferred Employee begins employment with Buyer.  Buyer shall employ at-will
those Transferred Employees who do not have employment agreements with Seller
initially at a monetary compensation (consisting of base salary, commission rate
and normal bonus opportunity) at least as favorable as those provided by Seller
immediately prior to the Employment Commencement Date.  The initial terms and
conditions of employment for those Transferred Employees who have employment
agreements with Seller shall be as set forth in such employment agreements
(other than terms related to severance in connection with a change in control of
Nexstar Broadcasting Group, Inc).  Buyer agrees so long as such Transferred
Employees remain employed by Buyer, Buyer shall provide each Transferred
Employee with compensation, that, in the aggregate, is no less favorable than
the compensation provided to the Transferred Employees immediately prior to the
Effective Time and employee benefits that are no less favorable to the employee
benefits provided to similarly situated employees of Buyer; provided, that sales
commissions and bonuses based on performance may be less to the extent of
changes in performance.  Buyer agrees that Buyer shall provide severance
benefits to the Transferred Employees on terms that are at least as favorable as
those provided to similarly situated employees of Buyer.  To the extent
permitted by law, Buyer shall give Transferred Employees full credit for
purposes of eligibility and vesting and benefit accrual (other than benefit
accrual under a defined benefit pension plan) under the employee benefit plans
or arrangements maintained by the Buyer or its Affiliates in which such
Transferred Employees participate for such Transferred Employees’ service with
the Seller or its Affiliates or predecessors.

 

Section 8.02                                Savings Plan.  Buyer shall cause a
tax-qualified defined contribution plan established or designated by Buyer (a
“Buyer’s 401(k) Plan”) to accept rollover contributions from the Transferred
Employees of any account balances distributed to them by the Seller’s 401(k)
Plan.  Buyer shall allow any such Transferred Employees’ outstanding plan loan
to be rolled into Buyer’s 401(k) Plan.  The distribution and rollover described
herein shall comply with applicable Law, and each party shall make all filings
and take any actions required

 

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of such party by applicable Law in connection therewith.  Buyer’s 401(k) Plan
shall credit Transferred Employees with service credit for eligibility and
vesting purposes for service recognized for the equivalent purposes under
Seller’s 401(k) Plan.

 

Section 8.03                                Employee Welfare Plans.  Seller
shall retain responsibility for and continue to pay all medical, life insurance,
disability and other welfare plan expenses and benefits for each Transferred
Employee with respect to claims incurred by such Employees or their covered
dependents prior to the Employment Commencement Date.  Expenses and benefits
with respect to claims incurred by Transferred Employees or their covered
dependents on or after the Employment Commencement Date shall be the
responsibility of Buyer.  For purposes of this paragraph, a claim is deemed
incurred when the services that are the subject of the claim are performed; in
the case of life insurance, when the death occurs, in the case of long-term
disability benefits, when the disability occurs and, in the case of a hospital
stay, when the employee first enters the hospital.  With respect to any welfare
benefit plans maintained by Buyer for the benefit of Transferred Employees on
and after the Employment Commencement Date, to the extent permitted by law,
Buyer shall (i) cause there to be waived any eligibility requirements or
pre-existing condition limitations to the same extent waived generally by Buyer
with respect to its employees and (ii) give effect, in determining any
deductible and maximum out-of-pocket limitations, amounts paid by such
Transferred Employees with respect to similar plans maintained by Seller.

 

Section 8.04                                Vacation.  To the extent Buyer has
received a credit in the prorations, Buyer will assume all liabilities for
unpaid, accrued vacation of each Transferred Employee as of the Employment
Commencement Date, giving credit under Buyer’s vacation policy for service with
Seller, and shall permit Transferred Employees to use their vacation entitlement
accrued as of the Closing Date in accordance with Buyer’s policy for carrying
over unused vacation.  To the extent that, following the Closing Date, Buyer’s
policies do not permit a Transferred Employee to use any accrued and unused
vacation for which Buyer has assumed the liabilities hereunder (other than as a
result of such Transferred Employee’s failure to use such vacation despite his
or her eligibility to do so, without adverse consequences, under Buyer’s
policies), Buyer will pay such Transferred Employee for any such vacation. 
Service with both Seller and Buyer shall be taken into account in determining
Transferred Employees’ vacation entitlement under Buyer’s vacation policy after
the Closing Date.

 

Section 8.05                                Sick Leave.  To the extent Buyer has
received a credit in the prorations, Buyer shall grant credit for all unused
sick leave accrued by Transferred Employees on the basis of their service during
the current calendar year as employees of Seller.

 

Section 8.06                                No Further Rights.  Nothing in this
Article VIII, express or implied, is intended to confer on any person other than
the parties hereto or their respective successors and assigns any rights,
remedies, obligations or liabilities under or by reason of this Article VIII.

 

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ARTICLE IX
TAX MATTERS

 

Section 9.01                                Bulk Sales.  Seller and Buyer hereby
waive compliance with the provisions of any applicable bulk sales law and no
representations, warranty or covenant contained in this Agreement shall be
deemed to have been breached as a result of such non-compliance; provided,
Seller shall be liable for any liability arising from such non-compliance solely
in accordance with Buyer’s right to indemnification in accordance with Article
XII.

 

Section 9.02                                Transfer Taxes.  All Transfer Taxes
arising out of or in connection with the transactions effected pursuant to this
Agreement shall be shared equally by Seller and Buyer.  The party which has the
primary responsibility under applicable law for the payment of any particular
Transfer Tax, shall prepare the relevant Tax Return and notify the other party
in writing of the Transfer Taxes shown on such Tax Return.  Such other party
shall pay the party that paid the Transfer Tax an amount equal to fifty percent
(50%) of such Transfer Taxes in immediately available funds no later than the
date that is the later of (i) five Business Days after the date of such notice
or (ii) two Business Days prior to the due date for such Transfer Taxes.  Seller
and Buyer shall cooperate in the preparation, execution and filing of all
Transfer Tax Returns and shall cooperate to seek and to secure any available
exemptions from such Transfer Taxes.

