Document:

<PAGE>

                                                                   Exhibit 10.25

================================================================================

                           ASSET PURCHASE AGREEMENT

                           Dated as of June 13, 2001

                                by and between

                        MEDIA DISPLAYS, INC., as Seller

                                      and

                       NEXTMEDIA OUTDOOR, INC., as Buyer

================================================================================
<PAGE>

                               TABLE OF CONTENTS

<TABLE>
<CAPTION>
                                                                                                          Page
<S>                                                                                                        <C>
ARTICLE I  DEFINED TERMS...............................................................................     1

    1.1      Defined Terms.............................................................................     1

ARTICLE II SALE AND PURCHASE OF ASSETS.................................................................     5

    2.1      Agreement to Sell and Purchase............................................................     5

    2.2      Excluded Assets...........................................................................     5

    2.3      Nonassignable Assumed Contracts...........................................................     6

    2.4      Liabilities...............................................................................     7

    2.5      Purchase Price............................................................................     8

    2.6      Adjustments and Prorations................................................................     9

    2.7      Allocation................................................................................    10

ARTICLE III REPRESENTATIONS AND WARRANTIES OF SELLER...................................................    10

    3.1      Organization, Standing and Authority......................................................    10

    3.2      Authorization and Binding Obligation......................................................    10

    3.3      Absence of Conflicting Agreements.........................................................    11

    3.4      Permits...................................................................................    11

    3.5      Site Leases...............................................................................    11

    3.6      Assumed Contracts.........................................................................    11

    3.7      Consents..................................................................................    12

    3.8      Advertising Displays......................................................................    12

    3.9      Financial Information.....................................................................    12

    3.10     Reports...................................................................................    12

    3.11     Taxes.....................................................................................    12

    3.12     Claims; Legal Actions.....................................................................    13

    3.13     Compliance with Laws......................................................................    13

    3.14     Undisclosed Liabilities...................................................................    13

    3.15     Books and Records.........................................................................    13

    3.16     Assets....................................................................................    14

    3.17     Environment, Health and Safety............................................................    14

    3.18     Brokerage.................................................................................    14
</TABLE>

                                       i
<PAGE>

                               TABLE OF CONTENTS
                                  (continued)

<TABLE>
<CAPTION>
                                                                                                          Page
<S>                                                                                                       <C>
    3.19     Affiliated Transactions...................................................................    14

    3.20     Real Property.............................................................................    14

    3.21     Absence of Certain Changes................................................................    14

    3.22     Seller's Financial Condition..............................................................    15

    3.23     No Third Party Options....................................................................    15

    3.24     Full Disclosure...........................................................................    15

ARTICLE IV REPRESENTATIONS AND WARRANTIES OF BUYER.....................................................    15

    4.1      Organization, Standing and Authority......................................................    15

    4.2      Authorization and Binding Obligation......................................................    15

    4.3      Absence of Conflicting Agreements or Consents.............................................    16

    4.4      Brokerage.................................................................................    16

ARTICLE V  COVENANTS...................................................................................    16

    5.1      Conduct prior to the Closing Date.........................................................    16

    5.2      Access....................................................................................    17

    5.3      Satisfaction of Conditions; Closing.......................................................    18

    5.4      Sale of Assets; Negotiations..............................................................    18

    5.5      Notification..............................................................................    18

    5.6      Updating Schedules........................................................................    18

    5.7      Accounts Receivable.......................................................................    19

    5.8      Taxes, Fees and Expenses..................................................................    19

    5.9      Bulk Sales Law............................................................................    20

    5.10     Confidentiality...........................................................................    20

    5.11     Noncompetition and Nonsolicitation........................................................    20

    5.12     Financial Information.....................................................................    21

    5.13     Further Assurances........................................................................    22

    5.14     Employee Matters..........................................................................    22

ARTICLE VI CLOSING; TERMINATION AND RISK OF LOSS.......................................................    22

    6.1      Closing...................................................................................    22

    6.2      Termination Rights........................................................................    22
</TABLE>

                                      ii
<PAGE>

                               TABLE OF CONTENTS
                                  (continued)

<TABLE>
<CAPTION>
                                                                                                          Page
<S>                                                                                                       <C>
    6.3      Procedures and Effect of Termination......................................................    23

    6.4      Risk of Loss..............................................................................    23

    6.5      Resolution of Disagreements...............................................................    24

ARTICLE VII  CONDITIONS OF CLOSING BY BUYER............................................................    24

    7.1      Representations, Warranties and Covenants.................................................    24

    7.2      Compliance with Agreement.................................................................    24

    7.3      Closing Certificates......................................................................    24

    7.4      Third Party Consents and Governmental Approvals...........................................    24

    7.5      No Adverse Proceedings....................................................................    25

    7.6      Closing Documents.........................................................................    25

    7.7      No Material Adverse Change................................................................    25

    7.8      Simultaneous Closing......................................................................    25

ARTICLE VIII CONDITIONS OF CLOSING BY SELLER...........................................................    25

    8.1      Representations, Warranties and Covenants.................................................    25

    8.2      Compliance with Agreement.................................................................    25

    8.3      Closing Certificates......................................................................    25

    8.4      No Adverse Proceedings....................................................................    25

    8.5      Closing Documents.........................................................................    26

ARTICLE IX  CLOSING DELIVERIES.........................................................................    26

    9.1      Deliveries by Seller......................................................................    26

    9.2      Deliveries by Buyer.......................................................................    27

ARTICLE X   SURVIVAL AND INDEMNIFICATION...............................................................    28

    10.1     Survival of Representations, Warranties and Covenants.....................................    28

    10.2     Indemnification by Seller.................................................................    28

    10.3     Indemnification by Buyer..................................................................    29

    10.4     Procedure for Indemnification.............................................................    29

ARTICLE XI  MISCELLANEOUS..............................................................................    30

    11.1     Notices...................................................................................    30

    11.2     Specific Performance......................................................................    31
</TABLE>

                                      iii
<PAGE>

                               TABLE OF CONTENTS
                                  (continued)

<TABLE>
<CAPTION>
                                                                                                          Page
<S>                                                                                                        <C>
    11.3     Benefit and Binding Effect.................................................................   31

    11.4     Headings...................................................................................   31

    11.5     Gender and Number..........................................................................   31

    11.6     Counterparts...............................................................................   32

    11.7     Entire Agreement...........................................................................   32

    11.8     Amendment..................................................................................   32

    11.9     Severability...............................................................................   32

    11.10    Governing Law..............................................................................   32
</TABLE>

                                      iv
<PAGE>

                                   EXHIBITS
                                   --------

Exhibit A         Form of Indemnification Escrow Agreement
Exhibit B         Form of Bill of Sale
Exhibit C         Form of Assignment and Assumption Agreement

                                   SCHEDULES
                                   ---------

Schedule 1.1(a)   Advertising Contracts
Schedule 1.1(b)   Advertising Displays
Schedule 2.1(a)   Assumed Contracts
Schedule 3.1      Foreign Qualifications
Schedule 3.4      Permits
Schedule 3.5      Site Leases
Schedule 3.7      Consents
Schedule 3.9      Financial Information
Schedule 3.11     Taxes
Schedule 3.12     Claims; Legal Actions
Schedule 3.14     Undisclosed Liabilities
Schedule 3.17     Environment, Health and Safety
Schedule 3.19     Affiliated Transactions
Schedule 3.20     Real Property
<PAGE>

                           ASSET PURCHASE AGREEMENT

     This ASSET PURCHASE AGREEMENT (this "Agreement"), dated as of June 13,
                                          ---------
2001, is made and entered into by and among MEDIA DISPLAYS, INC., a Delaware
corporation ("Seller"), NEXTMEDIA OUTDOOR, INC., a Delaware corporation
              ------
("Buyer") and, solely with respect to Section 5.11 hereof, each of Anthony Gaess
  -----                               ------------
and Jeffrey Gaess.

                            PRELIMINARY STATEMENTS

          WHEREAS, Seller owns and operates an outdoor advertising business
which develops billboard sites and sells advertising on billboards in the
Markets (as defined herein) (the "Business"); and
                                  --------

          WHEREAS, Seller desires to sell to Buyer and Buyer desires to purchase
from Seller the Assets (as defined herein) used in the operation of Seller's
Business upon the terms and conditions hereinafter set forth.

          NOW, THEREFORE, in consideration of the mutual promises and agreements
herein contained and for other good, valuable and binding consideration, the
receipt and sufficiency of which are hereby acknowledged, the parties hereto,
intending to be legally bound, hereby agree as follows:

                            STATEMENT OF AGREEMENT

                                   ARTICLE I

                                 DEFINED TERMS
                                 -------------

     1.1  Defined Terms. The following terms shall have the following meanings
          ------------
in this Agreement:

          "Accountant" shall have the meaning set forth in Section 2.6(b)
           ----------                                      --------------
hereof.

          "Accounts Receivable" means any and all amounts or other obligations
           -------------------
owed to Seller by reason of a sale of a good or the provision of a service
(including the provision of outdoor advertising) in the ordinary course of
Seller's conduct of the Business prior to the Closing Date and for which such
goods have been sold or such services have been provided and for which Buyer has
no liability or obligation with respect thereto.

          "Advertising Contracts" shall mean all contracts, including trade
           ---------------------
advertising contracts, whether written or oral, for advertising services to be
provided by Seller (including rental of space on Advertising Displays) in effect
as of the date hereof and all such other contracts entered into after such date
and in effect on the Closing Date to which Seller is a party or which have been
assumed by or assigned to Seller. All Advertising Contracts in effect as of the
date hereof are listed on Schedule 1.1(a) hereto.
                          ---------------
<PAGE>

          "Advertising Displays" shall mean all illuminated and unilluminated
           --------------------
painted bulletins, poster panels, junior panels and other outdoor advertising
displays, including billboards and the existing structures used in the display
thereof (such as supporting structures, upright beams, brackets, lighting
equipment and other fixtures attached thereto), whether or not in the process of
construction or assembly, reflected on Schedule 1.1(b) hereof as of the date
                                       ---------------
hereof as being owned, leased, used or operated by Seller and any others that
have been acquired, owned, leased, used or operated by Seller thereafter prior
to the Closing Date. All Advertising Displays as of the date hereof are
described on Schedule 1.1(b) hereto.
             ---------------

          "Affiliate" has the meaning given to such term in Rule 12b-2 of
           ---------
Regulation 12B under the Securities Exchange Act of 1934, as amended.

          "Agreement" shall have the meaning set forth in the recitals above.
           ---------

          "Ancillary Agreements" shall have the meaning set forth in Section 3.2
           --------------------                                      -----------
hereof.

          "Assets" shall have the meaning set forth in Section 2.1 hereof.
           ------                                      -----------

          "Assumed Contracts" means, collectively, the contracts, leases,
           -----------------
commitments and agreements (including any amendments or other modifications
thereto) to which Seller is a party which relate to the operation of the
Business as of the date hereof and which are listed on Schedule 2.1(a) hereof
                                                       ---------------
including, without limitation, contracts relating to the operation, construction
and development of the Advertising Displays, the Advertising Contracts and the
Site Leases. Any additional contracts relating to the operation of the Business
which are entered into by Seller on or after the date of this Agreement and
prior to Closing will be included as "Assumed Contracts," provided that Buyer
                                                          --------
has specifically agreed to assume such contracts after Buyer has had a
reasonable opportunity to review such contracts.

          "Assumed Liabilities" shall have the meaning set forth in Section
           -------------------                                      -------
2.4(a) hereof.
------

          "Bulk Sales Law" shall have the meaning set forth in Section 5.9
           --------------                                      -----------
hereof.

          "Business Day" means any day other than a Saturday, a Sunday or a day
           ------------
on which banking institutions in New York, New York are not required to be open.

          "Business" shall have the meaning set forth in the recitals above.
           --------

          "Buyer" shall have the meaning set forth in the recitals above.
           -----

          "Cause of Action" means a right to receive or recover property, debt
           ---------------
or damages on a cause of action, whether pending or not and whether arising in
contract, tort or otherwise. The term shall include, but shall not be limited
to, rights to judgments, settlements and proceeds from judgments or settlements.

          "Claimant" shall have the meaning set forth in Section 10.4(a) hereof.
           --------                                      ---------------

                                    Page 2
<PAGE>

          "Closing" means the consummation of the transactions contemplated by
           -------
this Agreement in accordance with the provisions of Article VI hereof.
                                                    ----------

          "Closing Date" means the date of the Closing specified in Article VI
           ------------                                             ----------
hereof.

          "Closing Payment" shall have the meaning set forth in Section 2.5
           ---------------                                      -----------
hereof.

          "Code" means the Internal Revenue Code of 1986, as amended to the date
           ----
hereof.

          "Collection Period" shall have the meaning set forth in Section 5.7(a)
           -----------------                                      --------------
hereof.

          "Consents" means the consents of third parties, including, without
           --------
limitation, applicable governmental authorities, necessary to transfer the
Assets to Buyer or otherwise to consummate the transactions contemplated hereby,
all of which Consents are set forth on Schedule 3.7 hereto.
                                       ------------

          "Environmental Claims" refers to any complaint, summons, citation,
           --------------------
notice, directive, order, claim, litigation, investigation, judicial or
administrative proceeding, judgment, letter or other communication from any
governmental agency, department, bureau, office or other authority, or any third
party involving violations of Environmental Laws with respect to the ownership
of the Assets or the operation of the Business.

          "Environmental Laws" include the Comprehensive Environmental Response,
           ------------------
Compensation and Liability Act, 42 U.S.C. 9601 et seq., as amended; the Resource
Conservation and Recovery Act, 42 U.S.C. 6901 et seq., as amended; the Clean Air
Act, 42 U.S.C. 7401 et seq., as amended; the Clean Water Act, 33 U.S.C. 1251 et
seq., as amended; the Occupational Safety and Health Act, 29 U.S.C. 655 et seq.,
and any other federal, state, local or municipal laws, statutes, regulations,
rules or ordinances imposing liability or establishing standards of conduct for
protection of the environment, including, without limitation, the protection of
surface water, groundwater, drinking water, air, wildlife, plants or other
natural resources, or the health and safety of Persons or property, including,
without limitation, protection of the health and safety of employees.

          "Excluded Assets" shall have the meaning set forth in Section 2.2
           ---------------                                      -----------
hereof.

          "Excluded Liabilities" shall have the meaning set forth in Section
           --------------------                                      -------
2.4(b) hereof.
------

          "Financial Information" shall have the meaning set forth in Section
           ---------------------                                      -------
3.9 hereof.
---

          "Hazardous Substances" means all substances, materials or waste that
           --------------------
are regulated by federal, state or local government under the Environmental Laws
as hazardous, toxic or pollutants or contaminants as well as any petroleum or
petroleum derived product.

          "Indemnifying Party" shall have the meaning set forth in Section
           ------------------                                      -------
10.4(a).
-------

                                    Page 3
<PAGE>

          "Liens" means any claims, mortgages, pledges, liens, security or other
           -----
third party interests, conditional sales agreements, options, encumbrances,
debts or charges of any kind.

          "Markets" means each of the following markets in which Seller
           -------
currently conducts the Business and in which Assets are being transferred to
Buyer: New York City, New York County, New York.

          "Nonassignable Right" shall have the meaning set forth in Section
           -------------------                                      -------
2.3(a) hereof.
------

          "Noncompete Period" shall have the meaning set forth in Section
           -----------------                                      -------
5.11(b) hereof.
-------

          "Permits" means all of the permits and other authorizations issued by,
           -------
or pending with, any federal, state or local governmental authorities to Seller
used or useful in connection with the operation of the Assets, including,
without limitation, those listed on Schedule 3.4 hereto.
                                    ------------

          "Person" means an individual, a partnership, a corporation, a limited
           ------
liability company, an association, a joint stock company, a trust, a joint
venture, an unincorporated organization or a governmental entity or any
department, agency or political subdivision thereof.

          "Purchase Price" means the consideration payable to Seller for the
           --------------
Assets as provided in Section 2.5 hereof.
                      -----------

          "Restricted Parties" shall have the meaning set forth in Section
           ------------------                                      -------
5.11(a) hereof.
-------

          "Restrictive Covenant" shall have the meaning set forth in Section
           --------------------                                      -------
5.11(a) hereof.
-------

          "Seller" shall have the meaning set forth in the recitals above.
           ------

          "Site Leases" shall mean the leases, licenses, easements, occupancy
           -----------
agreements and other grants of the right to use real property not owned in fee
by Seller for the use, operation, construction, or management of Advertising
Displays, and all extensions, modifications or renewals (whether or not pursuant
to different terms and conditions) thereof to which Seller was a party or of
which it had the benefit as of the date hereof including, without limitation,
rights to locations on which structures have not been built, which are further
listed on Schedule 3.5 hereto. Any additional leases, licenses, easements,
          ------------
occupancy agreements and other grants of the right to use real property which
have been assumed by or assigned to Seller or entered into following the date
hereof and in effect as of the Closing Date will be included as "Site Leases,"
provided that Buyer has specifically agreed to assume such agreements after
--------
Buyer has had a reasonable opportunity to review the same. Schedule 3.5 hereto
                                                           ------------
sets forth for each Site Lease listed on such Schedule: (a) the location of the
property, (b) the name of the lessor or grantor, (c) the annual base rent for
such Site Lease, if any, and (d) the expiration date, if any.

          "Taxes" means all federal, state, county, local, foreign and other
           -----
taxes of any kind whatsoever (including, without limitation, income, profits,
premium, estimated, excise, sales, use, occupancy, gross receipts, franchise, ad
valorem, severance, capital levy, production,

                                    Page 4
<PAGE>

transfer, license, stamp, environmental, withholding, employment, unemployment
compensation, payroll related and property taxes, import duties and other
governmental charges and assessments), whether or not measured in whole or in
part by net income, and including deficiencies, interest, additions to tax or
interest, and penalties with respect thereto, and including expenses associated
with contesting any proposed adjustment related to any of the foregoing.

          "Tax Return" means any return, information report or filing with
           ----------
respect to Taxes, including any schedules attached thereto and including any
amendment thereof.

                                  ARTICLE II

                          SALE AND PURCHASE OF ASSETS
                          ---------------------------

     2.1 Agreement to Sell and Purchase. Subject to the terms and conditions set
         ------------------------------
forth in this Agreement, Seller hereby agrees to sell, transfer and deliver to
Buyer on the Closing Date, and Buyer agrees to purchase from Seller on the
Closing Date, all of the rights, title and interest of Seller in and to the
assets related to the operation of the Business (collectively, the "Assets"),
                                                                    ------
wherever located, free and clear of any Liens (except as otherwise expressly set
forth herein) including, but not limited to:

          (a) All of the Assumed Contracts;

          (b) All of Seller's right, title and interest in and to all Permits;

          (c) The Advertising Displays;

          (d) All files, books and other records relating to the operation of
the Business, including, without limitation, executed copies of the Assumed
Contracts or, if no executed agreement exists, summaries of the Assumed
Contracts, price lists, marketing information, sales records, customer lists and
files;

          (e) All rights under, or pursuant to, all warranties, representations
and guarantees made by suppliers or servicers in connection with the Advertising
Displays to the extent that such warranties, representations and guarantees are
assignable; and

          (f) Except as provided in Section 2.2 below, all such other assets,
                                    -----------
properties, interests and rights owned, leased, licensed or used by Seller in
connection with the operation of the Business including the goodwill associated
therewith.

     2.2 Excluded Assets. The following assets of Seller shall not be acquired
         ---------------
by Buyer and shall be deemed excluded assets (collectively, the "Excluded
                                                                 --------
Assets"):
------

          (a) Seller's Accounts Receivable;

          (b) All cash on hand and in bank accounts, and other cash items and
equivalents of Seller as of the Closing Date;

                                    Page 5
<PAGE>

          (c) Seller's minute books and other books and records relating to its
internal governance matters, and any books and records not related to the
Business and the operations thereof;

          (d) Seller's right, title and interest in and to the name "Media
Displays" or any derivations thereof;

          (e) Any claims, rights or interest of Seller in or to any refunds of
federal, state or local franchise, income or other Taxes or fees of any nature
whatsoever which either: (i) relate solely to the period prior to the Closing
Date; or (ii) do not relate to the Assets;

          (f) All contracts other than Assumed Contracts and all assets or funds
held in trust, or otherwise, associated with or used in connection with Seller's
employee benefit plans, programs or arrangements; and

          (g) All of Seller's rights in and to all Causes of Action relating to
the Assets which existed on or prior to the Closing Date and which relate
entirely to the period prior to the Closing Date.

     2.3 Nonassignable Assumed Contracts.
         -------------------------------

          (a) Nonassignability. Without limiting or otherwise affecting the
              ----------------
rights of Buyer pursuant to Article X of this Agreement, to the extent that any
                            ---------
Assumed Contract or Permit is not capable of being assigned without the consent,
approval or waiver of a third Person, or if such assignment or attempted
assignment would constitute a breach thereof or a violation of any law or
regulation (each, a "Nonassignable Right"), nothing in this Agreement will
                     -------------------
constitute an assignment or require the assignment thereof, except to the extent
provided in this Section 2.3.
                 -----------

          (b) Seller to Use Commercially Reasonable Efforts. Notwithstanding
              ---------------------------------------------
anything to the contrary contained herein, Seller shall not be obligated to
assign to Buyer any rights or obligations in, to or under any of the
Nonassignable Rights without first having obtained all consents, approvals or
waivers necessary for such assignment; provided, however, that Seller shall use
                                       --------  -------
its commercially reasonable efforts to obtain all such consents, approvals and
waivers prior to the Closing and, if the Closing occurs without certain consents
being obtained, Seller shall use its commercially reasonable efforts after the
Closing Date to obtain all such consents, approvals and waivers. Buyer
acknowledges and agrees that it shall cooperate with Seller in Seller's efforts
to obtain all required consents, approvals and waivers.

          (c) If Waivers or Consents Cannot Be Obtained. To the extent that any
              -----------------------------------------
consent, approval or waiver required for the assignment of any Nonassignable
Right cannot be obtained by Seller either prior to or after the Closing, then
Seller shall use its commercially reasonable efforts to: (i) provide to Buyer
the financial and business benefits of such Nonassignable Right and (ii)
enforce, at the request of Buyer and for the account of Buyer, any rights of
Seller arising from any such Nonassignable Right (including, without limitation,
the right to elect to terminate in accordance with the terms thereof upon the
advice of Buyer).

                                    Page 6
<PAGE>

Notwithstanding the foregoing, Seller shall be required to take only such
actions as would be legally permissible under the Assumed Contract or the Permit
that it seeks to assign.