 

Section 9.03                                FIRPTA Certificate.  Seller shall
deliver to Buyer on the Closing Date, duly completed and executed certificates
of non-foreign status pursuant to section 1.1445-2(b)(2) of the Treasury
regulations sufficient to exempt Buyer from the requirements of Code Section
1445(a).  The sole remedy, including for purposes of Section 10.03 and Article
XI or Article XII for failure to provide any such certificate shall be to permit
Buyer to make any withholding as are required pursuant to Section 1445 of the
Code.

 

Section 9.04                                Taxpayer Identification Numbers. 
The taxpayer identification numbers of Buyer and Seller are set forth on
Disclosure Schedule Section 9.04.

 

Section 9.05                                Taxes and Tax Returns.  Subject to
Section 2.09, Seller shall be liable for payment of and shall prepare and
properly file on a timely basis true, complete and accurate Tax Returns and
other documentation, for any and all Taxes incurred with respect to the
Purchased Assets and the Business for any Pre-Closing Tax Period.  Subject to
Section 2.09, Buyer shall be liable for and payment of and shall prepare and
properly file on a timely basis true, complete and accurate Tax Returns and
other documentation for any and all Taxes incurred with respect to the Purchased
Assets and the Business for any Post-Closing Tax Period.

 

Section 9.06                                Purchase Price Allocation.  The
Buyer and Seller agree that the Purchase Price shall be allocated among the
Seller entities as set forth in Disclosure Schedule Section 9.06.  Buyer will
allocate the applicable portions of the Purchase Price paid to each Seller
entity among the Purchased Assets, of such Seller entity in accordance with
Section 1060 of the Code and the Treasury Regulations promulgated thereunder
(and any similar provisions of state, local, or foreign Law, as appropriate) and
will prepare a draft schedule documenting such allocation and shall provide such
draft schedule to Seller.  Seller shall be entitled to review and comment on
such schedule for ten (10) business days, and Buyer shall consider such comments

 

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in good faith.  Thereafter, Buyer shall provide Seller with Buyer’s final
allocation schedule.  Neither Buyer nor Seller shall take any position (whether
in audits, Tax Returns or otherwise) that is inconsistent with Buyer’s final
allocation schedule.

 

ARTICLE X
CONDITIONS TO CLOSING

 

Section 10.01                          Conditions to Obligations of Buyer and
Seller.  The obligations of Buyer and Seller to consummate the transactions
contemplated by this Agreement shall be subject to the fulfillment or waiver, at
or prior to the Closing, of each of the following conditions:

 

(a)                                  Any applicable waiting period, clearance,
approval or filing under the HSR Act or any other Antitrust Law or regulation
relating to the transactions contemplated hereby shall have expired or been
terminated or shall have been obtained or made.

 

(b)                                 No provision of any applicable Law and no
Governmental Order shall prohibit the consummation of the Closing.

 

(c)                                  The FCC Consent shall have been granted and
shall be in full force and effect and shall have become a Final Order.

 

Section 10.02                          Conditions to Obligations of Seller.  The
obligation of Seller to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment or waiver, at or prior to the
Closing, of each of the following further conditions:

 

(a)                                  The representations and warranties of Buyer
made in this Agreement shall be true and correct, disregarding all qualifiers
and exceptions relating to materiality or Material Adverse Effect, as of the
date of this Agreement and (except to the extent such representations and
warranties speak as of an earlier date, in which case such representations and
warranties shall have been true and correct, disregarding all qualifiers and
exceptions relating to materiality or Material Adverse Effect, as of such
earlier date) as of the Closing Date as though made on and as of the Closing
Date except, in both cases, (A) for changes expressly contemplated by this
Agreement, or (B) where the failures to be true and correct, individually or in
the aggregate, have not resulted in and would not reasonably be expected to
result in a material adverse effect on the ability of Buyer to perform its
obligations under this Agreement or any Ancillary Agreement.  Buyer shall have
performed in all material respects all obligations required to be performed by
it under this Agreement on or prior to the Closing Date.  Seller shall have
received a certificate dated as of the Closing Date from Buyer, executed by an
authorized officer of Buyer, to the effect that the conditions set forth in this
Section 10.02(a) have been satisfied.

 

(b)                                 Seller shall have received the following
documents:

 

(i)                                     the certificate of incorporation (or
equivalent organizational document) for Buyer, certified as of a recent date by
the Secretary of State of the applicable jurisdiction of organization;

 

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(ii)                                  a certificate of the Secretary of State as
to the good standing as of a recent date of Buyer in such jurisdiction;

 

(iii)                               a certificate of an officer of Buyer, given
by such officer on behalf of Buyer and not in such officer’s individual
capacity, certifying as to the bylaws (or equivalent governing document) of
Buyer and as to resolutions of the board of directors (or equivalent governing
body) of Buyer authorizing this Agreement and the transactions contemplated
hereby and thereby.

 

(c)                                  Buyer shall have made, or stand ready at
Closing to make the deliveries contemplated in Section 2.08(a) and Section
2.08(c) and each Ancillary Agreement.

 

Section 10.03                          Conditions to Obligations of Buyer.  The
obligations of Buyer to consummate the transactions contemplated by this
Agreement shall be subject to the fulfillment or waiver, at or prior to the
Closing, of each of the following further conditions:

 

(a)                                  The representations and warranties of
Seller made in this Agreement shall be true and correct, disregarding all
qualifiers and exceptions relating to materiality or Material Adverse Effect, as
of the date of this Agreement and (except to the extent such representations and
warranties speak as of an earlier date, in which case such representations and
warranties shall have been true and correct, disregarding all qualifiers and
exceptions relating to materiality or Material Adverse Effect, as of such
earlier date) as of the Closing Date as though made on and as of the Closing
Date, except, in both cases, (v) for changes expressly contemplated or permitted
by this Agreement, (w) for changes that take place after the LMA Commencement
Date unless such changes result from Seller’s breach of this Agreement or the
LMA or were under Seller’s control, (x) casualty losses or damages that are
reimbursable pursuant to Section 5.06, (y) for changes as a result of any act or
omission of Buyer or its agents under the LMA or (z) where the failures to be
true and correct, individually or in the aggregate, have not resulted in and
would not reasonably be expected to result in a Material Adverse Effect.  Seller
shall have performed in all material respects all obligations required to be
performed by it under this Agreement on or prior to the Closing Date, unless
such nonperformance was a result of any act or omission of Buyer or its agents
under the LMA.  Buyer shall have received a certificate dated as of the Closing
Date from Seller, executed by an authorized officer of Seller, to the effect
that the conditions set forth in this Section 10.03(a) have been satisfied.

 

(b)                                 Buyer shall have received the following
documents:

 

(i)                                     the certificate of incorporation (or
equivalent organizational document) for each Seller, certified as of a recent
date by the Secretary of State of the applicable jurisdiction of organization;

 

(ii)                                  a certificate of the Secretary of State of
each jurisdiction in which any Seller is organized or qualified to do business
as to the good standing as of a recent date of such Seller in such jurisdiction;

 

(iii)                               a certificate of an officer of each Seller,
given by each such officer on behalf of such Seller and not in such officer’s
individual capacity, certifying as to the

 

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bylaws (or equivalent governing document) of such Seller and as to resolutions
of the board of directors (or equivalent governing body) of Sellers authorizing
this Agreement and the transactions contemplated hereby and thereby; and

 

(iv)                              opinions of counsel to Seller opining as to
the corporate matters set forth on Disclosure Schedule Section 10.03(b).

 

(c)                                  Seller shall have obtained and (in the case
of an affirmative consent) delivered the consents to assignment listed on
Disclosure Schedule Section 10.03(c).

 

(d)                                 Seller shall have delivered to Buyer (A)
pay-off letters or similar documents evidencing the discharge or payment in full
of the Indebtedness of Seller duly executed by each lender of the Indebtedness
of Seller and (B) termination statements on Form UCC-3, or other appropriate
releases, which when filed will release and satisfy any and all Liens relating
to the Indebtedness of Seller, together with proper authority to file such
termination statements or other releases at and following the Closing.

 

(e)                                  Buyer shall have received title commitments
that comply with the requirements set forth in Section 5.03.

 

(f)                                    Seller shall have made, or stand ready at
Closing to make, the deliveries contemplated in Section 2.07(b) and Section
2.07(c) and each Ancillary Agreement.

 

ARTICLE XI
TERMINATION

 

Section 11.01                          Termination.  This Agreement may be
terminated at any time prior to the Closing as follows:

 

(a)                                  by the mutual written consent of Seller and
Buyer;

 

(b)                                 either by Seller or by Buyer:

 

(i)                                     if the Closing shall not have occurred
on or before the twelve (12) month anniversary of the date of this Agreement
(the “Termination Date”) so long as the terminating party is not then in breach
of any of its representations, warranties, covenants or agreements contained in
this Agreement to the extent that would give the other party the right not to
close pursuant to Section 10.01 or Section 10.02, as the case may be;

 

(ii)                                  if there shall be any Law that prohibits
consummation of the transactions contemplated by this Agreement or if a
Governmental Authority of competent jurisdiction shall have issued a Government
Order enjoining or otherwise prohibiting consummation of the transactions
contemplated by this Agreement; or

 

(iii)                               if the FCC denies the FCC Applications with
respect to the transactions contemplated by this Agreement.

 

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(c)                                  by Seller upon a breach of any
representation, warranty, covenant or agreement on the part of Buyer set forth
in this Agreement, or if any representation or warranty of Buyer shall have
become untrue, in either case such that the condition set forth in Section
10.02(a) would not be satisfied, unless such breach or untruth can be cured
prior to Closing and after receipt of notice thereof, Buyer proceeds in good
faith to cure such breach or untruth as promptly as practicable; provided that
Seller shall not have the right to terminate this Agreement pursuant to this
Section 11.01(c) if Seller is then in breach of any of its representations,
warranties, covenants or agreements contained in this Agreement to an extent
which would give Buyer the right not to close pursuant to Article X;

 

(d)                                 by Buyer upon a breach of any
representation, warranty, covenant or agreement on the part of Seller set forth
in this Agreement, or if any representation or warranty of Seller shall have
become untrue, in either case such that the condition set forth in Section
10.03(a) would not be satisfied, unless such breach or untruth can be cured
prior to Closing and after receipt of notice thereof, Seller proceeds in good
faith to cure such breach or untruth as promptly as practicable; provided that
Buyer shall not have the right to terminate this Agreement pursuant to this
Section 11.01(d) if Buyer is then in breach of any of its representations,
warranties, covenants or agreements contained in this Agreement to an extent
which would give Seller the right not to close pursuant to Article X.

 

(e)                                  The party desiring to terminate this
Agreement pursuant to this Section 11.01 (other than pursuant to Section
11.01(a)) shall give written notice of such termination to the other party.

 

Section 11.02                          Effect of Termination.

 

(a)                                  In the event of a valid termination of this
Agreement pursuant to Section 11.01, this Agreement (other than Section 7.02,
this Article XI, and Article XIII, which shall remain in full force and effect)
shall forthwith become null and void, and no party hereto (nor any of their
respective Affiliates, directors, officers or employees) shall have any
liability or further obligation, except as provided in Section 11.02(b) and
Section 11.02(c) below.  A termination of this Agreement shall not terminate the
Confidentiality Agreement, nor, in each case, affect the parties’ rights and
obligations thereunder.