     2.4 Liabilities.
         -----------

          (a) Assumed Liabilities. Subject to the provisions of Section 2.4(b)
              -------------------                               --------------
herein, at Closing, Buyer shall assume, discharge and perform the liabilities
and obligations of Seller arising or to be performed after the Closing Date
under the Assumed Contracts and Permits in effect on the Closing Date and all
other liabilities and obligations that arise from the ownership or operation of
the Assets after the Closing Date. All of the foregoing liabilities and
obligations shall be referred to herein collectively as the "Assumed
                                                             -------
Liabilities."
------------

          (b) Excluded Liabilities. Notwithstanding anything contained in this
              --------------------
Agreement to the contrary, Buyer shall not assume or otherwise be liable in
respect of, or be deemed by virtue of the execution and delivery of this
Agreement, or as a result of the consummation of the transactions contemplated
by this Agreement, to have assumed or otherwise be liable in respect of, any
debt, claim, obligation, or other liability of Seller, or any of Seller's
Affiliates, other than the Assumed Liabilities, including, without limitation,
any of the following liabilities or obligations of Seller (collectively, the
"Excluded Liabilities"):
 --------------------

               (i) any obligations or liabilities of Seller or any predecessor
     or Affiliate of Seller which in any way relate to, or arise out of, any of
     the Excluded Assets;

               (ii) any and all Tax liabilities of Seller;

               (iii) any liabilities or obligations of Seller owed to any of its
     Affiliates;

               (iv) any liabilities or obligations of Seller for borrowed money
     or for interest on such borrowed money;

               (v) any liabilities or obligations arising out of any breach by
     Seller or any predecessor or Affiliate of Seller of any of the terms or
     conditions of any provision of any contract;

               (vi) any liabilities or obligations of Seller or any predecessor
     or Affiliate of Seller resulting from, caused by or arising out of, any
     violation of law;

               (vii) any claims, liabilities, or obligations of Seller as an
     employer, including, without limitation, liabilities for wages,
     supplemental unemployment benefits, vacation benefits, severance benefits,
     retirement benefits, Federal Consolidated Omnibus Budget Reconciliation Act
     of 1985 benefits, Federal Family and Medical Leave Act of 1993 benefits,
     Federal Workers Adjustment and Retraining Notification Act obligations and
     liabilities, or any other employee benefits, withholding Tax liabilities,
     workers' compensation, or unemployment compensation benefits or premiums,
     hospitalization or medical claims, occupational disease or disability
     claims, or other claims attributable in whole or in part to employment or
     termination by Seller or arising out of any labor matter

                                    Page 7
<PAGE>

     involving Seller as an employer, and any claims, liabilities and
     obligations arising from or relating to any employee benefit plans;

               (viii) any claims, liabilities, losses, damages, or expenses
     relating to any litigation, proceeding, or investigation of any nature
     arising out of ownership of the Assets or Seller's operation of its
     Business on or prior to the Closing Date including, without limitation, any
     claims against or any liabilities for injury to, or death of, Persons or
     damage to or destruction of property, any workers' compensation claims, and
     any warranty claims;

               (ix) except as may otherwise be provided herein, any accounts
     payable, other indebtedness, obligations or accrued liabilities of Seller;

               (x) any claims, liabilities, losses, damages, expenses or
     obligations resulting from the failure to comply with, or imposed pursuant
     to, any Environmental Law or resulting from the use, presence, generation,
     storage, treatment, transportation, handling, disposal, emission or release
     of Hazardous Substances, solid wastes, or gaseous matters by Seller or by
     any other Person related to, or affiliated with, Seller, the Assets or
     Seller's operation of the Business to the extent related to, arising from
     or otherwise attributable to acts or omissions prior to, or conditions
     existing as of, the Closing Date, including, without limitation, any
     liability or obligation for cleaning up waste disposal sites from or
     related to acts or omissions occurring on or prior to the Closing Date;

               (xi) any fees and expenses incurred by Seller in connection with
     negotiating, preparing, closing, and carrying out this Agreement and the
     transactions contemplated by this Agreement, including, without limitation,
     the fees and expenses of Seller's attorneys, accountants, consultants and
     brokers; and

               (xii) any liabilities or obligations with respect to any
     contracts that Buyer is not specifically assuming.

Seller acknowledges and agrees that Seller shall pay promptly when due any and
all Excluded Liabilities not discharged by it at or prior to Closing. Buyer is
not the successor employer of Seller's employees for any purpose, is not
required to employ any of such employees and has no liability whatsoever with
respect to any employee of Seller.

     2.5 Purchase Price. The Purchase Price for the Assets shall be One Million
         --------------
Seventy Thousand Five Hundred Seventy Six Dollars ($1,070,576) and shall be paid
to Seller or its designee at Closing by wire transfer to an account or accounts
designated by Seller (the "Closing Payment"), provided, however, that
                           ---------------    --------  -------
notwithstanding anything to the contrary contained in this Agreement, a portion
of the Purchase Price equal to 5% thereof, or Fifty Three Thousand Five Hundred
Twenty Eight Dollars and Eighty Cents ($53,528.80), will be paid into escrow and
retained therein pursuant to an Indemnification Escrow Agreement, by and among
Buyer, Seller and an escrow agent, which will be mutually acceptable to both
parties, to be named prior to Closing.

                                    Page 8
<PAGE>

     2.6 Adjustments and Prorations.
         --------------------------

          (a) All revenues arising from the ownership of the Assets, earned or
accrued until midnight on the day prior to the Closing Date, and all expenses,
costs or liabilities, arising therefrom incurred, accrued or payable up until
such time including, without limitation, business, license, utility charges,
real and personal property Taxes and assessments levied against the Assets,
property and equipment rentals, applicable copyright or other fees, sales and
service charges and Taxes (other than income Taxes, which shall be Seller's sole
responsibility for all Taxable periods ending prior to the Closing Date, and
those Taxes arising from the sale and transfer of the Assets, which, in the case
of transfer and other similar Taxes shall be paid as set forth in Section 5.8)
                                                                  -----------
shall be prorated between Buyer and Seller in accordance with the principle
that: (i) Seller shall receive all revenues, refunds and deposits (to the extent
such refunds or deposits can be released or refunded) of Seller held by third
parties, and shall be responsible for all expenses, costs and liabilities
incurred, payable or allocable to the operation of the Business for the period
prior to the Closing Date and (ii) Buyer shall receive all revenues earned or
accrued, and shall be responsible for all expenses, costs and liabilities
incurred, payable or allocable to the operation of the Business for the period
commencing on and continuing after the Closing Date (provided, however, that
                                                     --------  -------
Buyer shall have no responsibility for any wages, salaries, vacation, sick pay
or other similar expenses of any employee of Seller, it being understood that
Buyer is not the successor employer of any of Seller's employees).

          (b) Adjustments or prorations pursuant to this Section 2.6 will,
                                                         -----------
insofar as feasible, be determined and paid on the Closing Date based upon
Seller's calculation thereof delivered to Buyer prior to the Closing Date and
approved by Buyer, with final settlement and payment by the appropriate party
occurring as described below. In the event any adjustment must be made
post-Closing, the determination of the amount of adjustment under this Section
                                                                       -------
2.6 shall be made by Buyer consistently with the practice used by Seller prior
---
to the Closing Date. Upon such determination, within ninety (90) days following
the Closing Date, Buyer shall submit such determination to Seller for approval.
If Seller disagrees with the determination made by Buyer of the adjustment,
Seller shall give prompt written notice thereof, but in no event later than ten
(10) days after receipt of such determination, specifying in reasonable detail
the nature and extent of such disagreement and stating the amount of Seller's
proposed final adjustment or proration, and Buyer and Seller shall have a period
of ten (10) days in which to resolve such disagreement in good faith. If the
parties are unable to resolve such disagreement within such 10-day period, the
matter shall be submitted to the New York office of Arthur Andersen LLP, an
independent certified public accounting firm ("Accountant"), which accounting
                                               ----------
firm shall be directed to submit a final resolution to Buyer and Seller within
thirty (30) days. Accountant's determination shall be binding on both Buyer and
Seller. Each party shall bear the fees and expenses of its own representatives,
including its independent accountants, if any, and shall share equally the fees
and expenses of Accountant, if any. Within ten (10) Business Days following a
final determination hereunder of the adjustments or prorations (either by
agreement of the parties or pursuant to the dispute mechanism described above),
the party obligated to make payment will pay the amounts determined to be due
and owing in accordance with this Section 2.6.
                                  ------------

                                    Page 9
<PAGE>

     2.7 Allocation. Buyer and Seller shall attempt in good faith to negotiate
         ----------
an allocation of the Closing Payment to the Assets in a manner which complies
with Section 1060 of the Code prior to Closing. The parties acknowledge and
agree that if Buyer and Seller are unable to reach such agreement prior to
Closing, then, within sixty (60) days after Closing, Buyer and Seller shall
negotiate in good faith such allocation. In the event that Buyer and Seller
cannot agree on such allocation within such sixty (60) day period, the matter
shall be submitted to Accountant which shall be directed to submit a final
allocation within thirty (30) days. Accountant's determination shall be binding
on both Buyer and Seller. Each party shall bear the fees and expenses of its own
representatives, including its independent accountants, if any, and shall share
equally the fees and expenses of Accountant, if any. The allocation, whether
agreed upon by both Buyer and Seller or submitted by Accountant, shall be
consistently reported by Buyer and Seller on Form 8594 in compliance with
Section 1060 of the Code.

                                  ARTICLE III

                   REPRESENTATIONS AND WARRANTIES OF SELLER
                   ----------------------------------------

     Seller hereby represents and warrants to Buyer as follows:

     3.1 Organization, Standing and Authority. Seller is a corporation validly
         ------------------------------------
existing and in good standing under the laws of the jurisdiction of its
organization. Seller has all necessary power and authority to own, lease and
operate its Assets and to operate the Business as now being conducted and as
proposed to be conducted and is duly qualified to do business in each
jurisdiction in which its operation of the Assets or its ownership or leasing of
property makes such qualification necessary. Each of the foregoing states are
listed on Schedule 3.1 hereto.
          ------------

     3.2 Authorization and Binding Obligation. Seller has the requisite power
         ------------------------------------
and authority to execute, deliver, and perform this Agreement and all other
agreements to be executed and delivered by it hereunder or in connection
herewith (the "Ancillary Agreements"), and all necessary actions on the part of
               --------------------
Seller have been duly and validly taken to authorize the execution, delivery and
performance of this Agreement and the Ancillary Agreements. This Agreement has
been duly executed and delivered by Seller and constitutes the legal, valid and
binding obligation of Seller enforceable against Seller, and each of the
Ancillary Agreements to be delivered by Seller, when executed and delivered at
Closing, will constitute a valid and binding obligation of Seller, enforceable
in accordance with its terms, except as provided by bankruptcy, insolvency,
fraudulent conveyance or similar laws affecting creditors' rights generally and
general equitable principles.

     3.3 Absence of Conflicting Agreements. Neither the execution, delivery or
         ---------------------------------
performance of this Agreement or the Ancillary Agreements when so executed (with
or without the giving of notice, the lapse of time, or both) nor the
consummation of the transactions contemplated hereby: (i) will conflict with any
provision of the organizational charter or bylaws of Seller; (ii) will conflict
with, will result in a breach of, or will constitute a default under any
applicable law, judgment, order, ordinance, decree, rule, regulation or ruling
of any court or governmental instrumentality; (iii) will result in a breach of,
will conflict with, will constitute a

                                    Page 10
<PAGE>

default under or will permit any party to terminate, modify, accelerate the
performance of or cancel the terms of, any Assumed Contract or Permit to which
Seller is a party or by which Seller may be bound; or (iv) will create any Lien
upon any of the Assets.

     3.4 Permits. Schedule 3.4 hereto contains a true, correct and complete list
         -------  -------------
of all of the Permits. The Permits comprise all of the permits and other
authorizations used or useful in connection with the operation of the
Advertising Displays or the other Assets in the manner and to the full extent
now being conducted by Seller, and none of the Permits is subject to any
restriction or condition which would limit the full operation of the Business as
presently operated. Except as otherwise set forth on Schedule 3.4, the Permits
                                                     ------------
are now in full force and effect, and the operation of the Business is in
accordance therewith. Upon consummation of the transactions contemplated hereby,
the Permits will be transferred to Buyer such that Buyer may continue to operate
the Business as presently operated or as proposed to be operated.

     3.5 Site Leases. Schedule 3.5 hereto contains a true, correct and complete
         -----------  ------------
list of the Site Leases used in connection with, or necessary to operate, the
Business as now operated or as proposed to be operated. Seller has good and
marketable title to all of the Site Leases relating to the operation of the
Business and none of such Site Leases is subject to any Lien, except for: (a)
Liens which shall be discharged or removed by Seller prior to or at Closing, (b)
Liens for Taxes not yet due and payable and (c) such imperfections of title and
encumbrances, if any, which are not, individually or in the aggregate, material
in character, amount or extent, and which do not materially detract from the
value, or materially interfere with the present use or anticipated use of the
property subject thereto or affected thereby. Each of the Site Leases is in full
force and effect. All necessary Permits with respect to the Site Leases have
been obtained, have been validly issued, are in full force and effect and upon
consummation of the transactions contemplated hereby, the Site Leases will be
transferred to Buyer such that Buyer may continue to operate the Business as
presently operated or as proposed to be operated. Except as otherwise disclosed
on Schedule 3.5, Seller is not, and to Seller's knowledge, no other party is in
   ------------
material default under any Site Lease. Seller has the full legal power and
authority to assign its rights under each Site Lease listed on Schedule 3.5
                                                               ------------
hereto to Buyer.

     3.6 Assumed Contracts. Schedule 2.1(a) hereto contains a true, correct and
         -----------------  ---------------
complete list of all of the Assumed Contracts in effect on the date hereof. On
or prior to the date hereof, Seller has provided Buyer with true, correct and
complete copies of the Assumed Contracts set forth on Schedule 2.1(a). All of
                                                      ---------------
the Assumed Contracts are in full force and effect and are valid, binding and
enforceable against Seller in accordance with their terms. Except as otherwise
disclosed on Schedule 2.1(a), there is no default or breach by Seller, or to
             ---------------
Seller's knowledge, any other party to any Assumed Contract and there are no
negotiations pending or in progress to revise, modify, terminate or extend any
such Assumed Contracts. To Seller's knowledge, there is no provision in any
Assumed Contract which any party to such Assumed Contract is unable to perform.
The Assumed Contracts are the only contractual agreements necessary to operate
the Business as currently operated and as presently proposed to be operated.

     3.7 Consents. Schedule 3.7 sets forth: (a) those Assumed Contracts which
         --------  ------------
require consent or notice for assignment to Buyer and (b) all of the other
consents, governmental or

                                    Page 11
<PAGE>

otherwise, required to consummate the transactions contemplated hereby. Except
for the Consents described on Schedule 3.7 hereto, no consent, authorization,
                              ------------
approval, order, license, certificate or permit of or from, or declaration or
filing with, any federal, state, local or other governmental authority or any
court or other tribunal, and no consent or waiver of any party to any contract
to which Seller is a party is required or declaration to or filing with any
governmental or regulatory authority, or any other third party is required to:
(i) execute this Agreement or any Ancillary Agreement, (ii) consummate this
Agreement or any Ancillary Agreement and the transactions contemplated hereby or
thereby, or (iii) permit Seller to assign or transfer the Assets to Buyer.

     3.8 Advertising Displays. Seller owns the Advertising Displays and, at
         --------------------
Closing, will deliver the Advertising Displays to Buyer, free and clear of all
Liens. Each of the Advertising Displays is in material compliance with all
applicable federal, state and local laws, rules, regulations, ordinances, codes
and statutes.

     3.9 Financial Information. Schedule 3.9 hereto contains a true, correct and
         ---------------------  ------------
complete list of all of the financial information that has been delivered to
Buyer by Seller related to the Assets to be acquired by Buyer (the "Financial
                                                                    ---------
Information"). The Financial Information was prepared by Seller in accordance
-----------
with its past practice, consistently applied. The Financial Information is true
and correct in all material respects.

     3.10 Reports. All returns, reports and statements relating to the Assets or
         --------
to the operation of the Business which Seller is required to file with any
governmental agency have been filed, and all reporting requirements of
governmental authorities having jurisdiction over the ownership of the Assets or
the operation of the Business have been complied with.

     3.11 Taxes. Except to the extent set forth in Schedule 3.11, Seller has
         ------                                    -------------
filed or has caused to be filed all federal, state, county, local or city Tax
Returns affecting the Assets or the operation of the Business which are required
to be filed by Seller, and all Tax assessments and other governmental charges
which are due and payable have been timely paid. To Seller's knowledge, there
are no Tax liens upon the Assets. With respect to the Assets or the operation of
the Business, all Tax reports filed by Seller fairly reflect the Taxes of Seller
for the periods covered thereby and the Seller has received no notice of any Tax
deficiency or delinquency. With respect to the Assets or the operation of the
Business, no Internal Revenue Service audit of Seller is pending or, to the
knowledge of Seller, threatened and the results of any completed audits are set
forth in Schedule 3.11 hereto. All monies required to be withheld by Seller from
         -------------
employees or collected from customers for income taxes, social security and
unemployment insurance Taxes and sales, excise and use Taxes, and the portion of
any such Taxes to be paid by Seller to governmental agencies or set aside in
accounts for such purposes have been so paid or set aside, or such monies have
been approved, reserved against and entered upon the books of Seller and the
Financial Statements.

     3.12 Claims; Legal Actions. Except as set forth on Schedule 3.12, there are
         ----------------------                         -------------
no actions, suits, proceedings, orders or claims pending or threatened against
Seller, or pending or threatened by Seller against any third party, at law or in
equity, or before or by any governmental

                                    Page 12
<PAGE>

department, commission, board, bureau, agency or instrumentality which relate
to, or in any way affect, the Assets or could affect, interfere or impede
Buyer's ownership or the operation of the Assets from and after the Closing Date
(including, without limitation, any actions, suits, proceedings or
investigations with respect to the transactions contemplated by this Agreement
or any Ancillary Agreement). Seller is not subject to any judgment, order or
decree of any court or other governmental agency, and Seller has received no
written opinion or memorandum from legal counsel to the effect that it is
exposed, from a legal standpoint, to any liability which relates to, or in any
way affects, the Assets or the operation of the Business.

     3.13 Compliance with Laws. Seller has complied in all material respects
         ---------------------
with: (i) the Permits and (ii) all applicable federal, state and local laws,
rules, regulations, ordinances, codes, statutes, judgments, orders and decrees
in connection with the ownership of the Assets and the operation of the
Business. To Seller's knowledge, neither the ownership nor the use of the Assets
conflicts with the rights of any other Person.

     3.14 Undisclosed Liabilities. With respect to the Business or the ownership
         ------------------------
of the Assets, except as set forth in Schedule 3.14 hereto or as otherwise
                                      -------------
disclosed in this Agreement or any schedule or exhibit hereto: (a) Seller has no
liability, secured or unsecured (whether absolute, accrued, contingent or
otherwise and whether due or to become due) of a nature which should have been
included or reflected in the Financial Information prepared by Seller except (i)
as such liabilities and obligations are reflected in the Financial Information,
or (ii) for liabilities and obligations incurred after the date of the Financial
Information, in the ordinary course of Seller's business consistent with past
practices (none of which is a liability resulting from breach of contract,
breach of warranty, tort, infringement, claim or lawsuit), none of which
individually or in the aggregate are materially adverse to the Assets or
operations of the Business and (b) Seller has no contingent liabilities or other
liabilities outside the ordinary course of business not otherwise disclosed in
this Agreement or any schedule or exhibit hereto.

     3.15 Books and Records. The books and other records of the Seller relating
         ------------------
to the Business are true, correct and complete in all material respects.

     3.16 Assets. The Assets include all assets used or useful in connection
         -------
with the operation of the Business as currently operated. Upon the consummation
of the transactions contemplated hereby, Seller will transfer good and valid
title to the Assets free and clear of any Liens.

     3.17 Environment, Health and Safety. To Seller's knowledge, except as set
         -------------------------------
forth on Schedule 3.17:
         -------------

          (a) Seller's operation of the Assets and the Business is in compliance
in all material respects with Environmental Laws;

          (b) Seller has obtained, and is in material compliance with, all
necessary permits or authorizations that are required under Environmental Laws
to operate the Business;

                                    Page 13
<PAGE>

          (c) No Environmental Claims have been asserted against Seller or, to
the knowledge of Seller, any predecessor in interest, nor does Seller have
knowledge or notice of any threatened or pending Environmental Claim against
Seller; and

          (d) Seller further represents that no environmental reports, studies,
investigations or correspondence exist regarding any environmental conditions at
any of the Site Lease locations.

     3.18 Brokerage. There are no claims for brokerage commissions, finders'
         ----------
fees or similar compensation in connection with the transactions contemplated by
this Agreement based on any arrangement or agreement binding upon Seller. Seller
shall pay, and shall hold Buyer harmless against, any liability, loss or expense
(including, without limitation, reasonable attorneys' fees and out-of-pocket
expenses) arising in connection with any such claim.

     3.19 Affiliated Transactions. Except as set forth on Schedule 3.19 hereto,
         ------------------------                         -------------
no officer, director, employee, shareholder, member or Affiliate of Seller or
any individual related by blood, marriage, or adoption to any such individual or
any entity in which such Person owns any beneficial interest, is a party to any
agreement, contract, commitment, or transaction with Seller with respect to the
Assets.

     3.20 Real Property. Except as set forth on Schedule 3.20, Seller does not
         --------------                         -------------
own any real property which is used or useful in connection with the operation
of the Business. Buyer and Seller acknowledge and agree that the real property
retained by Seller and used in connection with the operation of the Business and
listed on Schedule 3.20, shall, on the Closing Date, be leased to Buyer.
          -------------

     3.21 Absence of Certain Changes. In connection with Seller's operation of
         ---------------------------
the Business and ownership of the Assets, there has not been: (a) any material
damage, destruction or loss of any kind with respect to the Assets not covered
by valid and collectible insurance, nor, to Seller's knowledge, has there been
any event or circumstance which has had, or reasonably could be expected to
have, a material adverse effect on the ownership of the Assets or the operation
of the Business; or (b) any change by Seller in its financial or Tax accounting
principles or methods, except insofar as required by applicable law; (c) any
sale or encumbrance of any Assets of the Business except in the ordinary course
of business; or (d) any adverse change in Seller's relationship with its
material lenders, suppliers, customers which has had, or reasonably could be
expected to have, a material adverse effect on the operation of the Business.
Seller has no reason to believe that any such adverse change may be reasonably
likely to occur.

     3.22 Seller's Financial Condition. No insolvency proceedings of any
         -----------------------------
character, including, without limitation, bankruptcy, receivership,
reorganization, composition or arrangement with creditors, voluntary or
involuntary, affecting the Assets are pending, or to Seller's knowledge,
threatened, and Seller has made no assignment for the benefit of creditors, nor
taken any action with a view to, or which would constitute a basis for, the
institution of any such insolvency proceedings.

                                    Page 14
<PAGE>

     3.23 No Third Party Options. There are no existing agreements with, options
          ----------------------
or rights of, or commitments to any Person, other than to Buyer, to acquire any
of the Assets or any interest therein.