 

(b)                                 If this Agreement is terminated by Seller
pursuant to Section 11.01(c) due to Buyer’s default or breach of this Agreement,
then Seller shall be entitled to the Escrow Deposit as liquidated damages, and
the parties shall immediately deliver joint written instructions to the Escrow
Agent directing such disbursement.  Seller shall, in addition, be entitled to
prompt payment on demand from Buyer of the reasonable attorneys’ fees actually
incurred by Seller in enforcing its rights under this Agreement.  The parties
understand and agree that the amount of liquidated damages represents Seller’s
and Buyer’s reasonable estimate of actual damages and does not constitute a
penalty.  Notwithstanding any other provision of this Agreement to the contrary,
in the event that Seller terminates this Agreement pursuant to Section 11.01(c)
due to Buyer’s material default or breach of this Agreement, the payment of the
Escrow Deposit, together with any attorneys’ fees, pursuant to this Section
11.02(b), shall be Seller’s sole and exclusive remedy for damages of any nature
or kind that Seller may suffer as a result of Buyer’s breach or default under
this Agreement.  The parties hereto acknowledge and agree that

 

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the liquidated damages amount is reasonable in light of the substantial but
indeterminate harm anticipated to be caused by material breach or default under
this Agreement, the difficulty of proof of loss and damages, the inconvenience
and non-feasibility of otherwise obtaining an adequate remedy, and the value of
the transactions to be consummated hereunder.

 

(c)                                  If this Agreement is terminated by Buyer
pursuant to Section 11.01 due to Seller’s default or breach of this Agreement,
Seller shall be liable for any and all Losses incurred or suffered by Buyer in
an aggregate amount not to exceed Twenty Million Dollars ($20,000,000).

 

(d)                                 If this Agreement is terminated under the
provisions of this Article XI for any reason other than by Seller due to Buyer’s
default or breach of this Agreement under Section 11.01(c), then the Parties
shall deliver joint written instructions to the Escrow Agent directing the
disbursement of the Escrow Deposit to Buyer.

 

ARTICLE XII
SURVIVAL; INDEMNIFICATION

 

Section 12.01                          Survival.  The representations and
warranties of the parties hereto contained in or made pursuant to this Agreement
or in any certificate or other writing furnished pursuant hereto or in
connection herewith shall survive in full force and effect until the first
anniversary of the Closing Date; provided, that the representations and
warranties in the first sentence of Section 3.01, the first sentence of Section
4.01, and the representations and warranties in Section 3.02 and Section 4.02
shall survive in perpetuity; provided further that the representations and
warranties in Section 3.19 shall survive until the expiration of the applicable
statute of limitations and the representations and warranties in Section 3.16
shall survive until thirty-six (36) months after the Closing Date.  None of the
covenants and agreements shall survive the Closing except to the extent such
covenants and agreements contemplate performance after the Closing, in which
case such covenants and agreements shall survive until performed.  No claim may
be brought under this Agreement unless written notice describing in reasonable
detail the nature and basis of such claim is given on or prior to the last day
of the applicable survival period.  In the event such notice is given, the right
to indemnification with respect thereto shall survive the applicable survival
period until such claim is finally resolved and any obligations thereto are
fully satisfied.

 

Section 12.02                          Indemnification by Buyer.

 

(a)                                  Subject to Section 12.01 and the LMA, Buyer
shall indemnify against and hold harmless Seller, and its Affiliates and their
respective employees, officers and directors (collectively, the “Seller
Indemnified Parties”) from, and agrees to promptly defend any Seller Indemnified
Party from and reimburse any Seller Indemnified Party for, any and all losses,
damages, costs, expenses, liabilities, obligations and claims of any kind
(including any Action brought by any Governmental Authority or Person and
including reasonable attorneys’ fees and expenses reasonably incurred)
(collectively, “Losses”), which such Seller Indemnified Party may at any time
suffer or incur, or become subject to, as a result of or in connection with:

 

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(i)                                     Buyer’s breach of any of its
representations or warranties contained in this Agreement (each such breach, a
“Buyer Warranty Breach”);

 

(ii)                                  any breach or nonfulfillment of any
agreement or covenant of Buyer under the terms of this Agreement;

 

(iii)                               the Assumed Liabilities; and

 

(iv)                              the failure by Buyer to assume any Excluded
Section 2.02(m) Agreement.

 

(b)                                 Notwithstanding any other provision to the
contrary, Buyer shall not be required to indemnify and hold harmless any Seller
Indemnified Party pursuant to Section 12.02(a): (A) unless such Seller
Indemnified Party has asserted a claim with respect to such matters within the
applicable survival period set forth in Section 12.01 and (B) until the
aggregate amount of Seller Indemnified Parties’ Losses resulting from Buyer
Warranty Breaches exceeds Two Million Dollars ($2,000,000) (the “Threshold”) and
then only to the extent of such Losses in excess of One Million Dollars
($1,000,000); provided, however, that the cumulative indemnification obligation
of Buyer under this Article XII shall in no event exceed 22.5% of the Purchase
Price (the “Cap”); provided further, however, neither the Threshold nor the Cap
shall apply in the case of any indemnification under clauses (ii), (iii) and
(iv) of Section 12.02(a).

 

Section 12.03                          Indemnification by Seller and FPMG LLC.

 

(a)                                  Subject to Section 12.01 and the LMA,
Seller and FPMG LLC, jointly and severally, shall indemnify against and hold
harmless Buyer, its Affiliates and their respective employees, officers and
directors (collectively, the “Buyer Indemnified Parties”) from, and agrees to
promptly defend any Buyer Indemnified Party from and reimburse any Buyer
Indemnified Party for, any and all Losses which such Buyer Indemnified Party may
at any time suffer or incur, or become subject to, as a result of or in
connection with:

 

(i)                                     Seller’s breach of any of the
representations or warranties contained in this Agreement (each such breach, a
“Seller Warranty Breach”);

 

(ii)                                  any breach or nonfulfillment of any
agreement or covenant of Seller under the terms of this Agreement;

 

(iii)                               the Excluded Liabilities or any failure to
comply with laws relating to bulk sales; and

 

(iv)                              the Excluded Assets.

 

(b)                                 Notwithstanding any other provision to the
contrary, Seller and FPMG LLC shall not be required to indemnify and hold
harmless any Buyer Indemnified Party pursuant to Section 12.03(a): (A) unless
such Buyer Indemnified Party has asserted a claim with respect to such matters
within the applicable survival period set forth in Section 12.01 and (B) until
the aggregate amount of Buyer Indemnified Parties’ Losses resulting from Seller
Warranty Breaches exceeds the Threshold, and then only to the extent of such
Losses in excess of One

 

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Million Dollars ($1,000,000); provided, however, that the cumulative
indemnification obligation of Seller under this Section 12.03(b) shall in no
event exceed the Cap, or such lesser amount as may be specified in Section 12.04
from time to time; provided further, however, neither the Threshold nor the Cap
shall apply in the case of any indemnification under clauses (ii), (iii) and
(iv) of Section 12.03(a).