     3.24 Full Disclosure. No representation or warranty by Seller contained in
          ---------------
this Agreement (including the schedules hereto), or in any certificate furnished
pursuant to this Agreement, contains or will contain any untrue statement of a
material fact, or omits or will omit to state any material fact necessary, in
light of the circumstances under which it was or will be made, in order to make
the statements herein or therein made not misleading.

                                  ARTICLE IV

                    REPRESENTATIONS AND WARRANTIES OF BUYER
                    ---------------------------------------

     Buyer hereby represents and warrants to Seller as follows:

     4.1 Organization, Standing and Authority. Buyer is a corporation validly
         ------------------------------------
existing and in good standing under the laws of the State of Delaware.

     4.2 Authorization and Binding Obligation. Buyer has the requisite power and
         ------------------------------------
authority to execute, deliver, and perform this Agreement and any Ancillary
Agreements and all necessary action on the part of Buyer has been duly and
validly taken to authorize the execution, delivery and performance of this
Agreement and the Ancillary Agreements. This Agreement has been duly executed
and delivered by Buyer and constitutes the legal, valid and binding obligation
of Buyer enforceable against Buyer, and each of the Ancillary Agreements to be
delivered by Buyer, when executed and delivered at Closing, will constitute a
valid and binding obligation of Buyer, enforceable in accordance with its terms,
except as provided by bankruptcy, insolvency, fraudulent conveyance or similar
laws affecting creditors' rights generally and general equitable principles.

     4.3 Absence of Conflicting Agreements or Consents. No consent,
         ---------------------------------------------
authorization, approval, order, license, certificate or permit of or from, or
declaration or filing with any federal, state, local or other governmental
authority or any court or other tribunal, and no consent or waiver of any party
to any contract to which Buyer is a party is required for the execution,
delivery or performance of this Agreement or any Ancillary Agreement. Neither
the execution, delivery or performance of this Agreement or any Ancillary
Agreement (with or without the giving of notice, the lapse of time, or both) nor
the consummation of the transactions contemplated hereby or thereby: (i) will
conflict with the certificate of incorporation of Buyer; (ii) will conflict
with, result in a breach of, or constitute a default under any applicable law,
judgment, order, injunction, decree, rule, regulation or ruling of any court or
governmental instrumentality or (iii) will conflict with, result in a breach of,
constitute a default under, permit any party to terminate, modify, accelerate
the performance of or cancel the terms of, any agreement, lease, instrument of
indebtedness, license or other obligations to which Buyer is a party, or by
which Buyer may be bound, such that Buyer could not acquire the Assets or
operate the Business.

                                    Page 15
<PAGE>

     4.4 Brokerage. There are no claims for brokerage commissions, finders' fees
         ---------
or similar compensation in connection with the transactions contemplated by this
Agreement based on any arrangement or agreement binding upon Buyer. Buyer shall
pay, and hold Seller harmless against, any liability, loss or expense
(including, without limitation, reasonable attorneys fees and out-of-pocket
expenses) arising in connection with any such claim.

                                   ARTICLE V

                                   COVENANTS
                                   ---------

     5.1 Conduct prior to the Closing Date. Seller, from and after the date
         ---------------------------------
hereof through the Closing Date, shall:

          (a) use its commercially reasonable efforts to maintain its present
business organization, preserve its relationships with its customers and others
having business relationships with Seller and shall refrain from materially and
adversely changing any of its business policies;

          (b) maintain its books of account and records in the usual and
ordinary manner and in accordance with past practice, consistently followed,
except as otherwise provided herein;

          (c) operate in the usual and ordinary course of business, and conduct
the Business in compliance with the terms of the Permits and in accordance with
all applicable laws, rules, and regulations;

          (d) maintain the Assets in substantially their current condition,
ordinary wear and tear excepted;

          (e) maintain insurance on the Assets in such amounts and of such kinds
comparable to that in effect on the date of this Agreement;

          (f) not knowingly incur any debts, obligations or liabilities
(absolute, accrued, contingent, or otherwise) that include obligations (monetary
or otherwise) to be performed by Buyer after the Closing that exceeds $50,000
individually or $100,000 in the aggregate;

          (g) not lease, mortgage, pledge, or subject to a Lien any of the
Assets or sell or transfer any of the Assets without replacing such Assets with
an asset of substantially the same value and utility;

          (h) not: (i) modify or extend any Assumed Contracts (other than
automatic renewals that are effective without providing any notice) or (ii)
enter into any new contract that would constitute an Assumed Contract, which
requires payments after the Closing in excess of $50,000 individually or
$100,000 in the aggregate, without the prior written consent of Buyer, which
consent shall not be unreasonably withheld or delayed;

                                    Page 16
<PAGE>

          (i) not make (i) any change in the accounting principles, methods, or
practices followed by Seller or depreciation or amortization policies or rates,
or (ii) change any Tax election or settle any Tax audit or controversy relating
to the Assets;

          (j) not make any loans or make any dividends or distributions other
than with any Excluded Assets;

          (k) other than in the ordinary course of business, not cancel or
compromise any debt or claim, or waive or release any right, of material value
that will be assumed by or assigned to Buyer at the Closing;

          (l) not disclose to any person (other than Buyer and its
representatives) any confidential or proprietary information, except as may
otherwise be required by law; and

          (m) agree to do any of the foregoing.

     5.2 Access. From and after the date hereof through the Closing Date, Seller
         ------
shall (a) give Buyer and Buyer's counsel, accountants, engineers and other
representatives, reasonable access during normal business hours to all of
Seller's operations, properties, books, contracts, agreements, leases,
commitments, records and employees of the Business, in order that Buyer may have
full opportunity to make, at Buyer's expense, such review, examination and
investigation as Buyer desires of the affairs of Seller and (b) furnish Buyer
with information and copies of all documents and agreements including, but not
limited to, financial and operating data and other information concerning the
financial condition, results of operations and business of Seller that Buyer may
reasonably request. The rights of Buyer under this Section 5.2 shall not be
                                                   -----------
exercised in such a manner as to interfere unreasonably with the Business or
operations of Seller.

     5.3 Satisfaction of Conditions; Closing. From and after the date hereof
         -----------------------------------
through the Closing Date, each of Buyer and Seller shall use its commercially
reasonable efforts to conduct its business in such a manner that on the Closing
Date the representations and warranties of such party contained in this
Agreement shall be true and correct in all material respects as though such
representations and warranties were made on and as of such date. Furthermore,
Seller and Buyer shall cooperate with each other and shall use their respective
commercially reasonable efforts to satisfy promptly all conditions required
hereby to be satisfied by Buyer and Seller in order to consummate the
transactions contemplated by this Agreement.

     5.4 Sale of Assets; Negotiations. From and after the date hereof through
         ----------------------------
the Closing Date, Seller shall not, and Seller shall cause its respective
Affiliates, directors, officers, managers, members, employees, agents,
representatives, legal counsel, and financial advisors not to: (a) solicit,
initiate, accept, consider, entertain or encourage the submission of proposals
or offers from any Person with respect to the acquisition contemplated by this
Agreement or any similar transaction wherein such Person would directly or
indirectly acquire all or any portion of the Assets or ownership interests in
Seller, or any merger, consolidation, or business combination, directly or
indirectly, with or for Seller, or (b) participate in any negotiations
regarding, or, except as required by legal process (including pursuant to
discovery or agreements

                                    Page 17
<PAGE>

existing on the date hereof), furnish to any Person (other than Buyer)
information to do, any of the foregoing. Seller shall not enter into any
agreement or consummate any transactions that would interfere with the
consummation of the transactions contemplated by this Agreement. Seller shall
promptly notify Buyer in writing if it receives any written inquiry, proposal or
offer described in this Section 5.4 or any verbal inquiry, proposal or offer
                        -----------
described in this Section 5.4 that is competitive with the terms of the
                  -----------
transactions contemplated by this Agreement and Seller shall inform such
inquiring Person of the existence of this Agreement and make such inquiring
Person or entity aware of Seller's obligations under this Section 5.4. The
                                                          -----------
notification under this Section 5.4 shall include the identity of the Person
                        -----------
making such inquiry, offer, or other proposal, the terms thereof, and any other
information with respect thereto as Buyer may reasonably request. Seller shall
not provide any confidential information concerning the Business or the Assets
to any third party other than in the ordinary course of the business and
consistent with prior practice. Seller has ceased and caused to be terminated
any existing activities, discussions or negotiations with any Person conducted
heretofore with respect to any of the foregoing.

     5.5 Notification. From and after the date hereof through the Closing Date,
         ------------
each party hereto shall promptly notify the other party hereto in writing of:
(a) the failure of such party or, to such party's knowledge, any employee or
agent of such party to comply with or satisfy in any material respect any
covenant, condition or agreement to be complied with hereunder, or (b) the
occurrence of any event that would entitle such party to terminate this
Agreement pursuant to Section 6.2.
                      -----------
     5.6 Updating Schedules. From and after the date hereof, Seller acknowledges
         ------------------
and agrees that Seller shall promptly provide Buyer with any information which
would be required to be disclosed on the schedules to this Agreement and, on the
Closing Date, the schedules hereto shall have been updated by Seller such that
such schedules will be true and correct on the Closing Date. Notwithstanding the
foregoing, any update to the schedules from and after the date hereof by Seller
shall not relieve Seller of any liability to which Seller might be subject for
failure to disclose any information that should have been disclosed prior to the
execution of this Agreement.

     5.7 Accounts Receivable.
         -------------------

          (a) On the Closing Date, Seller shall furnish Buyer with a list
(certified a duly authorized financial officer of Seller to be a true and
complete list) of Seller's Accounts Receivable. The Accounts Receivable shall
remain the property of Seller. Buyer shall collect the Accounts Receivable on
behalf of Seller for a period of ninety (90) days (the "Collection Period") and,
                                                        -----------------
upon the termination of the Collection Period, Buyer shall have no further
obligation to collect Seller's Accounts Receivable. Buyer agrees that if, during
any calendar month within the Collection Period, it shall receive payment in
respect of any Accounts Receivable, Buyer shall, within five (5) business days
after the end of such calendar month, remit to Seller any such amounts received
by Buyer during the calendar month.

          (b) During the Collection Period, Buyer shall use its commercially
reasonable efforts, consistent with its billing and collection practices and in
the ordinary course of business,

                                    Page 18
<PAGE>

to collect any outstanding Accounts Receivable; provided, however, that,
                                                --------  -------
notwithstanding the foregoing, Buyer shall be under no obligation to commence
litigation, employ counsel or engage the services of a collection agency to
effect such collection. Except to the extent that any receivable amount is
deemed to be the property of Buyer in accordance with this Section 5.7, Buyer
                                                           -----------
shall not make any compromise, adjustment, concession or settlement of any
Accounts Receivable without Seller's express written consent. Furthermore, Buyer
shall be under no obligation to compromise, adjust, concede or settle any
accounts receivable generated after the Closing Date, or otherwise grant any
credit or allowance, to effect collection of an Account Receivable. Absent
written evidence that an account debtor owing an Account Receivable is disputing
in good faith any portion of such Account Receivable or that any payment
received from such account debtor corresponds to a particular account
receivable, any payments received by Buyer during the Collection Period from
such account debtor shall be presumed to represent payment on the most-aged
account receivable then owing from such account debtor, whether the account
receivable is for the account of Seller or Buyer.

     5.8 Taxes, Fees and Expenses. All sales, use, transfer, and purchase Taxes
         ------------------------
and fees, if any, arising out of the transfer of the Assets pursuant to this
Agreement shall be paid by Seller. Buyer and Seller agree to cooperate with each
other and to file all necessary documentation (including but not limited to, all
Tax Returns) with respect to all such amounts in a timely manner. Except as
otherwise provided in this Agreement, each party shall pay its own costs and
expenses incurred in connection with the authorization, preparation, execution,
and performance of this Agreement, including, without limitation, all fees and
expenses of counsel, accountants, agents and other representatives.

     5.9 Bulk Sales Law. Buyer hereby waives compliance by Seller with the
         --------------
provisions of Article 6 of the Uniform Commercial Code - Bulk Transfers and the
Bulk Sales Act and any other applicable United States, state or provincial bulk
sales act or statute, if applicable ("Bulk Sales Law"), and Seller warrants and
                                      --------------
agrees to pay and discharge when due all claims of creditors which could be
asserted against Buyer by reason of such noncompliance to the extent that such
liabilities arise before the Closing, and agrees to protect, defend, hold
harmless and indemnify Buyer from and against any and all such claims and
demands pursuant to the procedures set forth in Article X hereof which shall
                                                ---------
apply thereto in all respects in the event liability for noncompliance with the
Bulk Sales Law arises at any time following the Closing.

     5.10 Confidentiality. Except as necessary for the consummation of the
          ---------------
transactions contemplated hereby, each party hereto shall keep confidential the
economic terms of this Agreement and any information which is obtained from the
other party in connection with the transactions contemplated hereby, except to
the extent that such materials or information are or become readily available to
the public, have been obtained from independent sources, were known by either
party on a non-confidential basis prior to disclosure to such party or are
required to be disclosed in public filings or otherwise by applicable law.

                                    Page 19
<PAGE>

     5.11 Noncompetition and Nonsolicitation.
          ----------------------------------

          (a) As additional consideration for Buyer's agreement to purchase the
Assets and to pay the Purchase Price to Seller, each of Seller, Anthony Gaess
and Jeffrey Gaess (collectively, the "Restricted Parties") has agreed to the
                                      ------------------
noncompetition provision set forth in subparagraphs (b) and (c) below (the
"Restrictive Covenant"). Each of the Restricted Parties hereby represents and
 --------------------
acknowledges that: (i) the Restrictive Covenant is being entered into in
connection with Seller's sale of the Assets to Buyer and (ii) in the absence of
the Restricted Parties agreeing to be bound by the terms and conditions of the
Restrictive Covenant, the sale would not be consummated by Buyer.

          (b) For a period of twenty-four (24) months following the Closing Date
(the "Noncompete Period"), each of the Restricted Parties agrees that such party
      -----------------
will not, within any of the Markets, directly or indirectly, carry on, engage
in, assist in or have any financial interest in, or otherwise participate or be
involved in any way in, as an owner, partner, member, employee, agent, officer,
board member, consultant, independent contractor or shareholder, any outdoor
advertising business that is competitive with the Buyer's use and operation of
the Assets. Nothing contained herein shall prohibit any of the Restricted
Parties from being a passive owner of not more than five percent (5%) of the
outstanding stock of any class of securities of a corporation or other entity
which is publicly traded and in which such Restricted Party has no active
participation. Notwithstanding the foregoing, nothing contained herein shall
prohibit any of the Restricted Parties from engaging in exclusive development
activities in the Markets on behalf of Buyer. In the event that a Restricted
Party identifies a development opportunity in any of the Markets, and pursuing
such development opportunity would otherwise violate the terms and conditions of
this Section 5.11, the Restricted Party may nonetheless engage in such
     ------------
development opportunity on behalf of Buyer following presentment of the
development opportunity to Buyer, acceptance of the development opportunity by
Buyer and the negotiation of the terms of development which are mutually
satisfactory to each of Buyer and the Restricted Party who is presenting such
development opportunity.

          (c) Each of the Restricted Parties further acknowledges and agrees
that for a period of five (5) years from and after the Closing Date that such
party shall not knowingly take any action, or cause any other person to take any
action, which would impede, prohibit, restrict or interfere in any way with the
Buyer's ability to own or operate the Assets, or any other assets relating to
the operation of the Business acquired by Buyer after the Closing Date.

          (d) If, at the time of enforcement of the Restrictive Covenant, a
court shall hold that the duration, scope, area or other restrictions stated
herein are unreasonable, each of the Restricted Parties agrees that reasonable
maximum duration, scope, area or other restrictions may be substituted by such
court for the stated duration, scope, area or other restrictions and upon
substitution by such court, this Agreement shall be automatically modified
without further action by the parties hereto.

          (e) Each of the Restricted Parties hereby agrees that damages at law,
including, but not limited to, monetary damages, would be an insufficient remedy
to Buyer in the

                                    Page 20
<PAGE>

event that the Restrictive Covenant is violated and that, in addition to any
remedies or rights that may be available to Buyer, all of which other remedies
or rights shall be deemed to be cumulative, retained by Buyer and not waived by
the enforcement of any remedy available hereunder, including, but not limited
to, the right to sue for monetary damages, Buyer shall also be entitled, upon
application to a court of competent jurisdiction, to obtain injunctive relief,
including, but not limited to, a temporary restraining order or temporary,
preliminary or permanent injunction, to enforce the Restrictive Covenant, all of
which shall constitute rights and remedies to which Buyer may be entitled.

          (f) During the Noncompete Period, each of the Restricted Parties will
not solicit for employment any employee of Buyer if such Person is then, or was
at any time within the preceding twenty-four (24) months, an employee of Buyer,
its subsidiaries or its Affiliates.

     5.12 Financial Information. Seller hereby covenants and agrees that, unless
          ---------------------
otherwise specifically provided in this Agreement, any financial information
required to be delivered pursuant to this Agreement and any calculations
required to be made pursuant to this Agreement have been or shall be prepared or
calculated in accordance with Seller's past practice, consistently followed. At
all times after the date hereof, Seller shall, and shall cause all of Seller's
representatives (including their independent public accountants) to, cooperate
in all reasonable respects with the efforts of Buyer and Buyer's independent
auditors to prepare such audited and interim unaudited financial statements of
the Business as Buyer may reasonably determine are necessary in connection with
any filing required to be made by it or any of its Affiliates under the
Securities Exchange Act of 1934, as amended (the "Exchange Act"), or the
                                                  ------------
Securities Act of 1933, as amended (the "Securities Act"). Seller shall execute
                                         --------------
and deliver to Buyer's independent accountants such customary management
representation letters as they may require as a condition to their ability to
sign an unqualified report upon the audited financial statements of the Business
for the periods for which such financial statements are required under the
Exchange Act or the Securities Act. Seller shall use commercially reasonable
efforts to cause its independent public accountants to make available to Buyer
and its representatives all of their work papers related to the financial
statements or tax returns of Seller (to the extent they relate to the Business)
and to provide Buyer's independent public accountants with full access to those
personnel who previously have been involved in the audit or review of Seller's
financial statements or tax returns, subject to any limitations imposed by
Seller's independent accountants. Any reasonable out-of-pocket costs incurred by
Seller in connection with Seller's obligations under this Section 5.12 shall be
                                                          ------------
reimbursed by Buyer within a reasonable time after Buyer's receipt of reasonably
detailed information regarding such costs.

     5.13 Further Assurances. From and after the Closing, Seller shall from time
          ------------------
to time, at the request of, and without further cost and expense to Buyer, take
such actions, and shall execute and deliver to Buyer such further deeds, bills
of sale or other transfer documents as may be reasonably requested by Buyer in
order to more effectively consummate the transactions contemplated hereby.

     5.14 Employee Matters. The parties hereto acknowledge and agree that Buyer
          ----------------
does not intend to employ any of Seller's employees upon the consummation of the
transactions

                                    Page 21
<PAGE>

contemplated hereby. All of such employees shall remain employed by Seller and
Seller shall be solely responsible for any and all obligations to such persons.

                                  ARTICLE VI

                     CLOSING; TERMINATION AND RISK OF LOSS
                     -------------------------------------

     6.1 Closing. The Closing shall take place at the offices of Seller's
         -------
attorney at 10:00 a.m., eastern standard time, on or about the first day of the
month after the conditions set forth in Articles VII and VIII hereof have been
                                        ------------     ----
satisfied or waived by the party entitled to do so, or at such other place or
time as shall be mutually agreed upon by Buyer and Seller.

     6.2 Termination Rights. This Agreement may be terminated at any time prior
         ------------------
to Closing as follows:

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

          (b) by written notice of: (i) Buyer to Seller if Seller breaches in
any material respect any of its representations or warranties or defaults in any
material respect in the observance or in the due and timely performance of any
of its covenants or agreements herein contained and such breach or default shall
not be cured within thirty (30) days of the date of notice of breach or default
served by Buyer or (ii) Seller to the Buyer if Buyer breaches in any material
respect any of its representations or warranties or defaults in any material
respect in the observance or in the due and timely performance of any of its
covenants or agreements herein contained and such breach or default shall not be
cured within thirty (30) days of the notice of breach or default served by
Seller;

          (c) by Buyer or Seller by written notice to the other, if a court of
competent jurisdiction or other governmental entity shall have issued an order,
decree or ruling or taken any other action (which order, decree or ruling the
parties hereto shall use their commercially reasonable efforts to lift), in each
case permanently restraining, permanently enjoining or otherwise prohibiting the
transactions contemplated by this Agreement, and such order, decree, ruling or
other action shall have become final and nonappealable;

          (d) by either party, in the event that the Closing does not occur at
or before 5:00 p.m. eastern standard time on August 1, 2001; and

          (e) by written notice of Buyer to Seller, in accordance with Section
                                                                       -------
6.3 of this Agreement.
---

     Notwithstanding the foregoing, no party hereto may effect a termination
hereof if such party is in material default or in breach of this Agreement.

     6.3 Procedures and Effect of Termination. In order to effect the
         ------------------------------------
termination of this Agreement pursuant to, and in accordance with, the terms and
conditions of any provision of Section 6.2 hereof, written notice of such
                               -----------
termination shall be given by a party to the other party

                                    Page 22
<PAGE>

to this Agreement and this Agreement, assuming the relevant provision of Section
                                                                         -------
6.2 has been satisfied, shall terminate and the transactions contemplated hereby
---
shall be abandoned, without further action by either of the parties hereto. If
this Agreement is terminated as provided herein:

          (a) upon request therefor, each party shall redeliver all documents,
work papers and other materials of the other party hereto, and all copies of any
such materials, relating to the transactions contemplated hereby, whether
obtained before or after the execution hereof, to the party furnishing the same;
and

          (b) neither party hereto shall have any liability or further
obligation to the other party to this Agreement resulting from such termination
except: (i) that the provisions of Section 5.10 (Confidentiality), Section 5.8
                                   ------------                    -----------
(Expenses) and this Section 6.3 shall remain in full force and effect and the
                    -----------
parties shall have the obligations stated therein, and (ii) no party waives any
claim or right for damages against a breaching party to the extent that such
termination results from the breach by a party hereto of any of its
representations, warranties, covenants or agreements set forth herein.

     6.4 Risk of Loss. The risk of loss or damage to the Assets shall be upon
         ------------
Seller at all times prior to the Closing Date, unless such loss or damage is
caused by Buyer or by any employee or representative of Buyer. Seller shall
promptly notify Buyer of any such loss or damage. If the lost or damaged Assets
are capable of being replaced or repaired for an aggregate amount less than
$50,000, then Seller shall, at its sole cost and expense, replace or repair such
Assets prior to the Closing Date or deliver to Buyer at the Closing an amount in
cash equal to the cost of replacement or repair of such Assets, as mutually
agreed in good faith by Buyer and Seller, unless such loss or damage was caused
by Buyer or by any employee or representative of Buyer. Notwithstanding the
foregoing, if the amount required to replace or repair such Assets exceeds
$50,000, Seller may elect not to replace or repair such Assets, provided,
                                                                --------
however, that in such event Buyer, at its option, may elect to terminate this
-------
Agreement without either party being subject to a claim by the other for damages
in connection with this Section 6.4, or Buyer may waive any default or breach
                        -----------
with respect to the loss or damage and receive a $50,000 reduction in the
Closing Payment payable to Seller at Closing.