 

Section 12.04                          Indemnification Holdback.

 

(a)                                  FPMG LLC shall hold back an amount equal to
the Cap (the “Indemnification Holdback Amount”) from the Purchase Price and
shall not distribute the Indemnification Holdback Amount to its members except
as set forth in this Section 12.04.  Except for claims relating to fraud, the
Indemnification Holdback Amount shall be the sole and exclusive source for
effecting the payment and discharge of any and all amounts to which any Buyer
Indemnified Party shall be entitled to indemnification pursuant to this Article
XII and shall not be used for any other purpose (except for distributions
permitted hereby).  Such Indemnification Holdback Amount shall be held at a
money market account (or similar type of account that allows for immediately
available cash) at JPMorgan Chase Bank.

 

(i)                                     On the date which is the first
anniversary of the Closing Date (the “Initial Indemnification Holdback Payment
Date”), FPMG LLC shall be entitled to distribute to its members an amount equal
to the excess, if any, of 70% of the Indemnification Holdback Amount over the
sum of (x) the aggregate amount of any reductions of the Indemnification
Holdback Amount made in accordance with Section 12.04(b) and (y) the maximum
amount payable under any unresolved claims made by any Buyer Indemnified Party
pursuant to this Article XII (the amount of the Indemnity Holdback Amount
remaining after distribution, the “Initial Remaining Holdback Amount”).  Except
for claims relating to fraud, the Initial Remaining Holdback Amount shall, from
and after the Initial Indemnification Holdback Payment Date, be the sole and
exclusive source for effecting the payment and discharge of any and all amounts
to which any Buyer Indemnified Party shall be entitled to indemnification
pursuant to this Article XII.

 

(ii)                                  On the date which is the third anniversary
of the Closing Date (the “Second Indemnification Holdback Payment Date”), FPMG
LLC shall be entitled to distribute to its members an amount equal to the
excess, if any, of 90% of the Indemnification Holdback Amount over the sum of
(x) the amount previously distributable on the Initial Indemnification Holdback
Date pursuant to Section 12.04(a)(i), (y) the aggregate amount of any reductions
of the Initial Remaining Holdback Amount made in accordance with Section
12.04(b) from and after the Initial Indemnification Holdback Date and (z) the
maximum amount payable under any unresolved claims made by any Buyer Indemnified
Party pursuant to this Article XII (the amount of the Initial Indemnity Holdback
Amount remaining after such distribution, the “Second Remaining Holdback
Amount”).  Except for claims relating to fraud, the Second Remaining Holdback
Amount shall, from and after the Second Indemnification Holdback Payment Date,
be the sole and exclusive source for effecting the payment and discharge of

 

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any and all amounts to which any Buyer Indemnified Party shall be entitled to
indemnification pursuant to this Article XII.

 

(iii)                               On the date which is the sixth anniversary
of the Closing Date (the “Final Indemnification Holdback Payment Date”), FPMG
LLC shall be entitled to distribute to its members an amount equal to the
excess, if any, of the Second Remaining Holdback Amount over the sum of (x) the
aggregate amount of any reductions of the Second Remaining Holdback Amount made
in accordance with Section 12.04(b) from and after the Second Indemnification
Holdback Date and (y) the maximum amount payable under any unresolved claims
made by any Buyer Indemnified Party pursuant to this Article XII (the amount of
the Second Remaining Holdback Amount after such distribution, the “Final
Remaining Holdback Amount”).  Except for claims relating to fraud, the Final
Remaining Holdback Amount shall, from and after the Final Indemnification
Holdback Payment Date, be the sole and exclusive source for effecting the
payment and discharge of any and all amounts to which any Buyer Indemnified
Party shall be entitled to indemnification pursuant to this Article XII.

 

(b)                                 To the extent that any Buyer Indemnified
Party is entitled to any indemnification pursuant to Article XII, the
Indemnification Holdback Amount, the Initial Remaining Holdback Amount, Second
Remaining Holdback Amount or the Final Remaining Holdback Amount, as applicable,
shall be reduced dollar-for-dollar by the amount of such indemnification made to
such Buyer Indemnified Party, but only to the extent such indemnification is (x)
consented to in writing by the Seller, to the extent required by Section 12.05,
or (y) in such Buyer Indemnified Party’s favor and is finally determined
pursuant to a final, non-appealable judgment of a court of competent
jurisdiction or is no longer subject to challenge under applicable Law (a “Final
Determination”).

 

(c)                                  To the extent any claims for
indemnification pursuant to Article XII by any Buyer Indemnified Party remain
pending and unresolved (and such claims have been timely made in accordance with
Article XII) after the Final Indemnification Holdback Date, Seller shall not
distribute the portion of the Final Remaining Holdback Amount relating to any
such pending and unresolved indemnification claim until (x) the resolution of
such indemnification claim is consented to in writing by the Seller, to the
extent required by Section 12.05, or (y) such indemnification claim is
determined in favor of such Buyer Indemnified Party, by a Final Determination,
in which case the amount to which Buyer is entitled to by such Final
Determination shall be distributed in accordance with Section 12.04(c).  To the
extent that any such indemnification claims are resolved in Seller’s favor by a
Final Determination, FPMG LLC shall distribute the portion of the Final
Remaining Holdback Amount relating to such claims to its members.

 

(d)                                 Any payment required to be made by FPMG LLC
pursuant to this Section 12.04 shall be made by wire transfer or other delivery
of immediately available funds within five Business Days following the date on
which such payment is required to be made.

 

(e)                                  FPMG LLC is entitled to retain interest on
the account where the Indemnification Holdback Amount, Initial Remaining
Holdback Amount and the Final

 

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Remaining Holdback Amount, as applicable, are held and distribute any such
interest earned to its members.