     6.5 Resolution of Disagreements. If Buyer and Seller are unable to agree
         ---------------------------
upon the extent of any loss or damage, the cost to repair, replace or restore
any lost or damaged property, the adequacy of any repair, replacement, or
restoration of any lost or damaged property, or any other matter arising under
Section 6.4, the disagreement shall be referred to an insurance company mutually
-----------
acceptable to each of Buyer and Seller, whose decision shall be final, binding
upon and nonappealable by the parties, and whose fees and expenses shall be paid
one-half by Seller and one-half by Buyer.

                                    Page 23
<PAGE>

                                  ARTICLE VII

                        CONDITIONS OF CLOSING BY BUYER
                        ------------------------------

     The obligations of Buyer hereunder, including, without limitation, Buyer's
obligations to close the transactions contemplated herein, are, at its option,
subject to satisfaction, at or prior to the Closing Date, of all of the
following conditions, any of which may be waived by Buyer:

     7.1 Representations, Warranties and Covenants. All of the representations
         -----------------------------------------
and warranties of Seller made in this Agreement or in any exhibit, schedule or
document delivered pursuant hereto, shall be true and correct in all material
respects as of the date hereof and on and as of the Closing Date as if made on
and as of that date, except for those given as of a specified date which must
only be true and correct as of such specified date.

     7.2 Compliance with Agreement. All of the terms, covenants and conditions
         -------------------------
to be complied with and performed by Seller on or prior to the Closing Date
shall have been complied with or performed in all material respects.

     7.3 Closing Certificates. Buyer shall have received a certificate, dated as
         --------------------
of the Closing Date, from Seller, executed by an executive officer or other
proper representative of Seller certifying, in such detail as Buyer may
reasonably request, that the conditions set forth in Sections 7.1 and 7.2 hereto
                                                     ------------     ---
have been fulfilled.

     7.4 Third Party Consents and Governmental Approvals. Seller shall have
         -----------------------------------------------
obtained all third party consents and governmental approvals, if any, required
for the transfer or continuance, as the case may be, of the Assumed Contracts,
the Permits and the Site Leases, each in a form which is satisfactory to Buyer
in its sole and absolute discretion and without additional cost, expense or
liability to Buyer.

     7.5 No Adverse Proceedings. No injunction, order, decree or judgment of any
         ----------------------
court, agency or other governmental entities shall have been rendered against
Seller or Buyer which would render it unlawful, as of the Closing Date, to
effect the transactions contemplated by this Agreement in accordance with its
terms.

     7.6 Closing Documents. Seller shall have delivered or caused to be
         -----------------
delivered to Buyer, on the Closing Date, the documents identified in Section
                                                                     -------
9.1.
---

     7.7 No Material Adverse Change. Since the date hereof through the Closing
         --------------------------
Date, there shall have been no material adverse change to the Assets, taken as a
whole, or to the financial condition or operating results of the Business.

     7.8 Simultaneous Closing. The parties shall be in a position to close each
         --------------------
of the following simultaneously: (i) the transactions contemplated by this
Agreement; (ii) the transactions contemplated in that certain Asset Purchase
Agreement by and between Great Outdoor, Inc., a New Jersey corporation and
Buyer; and (iii) the transactions contemplated in that

                                    Page 24
<PAGE>

certain Asset Purchase Agreement by and between Great Advertising, LLC, a New
Jersey limited liability company, and Buyer.

                                 ARTICLE VIII

                        CONDITIONS OF CLOSING BY SELLER
                        -------------------------------

     The obligations of Seller hereunder including, without limitation, Seller's
obligations to close the transactions contemplated herein are, at its option,
subject to the satisfaction, at or prior to the Closing Date, of all of the
following conditions, any of which may be waived by Seller:

     8.1 Representations, Warranties and Covenants. All of the representations
         -----------------------------------------
and warranties of Buyer made in this Agreement or in any exhibit, schedule or
document delivered pursuant hereto, shall be true and correct in all material
respects as of the date hereof and on and as of the Closing Date as if made on
and as of that date, except for those given as of a specified date which must
only be true and correct as of such specified date.

     8.2 Compliance with Agreement. All the terms, covenants, and conditions to
         -------------------------
be complied with and performed by Buyer on or prior to the Closing Date shall
have been complied with or performed in all material respects.

     8.3 Closing Certificates. Seller shall have received a certificate, dated
         --------------------
as of the Closing Date, from Buyer, executed by an executive officer of Buyer
certifying, in such detail as Seller may reasonably request, that the conditions
set forth in Sections 8.1 and 8.2 hereto have been fulfilled.
             ------------     ---

     8.4 No Adverse Proceedings. No injunction, decree or judgment of any court,
         ----------------------
agency or other governmental entities shall have been rendered against Buyer or
Seller which would render it unlawful, as of the Closing Date, to effect the
transactions contemplated by this Agreement in accordance with its terms.

     8.5 Closing Documents. Buyer shall have delivered or caused to be delivered
         -----------------
to Seller, on the Closing Date, the documents identified in Section 9.2.
                                                            -----------

                                  ARTICLE IX

                              CLOSING DELIVERIES
                              ------------------

     9.1 Deliveries by Seller. Prior to, or on the Closing Date, as applicable,
         --------------------
Seller shall deliver or shall cause to be delivered to Buyer the following, in
form and substance reasonably satisfactory to Buyer and its counsel:

          (a) Indemnification Escrow Agreement. A duly executed Indemnification
              --------------------------------
Escrow Agreement, substantially in the form of Exhibit A hereto;

                                    Page 25
<PAGE>

          (b) Bill of Sale. A duly executed Bill of Sale, substantially in the
              ------------
form of Exhibit B hereto;

          (c) Assignment Agreement. A duly executed Assignment and Assumption
              --------------------
Agreement with respect to the Assumed Contracts, substantially in the form of
Exhibit C hereto;

          (d) Consents. A copy of each required Consent listed on Schedule 3.7;
              --------                                            -------------

          (e) Certified Resolutions. A certificate of Seller, dated as of the
              ---------------------
Closing Date, executed by an officer of Seller certifying that the resolutions,
as attached to such certificate, were duly adopted by such Seller's board of
directors and shareholders, authorizing and approving the execution of this
Agreement and the Ancillary Agreements and the consummation of the transactions
contemplated hereby and thereby and that such resolutions remain in full force
and effect;

          (f) Officer's Certificate. A certificate, dated as of the Closing
              ---------------------
Date, executed on behalf of Seller in the form described in Section 7.3;
                                                            -----------

          (g) Permits, Contracts, Business Records, Etc. To the extent they are
              -----------------------------------------
in possession of Seller, copies of all Permits, Assumed Contracts, plans,
engineering records, and all files and records used by Seller in connection with
the ownership of the Assets or the operation of the Business;

          (h) Good Standing. A certificate of good standing of Seller issued by
              -------------
the Secretary of State of the jurisdiction of its organization, dated within
thirty (30) days of the Closing Date and brought down to the Closing Date by
facsimile of the applicable Secretary of State;

          (i) Pay-Off Letters. Pay-off Letters evidencing required payment of
              ---------------
Seller's obligations with respect to any outstanding loan agreements or capital
leases which are secured by the Assets;

          (j) Foreign Qualifications. Certificates showing that Seller is in
              ----------------------
good standing and is qualified to do business in each of the states listed on
Schedule 3.1;
------------

          (k) UCC-3 Termination Statements. UCC-3 Termination Statements
              ----------------------------
terminating or releasing any outstanding Liens against the Assets;

          (l) Estoppel Certificates. Seller shall have delivered to Buyer such
              ---------------------
estoppel certificates as Buyer shall have reasonably requested;

          (m) Accounts Receivable List. Seller shall deliver to Buyer the
              ------------------------
Accounts Receivable list referenced in Section 5.7 of this Agreement; and
                                       -----------

          (n) Other. Duly executed copies of all other deeds, endorsements,
              -----
assignments, consents and instruments as may be necessary to transfer the Assets
to Buyer.

                                    Page 26
<PAGE>

     9.2 Deliveries by Buyer. Prior to, or on the Closing Date, as applicable,
         -------------------
Buyer shall deliver to Seller the following, in form and substance reasonably
satisfactory to Seller and its counsel:

          (a) Closing Payment. The Closing Payment, as provided in Section 2.5
              ---------------
hereof;

          (b) Indemnification Escrow Agreement. A duly executed Indemnification
              --------------------------------
Escrow Agreement, substantially in the form of Exhibit A hereto;

          (c) Assumption Agreement. A duly executed counterpart of the
              --------------------
Assignment and Assumption Agreement with respect to the Assumed Contracts,
substantially in the form of Exhibit C hereto;

          (d) Good Standing. A certificate of good standing of Buyer issued by
              -------------
the Secretary of State of Delaware, dated within thirty (30) days of the Closing
Date and brought down to the Closing Date by telegram of the Secretary of State
of Delaware; and

          (e) Officer's Certificate. A certificate, dated as of the Closing
              ---------------------
Date, executed on behalf of Buyer, in the form described in Section 8.3.
                                                            -----------

                                   ARTICLE X

                         SURVIVAL AND INDEMNIFICATION
                         ----------------------------

     10.1 Survival of Representations, Warranties and Covenants.
          -----------------------------------------------------

          (a) Notwithstanding any examination made for or on behalf of any of
the parties hereto, the knowledge of any officer, director, employee or agent of
any of the parties hereto or any of their respective Affiliates, or the
acceptance of any certificate contemplated hereby, all representations and
warranties contained in this Agreement shall be deemed continuing
representations and warranties and shall survive the Closing Date for a period
of two (2) years, except for any breach of the representations and warranties
contained in Section 3.11 hereof, which shall survive the Closing Date until the
             ------------
expiration of the applicable statute of limitations, the representations and
warranties contained in Section 3.17 hereof, which shall survive the Closing
                        ------------
Date for ten (10) years, and the representations and warranties contained in
Section 3.16 hereof, which shall survive the Closing Date indefinitely.
------------

          (b) Unless a specified period is set forth in this Agreement (in which
event such period will control), the covenants in this Agreement will survive
the Closing and remain in effect indefinitely.

     10.2 Indemnification by Seller. Seller agrees to indemnify, defend and hold
          -------------------------
harmless Buyer and its Affiliates and their respective directors, officers,
partners, employees, agents and representatives from and against:

                                    Page 27
<PAGE>

          (a) Any and all losses, liabilities or damages resulting from any
untrue representation or breach of any warranty by Seller contained herein or in
any certificate, document or instrument delivered to Buyer hereunder;

          (b) Any and all losses, liabilities or damages resulting from the
nonfulfillment of any covenant or other agreement of the Seller contained herein
or in any certificate, document or instrument delivered to Buyer hereunder;

          (c) Any and all losses, liabilities or damages resulting from Seller's
ownership of the Assets or operation or control of the Business prior to the
Closing Date, including, without limitation, any and all liabilities arising
under the Permits, the Assumed Contracts or the Site Leases which relate to
events occurring prior to the Closing Date;

          (d) Any Excluded Liabilities;

          (e) Any failure to comply with the Bulk Sales Law; and

          (f) Any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs or expenses, including reasonable legal fees and
expenses, incident to any of the foregoing or in enforcing this indemnity.

     10.3 Indemnification by Buyer. Buyer agrees to indemnify, defend and hold
          ------------------------
harmless Seller and its Affiliates and their respective directors, officers,
partners, employees, agents and representatives from and against:

          (a) Any and all losses, liabilities or damages resulting from any
untrue representation or breach of warranty by Buyer contained herein or in any
certificate, document or instrument delivered to Seller hereunder;

          (b) Any and all losses, liabilities or damages resulting from the
nonfulfillment of any covenant or other agreement of Buyer contained herein or
in any certificate, document or instrument delivered to Seller hereunder;

          (c) Any and all losses, liabilities or damages resulting from Buyer's
ownership of the Assets following the Closing Date, including, without
limitation, any and all liabilities arising under the Assumed Contracts which
relate to events occurring after the Closing Date; or

          (d) Any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs or expenses, including reasonable legal fees and
expenses, incident to any of the foregoing or in enforcing this indemnity.

     10.4 Procedure for Indemnification. The procedure for indemnification shall
          -----------------------------
be as follows:

                                    Page 28
<PAGE>

          (a) The party claiming indemnification (the "Claimant") shall give
                                                       --------
reasonably prompt notice to the party from whom indemnification is claimed (the
"Indemnifying Party") of any claim, whether between the parties or brought by a
 ------------------
third party, specifying: (i) the factual basis for such claim and (ii) the
amount of the claim. If the claim relates to an action, suit or proceeding filed
by a third party against Claimant, such notice shall be given by Claimant within
ten (10) Business Days after written notice of such action, suit or proceeding
is received by Claimant.

          (b) Following receipt of notice from the Claimant of a claim, the
Indemnifying Party shall have twenty (20) Business Days (or such shorter period
of time as may be required to respond to the subject litigation or proceeding)
to make such investigation of the claim as the Indemnifying Party deems
necessary or desirable. For the purposes of such investigation, the Claimant
agrees to make available to the Indemnifying Party or its authorized
representative(s) the information relied upon by the Claimant to substantiate
the claim. If the Claimant and the Indemnifying Party agree at or prior to the
expiration of said 20-day period (or any mutually agreed upon extension thereof)
to the validity and amount of such claim, the Indemnifying Party shall
immediately pay to the Claimant the full amount of the claim. If the Claimant
and the Indemnifying Party do not agree within said period (or any mutually
agreed upon extension thereof), the Claimant may seek appropriate legal remedy.

          (c) With respect to any claim by a third party as to which the
Claimant is entitled to indemnification hereunder, the Indemnifying Party shall
have the right at its own expense, to participate in or assume control of the
defense of such claim, and the Claimant shall cooperate fully with the
Indemnifying Party. If the Indemnifying Party elects to assume control of the
defense of any third-party claim, the Claimant shall have the right to
participate in the defense of such claim and retain separate co-counsel at the
Indemnifying Party's expense; provided if requested to participate at
Indemnifying Party's request or if the Claimant reasonably believes (based upon
an opinion of counsel) that a conflict of interest exists between Claimant and
the Indemnifying Party, then the Claimant will be reimbursed for reasonable
expenses of counsel. The Indemnifying Party will select counsel reasonably
satisfactory to the Claimant. The Indemnifying Party will not consent to an
entry of judgment or settlement without release of liability and, with respect
to nonmonetary terms, the Claimant's consent (not to be unreasonably withheld or
delayed).

          (d) If a claim, whether between the parties or by a third party,
requires immediate action, the parties will make every effort to reach a
decision with respect thereto as expeditiously as possible.

          (e) If the Indemnifying Party does not elect to assume control or
otherwise participate in the defense of any third party claim, it shall be bound
by the results obtained by the Claimant with respect to such claim.

                                    Page 29
<PAGE>

                                  ARTICLE XI

                                 MISCELLANEOUS
                                 -------------

     11.1 Notices. All notices, demands, and requests required or permitted to
          -------
be given under the provisions of this Agreement shall be: (i) in writing, (ii)
delivered by personal delivery, or sent by commercial delivery service or
registered or certified mail, return receipt requested or sent by telecopy,
(iii) deemed to have been given on the date of personal delivery or the date set
forth in the records of the delivery service or on the return receipt or, in the
case of a telecopy, upon confirmation thereof and (iv) addressed as follows:

          If to Seller:

                   Coral Ortenberg Zeck & Codispoti, P.C.
                   44 Park Avenue, P. O. Box 277
                   Suffern, New York  10901
                   Attention:  Reuben Ortenberg
                   Fax No.:  (845) 357-2527

          If to Buyer:

                   NextMedia Outdoor, Inc.
                   6312 South Fiddler's Green Circle, 360E
                   Englewood, CO  80111
                   Attention:  Sean Stover
                   Fax No.:  (303) 694-4940

          With a copy to:

                   Weil, Gotshal & Manges, LLP
                   100 Crescent Court, Suite 1300
                   Dallas, TX  75201-6950
                   Attention:  Glenn D. West
                   Fax No.:  (214) 746-7777

or to any such other or additional persons and addresses as the parties may from
time to time designate in a writing delivered in accordance with this Section
                                                                      -------
11.1.
----

     11.2 Specific Performance. In addition to any other remedies which Buyer
          --------------------
may have at law or in equity, Seller hereby acknowledges that the Assets are
unique, and that the harm to Buyer resulting from a breach by Seller of its
obligations to sell the Assets to Buyer cannot be adequately compensated by
damages. Accordingly, Seller agrees that, from the date hereof through the
Closing Date, Buyer shall have the right to have this Agreement specifically
performed by Seller and hereby agrees not to assert any objections to the
imposition of the equitable remedy of specific performance by any court of
competent jurisdiction.

                                    Page 30
<PAGE>

     11.3 Benefit and Binding Effect. Neither party may assign this Agreement
          --------------------------
without the prior written consent of the other party hereto; provided, however,
                                                             --------  -------
that Buyer may assign this Agreement: (i) to any of its wholly-owned
subsidiaries or Affiliates or (ii) upon five days prior written notice to
Seller, to any Person in connection with (x) the sale of all or substantially
all of Buyer's assets, (y) any dissolution, merger, consolidation or other
reorganization of Buyer or (z) the sale or transfer of at least fifty percent
(50%) of the capital stock of the Buyer; provided that any proposed assignee
                                         --------
provides to Seller a written assumption of all of the obligations of Buyer to be
performed under this Agreement. This Agreement shall be binding upon and inure
to the benefit of the parties hereto and their respective successors and
permitted assigns.

     11.4 Headings. The headings herein are included for ease of reference only
          --------
and shall not control or affect the meaning or construction of the provisions of
this Agreement.

     11.5 Gender and Number. Words used herein, regardless of the gender and
          -----------------
number specifically used, shall be deemed and construed to include any other
gender, masculine, feminine or neuter, and any other number, singular or plural,
as the context requires.

     11.6 Counterparts. This Agreement may be signed in any number of
          ------------
counterparts with the same effect as if the signature on each such counterpart
were upon the same instrument.

     11.7 Entire Agreement. This Agreement, all schedules and exhibits hereto
          ----------------
and all documents, writings, instruments and certificates delivered or to be
delivered by the parties pursuant hereto collectively represent the sole and
entire understanding and agreement between Buyer and Seller with respect to the
subject matter hereof. All schedules, and exhibits attached to this Agreement
shall be deemed part of this Agreement and incorporated herein, as if fully set
forth herein. This Agreement supersedes all prior negotiations and
understandings between Buyer and Seller whatsoever, and all letters of intent
and other writings relating to such negotiations and understandings.

     11.8 Amendment. This Agreement cannot be amended, supplemented or modified
          ---------
except by an agreement in writing which makes specific reference to this
Agreement or an agreement delivered pursuant hereto, as the case may be, and
which is signed by the party against which enforcement of any such amendment,
supplement or modification is sought.

     11.9 Severability. If in any jurisdiction any provision of this Agreement
          ------------
or its application to any party or circumstance is restricted, prohibited or
unenforceable, such provision shall, as to such jurisdiction, be ineffective
only to the extent of the restriction, prohibition or unenforceability without
invalidating the remaining provisions hereof and without affecting the validity
or enforceability of such provision in any other jurisdiction or its application
to other parties or circumstances. In addition, if any one or more of the
provisions contained in this Agreement shall for any reason in any jurisdiction
be held excessively broad as to time, duration, geographical scope, activity or
subject, it shall be construed, by limiting and reducing it, so as to be
enforceable to the extent compatible with the applicable law of such
jurisdiction as it shall then appear.

                                    Page 31
<PAGE>

     11.10 Governing Law. This Agreement will be governed by, and construed and
           -------------
enforced in accordance with, the laws of the State of New York, without regard
to conflicts of law principles thereof.

                            [SIGNATURE PAGE FOLLOWS]

                                    Page 32
<PAGE>

     This Agreement has been executed by the parties hereto as of the date first
above written.

                                       NEXTMEDIA OUTDOOR, INC.

                                       By:______________________________________

                                       Name:____________________________________

                                       Title:___________________________________

                                       MEDIA DISPLAYS, INC.

                                       By:______________________________________

                                       Name:____________________________________

                                       Title:___________________________________

                                       The following individuals, solely with
                                       respect to Section 5.11 hereof:
                                                  ------------

                                       _________________________________________
                                       Anthony D. Gaess

                                       _________________________________________
                                       Jeffrey R. Gaess<PAGE>

                                                                   Exhibit 10.26

                                                                  Execution Copy

                  CONTRIBUTION and PURCHASE AND SALE AGREEMENT
                  --------------------------------------------

     THIS CONTRIBUTION AND PURCHASE AND SALE AGREEMENT (this "Agreement") is
made and entered into as of the 13 day of June, 2001 by and among PNE MEDIA,
LLC, a Delaware limited liability company ("PNE"), NEXTMEDIA INVESTORS, LLC, a
Delaware limited liability company ("NextMedia"), and NEXTMEDIA OUTDOOR, INC., a
Delaware corporation ("NextMedia Outdoor") (NextMedia and NextMedia Outdoor are
sometimes hereinafter collectively referred to as the "NextMedia Parties").

                              W I T N E S S E T H:
                              -------------------

     WHEREAS, PNE owns and operates an outdoor advertising business which owns
and develops billboard sites and sells advertising on billboards in various
markets in the United States;

     WHEREAS, PNE wishes to contribute (the "Contribution") certain billboard
assets of PNE used or useful in the operation of the Business (as defined
herein) to NextMedia in exchange for NextMedia Class A membership interests on
the terms and conditions set forth herein and PNE wishes to sell, and NextMedia
Outdoor wishes to purchase from PNE, certain billboard assets of PNE used or
useful in the operation of the Business and certain securities held by PNE for
cash (collectively, the "Purchase and Sale"); and

     WHEREAS, the parties hereto intend that the Contribution shall constitute a
tax-free contribution to the capital of NextMedia under Section 721 of the Code
(as defined herein).

     NOW, THEREFORE, in consideration of the premises and the representations,
warranties, promises and covenants herein contained, the parties hereto hereby
agree as follows:

                                    ARTICLE I

                                  DEFINED TERMS
                                  -------------

     1.1 Defined Terms. Defined terms used in this Agreement shall have the
         -------------
following meanings:

          "Accountant" shall have the meaning set forth in Section 2.10 hereof.
                                                           ------------

          "Accounts Receivable" means any and all amounts or other Obligations
owed to PNE by reason of a sale of a good or the provision of a service
(including the providing of outdoor advertising) in the ordinary course of PNE's
conduct of the Business prior to the Closing Date and for which such goods have
been sold or such services have been provided.
<PAGE>

          "Advertising Contracts" means all Contracts, including trade
advertising contracts, whether written or oral, for advertising services to be
provided by PNE (including rental of space on Advertising Displays) in effect as
of May 8, 2001 relating to the operation of the Business and all such other
Contracts entered into after such date and in effect on the Closing Date to
which PNE is a party and which have been assumed by or assigned to PNE on or
after May 8, 2001 and before the Closing which NextMedia or NextMedia Outdoor
has specifically agreed to assume after NextMedia or NextMedia Outdoor has had a
reasonable opportunity to review such Advertising Contracts. All Advertising
Contracts in effect as of May 8, 2001 are listed on Schedule 1.1(a) of the PNE
Disclosure Memorandum.

          "Advertising Displays" means all illuminated and unilluminated painted
bulletins, poster panels, junior panels and other outdoor advertising displays,
including billboards and the existing structures used in the display thereof
(such as supporting structures, upright beams, brackets, lighting equipment and
other fixtures attached thereto), whether or not in the process of construction
or assembly, reflected on PNE's books and records as of May 8, 2001 as being
owned, leased, used or operated by PNE in the Business and any others that have
been acquired, owned, leased, used or operated by PNE thereafter prior to the
Closing Date. All Advertising Displays as of May 8, 2001 are described on
Schedule 1.1(b) of the PNE Disclosure Memorandum.

          "Affiliate" has the meaning given to such term in Rule 12b-2 of
Regulation 12B under the Securities Exchange Act of 1934, as amended.

          "Aggregate Consideration" shall have the meaning set forth in Section
                                                                        -------
2.7 hereof.
---

          "Agreement" shall have the meaning set forth in the preamble hereof.

          "Ancillary Agreements" shall have the meaning set forth in Section 4.4
                                                                     -----------
hereof.

          "Assets" means, collectively, the Purchased Assets and the Contributed
Assets.

          "Assumed Contracts" means all: (i) Contracts relating to the operation
of the Business, including, without limitation, those described and set forth on
Schedule 4.14 of the PNE Disclosure Memorandum, the Advertising Contracts and
the Site Leases and (ii) any Contracts relating to the operation of the Business
entered into by PNE on or after May 8, 2001 and before the Closing which
NextMedia or NextMedia Outdoor has specifically agreed to assume after NextMedia
or NextMedia Outdoor has had a reasonable opportunity to review such Contracts;
provided, however, that Assumed Contracts shall not include any Contracts with
--------  -------
respect to franchise agreements, subfranchise agreements,
distributor-distributee agreements, loan agreements, security agreements,
guarantees, management contracts, employment agreements, consulting agreements,
shareholders' agreements, buy/sell agreements, options, warrants, subscriptions,
calls or puts.

          "Assumed Liabilities" shall have the meaning set forth in Section
                                                                    -------
2.5(a) hereof.
------

                                       2
<PAGE>

          "Bulk Sales Law" shall have the meaning set forth in Section 9.9
                                                               -----------
hereof.

          "Business" means PNE's operation of an outdoor advertising business
which develops billboard sites and sells advertising space in the Markets,
excluding PNE's New York operations and its home office operations in New
Jersey.

          "Business Day" means any day other than a Saturday, a Sunday or a day
on which banking institutions in New York, New York are not required to be open.

          "Claimant" shall have the meaning set forth in Section 13.4 hereof.
                                                         ------------

          "Closing" means the consummation of the transactions contemplated by
this Agreement in accordance with the provisions of Article III hereof.
                                                    -----------

          "Closing Date" means the date of the Closing specified in Article III
                                                                    -----------
hereof.

          "Code" means the Internal Revenue Code of 1986, as amended.

          "Collection and Payment Period" shall have the meaning set forth in
Section 9.16(a) hereof.
---------------

          "Consent" means any approval, order or authorization of, or any
declaration, filing or registration with, or any application or report to, or
any waiver by, or any other action (whether similar or dissimilar to any of the
foregoing) of, by or with, any Person, which is necessary in order to transfer
the Assets to the NextMedia Parties or otherwise to consummate the transactions
contemplated hereby (except consents required by the Site Leases), all of which
Consents are set forth on Schedule 4.15 of the PNE Disclosure Memorandum.

          "Consent Period" shall have the meaning set forth in Section 2.4(c)
                                                               --------------
hereof.

          "Contract" means any written or oral agreement, understanding or
commitment of any nature whatsoever to which PNE is a party which relates to the
Assets or to the Business or the operations thereof, including, without
limitation, any sales order, purchase order, lease, sublease, franchise
agreement, subfranchise agreement, license agreement, sublicense agreement,
distributor-distributee agreement, loan agreement, security agreement,
guarantee, management contract, employment agreement, consulting agreement,
shareholders' agreement, buy/sell agreement, option, warrant, subscription, call
or put.

          "Contributed Assets" shall have the meaning set forth in Section
                                                                   -------
2.1(a) hereof.
------

          "Contribution" shall have the meaning set forth in the recitals
hereof.

          "Deductible" shall have the meaning set forth in Section 13.5(a)
                                                           ---------------
hereof.

          "Deposit" shall have the meaning set forth in Section 2.12 hereof.
                                                        ------------

                                       3
<PAGE>

          "Employee List" shall have the meaning set forth in Section 9.12(b)
                                                              ---------------
hereof.

          "Environmental Claim" means any complaint, summons, citation, notice,
directive, order, claim, litigation, investigation, judicial or administrative
Proceeding, judgment, letter or other communication from any governmental
agency, department, bureau, office or other authority, or any third party
involving violations of Environmental Laws with respect to the ownership of the
Assets or the operation of the Business.

          "Environmental Laws" include the Comprehensive Environmental Response,
Compensation and Liability Act, 42 U.S.C. 9601 et seq., as amended; the Resource
Conservation and Recovery Act, 42 U.S.C. 6901 et seq., as amended; the Clean Air
Act, 42 U.S.C. 7401 et seq., as amended; the Clean Water Act, 33 U.S.C. 1251 et
seq., as amended; the Occupational Safety and Health Act, 29 U.S.C. 655 et seq.,
and any other federal, state, local or municipal Laws imposing liability or
establishing standards of conduct for protection of the environment, including,
without limitation, the protection of surface water, groundwater, drinking
water, air, wildlife, plants or other natural resources, or the health and
safety of Persons or property, including, without limitation, protection of the
health and safety of employees.

          "ERISA" means the Employee Retirement Income Security Act of 1974, as
amended.

          "Escrow Agent" shall have the meaning set forth in Section 2.12
                                                             ------------
hereof.

          "Escrow Agreement" shall have the meaning set forth in Section 2.12
                                                                 ------------
hereof.

          "Exchange Act" shall have the meaning set forth in Section 9.14
                                                             ------------
hereof.

          "Excluded Assets" shall have the meaning set forth in Section 2.2
                                                                -----------
hereof.

          "Excluded Liabilities" shall have the meaning set forth in Section
                                                                     -------
2.5(b) hereof.
------

          "Final Working Capital Statement" shall have the meaning set forth in
Section 9.16(c) hereof.
---------------

          "GAAP" means United States generally accepted accounting principles,
consistently applied.

          "Hazardous Substances" means all substances, materials or waste that
are regulated by federal, state or local governments under the Environmental
Laws as hazardous, toxic, pollutants or contaminants, as well as any petroleum
or petroleum derived product.

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

          "Indemnifying Party" shall have the meaning set forth in Section
                                                                   -------
13.4(a) hereof.
-------

                                       4
<PAGE>

          "Judgment" means any order, writ, injunction, fine, citation, award,
decree, or any other judgment of any nature whatsoever of any foreign, federal,
state or local court, any governmental, administrative or regulatory authority,
or any arbitration tribunal.

          "Law" means any provision of any act, statute, ordinance, order,
constitution, charter, treaty, rule or regulation of any foreign, federal, state
or local governmental, administrative or regulatory authority.

          "Lease Cancellation Event" shall have the meaning set forth in Section
                                                                         -------
2.4(c) hereof.
------

          "Lease Cancellation Notice" shall have the meaning set forth in
Section 2.4(c) hereof.
--------------

          "Lease Cancellation Payment" shall have the meaning set forth in
Section 2.4(e) hereof.
--------------

          "Leased Real Property" means the rights and incidents of interest of
PNE in and to the real property leases relating to the operation of the Business
(excluding the Site Leases) which are listed on Schedule 4.16 of the PNE
Disclosure Memorandum.

          "Licenses" means all of PNE's licenses, permits and other
authorizations issued by, or pending with, any federal, state or local
governmental authorities which are used or useful in connection with the
operation of the Business, including, without limitation, those listed on
Schedule 4.23 of the PNE Disclosure Memorandum.

          "Lien" shall have the meaning set forth in Section 2.1(a) hereof.
                                                     --------------

          "Losses" shall have the meaning set forth in Section 13.2(a) hereof.
                                                       ---------------

          "Markets" means each of the following markets in which PNE currently
conducts business: (i) Connecticut, (ii) New Jersey/Philadelphia, (iii)
Maryland/Washington, D.C., and (iv) Harrisburg, Pennsylvania.

          "Maximum Rental" shall have the meaning set forth in Section
                                                               -------
2.4(f)(ii) hereof.
----------

          "NextMedia" shall have the meaning set forth in the preamble hereof.

          "NextMedia Disclosure Memorandum" shall have the meaning set forth in
Section 6.1 hereof.
-----------

          "NextMedia Financial Statements" shall have the meaning set forth in
Section 6.7 hereof.
-----------

          "NextMedia Interests" shall have the meaning set forth in Section
                                                                    -------
2.1(a) hereof.
------

                                       5
<PAGE>

          "NextMedia LLC Agreement" shall have the meaning set forth in Section
                                                                        -------
6.3 hereof.
---

          "NextMedia Outdoor" shall have the meaning set forth in the preamble
hereof.

          "NextMedia Parties" shall have the meaning set forth in the preamble
hereof.

          "Nonassignable Right" shall have the meaning set forth in Section
                                                                    -------
2.3(a) hereof.
------

          "Noncompete Period" shall have the meaning set forth in Section
                                                                  -------
9.10(b) hereof.
-------

          "Obligation" means any debt, liability or duty to pay of any nature
whatsoever, whether secured, unsecured, recourse, non-recourse, liquidated,
unliquidated, accrued, absolute, fixed, contingent, ascertained, unascertained,
known, unknown or otherwise, including, without limitation, liabilities and
obligations under executory Contracts.

          "Offered Rental" shall have the meaning set forth in Section
                                                               -------
2.4(f)(ii) hereof.
----------

          "Offering" shall have the meaning set forth in Section 9.1 hereof.
                                                         -----------

          "Payable Statement" shall have the meaning set forth in Section
                                                                  -------
9.16(a) hereof.
-------

          "Person" means any individual, sole proprietorship, joint venture,
partnership, corporation, limited liability company, association, unincorporated
organization, cooperative, trust, estate, government (or any branch, subdivision
or agency thereof), governmental, administrative or regulatory authority, or any
other entity of any nature whatsoever.

          "Personal Property" includes, without limitation, machinery,
equipment, computer programs, computer software, copyrights, patents,
trademarks, websites, URL addresses, tools, motor vehicles, furniture, leasehold
improvements, office equipment, supplies, inventory, spare parts and all other
tangible or intangible personal property which is owned, used or leased by PNE
in the operation of the Business.

          "PNE" shall have the meaning set forth in the preamble hereof.

          "PNE Carve-Out Financial Statements" shall have the meaning set forth
in Section 4.7 hereof.
   -----------

          "PNE Debt Instruments" shall have the meaning set forth in Section
                                                                     -------
4.20 hereof.
----

          "PNE Disclosure Memorandum" shall have the meaning set forth in
Section 4.1 hereof.
-----------

          "PNE Securities" means the securities held by PNE in the following
wholly-owned subsidiaries of PNE: Crickett, Ltd. and Chesapeake Outdoor
Enterprises, Inc. (collectively, the "PNE Subsidiaries").

                                       6
<PAGE>

          "PNE Subsidiaries" shall have the meaning set forth above.

          "Preliminary Working Capital Amount" shall have the meaning set forth
in Section 9.16(a).
   ---------------

          "Proceeding" means any claim, suit, action, litigation, investigation,
arbitration, administrative hearing, or any other similar matter of any nature
whatsoever

          "Purchased Assets" shall have the meaning set forth in Section 2.1(c)
                                                                 --------------
hereof.

          ."Purchase and Sale" shall have the meaning set forth in the recitals
hereof.

          "Real Property" means, collectively, the real property owned in fee by
PNE relating to the operation of the Business, together with all appurtenant
easements thereunto, and all structures, fixtures and improvements located
thereon, and the Leased Real Property.

          "Receivable Statement" shall have the meaning set forth in Section
                                                                     -------
9.16(a) hereof.
-------

          "Restrictive Covenant" shall have the meaning set forth in Section
                                                                     -------
9.10(a) hereof.
-------

          "Securities Act" shall have the meaning set forth in Section 9.14
                                                               ------------
hereof.

          "Site Leases" shall mean all leases, licenses, easements, occupancy
agreements and other grants of any right to use real property not owned in fee
by PNE for the use, operation, construction, or management of outdoor
Advertising Displays relating to the operation of the Business, and all
extensions, modifications or renewals (whether or not pursuant to different
terms and conditions) thereof to which PNE was a party or of which it had the
benefit as of May 8, 2001 or which have been assumed by or assigned to PNE or
entered into after such date and in effect as of the Closing Date, including,
without limitation, rights to locations on which structures have not been built
which NextMedia Outdoor or NextMedia has specifically agreed to assume after
NextMedia Outdoor or NextMedia has had a reasonable opportunity to review such
Site Leases. All Site Leases in existence as of May 8, 2001 are listed on
Schedule 4.13 of the PNE Disclosure Memorandum, which Schedule sets forth for
each such Site Lease (a) the location of the property, (b) the name of the
lessor or grantor, (c) the expiration date, if any, and (d) the panel number of
the sign, if any, located thereon.

          "Site Lease Lessor Report" shall have the meaning set forth in Section
                                                                         -------
2.4(b) hereof.
------

          "Tax" means any foreign, federal, state, local, county or other taxes
of any kind whatsoever, including, without limitation, (a) income, profits,
premium, estimated, gross receipts, corporate loan, franchise, ad valorem,
severance, capital stock, sales, use, occupancy, production, general property,
real property, personal property, intangible property, transfer,

                                       7
<PAGE>

license, stamp, environmental, withholding, fuel, excise, accumulated earnings,
personal holding company, employment, unemployment compensation, social
security, payroll related, import duties or other governmental charges and
assessments, (b) corporate or other organizational fee, assessment, rent, or any
other fee or charge of any nature whatsoever, or (c) deficiency, interest,
additions to tax, or penalty imposed with respect to any of the foregoing
(including expenses associated with contesting any proposed adjustment with
respect to the foregoing).

          "Tax Return" means any return, information, report or filing with
respect to Taxes, including any schedules attached thereto and including any
amendment thereof.

          "WARN Act" means the Worker Adjustment and Retraining Notification Act
of 1988.

          "Working Capital Amount" shall have the meaning set forth in Section
                                                                       -------
9.16(c) hereof.
-------

                                   ARTICLE II

                       CONTRIBUTION AND PURCHASE AND SALE
                       ----------------------------------

     2.1 Contribution and Purchase and Sale. Subject to the terms and conditions
         ----------------------------------
contained herein, on the Closing Date:

          (a) PNE shall contribute (i) a 26.20% undivided interest in and to the
billboard assets used or useful in the operation of the Business which are
described on Schedule 2.1(a) of the PNE Disclosure Memorandum and (ii) the PNE
Securities (the "Contributed Assets") as a capital contribution to NextMedia in
exchange for $33,000,000 of NextMedia's Class A membership interests, at a price
of $1.16 per interest (the "NextMedia Interests") on the terms and conditions
set forth in the NextMedia LLC Agreement (as defined in Section 6.3 hereof), and
                                                        -----------
PNE shall be credited with an initial capital contribution to NextMedia in the
amount of Thirty-Three Million Dollars ($33,000,000). The Contributed Assets
shall be transferred to NextMedia free and clear of all mortgages, liens,
pledges, encumbrances, equities, restrictions, security or other third party
interests, conditional sales agreements, options, debts, charges, claims and
Obligations of every nature, kind and character (collectively, the "Liens").

          (b) PNE shall sell, transfer, assign, convey and deliver to NextMedia
Outdoor, and NextMedia Outdoor shall purchase from PNE, a 73.80% undivided
interest in and to the billboard assets used or useful in the operation of the
Business which are described on Schedule 2.1(a) of the PNE Disclosure Memorandum
(the "Purchased Assets"), wherever located, free and clear of all Liens.

          (c) The Contributed Assets and the Purchased Assets shall include the
following:

                                       8
<PAGE>

               (i) all of the Assumed Contracts;

               (ii) all of PNE's right, title and interest in and to the
Licenses;

               (iii) all Advertising Displays;

               (iv) all Personal Property;

               (v) all Real Property;

               (vi) all files, books and other records relating primarily to the
Business or the operations thereof, including, without limitation, executed
copies of the Assumed Contracts or, if no executed agreement exists, summaries
of the Assumed Contracts, price lists, marketing information, sales records,
customer lists and files;

               (vii) all of PNE's goodwill with respect to the Business and the
operations thereof;

               (viii) all rights under or pursuant to all warranties,
representations and guarantees made by suppliers in connection with the Assets
or services furnished to PNE to the extent such warranties, representations and
guarantees are assignable; and

               (ix) all such other assets, properties, interests and rights
owned, leased or licensed by PNE that are used or useful in connection with the
Business or the operations thereof, except for any Excluded Assets.

     2.2 Excluded Assets. The following assets of PNE shall not be contributed
         ---------------
to or acquired by either NextMedia or NextMedia Outdoor and shall be deemed
excluded assets (collectively, the "Excluded Assets"):

          (a) PNE's minute books and other books and records relating to
internal governance matters, and any books and records not related to the
Business or the operations thereof; provided, however, that NextMedia or
                                    --------  -------
NextMedia Outdoor, as applicable, shall receive any minute books and other such
books and records relating to the PNE Subsidiaries;

          (b) All claims, rights or interest of PNE in and to any refunds of
federal, state or local franchise, income or other Taxes or fees of any nature
whatsoever which relate solely to the period prior to the Closing Date;

          (c) All Contracts, other than the Assumed Contracts, and all assets or
funds held in trust, or otherwise associated with or used in connection with
PNE's employee benefit plans, programs or arrangements;

          (d) All assets, properties, interests and rights owned by PNE that are
used in connection with PNE's New York operations or the operation of its New
Jersey corporate office;

                                       9
<PAGE>

          (e) All Accounts Receivable; and

          (f) All cash on hand, in bank accounts and all other cash items and
equivalents of PNE relating to the Business or operations thereof as of the
Closing Date.

     2.3 Nonassignable Contracts.
         -----------------------

          (a) Nonassignability. Without limiting or otherwise affecting the
              ----------------
rights of NextMedia or NextMedia Outdoor pursuant to Article XIII of this
                                                     ------------
Agreement, to the extent that any Assumed Contract is not capable of being
assigned without the consent, approval or waiver of a third Person (including,
without limitation, a governmental entity), or if such assignment or attempted
assignment would constitute a breach thereof or a violation of any Law (each, a
"Nonassignable Right"), nothing in this Agreement will constitute an assignment
or require the assignment thereof, except to the extent provided in this Section
                                                                         -------
2.3.
---

          (b) PNE to Use Commercially Reasonable Efforts. Notwithstanding
              ------------------------------------------
anything to the contrary contained herein, PNE shall not be obligated to assign
to NextMedia or NextMedia Outdoor any rights or Obligations in, to or under any
Nonassignable Right without first having obtained all consents, approvals and
waivers necessary for such assignment; provided, however, that PNE shall use its
                                       --------  -------
commercially reasonable efforts to obtain all such consents, approvals and
waivers prior to the Closing and, if the Closing occurs without certain consents
being obtained, PNE shall use its commercially reasonable efforts after the
Closing Date to obtain all such consents, approvals and waivers. NextMedia
Outdoor acknowledges and agrees that it shall cooperate with PNE in PNE's
efforts to obtain all required consents, approvals and waivers.

          (c) If Waivers or Consents Cannot Be Obtained. To the extent that any
              -----------------------------------------
consent, approval or waiver required for the assignment of any Nonassignable
Right cannot be obtained by PNE either prior to or after the Closing, then PNE
shall use it commercially reasonable efforts to: (i) provide to the NextMedia
Parties the financial and business benefits of any such Nonassignable Right and
(ii) enforce, at the request of the NextMedia Parties, for the account of the
NextMedia Parties, any rights of PNE arising from any such Nonassignable Right
(including, without limitation, the right to elect to terminate in accordance
with the terms thereof upon the advice of the NextMedia Parties).

          (d) Not Applicable to Site Leases. This Section 2.3 shall not apply to
              -----------------------------       -----------
consents to assignment required under the Site Leases.

     2.4 Consents to Certain Site Leases.
         -------------------------------

          (a) Pre-Closing Consents. Prior to Closing, PNE shall obtain the
              --------------------
consent of TDI to the assignment of those bulletin Site Leases in which TDI is a
party, which Site Leases are listed on Schedule 2.4(a) of the PNE Disclosure
Memorandum to NextMedia Outdoor and will assist NextMedia Outdoor post-Closing
in obtaining the consent of TDI on non-bulletin Site Leases in which TDI is a
party.

                                       10
<PAGE>

          (b) Post-Closing Consents. In connection with the bulletin Site Leases
              ---------------------
requiring consents to assignment listed on Schedule 2.4(b) of the PNE Disclosure
Memorandum, NextMedia Outdoor shall, at its option, obtain the lessors' consents
to the assignment of such Site Leases to NextMedia Outdoor after the Closing and
shall bear any expenses incidental to obtaining such consents. Within sixty (60)
days after the Closing, NextMedia Outdoor shall provide to PNE a list of those
lessors from whom NextMedia Outdoor intends to seek consents (the "Site Lease
Lessor Report").

          (c) Site Lease Cancellation. If, during the six (6) month period
              -----------------------
commencing on the Closing Date ("the Consent Period"), with respect to any
consent under Section 2.4(b) (provided that NextMedia Outdoor is not in material
              --------------
default with respect to such Site Lease as a result of any action taken by
NextMedia Outdoor after the Closing Date), all of the following occur: (i)
NextMedia Outdoor is unable to obtain the lessor's consent, (ii) NextMedia
Outdoor, after using commercially reasonable efforts to negotiate a new lease,
does not enter into a new lease for the same or a substantially similar site,
and (iii) the lessor terminates the existing Site Lease prior to the expiration
of its term (including extension options other than extension options that
require lease rate negotiations) (collectively, a "Lease Cancellation Event");
then for each Lease Cancellation Event, NextMedia Outdoor may receive a Lease
Cancellation Payment (as defined below) by delivering to PNE a certificate of an
officer of NextMedia Outdoor certifying to PNE the occurrence of the Lease
Cancellation Event (a "Lease Cancellation Notice"). Each Lease Cancellation
Notice shall set forth in reasonable detail a description of the Lease
Cancellation Event and shall contain as an attachment copies of documents
evidencing NextMedia Outdoor's satisfaction of its obligation to exercise
commercially reasonable efforts to negotiate a new Site Lease for the same or a
substantially similar site.