 

(f)                                    Except for claims relating to fraud, each
Buyer Indemnified Party’s sole and exclusive remedy to receive payments of any
amounts to which any Buyer Indemnified Parties shall be entitled to
indemnification pursuant to this Article XII hereof shall in no event exceed the
amount of, and shall be recoverable solely from, the Indemnification Holdback
Amount.  In the event that the Indemnification Holdback Amount, the Initial
Remaining Holdback Amount, the Second Remaining Holdback Amount or the Final
Remaining Holdback Amount, as the case may be, is insufficient to pay any Buyer
Indemnified Party any amounts owed to such Buyer Indemnified Party to this
Article XII, except for claims relating to fraud, the Buyer Indemnified Parties
shall not be entitled to collect any remaining amounts not satisfied from the
Indemnification Holdback Amount and none of Seller or its Affiliates, nor any
other Person shall have any liability for any such deficiency.

 

Section 12.05                          Notification of Claims.

 

(a)                                  A party entitled to be indemnified pursuant
to Section 12.02 or Section 12.03 (the “Indemnified Party”) shall promptly
notify the party liable for such indemnification (the “Indemnifying Party”) in
writing of any claim or demand that the Indemnified Party has determined has
given or could give rise to a right of indemnification under this Agreement;
provided, however, that a failure to give prompt notice or to include any
specified information in any notice will not affect the rights or obligations of
any party hereunder except and only to the extent that, as a result of such
failure, any party that was entitled to receive such notice was damaged as a
result of such failure.  Subject to the Indemnifying Party’s right to defend in
good faith third party claims as hereinafter provided, the Indemnifying Party
shall satisfy its obligations under this Article XII within 30 days after the
receipt of written notice thereof from the Indemnified Party.

 

(b)                                 If the Indemnified Party shall notify the
Indemnifying Party of any claim or demand pursuant to Section 12.05(a), and if
such claim or demand relates to a claim or demand asserted by a third party
against the Indemnified Party that the Indemnifying Party acknowledges is a
claim or demand for which it must indemnify or hold harmless the Indemnified
Party under Section 12.02 or Section 12.03, the Indemnifying Party shall have
the right to employ counsel reasonably acceptable to the Indemnified Party to
defend any such claim or demand asserted against the Indemnified Party for so
long as the Indemnifying Party shall continue in good faith to diligently defend
against such action or claim.  The Indemnified Party shall have the right to
participate in the defense of any such claim or demand at its own expense.  The
Indemnifying Party shall notify the Indemnified Party in writing, as promptly as
possible (but in any case five Business Days before the due date for the answer
or response to a claim) after the date of the notice of claim given by the
Indemnified Party to the Indemnifying Party under Section 12.05(a) of its
election to defend in good faith any such third party claim or demand.  So long
as the Indemnifying Party is defending in good faith any such claim or demand
asserted by a third party against the Indemnified Party, the Indemnified Party
shall not settle or compromise such claim or demand without the consent of the
Indemnifying Party, which consent shall not be unreasonably withheld, and the
Indemnified Party shall make available to the Indemnifying Party or its agents
all records and other material in the Indemnified Party’s

 

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possession reasonably required by it for its use in contesting any third party
claim or demand.  Whether or not the Indemnifying Party elects to defend any
such claim or demand, the Indemnified Party shall have no obligations to do so. 
In the event: (i) the Indemnifying Party elects not to defend such claim or
action; or (ii) the Indemnifying Party elects to defend such claim or action but
fails to diligently defend such claim or action in good faith, the Indemnified
Party shall have the right to conduct the defense thereof and to settle or
compromise such claim or action without the consent of the Indemnifying Party,
except that with respect to the settlement or compromise of such a claim, demand
or action, the Indemnified Party shall not settle or compromise any such claim
or demand or action without the consent of the Indemnifying Party (such consent
not to be unreasonably withheld), unless the Indemnifying Party is given a full
and completed release of any and all liability by all relevant parties relating
thereto and has no obligation to pay any damages.

 

Section 12.06                          Net Losses; Subrogation; Mitigation.

 

(a)                                  Notwithstanding anything contained herein
to the contrary, the amount of any Losses incurred or suffered by an Indemnified
Party shall be calculated after giving effect to (i) any insurance proceeds
received by the Indemnified Person (or any of its Affiliates) with respect to
such Losses and (ii) any recoveries obtained by the Indemnified Party (or any of
its Affiliates) from any other third party.  Each Indemnified Party shall
exercise reasonable best efforts to obtain such proceeds, benefits and
recoveries.  If any such proceeds, benefits or recoveries are received by an
Indemnified Party (or any of its Affiliates) with respect to any Losses after an
Indemnifying Party has made a payment to the Indemnified Party with respect
thereto, the Indemnified Party (or such Affiliate) shall pay to the Indemnifying
Party the amount of such proceeds, benefits or recoveries (up to the amount of
the Indemnifying Party’s payment).  With respect to any Losses incurred or
suffered by an Indemnified Party, no liability shall attach to the Indemnifying
Party in respect of any Losses to the extent that the same Losses have been
recovered by the Indemnified Person from the Indemnifying Party, accordingly,
the Indemnified Person may only recover once in respect of the same Loss.

 

(b)                                 Upon making any payment to an Indemnified
Party in respect of any Losses, the Indemnifying Party shall, to the extent of
such payment, be subrogated to all rights of the Indemnified Party (and its
Affiliates) against any third party in respect of the Losses to which such
payment relates.  Such Indemnified Party (and its Affiliates) and Indemnifying
Party shall execute upon request all instruments reasonably necessary to
evidence or further perfect such subrogation rights.

 

(c)                                  Buyer and Seller shall use reasonable best
efforts to mitigate any Losses, whether by asserting claims against a third
party or by otherwise qualifying for a benefit that would reduce or eliminate an
indemnified matter; provided, that no party shall be required to use such
efforts if they would be demonstrably detrimental in any material respect to
such party.