          (d) Procedure for Claims by NextMedia. Upon the occurrence of a Lease
              ---------------------------------
Cancellation Event, PNE shall have thirty (30) days from its receipt of the
Lease Cancellation Notice to request in writing reasonable additional
information from NextMedia Outdoor regarding the Lease Cancellation Event. If
PNE does not request such additional information, PNE will be deemed to have
accepted the Lease Cancellation Notice and shall, upon the expiration of the
Lease Consent Period, pay to NextMedia Outdoor the sum of all Lease Cancellation
Payments (as defined below) in accordance with Section 2.4(i). If PNE requests
                                               --------------
in writing such additional information, NextMedia Outdoor will have thirty (30)
days from its receipt of PNE's request to provide such reasonable information to
PNE or object to the request. If NextMedia Outdoor objects to PNE's request, or
if PNE is not satisfied with the additional information that NextMedia Outdoor
provides, PNE and NextMedia Outdoor shall attempt to resolve their differences
prior to the expiration of the Lease Consent Period. If PNE and NextMedia cannot
resolve their dispute by the expiration of the Lease Consent Period, the parties
shall resolve the dispute by arbitration pursuant to Article XV hereof.
                                                     ----------

          (e) Lease Cancellation Payment Defined. For purposes of this Section
              ----------------------------------                       -------
2.4, a "Lease Cancellation Payment" means a cash payment in an amount equal to
---
the product of the average monthly net revenue attributable to the Advertising
Display(s) covered under the Site Lease during the preceding 12-month period
multiplied by the months remaining on the Site Lease (including extension
options other than extension options that require lease rate negotiation) at the
time of the Lease Cancellation Event, multiplied by fifty percent (50%)

                                       11
<PAGE>

multiplied by twelve (12), then discounted at ten percent (10%) per year, minus
the value of the sign structure at the time of the Lease Cancellation Event.

          (f) Limitations on NextMedia Claims. PNE's obligation to make any
              -------------------------------
Lease Cancellation Payment under this Section 2.4 shall not be triggered unless:
                                      -----------

               (i) NextMedia Outdoor has used commercially reasonable efforts to
contest any lessor's unreasonable refusal to consent to an assignment, including
the institution of reasonable litigation to obtain such consent;

               (ii) (A) NextMedia Outdoor is unable to negotiate a new Site
Lease that is (x) not greater than a one hundred percent (100%) increase of the
rent of the relevant Site Lease at the time of Closing or (y) market rent,
whichever is higher (the "Maximum Rental"), (B) notifies PNE of the rental
amount demanded by the lessor of that Site Lease (the "Offered Rental") and
offers PNE the opportunity, exercisable within 10 days after such notice, to pay
NextMedia Outdoor an amount equal to the difference between the Offered Rental
and the Maximum Rental times the remaining term of the existing lease (including
extension options other than extension options that require lease rate
negotiation), discounted at 10% per year, and (C) PNE does not agree to make
such payment within the 10-day period (in the event that PNE makes such payment,
such Site Lease shall count as a Site Lease under which consent has been
obtained);

               (iii) NextMedia Outdoor does not receive a take-down credit
(i.e., the right to improve a new site lease) with respect to the Site Lease;
and

               (iv) NextMedia Outdoor does not receive the consent of the
lessors with respect to at least 75% of the Site Leases listed on the Site Lease
Lessor Report during the Consent Period.

          (g) Status Reports. On the 1st and 15th day of each calendar month
              --------------
during the Consent Period, NextMedia Outdoor shall provide PNE with a written
report of the following items:

               (i) the number and identity of consents of lessors received by
NextMedia Outdoor since Closing; and

               (ii) an updated status report of the most recent responses (other
than consents) received by NextMedia Outdoor from lessors.

          (h) Cap on Aggregate Claims. PNE's obligation to make any Lease
              -----------------------
Cancellation Payments or payments pursuant to Section 2.4(f)(ii) to NextMedia
                                              ------------------
Outdoor shall not exceed One Million Five Hundred Thousand Dollars
($1,500,000.00) in the aggregate. Any Lease Cancellation Payments by PNE
pursuant to this Section 2.4 shall reduce PNE's aggregate indemnification
                 -----------
liability pursuant to Section 13.5(d) hereof.
                      ---------------

                                       12
<PAGE>

          (i) Offset. Any amount payable to NextMedia Outdoor pursuant to this
              ------
Section 2.4 by PNE shall be made pursuant to the NextMedia Parties' rights of
-----------
offset in Section 13.7 hereof to the extent of the Preliminary Working Capital
          ------------
Amount, if any. To the extent the Preliminary Working Capital Amount is
insufficient to satisfy NextMedia Outdoor's claims under this Section 2.4, PNE
                                                              -----------
shall pay the amount of any deficiency to NextMedia Outdoor within five (5)
Business Days.

          (j) Resolution of Disputes. Any dispute between the parties under this
              ----------------------
Section 2.4 shall be resolved by arbitration pursuant to Article XV.
-----------                                              ----------

     2.5 Liabilities.
         -----------

          (a) Assumed Liabilities. Subject to the provisions of Section 2.5(b),
              -------------------                               --------------
at Closing, the NextMedia Parties shall assume, discharge and perform the
liabilities of PNE arising or to be performed after the Closing Date under the
Assumed Contracts and Licenses in effect on the Closing Date which are a part of
the Assets and all other liabilities that arise from the ownership or operation
of the Assets after the Closing Date. All of the foregoing liabilities shall be
referred to herein collectively as the "Assumed Liabilities."

          (b) Excluded Liabilities. Notwithstanding anything contained in this
              --------------------
Agreement to the contrary, the NextMedia Parties shall not assume or otherwise
be liable in respect of, or be deemed by virtue of the execution and delivery of
this Agreement, or as a result of the consummation of the transactions
contemplated by this Agreement, to have assumed or otherwise be liable in
respect of, any Obligation of PNE, or any of its Affiliates other than the
Assumed Liabilities, including, without limitation, any of the following
Obligations of PNE (collectively, the "Excluded Liabilities"):

               (i) all Obligations of PNE or any predecessor or Affiliate of PNE
which in any way relate to, or arise out of, any of the Excluded Assets;

               (ii) any and all Tax liabilities of PNE;

               (iii) all Obligations of PNE for borrowed money or interest on
such borrowed money;

               (iv) all Obligations arising out of any breach by PNE or any
predecessor or Affiliate of PNE of any of the terms or conditions of any
provision of any Contract;

               (v) all Obligations of PNE or any predecessor or Affiliate of PNE
resulting from, or arising out of, any violation of Law;

               (vi) all claims or Obligations of PNE as an employer, including,
without limitation, liabilities for wages, supplemental unemployment benefits,
vacation benefits, severance benefits, retirement benefits, Federal Consolidated
Omnibus Budget Reconciliation Act of 1985 benefits, Federal Family and Medical
Leave Act of 1993 benefits, WARN Act

                                       13
<PAGE>

Obligations and liabilities, or any other employee benefits, withholding Tax
liabilities, workers' compensation, or unemployment compensation benefits or
premiums, hospitalization or medical claims, occupational disease or disability
claims, or other claims attributable in whole or in part to employment or
termination by PNE or arising out of any labor matter involving PNE as an
employer, and any claims, liabilities and Obligations arising from or relating
to any employee benefit plans;

               (vii) all claims, liabilities, losses, damages, or expenses
relating to any Proceeding of any nature arising out of the Business or
ownership of the Assets on or prior to the Closing Date including, without
limitation, any claims against or any liabilities for injury to, or death of,
Persons or damage to or destruction of property, any workers' compensation
claims, and any warranty claims;

               (viii) except as may otherwise be provided herein, any accounts
payable, other indebtedness, Obligations or accrued liabilities of PNE (except
for Assumed Liabilities);

               (ix) any claims, liabilities, losses, damages, expenses or
Obligations resulting from the failure to comply with, or imposed pursuant to,
any Environmental Law or resulting from the use, presence, generation, storage,
treatment, transportation, handling, disposal, emission or release of Hazardous
Substances, solid wastes, and gaseous matters by PNE or by any other Person
related to, or affiliated with, PNE or the Assets to the extent related to,
arising from or otherwise attributable to acts or omissions prior to, or
conditions existing as of, the Closing Date, including, without limitation, any
Obligation for cleaning up waste disposal sites from or related to acts or
omissions on or prior to the Closing Date; and

               (x) all fees and expenses incurred by PNE in connection with
negotiating, preparing, closing, and carrying out this Agreement and the
transactions contemplated by this Agreement, including, without limitation, the
fees and expenses of PNE's attorneys, accountants, consultants and brokers.

No NextMedia Party shall be the successor employer of PNE's employees for any
purpose and no such party is required to employ any of such employees or has any
liability whatsoever with respect to any employee of PNE.

     2.6 Delivery of NextMedia Interest. Contemporaneously with the Closing,
         ------------------------------
NextMedia shall deliver to PNE a duly executed counterpart of the Joinder
Agreement, substantially in the form of Exhibit A hereto and, effective as of
                                        ---------
the Closing Date, PNE shall be credited with an initial capital contribution to
NextMedia as further described herein.

     2.7 Aggregate Consideration. Subject to Section 2.8, the aggregate
         -----------------------             -----------
consideration ("Aggregate Consideration") for the Assets is $92,150,000,
consisting of $59,150,000 in cash for the Purchased Assets, which amount shall
be paid to PNE or its designee at Closing by wire transfer to an account or
accounts designated by PNE, and the issuance to PNE of the NextMedia Interests
and the receipt by PNE of a credit on the books and records of NextMedia for an
initial capital contribution of Thirty-Three Million Dollars ($33,000,000) in
exchange for the Contributed Assets. NextMedia Outdoor shall be notified by PNE
in writing at least two (2)

                                       14
<PAGE>

Business Days prior to the Closing Date of the account(s) to which the cash
portion of the Aggregate Consideration should be directed.

     2.8 PNE Option to Increase Cash Component of Aggregate Consideration.
         ----------------------------------------------------------------
Notwithstanding the foregoing provisions of this Article II, PNE shall have the
                                                 ----------
option to increase the cash portion of the Aggregate Consideration (with a
corresponding reduction in PNE's initial capital contribution credit) by no more
than One Million Three Hundred Fifty Thousand Dollars ($1,350,000) upon notice
to NextMedia prior to the Closing. If PNE exercises this option, the percentages
in Sections 2.1(a) and 2.1(c) and the amounts in Sections 2.6 and 2.7 shall be
   ---------------     ------                    ------------     ---
adjusted to reflect the change.

     2.9 Adjustments and Prorations.
         --------------------------

          (a) All revenues arising from the operation of the Business, earned or
accrued until midnight on the day prior to the Closing Date, and all expenses,
costs or liabilities, arising therefrom incurred, accrued or payable up until
such time including, without limitation, business, license, utility charges,
real and personal property Taxes and assessments levied against the Assets,
property and equipment rentals, applicable copyright or other fees, sales and
service charges and Taxes (other than income Taxes, which shall be PNE's sole
responsibility for all taxable periods ending prior to the Closing Date, and
those Taxes arising from the sale and transfer of the Assets, which, in the case
of transfer and other similar Taxes shall be paid as set forth in Section 9.8)
                                                                  -----------
shall be prorated among the NextMedia Parties and PNE in accordance with the
principle that (i) in accordance with Section 9.16, PNE shall receive credit for
                                      ------------
all revenues, refunds and deposits of PNE held by third parties and shall be
responsible for all expenses, costs and liabilities incurred, payable or
allocable to the conduct of the Business for the period prior to the Closing
Date and (ii) the NextMedia Parties shall receive all revenues earned or
accrued, and shall be responsible for all expenses, costs and liabilities
incurred, payable or allocable to the conduct of the Business for the period
commencing on and continuing after the Closing Date (provided that the NextMedia
Parties shall have no responsibility for any wages, salaries, vacation,
severance, sick pay or other similar expenses of any employee of PNE, it being
understood that neither of the NextMedia Parties is a successor employer of any
of PNE's employees).

          (b) Adjustments or prorations pursuant to this Section 2.9 will,
                                                         -----------
insofar as feasible, be determined on the Closing Date based upon PNE's
calculation delivered to NextMedia Outdoor five (5) days prior to the Closing
Date and approved by NextMedia Outdoor.

     2.10 Allocation. The NextMedia Parties and PNE agree to allocate Twelve
          ----------
Million Dollars ($12,000,000) to the stock of the PNE Subsidiaries. The
NextMedia Parties and PNE shall attempt in good faith to negotiate an allocation
of the remainder of the Aggregate Consideration to the Assets in a manner which
complies with Section 1060 of the Code prior to Closing. The parties acknowledge
and agree that if the NextMedia Parties and PNE are unable to reach an agreement
prior to Closing, then, within sixty (60) days after Closing, the NextMedia
Parties and PNE shall negotiate in good faith such allocation. In the event that
the NextMedia Parties and PNE cannot agree on such allocation within such
sixty-day period, the matter shall be

                                       15
<PAGE>

submitted to Arthur Andersen, an independent certified public accounting firm
("Accountant") who shall be directed to submit a final allocation to the
NextMedia Parties and PNE within thirty (30) days. Accountant's determination
shall be binding on the NextMedia Parties and PNE. Each party shall bear the
fees and expenses of its own representatives, if any, and shall share equally
the fees and expenses of Accountant, if any. The allocation, whether agreed upon
by the NextMedia Parties and PNE or determined by Accountant, shall be
consistently reported by the NextMedia Parties and PNE on Form 8594 in
compliance with Section 1060 of the Code.

     2.11 Tax-Free Exchange. The parties intend that the Contribution shall
          -----------------
qualify as a tax-free exchange within the meaning of Section 721 of the Code.
The parties shall not take, or omit to take, or cause to be taken or omitted,
any action that would prevent the transaction from qualifying for such treatment
thereunder.

     2.12 Deposit. Within ten (10) days after the execution of this Agreement,
          -------
NextMedia Outdoor, on behalf of the NextMedia Parties, will deliver a letter of
credit reasonably acceptable to PNE in the amount of Five Million Dollars
($5,000,000) to Bank One, Baton Rouge, Louisiana (the "Escrow Agent"), as a good
faith deposit, which letter of credit (the "Deposit"), shall be held by the
Escrow Agent pursuant to the terms and conditions of the Escrow Agreement, of
even date herewith, among NextMedia Outdoor, PNE and the Escrow Agent, a copy of
which is attached as Exhibit B hereto (the "Escrow Agreement"), until the
                     ---------
earlier of the Closing or the termination of this Agreement in accordance with
Article XIV hereof. In the event that this Agreement is properly terminated by
-----------
PNE in accordance with the provisions of Sections 14.1(d) or (e), then the
                                         ----------------    ---
Escrow Agent shall deliver the Deposit to PNE as liquidated damages. The parties
hereby acknowledge and agree that the receipt by PNE of the Deposit following
its termination of this Agreement in accordance with the terms and conditions of
Sections 14.1(d) or (e) shall be PNE's sole and exclusive remedy with respect to
----------------    ---
any such termination. In the event that this Agreement is terminated for any
reason other than by PNE in accordance with Sections 14.1(d) or (e), or the
                                            ----------------    ---
transactions contemplated hereby are consummated, then the Escrow Agent shall
promptly return the Deposit to NextMedia Outdoor.

                                   ARTICLE III

                                     CLOSING
                                     -------

     The transactions contemplated herein shall be consummated (the "Closing")
at the office of Kilpatrick Stockton LLP, at 1100 Peachtree Street, Suite 2800,
Atlanta, Georgia 30309-4530 at 10:00 a.m., eastern standard time, within ten
(10) days after the conditions set forth in Articles X and XI hereof have been
                                            ----------     --
satisfied or waived by the party entitled to do so (the "Closing Date"),
provided that the Closing shall not occur prior to June 30, 2001 or after July
31, 2001, unless the parties mutually agree to another time.

                                       16
<PAGE>

                                   ARTICLE IV

                      REPRESENTATIONS AND WARRANTIES OF PNE
                      -------------------------------------

     To induce the NextMedia Parties to enter into and perform this Agreement,
PNE represents, warrants and agrees as follows, which representations,
warranties and agreements are being made as of the date hereof and shall be
deemed to be made again as of the Closing:

     4.1 PNE Disclosure Memorandum. PNE has delivered to the NextMedia Parties a
         -------------------------
memorandum (the "PNE Disclosure Memorandum") containing certain information
regarding PNE and the PNE Subsidiaries as indicated at various places in this
Agreement. All information set forth in the PNE Disclosure Memorandum or in
documents incorporated by reference in the PNE Disclosure Memorandum is true,
correct and complete in all material respects, does not omit to state any
material fact necessary in order to make the statements therein not misleading,
and shall be deemed for all purposes of this Agreement to constitute part of the
representations and warranties of PNE under this Article IV. The information
                                                 ----------
contained in the PNE Disclosure Memorandum shall be deemed to be part of and
qualify the representations and warranties contained in this Article IV. PNE
                                                             ----------
shall promptly provide the NextMedia Parties with written notification of any
event, occurrence or other information necessary to maintain the PNE Disclosure
Memorandum and all other documents and writings furnished to the NextMedia
Parties pursuant to this Agreement, taken as a whole, materially true, correct
and complete at all times prior to and including the Closing; provided, however,
                                                              --------  -------
that any such written notification shall not be deemed to amend or supplement
the PNE Disclosure Memorandum.

     4.2 Company Existence.
         -----------------

          (a) PNE is a limited liability company, validly existing and in good
standing under the laws of the State of Delaware and has the full power and
authority to own, lease and operate the Assets and to carry on the Business as
it is now being conducted and as presently proposed to be conducted, and is duly
qualified to conduct business and is in good standing in each jurisdiction in
which its operation of the Assets or its ownership or leasing of property makes
such qualification necessary. Each of the foregoing states are listed on
Schedule 4.2(a) of the PNE Disclosure Memorandum.

          (b) Each of the PNE Subsidiaries is a corporation validly existing and
in good standing under the laws of its jurisdiction of incorporation and has the
full power and authority to own, lease and operate its assets and to carry on
its business as it is now being conducted and as presently proposed to be
conducted, and is duly qualified to conduct business and is in good standing in
each jurisdiction in which its operation of its assets or its ownership or
leasing of property makes such qualification necessary. Each of the foregoing
states are listed on Schedule 4.2(b) of the PNE Disclosure Memorandum.

     4.3 Capitalization.
         --------------

          (a) PNE is wholly-owned by PNE Media Holdings, LLC. The PNE
Subsidiaries are wholly-owned by PNE. All of the issued and outstanding shares
of the capital

                                       17
<PAGE>

stock of the PNE Subsidiaries held by PNE were duly authorized for issuance, are
validly issued, fully paid and nonassessable and were not issued in violation of
any preemptive or similar rights.

          (b) There is no existing option, warrant, call, right, stock
appreciation right or equivalent right, commitment or other agreement of any
character to which any PNE Subsidiary or PNE is a party requiring, and there are
no securities of any PNE Subsidiary outstanding which upon conversion or
exchange would require, the issuance, sale or transfer of any additional shares
of capital stock, voting securities or other equity securities of the PNE
Subsidiaries or other securities convertible into, exchangeable for or
evidencing the right to subscribe for or purchase shares of capital stock,
voting securities or other equity securities of the PNE Subsidiaries. Except as
set forth above, no shares of capital stock or other voting securities of the
PNE Subsidiaries are outstanding. Neither of the PNE Subsidiaries nor PNE is a
party to any voting trust or other voting agreement with respect to any of the
shares of common stock of the PNE Subsidiaries or to any agreement relating to
the issuance, sale, redemption, transfer or other disposition of the capital
stock of the PNE Subsidiaries. Except as set forth on Schedule 4.3 of the PNE
Disclosure Memorandum, there are no restrictions as to the transferability of
the PNE Securities.

     4.4 Authorization. PNE has the requisite power and authority to execute,
         -------------
deliver and perform this Agreement and all other agreements to be executed and
delivered by it hereunder or in connection herewith (the "Ancillary
Agreements"), and all necessary actions on the part of PNE have been duly and
validly taken to authorize the execution, delivery and performance of this
Agreement and the Ancillary Agreements.

     4.5 Valid and Binding Obligation. This Agreement has been duly executed and
         ----------------------------
delivered by PNE and constitutes the legal, valid and binding obligation of PNE
enforceable against PNE, and each of the Ancillary Agreements to be delivered by
PNE, when executed and delivered at Closing, will constitute a legal, valid and
binding obligation of PNE, enforceable in accordance with its terms, except as
the enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization and moratorium laws, other laws of general application affecting
the enforcement of creditors' rights generally and general principles of equity.

     4.6 Absence of Conflicting Agreements. Neither the execution, delivery or
         ---------------------------------
performance of this Agreement or the Ancillary Agreements when so executed (with
or without the giving of notice, the lapse of time, or both) nor the
consummation of the transactions contemplated hereby or thereby, (a) will
conflict with any provision of the Articles of Organization or the Operating
Agreement of PNE or the governing documents of the PNE Subsidiaries; (b) will
conflict with, will result in a breach of, or will constitute a default under
any applicable Law, except for those conflicts, breaches and defaults that,
individually or in the aggregate, could not reasonably be expected to have a
material adverse effect on PNE's ability to consummate the transactions
contemplated by this Agreement and the Ancillary Agreements; (c) will result in
a breach of, will conflict with, will constitute a default under or will permit
any party to terminate, modify, accelerate the performance of or cancel the
terms of, any Assumed Contract or License to which PNE is a party or by which
PNE may be bound (except for consents required by the Site Leases); or (d)
create any Lien upon any of the Assets.

                                       18
<PAGE>

     4.7 Financial Statements. PNE has delivered to NextMedia Outdoor, a true,
         --------------------
correct and complete copy of financial statements relating to the Assets and the
operations of the Business as, at and for the fiscal years ended December 31,
1999 and 2000, as audited by PriceWaterhouseCoopers and (b) the unaudited
financial statements for the three (3) month period ended March 31, 2001,
consisting of balance sheets and statements of income (such audited and
unaudited financial statements are collectively referred to as the "PNE
Carve-Out Financial Statements"). The PNE Carve-Out Financial Statements were
prepared in accordance with GAAP. The PNE Carve-Out Financial Statements are
true and correct in all material respects and present fairly in all respects the
financial condition and results of the operations of the Business as of their
respective dates. Except as otherwise indicated in the PNE Carve-Out Financial
Statements, the accounting practices used by PNE in preparing PNE's internal
financial statements for the PNE Carve-Out Financial Statements were the same in
each of the PNE Carve-Out Financial Statements and were consistently followed
throughout the periods reflected in each of the PNE Carve-Out Financial
Statements.