 

Section 12.07                          Computation of Indemnifiable Losses.  Any
calculation of Losses for purposes of this Article XII shall be (a) reduced to
take account of any net Tax benefit actually realized by the Indemnified Party
arising from the deductibility of any such Loss in the year such Loss is
incurred; and (b) increased to take account of any net Tax liability actually
realized by the Indemnified Party arising from the receipt or accrual of any
indemnity obligation

 

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hereunder.  To the extent permitted by law, all indemnity payments made pursuant
to this Agreement shall be treated by the parties hereto as an adjustment to the
Purchase Price.

 

Section 12.08                          Exclusive Remedies.  Buyer and Seller
acknowledge and agree that, if the Closing occurs, the indemnification
provisions of this Article XII shall be the sole and exclusive remedies of Buyer
and Seller for any breach of the representations or warranties or nonperformance
of any covenants and agreements of Buyer or Seller contained in this Agreement
or any Ancillary Agreement, and neither party shall have any liability to the
other party under any circumstances for special, indirect, consequential,
punitive or exemplary damages, or lost profits, diminution in value or any
damages based on any type of multiple of earnings of any Indemnified Party
provided, however, that nothing contained in this Agreement shall relieve or
limit the liability of either party from any liability or Losses arising out of
or resulting from fraud in connection with the transactions contemplated in this
Agreement or the Ancillary Agreements.

 

Section 12.09                          Specific Performance.  Each of Seller and
Buyer agree that irreparable harm may occur for which money damages would not be
an adequate remedy at law in the event that any of the provisions of this
Agreement were not performed in accordance with their specific terms or were
otherwise breached such that the Closing did not occur.  It is accordingly
agreed that each of Seller and Buyer may be entitled to an injunction or
injunctions and other equitable relief to prevent breaches of this Agreement,
any requirement for the securing or posting of any bond in connection with the
obtaining of any such injunctive or other equitable relief hereby being waived.

 

ARTICLE XIII
GENERAL PROVISIONS

 

Section 13.01                          Expenses.  Except as may be otherwise
specified herein or in the LMA, all costs and expenses, including fees and
disbursements of counsel, financial advisors and accountants, incurred in
connection with this Agreement and the transactions contemplated hereby shall be
paid by the party incurring such costs and expenses, whether or not the Closing
shall have occurred.

 

Section 13.02                          Notices.  All notices, requests, claims,
demands and other communications hereunder shall be in writing and shall be
deemed to have been duly delivered and received (a) on the date of personal
delivery, (b) on the date of transmission, if sent by facsimile, or (c) one
Business Day after having been dispatched via a nationally recognized overnight
courier service, to the respective parties at the following addresses (or at
such other address for a party as shall be specified in a notice given in
accordance with this Section 13.02):

 

If to Buyer:

 

Sinclair Television Group, Inc.

10706 Beaver Dam Road

Cockeysville, MD 21030

Attention:  President

Facsimile:  (410) 568-1533

 

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With a copy, which shall not constitute notice, to:

 

Sinclair Broadcast Group, Inc

10706 Beaver Dam Road

Cockeysville, MD 21030

Attention:  General Counsel

Facsimile:  (410) 568-1537

 

If to Seller:

 

Four Points Media Group Holding LLC

 

c/o Cerberus Capital Management, L.P.
299 Park Avenue
New York, New York 10171
Attention: Robert G. Warden
Facsimile: (212) 891-1540

 

With a copy, which shall not constitute notice, to:

 

Schulte Roth & Zabel LLP
919 Third Avenue
New York, New York 10022
Attention: Stuart D. Freedman
Facsimile: (212) 593-5955

 

Section 13.03                          Headings.  The headings contained in this
Agreement are for reference purposes only and shall not affect in any way the
meaning or interpretation of this Agreement.

 

Section 13.04                          Severability.  If any term or other
provision of this Agreement is invalid, illegal or incapable of being enforced
because of any Law or public policy, all other conditions and provisions of this
Agreement shall nevertheless remain in full force and effect so long as the
economic or legal substance of the transactions contemplated hereby is not
affected in any manner adverse to either party hereto.  Upon such determination
that any term or other provision is invalid, illegal or incapable of being
enforced, the parties hereto shall negotiate in good faith to modify this
Agreement so as to effect the original intent of the parties as closely as
possible in a mutually acceptable manner in order that the transactions
contemplated hereby be consummated as originally contemplated to the greatest
extent possible.

 

Section 13.05                          Entire Agreement.  This Agreement, the
Confidentiality Agreement and the Ancillary Agreements constitute the entire
agreement of the parties hereto with respect to the subject matter hereof and
thereof and supersede all prior agreements and undertakings, both written and
oral, between Seller and Buyer with respect to the subject matter hereof and
thereof, except as otherwise expressly provided herein.

 

Section 13.06                          Successors and Assigns.  This Agreement
shall be binding upon and shall inure to the benefit of the parties hereto and
their respective successors and assigns.

 

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Neither party may assign its rights under this Agreement without the other
party’s prior written consent; provided, however, that Buyer may assign its
rights hereunder to an affiliate of Buyer upon written notice to, but without
consent of, Seller, provided that (i) any such assignment does not delay or
impede processing of the FCC Applications, grant of the FCC Consent or Closing,
(ii) any such assignee delivers to Seller a written assumption of this
Agreement, (iii) Buyer shall remain liable for all of its obligations hereunder,
and (iv) Buyer shall be solely responsible for any third party consents
necessary in connection therewith (none of which are a condition to Closing);
provided further, however, that anything in this Agreement to the contrary
notwithstanding, Seller shall have the right (without the prior written consent
of Buyer), at any time, and in its sole discretion, to assign for security
interest purposes any or all of its rights under this Agreement to any lender
providing financing to Seller, or any of Seller’s permitted assigns, or any
Affiliates of Seller or Seller’s permitted assigns (Seller, such assigns, and
such Affiliates, collectively, the (“Seller Parties”)) and, upon the occurrence
and during the continuance of any event of default under the financing
agreements between any such lender and a Seller Party, and only in such
circumstances, such lender may exercise any or all of the rights, interests, and
remedies of any of the Seller Parties under this Agreement.  No assignment shall
relieve a party of any obligation or liability under this Agreement.