     4.8 Reports. All material returns, reports and statements which PNE or the
         -------
PNE Subsidiaries are required to file with any governmental agency relating to
the operation of the Business or otherwise have been filed, and all reporting
requirements of governmental authorities having jurisdiction over the operation
of the Business by PNE and the PNE Subsidiaries have been complied with.

     4.9 Events Subsequent to PNE Carve-Out Financial Statements. Except as
         -------------------------------------------------------
indicated in Schedule 4.9 of the PNE Disclosure Memorandum, since March 31,
2001, there has not been: (a) any change in the condition of the Assets, the
liabilities or the Business of PNE or the PNE Subsidiaries or any damage,
destruction or loss of any kind (whether or not covered by insurance) or any
other event or circumstance which has had, or could reasonably be expected to
have, a material adverse affect on the Assets, the Business or the PNE
Subsidiaries; (b) any material mortgage on, pledge of, or creation of any other
material Lien on, any of the Assets or the assets or capital stock of the PNE
Subsidiaries; (c) any cancellation or waiver of any right material to the
operation of the Business or cancellation or waiver of any material debts or
claims due or owing to PNE or the PNE Subsidiaries; (d) any sale, transfer or
other disposition of any of the Assets or the assets of the PNE Subsidiaries
(except sales in the ordinary course of business); (e) payment, discharge or
satisfaction of any Obligation by PNE or the PNE Subsidiaries other than in the
ordinary course of business; (f) any material transaction, agreement or event
outside the ordinary course of PNE's or the PNE Subsidiaries' business or which
is inconsistent with past practice; (g) any labor strike or other labor trouble;
(h) any material loss of employees, other than in the ordinary course of
business; (i) any material adverse change in PNE's or the PNE Subsidiaries'
relationship with its suppliers and customers, and PNE has no reason to believe
that any such material adverse change may be reasonably likely to occur; and (j)
any change by PNE or the PNE Subsidiaries in its financial or Tax accounting
principles or methods, except insofar as required by GAAP or applicable Law.

     4.10 Undisclosed Obligations. Except as indicated in Schedule 4.10 of the
          -----------------------
PNE Disclosure Memorandum or otherwise disclosed in this Agreement: (a) neither
PNE nor the PNE Subsidiaries has any liability, secured or unsecured (whether
absolute, accrued, contingent or otherwise and whether due or to become due) of
a nature required by GAAP to be reflected in a

                                       19
<PAGE>

balance sheet or disclosed in the notes thereto except (i) as such Obligations
are reflected in the PNE Carve-Out Financial Statements, or (ii) for Obligations
incurred after March 31, 2001, in the ordinary course of business consistent
with past practices (none of which is a liability resulting from breach of
contract, breach of warranty, tort, infringement, claim or lawsuit), none of
which individually or in the aggregate are materially adverse to the Assets, the
operation of the Business or the PNE Subsidiaries and (b) neither PNE nor the
PNE Subsidiaries has any contingent liabilities or other liabilities outside the
ordinary course of business not reflected in the PNE Carve-Out Financial
Statements.

     4.11 Taxes. Each of PNE and the PNE Subsidiaries has filed, or caused to be
          -----
filed, with the appropriate agencies, all federal, state, county, local or city
Tax Returns and Tax reports affecting the Business or the Assets which are
required by Law to be filed by PNE or the PNE Subsidiaries, and all Tax
assessments and other governmental charges which are due and payable have been
paid. Such Tax Returns and reports are materially true, complete and correct. No
audit of any Tax Returns of PNE or the PNE Subsidiaries is in progress, or to
the knowledge of PNE or the PNE Subsidiaries, threatened and the results of any
completed audits are properly reflected in the PNE Carve-Out Financial
Statements. There exists no past due unpaid Tax or Tax deficiency against PNE or
the PNE Subsidiaries by a governmental agency or authority having jurisdiction.
All Taxes due have been fully paid, or adequate reserves have been set up for
the same and reflected on the PNE Carve-Out Financial Statements, except
reserves for such as may have accrued or been incurred in the ordinary course of
business since the compilation of the PNE Carve-Out Financial Statements. There
exist no grounds for the assertion or assessment of any material additional
Taxes against PNE, the PNE Subsidiaries or the Assets in excess of the reserves
shown on the PNE Carve-Out Financial Statements. Copies of all Tax Returns, Tax
examination reports and statements of deficiencies assessed against, or agreed
to by, PNE or the PNE Subsidiaries with respect to all periods from and after
December 31, 2000 have previously been made available to the NextMedia Parties.
No waiver of any statute of limitations has been given and is in effect against
PNE or the PNE Subsidiaries. All monies required to be withheld by PNE or the
PNE Subsidiaries from employees or collected from customers for income Taxes,
social security and unemployment insurance Taxes and sales, excise and use
Taxes, and the portion of any such Taxes to be paid by PNE or the PNE
Subsidiaries to governmental agencies or set aside in accounts for such purposes
have been so paid or set aside, or such monies have been approved, reserved
against and entered upon the books of PNE and the PNE Subsidiaries and the PNE
Carve-Out Financial Statements.

     4.12 Assets Owned; Use and Condition. Except as indicated in Schedule 4.12
          -------------------------------
of the PNE Disclosure Memorandum or in the PNE Carve-Out Financial Statements,
PNE or the PNE Subsidiaries, as applicable, has good and marketable title to the
Assets and the assets owned by the PNE Subsidiaries, free and clear of all Liens
of every kind and there exists no material restriction on the use or transfer of
the Assets or such assets. The Assets include all material assets used or useful
in connection with the Business as currently conducted and all material assets
which permit the operation of the Business as currently conducted. The
improvements located on, and the use presently being made of the real property,
leased or owned by PNE, taken as a whole, are in material compliance with
applicable zoning ordinances and other applicable Laws. PNE is not aware of any
proposed, pending or threatened change in any code, ordinance

                                       20
<PAGE>

or standard which would materially and adversely affect the Business of PNE, the
PNE Subsidiaries or the use of the Assets.

     4.13 Site Leases. Schedule 4.13 of the PNE Disclosure Memorandum contains a
          -----------
true, correct and materially complete list of all Site Leases used in connection
with, or necessary to conduct the Business as now conducted. Except as otherwise
disclosed on Schedule 4.13 of the PNE Disclosure Memorandum, PNE has a valid
leasehold interest in all of the Site Leases and none of such Site Leases is
subject to any Lien, except for (a) Liens which shall be discharged or removed
by PNE prior to or at Closing, (b) Liens for Taxes not yet due and payable and
(c) such imperfections of title and encumbrances, if any, which are not,
individually or in the aggregate, material in character, amount or extent, and
which do not materially detract from the value, or materially interfere with the
present use (or anticipated use for outdoor displays), of the property subject
thereto or affected thereby. All material Licenses required, if any, with
respect to the Site Leases have been obtained, have been validly issued and are
in full force and effect. PNE is not, and to PNE's knowledge, no other party is
in material default with respect to Site Leases used in and material to, taken
as a whole, the operation of the Business.

     4.14 Contracts. Schedule 4.14 of the PNE Disclosure Memorandum contains a
          ---------
true, correct and complete list of the Advertising Contracts and the other
Assumed Contracts in effect on the date hereof relating to the Business. On or
prior to the date hereof, PNE has provided NextMedia Outdoor with access to
true, correct and complete copies of the Advertising Contracts and the other
Assumed Contracts set forth on Schedule 4.14 and such contracts will be
delivered promptly after the Closing. The Advertising Contracts and other
Assumed Contracts are in full force and effect and are valid, binding and
enforceable against PNE in accordance with their terms. Except as otherwise
disclosed on Schedule 4.14 of the PNE Disclosure Memorandum, there is no default
or breach by PNE, or to PNE's knowledge, any other party to any of the
Advertising Contracts or other Assumed Contracts and there are no negotiations
pending or in progress to revise, modify, terminate or extend any such
contracts. Except as set forth on Schedule 4.14 of the PNE Disclosure
Memorandum, to PNE's knowledge, there is no provision in any Advertising
Contract or other Assumed Contract which any party to such contract is unable to
perform. The Assumed Contracts are the only contractual agreements necessary to
operate the Business as currently conducted and as presently proposed to be
conducted.

     4.15 Consents. Schedule 4.15 of the PNE Disclosure Memorandum sets forth
          --------
(a) those Assumed Contracts (other than the Site Leases) which require consent
for assignment to NextMedia Outdoor and (b) all of the other consents,
governmental or otherwise, required to consummate the transactions contemplated
hereby. Except for the Consents described in Schedule 4.15 of the PNE Disclosure
Memorandum and those consents described in Sections 2.4(a) and 2.4(b) of the PNE
                                           --------------------------
Disclosure Memorandum, no consent, authorization, approval, order, license,
certificate or permit of or from, or declaration or filing with, any federal,
state, local or other governmental authority or any court or other tribunal, and
no consent or waiver of any party to any contract to which PNE or the PNE
Subsidiaries is a party is required or declaration to or filing with any
governmental or regulatory authority, or any other third party is required to:
(i) execute this Agreement or any Ancillary Agreement, (ii) consummate this

                                       21
<PAGE>

Agreement or any Ancillary Agreement and the transactions contemplated hereby or
thereby, or (iii) permit PNE to assign or transfer the Assets to NextMedia
Outdoor.

     4.16 Real Property.
          -------------

          (a) Title to the owned Real Property is, and at Closing shall be, good
and marketable, fee simple absolute, free and clear of all Liens, adverse claims
and other matters affecting PNE's title to or possession of such owned Real
Property, including, but not limited to, all encroachments, boundary disputes,
covenants, restrictions, easements, rights of way, mortgages, security
interests, leases, encumbrances and title objections, excepting only such
easements, restrictions and covenants presently of record which will not, in
NextMedia Outdoor's reasonable business judgment, materially interfere with or
impair NextMedia Outdoor's intended use of any of the owned Real Property or
materially reduce its value.

          (b) Schedule 4.16 of the PNE Disclosure Memorandum lists each lease
relating to the Leased Real Property. Each lease relating to the Leased Real
Property is, and at Closing shall be, in full force and effect and shall not
have been assigned, modified, supplemented or amended, and no party under any
lease relating to the Leased Real Property is in default under any such lease,
and no circumstances or state of facts presently exists which, with the giving
of notice or passage of time, or both, would permit any party under any such
lease to terminate such lease prior to the end of its stated term.

          (c) Except as disclosed on Schedule 4.16 of the PNE Disclosure
Memorandum, the Real Property and the leased property under the Site Leases and
the present uses thereof materially comply with all Laws of all governmental
entities having jurisdiction over the real property, and PNE has received no
notices, oral or written, from any governmental entity, and has no reason to
believe, that the real property or any improvements erected or situated thereon,
or the uses conducted thereon or therein, violate any Laws of any governmental
entity having jurisdiction over the Real Property or the leased property under
the Site Leases.

          (d) Except as identified on Schedule 4.16 of the PNE Disclosure
Memorandum, the improvements located on the Real Property and on the leased
property under the Site Leases are, taken as a whole, in operating condition and
are structurally sound, and the mechanical and other systems located thereon are
in operating condition, subject to normal wear.

     4.17 Personal Property. Schedule 4.17 of the PNE Disclosure Memorandum
          -----------------
contains a true, correct and complete list of all of the items of Personal
Property valued at Fifty Thousand Dollars ($50,000) or greater which the
NextMedia Parties will acquire as of the Closing Date relating to the operation
of the Business. PNE or the PNE Subsidiaries, as applicable, has good and
marketable title to all of the Personal Property and none of the Personal
Property is subject to any Lien, except for (a) Liens which shall be discharged
or removed by PNE prior to or at Closing, (b) Liens for Taxes not yet due and
payable and (c) such imperfections of title and encumbrances, if any, which are
not, individually or in the aggregate, material in character, amount or extent,
and which do not detract from the value, or interfere with the present use, of
the Personal Property subject thereto or affected thereby. PNE is not, and to
PNE's knowledge no other party is, in material default under any of the leases,
licenses or other agreements relating

                                       22
<PAGE>

to the Personal Property. The Personal Property is in operating condition and
repair (ordinary wear and tear excepted), and is available for immediate use in
the Business.

     4.18 Environment, Health and Safety. To PNE's knowledge, except as set
          ------------------------------
forth on Schedule 4.18 of the PNE Disclosure Memorandum:

          (a) PNE's and the PNE Subsidiaries' operation of the Business is in
compliance in all material respects with the Environmental Laws;

          (b) The Business has obtained, and is in material compliance with, all
necessary permits or authorizations that are required under Environmental Laws
to operate the Business;

          (c) No Environmental Claims have been asserted against PNE or the PNE
Subsidiaries or, to the knowledge of PNE, any predecessor in interest, nor does
PNE have knowledge or notice of any threatened or pending Environmental Claim
against PNE or the PNE Subsidiaries; and

          (d) PNE further represents that it has delivered to NextMedia Outdoor
true, correct and complete copies of all environmental reports, studies,
investigations or correspondence in PNE's possession, if any, regarding any
environmental conditions at any of the Site Lease locations or with respect to
any Real Property.

     4.19 Advertising Displays. Except as listed on Schedule 4.19 of the PNE
          --------------------
Disclosure Memorandum, at Closing, PNE will own the Advertising Displays, all of
which are located within the Markets, free and clear of all Liens. Each of the
Advertising Displays is in material compliance with all applicable Laws. The
location of each Advertising Display is set forth on Schedule 4.19 of the PNE
Disclosure Memorandum.

     4.20 Debt Instruments. Schedule 4.20 of the PNE Disclosure Memorandum sets
          ----------------
forth a true, correct and complete list of all (a) material instruments defining
the terms on which PNE has borrowed or is committed to loan money and all oral
agreements therefor (collectively, the "PNE Debt Instruments") and (b) all
indebtedness, including intercompany indebtedness, of the PNE Subsidiaries.

     4.21 Litigation. Except as indicated in Schedule 4.21 of the PNE Disclosure
          ----------
Memorandum, there is no Proceeding now pending or, to the knowledge of PNE,
threatened to which PNE or the PNE Subsidiaries are a party, at law or in
equity, or before any governmental department, commission, board, bureau, agency
or instrumentality which relates to, or in any way affects, the Business or the
Assets (including, without limitation, any Proceedings with respect to the
transactions contemplated by this Agreement or any Ancillary Agreement). No
Judgment has been entered against PNE or the PNE Subsidiaries, and PNE has
received no opinion or memorandum from legal counsel to the effect that it is
exposed, from a legal standpoint, to any liability which may be material to the
operation of the Business or the Assets.

                                       23
<PAGE>

     4.22 Compliance with Laws. PNE and the PNE Subsidiaries have complied in
          --------------------
all material respects with (a) the Licenses and (b) all applicable Laws in
connection with the operation of the Business. To PNE's knowledge, neither the
ownership or the use of the properties of PNE and the PNE Subsidiaries relating
to the Business nor the conduct of the Business conflicts with the rights of any
other Person.

     4.23 Licenses. Schedule 4.23 of the PNE Disclosure Memorandum contains a
          --------
true, correct and complete list of all of the sign permits and all other
Licenses used in, and material to, taken as a whole, the operation of the
Business. Except as disclosed on Schedule 4.23 of the PNE Disclosure Memorandum,
PNE has all material licenses, permits and other authorizations necessary to
conduct the Business in the manner and to the full extent now being conducted by
PNE, including the sign permits and other Licenses listed on Schedule 4.23 of
the PNE Disclosure Memorandum. The Licenses, except as otherwise set forth on
Schedule 4.23 of the PNE Disclosure Memorandum, are in full force and effect,
and the conduct of the Business is in accordance therewith. Upon consummation of
the transactions contemplated hereby, the Licenses will be transferred to
NextMedia Outdoor such that NextMedia Outdoor may continue to operate the
Business as presently operated.

     4.24 Insurance Policies. Schedule 4.24 of the PNE Disclosure Memorandum
          ------------------
sets forth a true, correct and complete list of all insurance policies and bonds
in force covering PNE, the PNE Subsidiaries and any of their respective
properties, operations or personnel and claims histories for each such policy
for the past two (2) years. Such policies comply with the terms of the Site
Leases and other Assumed Contracts with respect to the insurance coverage
required thereunder, if any.

     4.25 Guarantees. Except as provided in Schedule 4.25 of the PNE Disclosure
          ----------
Memorandum, neither PNE nor either of the PNE Subsidiaries is a guarantor,
indemnitor or otherwise liable for any indebtedness of any other Person, except
as endorser of checks received by PNE and the PNE Subsidiaries and deposited in
the ordinary course of business.

     4.26 Brokerage Fees. PNE shall pay, and shall hold the NextMedia Parties
          --------------
harmless against, any liability, loss or expense (including, without limitation,
reasonable attorneys' fees and out-of-pocket expenses) arising in connection
with any broker's commission, finders' fee or similar compensation in connection
with the execution of this Agreement and the consummation of the transactions
contemplated hereby.

     4.27 Securities Regulation. All PNE Securities were issued pursuant to
          ---------------------
exemptions to the registration requirements under the Securities Act of 1933, as
amended, and applicable state securities Laws. The PNE Securities are not
registered nor required to be registered under Section 12(a) of the Securities
Exchange Act of 1934, as amended.

     4.28 Affiliated Transactions. Except as set forth on Schedule 4.28 of the
          -----------------------
PNE Disclosure Schedule, no officer, director, employee, stockholder, member or
Affiliate of PNE or any individual related by blood, marriage, or adoption to
any such individual or any entity in which such Person owns any beneficial
interest, is a party to any non-arm's length agreement, contract, commitment, or
transaction with PNE.

                                       24
<PAGE>

     4.29 No Third Party Options. There are no existing agreements with, options
          ----------------------
or rights of, or commitments to any Person, other than to the NextMedia Parties,
to acquire any of the Assets or any interest therein.

     4.30 Books and Records. The books of account of the Business and the other
          -----------------
records of PNE and the PNE Subsidiaries relating to the Business are true,
correct and complete in all material respects. At the Closing, all such books
and records shall be located at the business office of PNE, except for the books
and records which relate solely and exclusively to the Excluded Assets.

     4.31 Full Disclosure. No representation or warranty by PNE contained in
          ---------------
this Agreement (including the PNE Disclosure Memorandum and the Schedules
hereto), or in any certificate furnished pursuant to this Agreement, contains or
will contain any untrue statement of a material fact, or omits or will omit to
state any material fact necessary, in light of the circumstances under which it
was or will be made, in order to make the statements herein or therein made not
misleading.

     4.32 PNE's Financial Condition. No insolvency proceedings of any character,
          -------------------------
including, without limitation, bankruptcy, receivership, reorganization,
composition or arrangement with creditors, voluntary or involuntary, affecting
PNE, the PNE Subsidiaries or any of their respective assets or properties are
pending, or to PNE's knowledge, threatened, and neither PNE nor the PNE
Subsidiaries has made an assignment for the benefit of creditors, nor taken any
action with a view to, or which would constitute a basis for, the institution of
any such insolvency proceedings. PNE shall use the proceeds received under this
Agreement to pay or to make appropriate provision for the payment of any and all
creditors of PNE prior to making any distribution to its members.

                                    ARTICLE V

               REPRESENTATIONS AND WARRANTIES OF NEXTMEDIA OUTDOOR
               ---------------------------------------------------

     To induce PNE to enter into and perform this Agreement, NextMedia Outdoor
represents, warrants and agrees as follows, which representations, warranties,
covenants and agreements are being made as of the date hereof and shall be
deemed to be made again as of the Closing:

     5.1 Corporate Existence. NextMedia Outdoor is a corporation validly
         -------------------
existing and in good standing under the laws of the State of Delaware and has
the full power and authority to own all of its assets and to carry on its
business as it is now being conducted, and at Closing, Next Media Outdoor will
be duly qualified to conduct business and in good standing in each of the
jurisdictions in which ownership of the Assets would require such qualification.

     5.2 Authorization. NextMedia Outdoor has the requisite power and authority
         -------------
to execute, deliver and perform this Agreement and the Ancillary Agreements, and
all necessary

                                       25
<PAGE>

actions on the part of NextMedia Outdoor have been duly and validly taken to
authorize the execution, delivery and performance of this Agreement and the
Ancillary Agreements.

     5.3 Valid and Binding Obligation. This Agreement has been duly executed and
         ----------------------------
delivered by NextMedia Outdoor and constitutes the legal, valid and binding
obligation of NextMedia Outdoor, enforceable against NextMedia Outdoor, and each
of the Ancillary Agreements to be delivered by NextMedia Outdoor, when executed
and delivered at Closing, will constitute a legal, valid and binding obligation
of NextMedia Outdoor, enforceable in accordance with its terms, except as the
enforceability thereof may be limited by applicable bankruptcy, insolvency,
reorganization and moratorium laws and other laws of general application
affecting the enforcement of creditors' rights generally and general principles
of equity.

     5.4 Brokerage Fees. No Person acting on NextMedia Outdoor's behalf is
         --------------
entitled to any brokerage commissions, finders' fees or similar compensation in
connection with the execution of this Agreement and the consummation of the
transactions contemplated hereby. NextMedia Outdoor shall pay, and shall hold
PNE harmless against, any liability, loss or expense (including, without
limitation, reasonable attorneys' fees and out-of-pocket expenses) arising in
connection with any such claim.

                                   ARTICLE VI

                   REPRESENTATIONS AND WARRANTIES OF NEXTMEDIA
                   -------------------------------------------

          To induce PNE to enter into and perform this Agreement, NextMedia
represents, warrants and agrees as follows, which representations, warranties,
covenants and agreements are being made as of the date hereof and shall be
deemed to be made again as of the Closing:

     6.1 NextMedia Disclosure Memorandum. NextMedia has delivered to PNE a
         -------------------------------
memorandum (the "NextMedia Disclosure Memorandum") containing certain
information regarding NextMedia as indicated at various places in this
Agreement. All information set forth in the NextMedia Disclosure Memorandum or
in documents incorporated by reference in the NextMedia Disclosure Memorandum is
true, correct and complete in all material respects, does not omit to state any
material fact necessary in order to make the statements therein not misleading,
and shall be deemed for all purposes of this Agreement to constitute part of the
representations and warranties of NextMedia under this Article VI. The
                                                       ----------
information contained in the NextMedia Disclosure Memorandum shall be deemed to
be part of and qualify the representations and warranties contained in this
Article VI. NextMedia shall promptly provide PNE with written notification of
----------
any event, occurrence or other information necessary to maintain the NextMedia
Disclosure Memorandum and all other documents and writings furnished to PNE
pursuant to this Agreement taken as a whole materially true, correct and
complete at all times prior to and including the Closing; provided, however,
                                                          --------  -------
that any such written notification shall not be deemed to amend or supplement
the NextMedia Disclosure Memorandum.

                                       26
<PAGE>

     6.2 Corporate Existence. NextMedia is a limited liability company, validly
         -------------------
existing and in good standing under the laws of the State of Delaware and has
the full power and authority to own all of its assets and to carry on its
business as it is now being conducted, and is duly qualified to conduct business
and is in good standing in all jurisdictions in which such qualification would
be necessary.