 

Section 13.07                          No Recourse.  Notwithstanding any of the
terms or provisions of this Agreement, Seller, on the one hand, and Buyer, on
the other hand, agree that neither it nor any Person acting on its behalf may
assert any claims or cause of action against any employee, officer or director
of the other party or stockholder of such other party in connection with or
arising out of this Agreement or the transactions contemplated hereby.

 

Section 13.08                          No Third-Party Beneficiaries.  Except as
expressly provided in Article IX, Article XII and Section 13.06, this Agreement
is for the sole benefit of the parties hereto and their permitted assigns and
nothing herein, express or implied, is intended to or shall confer upon any
other Person or entity any legal or equitable right, benefit or remedy of any
nature whatsoever under or by reason of this Agreement.

 

Section 13.09                          Amendments and Waivers.

 

(a)                                  This Agreement may not be amended or
modified except by an instrument in writing signed by Seller, Buyer and FPMG
LLC.

 

(b)                                 At any time prior to the Closing, either
party may (i) extend the time for the performance of any of the obligations or
other acts of the other party hereto, (ii) waive any inaccuracies in the
representations and warranties of the other party hereto contained herein or in
any document delivered pursuant hereto or (iii) waive compliance by the other
party hereto with any of the agreements or conditions contained herein.  Any
such extension or waiver shall be valid only if set forth in an instrument in
writing signed by the party to be bound thereby.

 

(c)                                  No failure or delay by either party in
exercising any right, power or privilege hereunder shall operate as a waiver
thereof nor shall any single or partial exercise thereof preclude any other or
further exercise thereof or the exercise of any other right, power or

 

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privilege.  The rights and remedies herein provided shall be cumulative and not
exclusive of any rights or remedies provided by law.

 

Section 13.10                          Governing Law; Jurisdiction.  The
construction and performance of this Agreement shall be governed by, and
construed in accordance with, the law of the State of Delaware without regard to
its principles of conflict of law.  The exclusive forum for the resolution of
any disputes arising hereunder shall be the Delaware Chancery Court, and each
party hereto irrevocably submits to the exclusive jurisdiction of such courts in
any such action or proceeding and irrevocably waives the reference of an
inconvenient forum to the maintenance of any such action or proceeding.  Each
party agrees not to bring any action or proceeding arising out of or relating to
this Agreement in any other court.

 

Section 13.11                          WAIVER OF JURY TRIAL.  EACH PARTY HERETO
HEREBY IRREVOCABLY AND UNCONDITIONALLY WAIVES ANY RIGHT IT MAY HAVE TO A TRIAL
BY JURY IN ANY LEGAL PROCEEDING ARISING OUT OF OR RELATED TO THIS AGREEMENT OR
THE TRANSACTIONS CONTEMPLATED HEREBY.

 

Section 13.12                          Counterparts.  This Agreement may be
executed in one or more counterparts, each of which when executed shall be
deemed to be an original but all of which taken together shall constitute one
and the same agreement.  Delivery of an executed counterpart of a signature page
to this Agreement by facsimile or e-mail shall be effective as delivery of a
manually executed counterpart of this Agreement.

 

Section 13.13                          No Presumption.  This Agreement shall be
construed without regard to any presumption or rule requiring construction or
interpretation against the party drafting or causing any instrument to be
drafted.

 

Section 13.14                          Disclosure Schedules.

 

(a)                                  The parties acknowledge and agree that (i)
matters reflected in the Disclosure Schedules are not necessarily limited to the
matters required by the Agreement to be disclosed in the Disclosure Schedules,
(ii) the Disclosure Schedules may include certain items and information solely
for informational purposes for the convenience of the parties and (iii) the
disclosure by Seller of any matter in the Disclosure Schedules shall not be
deemed to constitute an acknowledgment by Seller that the matter is required to
be disclosed by the terms of this Agreement or that the matter is material.  The
specification of any dollar amount in the representations and warranties
contained in the Agreement or the inclusion of any specific item in the
Disclosure Schedules are not intended to imply that such amounts are within or
outside the ordinary course of business for purposes of the Agreement.

 

(b)                                 If and to the extent any information
required to be furnished in any section of the Disclosure Schedules is contained
in the Agreement or in any section of the Disclosure Schedules, such information
shall be deemed to be included in all sections of the Disclosure Schedules to
the extent that the relevance of any such information to any other section of
the Disclosure Schedules is readily apparent from the text of such disclosure.

 

(c)                                  Seller has disclosed the information
contained in the Disclosure Schedules solely for purposes of the Agreement, and
no information contained therein shall be

 

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deemed to be an admission by any party thereto to any third party of any matter
whatsoever, including of any violation of Law or breach of any agreement.

 

[SIGNATURE PAGES FOLLOW]

 

59

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IN WITNESS WHEREOF, the parties have caused this Agreement to be executed as of
the date first written above by their respective officers thereunto duly
authorized.

 

 

BUYER

 

 

 

 

SINCLAIR TELEVISION GROUP, INC

 

 

 

 

 

 

 

 

By:

 

 

 

 

Name: David Amy

 

 

 

Title: Executive Vice President

 

 

 

 

 

 

 

SELLER

 

 

 

 

 

FOUR POINTS MEDIA GROUP OF WEST PALM BEACH, INC.

 

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

 

FOUR POINTS MEDIA GROUP OF SALT LAKE CITY, INC.

 

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

 

 

 

 

 

 

 

FOUR POINTS MEDIA GROUP OF PROVIDENCE, INC.

 

 

 

 

 

 

 

 

By:

 

 

 

 

Name:

 

 

 

Title:

 

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FOUR POINTS MEDIA GROUP OF AUSTIN, INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

FOUR POINTS MEDIA GROUP SERVICES, INC.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

WPB TV LICENSEE CORP.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

SLC TV LICENSEE CORP.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

PROVIDENCE TV LICENSEE CORP.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

 

 

 

 

AUSTIN TV LICENSEE CORP.

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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FOUR POINTS MEDIA GROUP LLC (solely with respect to Article XII):

 

 

 

FOUR POINTS MEDIA GROUP LLC

 

 

 

 

 

By:

 

 

 

Name:

 

 

Title:

 

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