     6.3 NextMedia Membership Interests. All of NextMedia's issued and
         ------------------------------
outstanding equity interests are owned as shown on Schedule 6.3 of the NextMedia
Disclosure Memorandum. Except as shown on Schedule 6.3 of the NextMedia
Disclosure Memorandum, there are no restrictions as to the transferability of
the NextMedia Interests, except (a) as provided in the NextMedia Investors LLC
Second Amended and Restated Limited Liability Company Agreement dated June 13,
2001 (the "NextMedia LLC Agreement"), (b) such restrictions as may exist under
any federal or state securities Laws or (c) such other transfer restrictions
which are not material to PNE's ownership of the NextMedia Interests being
acquired hereunder.

     6.4 Authorization. NextMedia has the requisite power and authority to
         -------------
execute, deliver and perform this Agreement and the Ancillary Agreements, and
all necessary actions on the part of NextMedia have been duly and validly taken
to authorize the execution, delivery and performance of this Agreement and the
Ancillary Agreements.

     6.5 Authorization and Issuance of Interests. The issuance of the Class A
         ---------------------------------------
Interests (as defined in the NextMedia LLC Agreement) has been duly authorized
by all requisite limited liability company action on the part of NextMedia, and
when issued and delivered in accordance with this Agreement and the NextMedia
LLC Agreement, such Class A Interests will be validly issued and outstanding,
fully paid and nonassessable with no personal liability attaching to the
ownership thereof, free of any encumbrances created by NextMedia and will not
have been issued in violation of preemptive or similar rights of the equity
holders of NextMedia or others. The terms, designations, powers, preferences and
relative, participating, optional and other special rights, and the
qualifications, limitations and restrictions, of the interests are as stated in
the NextMedia LLC Agreement.

     6.6 Valid and Binding Obligation. This Agreement has been duly executed and
         ----------------------------
delivered by NextMedia and constitutes the legal, valid and binding obligation
of NextMedia, enforceable against NextMedia, and each of the Ancillary
Agreements to be delivered by NextMedia, when executed and delivered at Closing,
will constitute a legal, valid and binding obligation of NextMedia, enforceable
in accordance with its terms, except as the enforceability thereof may be
limited by applicable bankruptcy, insolvency, reorganization and moratorium laws
and other laws of general application affecting the enforcement of creditors'
rights generally and general principles of equity.

     6.7 Absence of Conflicting Agreements. Neither the execution, delivery or
         ---------------------------------
performance of this Agreement or the Ancillary Agreements when so executed (with
or without the giving of notice, the lapse of time, or both) nor the
consummation of the transactions contemplated hereby or thereby, (a) will
conflict with any provision of the Articles of Organization or the NextMedia LLC
Agreement; (b) will conflict with, will result in a breach of,

                                       27
<PAGE>

or will constitute a default under any applicable Law, except for those
conflicts, breaches and defaults that, individually or in the aggregate, could
not reasonably be expected to have a material adverse effect on NextMedia's
ability to consummate the transaction contemplated by this Agreement or the
Ancillary Agreements; or (c) will result in a breach of, will conflict with,
will constitute a default under or will permit any party to terminate, modify,
accelerate the performance of or cancel the terms of, any contract or agreement
to which NextMedia is a party or by which NextMedia may be bound.

     6.8 Financial Statements. NextMedia has previously delivered to PNE, a
         --------------------
true, correct and complete copy of (a) NextMedia's financial statements as, at
and for the fiscal year ended December 31, 2000, as audited by
PriceWaterhouseCoopers and (b) the unaudited financial statements for the three
(3) month period ended March 31, 2001, consisting of balance sheets and
statements of income (such audited and unaudited financial statements are
referred to as the "NextMedia Financial Statements"). The NextMedia Financial
Statements were prepared in accordance with GAAP. The NextMedia Financial
Statements are true and correct in all material respects and present fairly in
all material respects the financial condition and results of the operations of
NextMedia as at their respective dates.

     6.9 Reports. All material returns, reports and statements which NextMedia
         -------
is required to file with any governmental agency have been filed, and all
reporting requirements of governmental authorities having jurisdiction over the
operation of NextMedia have been complied with.

     6.10 Events Subsequent to NextMedia Financial Statements. Since March 31,
          ---------------------------------------------------
2001, there has not been any material change by NextMedia in its financial or
Tax accounting principles or methods, except insofar as required by GAAP or
applicable Law.

     6.11 Undisclosed Obligations. NextMedia does not have any material
          -----------------------
obligations, and knows of no basis for any material claim against NextMedia for
any material obligation, except (a) to the extent set forth in the NextMedia
Financial Statements (b) to the extent specifically set forth in this Agreement,
and (c) obligations incurred in the normal and ordinary course of business of
NextMedia since compilation of the NextMedia Financial Statements.

     6.12 Taxes. NextMedia has filed, or caused to be filed, with the
          -----
appropriate agencies, all federal, state, county, local or city Tax Returns and
Tax reports which are required by Law to be filed by NextMedia, and all Tax
assessments and other governmental charges which are due and payable have been
paid. Such Tax Returns and reports are materially true, complete and correct. No
audit of any Tax Returns of NextMedia is in progress, or to the knowledge of
NextMedia, threatened and the results of any completed audits are properly
reflected in the NextMedia Financial Statements. There exists no past due unpaid
Tax or Tax deficiency against NextMedia by a governmental agency or authority
having jurisdiction. All Taxes due have been fully paid, or adequate reserves
have been set up for the same and reflected on the NextMedia Financial
Statements, except reserves for such as may have accrued or been incurred in the
ordinary course of business since the compilation of the NextMedia Financial
Statements. There exist no grounds for the assertion or assessment of any
material additional Taxes against NextMedia in excess of the reserves shown on
the NextMedia Financial Statements. Copies of

                                       28
<PAGE>

all Tax Returns, Tax examination reports and statements of deficiencies assessed
against, or agreed to by, NextMedia with respect to all periods from and after
December 31, 2000 have previously been made available to PNE. No waiver of any
statute of limitations has been given and is in effect against NextMedia.

     6.13 Litigation. There is no Proceeding now pending or to the knowledge of
          ----------
NextMedia threatened, to which NextMedia is a party and which may result in any
Judgment or liability which would have a material adverse impact on NextMedia.
No such Judgment has been entered against NextMedia nor has any such liability
been incurred. There is no claim, action or Proceeding now pending, or to the
knowledge of NextMedia, threatened against NextMedia, which will, or could,
prevent or hamper the consummation of the transactions contemplated by this
Agreement.

     6.14 Compliance with Laws. NextMedia has complied in all material respects
          --------------------
with all applicable Laws in connection with the operation of its business. To
NextMedia's knowledge, neither the ownership or the use of the properties of
NextMedia relating to its business nor the conduct of its business conflicts
with the rights of any other Person.

     6.15 Brokerage Fees. No Person acting on behalf of NextMedia or the
          --------------
NextMedia members is entitled to any brokerage or finder's fee or commission in
connection with the execution of this Agreement and the consummation of the
transactions contemplated hereby. NextMedia shall pay, and shall hold PNE
harmless against, any liability, loss or expense (including, without limitation,
reasonable attorneys' fees and out-of-pocket expenses) arising in connection
with any such claim.

     6.16 Collateral Agreements. NextMedia has delivered to PNE true, correct
          ---------------------
and complete copies of (i) the executed NextMedia LLC Agreement and (ii) the
executed Limited Liability Company Interest Purchase Agreement dated June 13,
2001 by and among NextMedia, the GSCP Investors (as defined in such agreement)
and certain other holders of NextMedia Class A Interests.

                                   ARTICLE VII

                   CONDUCT OF BUSINESS OF PNE PENDING CLOSING
                   ------------------------------------------

During the period from the date of this Agreement and continuing until the
Closing Date, or the earlier termination of this Agreement pursuant to Article
                                                                       -------
XIV hereof, PNE agrees as follows:
---

     7.1 Ordinary Course. Except in specific contemplation of the transactions
         ---------------
contemplated by this Agreement, PNE shall carry on its business and the business
of the PNE Subsidiaries' in the usual, regular and ordinary course in the same
manner as heretofore conducted, without the creation of any Obligations
(monetary or otherwise) to be performed by the NextMedia Parties after the
Closing that exceed $50,000 individually or $100,000 in the aggregate and, PNE
furthermore shall use its commercially reasonable efforts to preserve intact
its, and the PNE Subsidiaries', present business organization, keep available
the services of its,

                                       29
<PAGE>

and the PNE Subsidiaries', present officers and employees, preserve its, and the
PNE Subsidiaries', relationships with representatives, customers, suppliers,
personnel and others having business dealings with PNE and the PNE Subsidiaries
and refrain from materially and adversely changing any of their business
policies.

     7.2 Distributions; Changes in PNE Securities. Except upon the prior written
         ----------------------------------------
approval of the NextMedia Parties, PNE shall not, and shall not propose to,
declare or pay any distribution on, or make other distributions in respect of,
any of the PNE Securities, and PNE shall not, and shall not propose to (a)
split, combine or reclassify any of the PNE Securities or issue, authorize or
propose the issuance of any other securities in respect of, in lieu of or in
substitution for the PNE Securities, or (b) repurchase or otherwise acquire any
of the PNE Securities.

     7.3 Issuance of Securities. PNE shall not, and shall cause the PNE
         ----------------------
Subsidiaries not to, sell, issue, authorize or propose the sale or issuance of,
or purchase or propose the purchase of, any of its securities or any class of
securities convertible into, or rights, warrants or options to acquire, any such
shares or other convertible securities or enter into any agreement with respect
to the foregoing.

     7.4 Governing Documents; Compliance with Law. PNE shall not, and shall
         ----------------------------------------
cause the PNE Subsidiaries not to, amend their respective organizational
documents. PNE shall maintain and shall cause the PNE Subsidiaries to maintain
their limited liability company or corporate existence and powers and shall
fully comply with the terms of the Licenses and all federal, state and local
Laws with respect to the operations and the conduct of the Business.

     7.5 No Acquisitions. PNE shall not, and shall cause the PNE Subsidiaries
         ---------------
not to, acquire by merging or consolidating with, or by purchasing a substantial
portion of the assets of, or by any other manner, any business or any
corporation, partnership, association or other entity or division thereof or
otherwise acquire or agree to acquire any assets which are material,
individually or in the aggregate, to PNE.

     7.6 No Dispositions or Liens. PNE shall not, and shall cause the PNE
         ------------------------
Subsidiaries not to, lease, mortgage, pledge or subject to any Lien any of the
Assets or sell or transfer or otherwise dispose of any of the Assets without
replacing such Assets with an asset of substantially the same value and utility.

     7.7 Modification of Assumed Contracts. PNE shall not, and shall cause the
         ---------------------------------
PNE Subsidiaries not to: (a) modify or extend any Assumed Contract (other than
automatic renewals that are effective without providing any notice) or (b) enter
into any new Contract that would constitute an Assumed Contract, which requires
payments after Closing in excess of $50,000 individually or $100,000 in the
aggregate, without the prior written consent of NextMedia Outdoor.

     7.8 Changes in Accounting Principles. PNE shall not, and shall cause the
         --------------------------------
PNE subsidiaries not to, make (a) any change in accounting principles, methods
or practices followed

                                       30
<PAGE>

by PNE or depreciation or amortization policies or rates, or (b) change any Tax
election or settle any Tax audit or controversy relating to the Assets or to the
operation of the Business.

     7.9 Maintenance of Properties. PNE shall maintain, and shall cause the PNE
         -------------------------
Subsidiaries to maintain, its properties and the Assets in operating condition
and repair for the purposes intended, ordinary wear and tear, and damage by fire
or other casualty excepted.

     7.10 Benefit Plans, Etc. PNE shall not, and shall cause the PNE
          -------------
Subsidiaries not to, enter into or amend any bonus, incentive compensation,
deferred compensation, profit sharing, retirement, pension, group insurance,
stock option, stock purchase or other benefit plan or any union, employment or
consulting agreement except as required by Law, and shall not accelerate the
exercisability of any options, warrants or rights to purchase securities of PNE
pursuant to any benefit plan.

     7.11 Books and Records. The books and records of PNE and the PNE
          -----------------
Subsidiaries shall be maintained in the usual, regular and ordinary course on a
basis consistent with past practice and in accordance with GAAP.

     7.12 Increase in Compensation. Except in the ordinary course of business,
          ------------------------
PNE shall not, and shall cause the PNE Subsidiaries not to, grant to any
officer, employee or agent employed with the Business any increase in
compensation or in severance or termination pay, or enter into any employment
agreement, except as may be required under employment, termination or other
agreements in effect on the date of this Agreement and which are described in
the PNE Disclosure Memorandum. Notwithstanding the foregoing, PNE shall not be
limited or restricted from increasing the compensation of any officer, employee
or agent employed with the Business who will not be hired by the NextMedia
Parties after the Closing so that PNE may incentivize such persons to remain
with PNE through the Closing Date.

     7.13 Payment of Debt. Except as otherwise provided herein or as required to
          ---------------
consummate the transactions contemplated hereby, PNE shall not, and shall cause
the PNE Subsidiaries not to, pay any claim or discharge or satisfy any Lien or
pay any Obligation other than in the ordinary course of business, or as required
by the terms of any written instrument evidencing or governing the same. A copy
of any such instrument has been made available to the NextMedia Parties.

     7.14 Maintenance of Insurance. PNE and the PNE Subsidiaries shall maintain
          ------------------------
and keep or cause to be maintained and kept in full force and effect all of the
insurance on the Assets referred to in Section 4.24 hereof or other insurance
                                       ------------
equivalent thereto.

     7.15 Advise of Changes. PNE shall promptly advise the NextMedia Parties
          -----------------
orally and in writing of any change or event having, or which management of PNE
believes could have, a material adverse effect on the Assets, the operation of
the Business or the PNE Subsidiaries.

                                       31
<PAGE>

                                  ARTICLE VIII

     CONDUCT OF THE BUSINESS OF NEXTMEDIA PENDING CLOSING
     ----------------------------------------------------

     During the period from the date of this Agreement and continuing until the
Closing Date, or the earlier termination of this Agreement pursuant to Article
                                                                       -------
XIV hereof, for purposes of this Article VIII, NextMedia agrees, that:
---                              ------------

     8.1 Ordinary Course. Except in specific contemplation of the transactions
         ---------------
contemplated by this Agreement, NextMedia shall carry on its business in the
usual, regular and ordinary course in the same manner as heretofore conducted,
without the creation of any indebtedness for borrowed money (other than in the
ordinary course of business), and, to the extent consistent with its business,
use its commercially reasonable efforts to preserve intact its present business
organization, keep available the services of its present officers and employees
and preserve its relationships with representatives, personnel and others having
business dealings with NextMedia.

     8.2 Distributions; Changes in NextMedia Units. Except as set forth on
         -----------------------------------------
Schedule 8.2 of the NextMedia Disclosure Memorandum or except upon the prior
written approval of PNE, NextMedia shall not and shall not propose to declare or
pay any distribution on, or make other distributions in respect of, any of
NextMedia's membership interests, and NextMedia shall not propose to: (a) split,
combine or reclassify any of NextMedia's membership interests or issue,
authorize or propose the issuance of any other securities in respect of, in lieu
of or in substitution for NextMedia's membership interests, or (b) repurchase or
otherwise acquire any of NextMedia's membership interests.

     8.3 Changes in Accounting Principles. NextMedia shall not make (a) any
         --------------------------------
change in accounting principles, methods or practices followed by NextMedia or
depreciation or amortization policies or rates, or (b) change any Tax election
or settle any Tax audit or controversy relating to any assets held by NextMedia.

     8.4 Maintenance of Properties. NextMedia shall maintain its properties and
         -------------------------
assets in operating condition and repair for the purposes intended, ordinary
wear and tear, and damage by fire or other casualty, excepted.

     8.5 Books and Records. The books and records of NextMedia shall be
         -----------------
maintained in the usual, regular and ordinary course on a basis consistent with
past practice.

     8.6 Maintenance of Insurance. NextMedia shall maintain and keep or cause to
         ------------------------
be maintained and kept in full force and effect all of the insurance on its
assets or other insurance equivalent thereto.

     8.7 Compliance with Law. NextMedia shall maintain its limited liability
         -------------------
company existence and powers and shall fully comply with all Laws with respect
to its operations and the conduct of its business.

                                       32
<PAGE>

     8.8 Advise of Changes. NextMedia shall promptly advise PNE orally and in
         -----------------
writing of any change or event having, or which management of NextMedia believes
could have, a material adverse effect on the assets, liabilities, business,
operations or financial condition of NextMedia.

                                    ARTICLE 9

                                OTHER AGREEMENTS
                                ----------------

     9.1 Confidentiality. Except as may be necessary for the consummation of the
         ---------------
transactions contemplated hereby, each of PNE and the NextMedia Parties agrees
that it will hold confidential and protect all information provided to it by the
other party, and use such information only in connection with the consummation
of the Contribution and Purchase and Sale; provided, however, that the NextMedia
                                           --------  -------
Parties shall be permitted to disclose such confidential information of PNE as
is necessary for the completion of the pending note offering of NextMedia
Operating, Inc., an Affiliate of the NextMedia Parties (the "Offering").
Notwithstanding the foregoing, the obligations contained in this Section 9.1
                                                                 -----------
shall not in any way restrict the rights of any such Person to use information
that (a) was known to such Person prior to the disclosure by the other party;
(b) is or becomes generally available to the public other than by breach of this
Agreement; (c) such Person is or becomes legally compelled to disclose, provided
                                                                        --------
that such Person provides prompt notice to the affected Person so that such
affected Person may seek a protective order or other appropriate remedy and/or
waive compliance with the provisions of this Section 9.1 and in the event that
                                             -----------
such protective order or other remedy is not obtained or a waiver of the
provisions of this Section 9.1 is not granted, such Person shall furnish only
                   -----------
that portion of the confidential information which is legally required, or (d)
otherwise becomes lawfully available to a party to this Agreement on a
non-confidential basis from a third party who is not under an obligation of
confidence to the other party. If this Agreement is terminated prior to
consummation of the Contribution and the Purchase and Sale, PNE and NextMedia
agree to return all documents and other material, and any copies thereof,
whether or not confidential, provided to it by or on behalf of the other party.
The provisions of this Section 9.1 shall survive any termination of this
                       -----------
Agreement.

     9.2 Full Cooperation; Satisfaction of Conditions. From and after the date
         --------------------------------------------
hereof through the Closing Date, PNE and the NextMedia Parties shall make all
necessary filings, including, without limitation, those required under the HSR
Act, in order to consummate the transactions contemplated by this Agreement and
shall cooperate fully with each other and with their respective agents,
representatives, counsel and accountants in connection with any acts or actions
required to be taken as part of their respective obligations under this
Agreement, including cooperation in the filing of all applications and other
requests for consents and approvals with respect to the transactions
contemplated hereby. From and after the date hereof through the Closing Date,
each of the NextMedia Parties and PNE shall use their respective commercially
reasonable efforts to conduct its business in a manner that on the Closing Date,
the representations and warranties of such party contained in this Agreement
shall be true and correct in all material respects as though such
representations and warranties were made on and as of such date. Furthermore,
each of the NextMedia Parties and PNE shall use their respective

                                       33
<PAGE>

commercially reasonable efforts to satisfy promptly all conditions required
hereby to be satisfied by the NextMedia Parties and PNE in order to consummate
the transactions contemplated by this Agreement.

     9.3 Access. From and after the date hereof through the Closing Date, PNE
         ------
shall: (a) give the NextMedia Parties and their counsel, accountants and other
representatives, reasonable access during normal business hours to all of PNE's
employees and the Assets, in order that the NextMedia Parties may have full
opportunity to make, at the NextMedia Parties' expense, such review, examination
and investigation as the NextMedia Parties desire of the affairs of the Business
and (b) furnish the NextMedia Parties with information and copies of all
documents and agreements including, but not limited to, financial and operating
data and other information concerning the financial condition, results of
operations of the Business that the NextMedia Parties may reasonably request.
The rights of the NextMedia Parties under this Section 9.3 shall not be
                                               -----------
exercised in such a manner as to interfere unreasonably with the business or
operations of PNE.

     9.4 Sale of Assets; Negotiations. From and after the date hereof through
         ----------------------------
the Closing Date, PNE shall not, and PNE shall cause its Affiliates, directors,
officers, employees, agents, representatives, legal counsel, and financial
advisors not to: (a) solicit, initiate, accept, consider, entertain or encourage
the submission of proposals or offers from any Person with respect to the
acquisition contemplated by this Agreement or any similar transaction wherein
such Person would directly or indirectly acquire all or any portion of the
Assets or ownership interests in PNE, or any merger, consolidation, or business
combination, directly or indirectly, for PNE or all or substantially all of
PNE's assets, or (b) participate in any negotiations regarding, or, except as
required by legal process (including pursuant to discovery or agreements
existing on the date hereof), furnish to any Person (other than the NextMedia
Parties) to do or seek any of the foregoing. PNE shall not enter into any
agreement or consummate any transactions that would interfere with the
consummation of the transactions contemplated by this Agreement. If PNE receives
any written inquiry, proposal or offer described in this Section 9.4 or any
                                                         -----------
verbal inquiry, proposal or offer described in this Section 9.4 that is
                                                    -----------
competitive with the terms of the transactions contemplated by this Agreement,
PNE shall inform such inquiring Person of the existence of this Agreement and
make such inquiring Person or entity aware of PNE's obligations under this
Section 9.4. PNE shall not provide any confidential information concerning the
-----------
Business or the Assets to any third party other than in the ordinary course of
the business and consistent with prior practice. PNE has ceased and caused to be
terminated any existing activities, discussions or negotiations with any Person
conducted heretofore with respect to any of the foregoing.

     9.5 Notification. From and after the date hereof through the Closing Date,
         ------------
each party hereto shall promptly notify the other party hereto in writing of:
(a) the failure of such party or, to such party's knowledge, any employee or
agent of such party to comply with or satisfy in any material respect any
covenant, condition or agreement to be complied with hereunder, or (b) the
occurrence of any event that would entitle such party to terminate this
Agreement pursuant to Section 14.1(d).
                      ---------------

                                       34
<PAGE>

     9.6 Response to Certain Actions. From and after the date hereof through the
         ---------------------------
Closing Date, each of the NextMedia Parties and PNE agrees to cooperate and use
its commercially reasonable efforts to contest and resist any action, including
administrative or judicial action, and make reasonable attempts to have vacated,
lifted, reversed or overturned any Judgment, whether temporary, preliminary or
permanent, that is in effect and that restricts, prevents or prohibits the
consummation of the transactions contemplated by this Agreement.

     9.7 Further Assurances. At and after the Closing, PNE shall from time to
         ------------------
time, at the request of, and without further cost and expense to the NextMedia
Parties, take such actions, and shall execute and deliver to the NextMedia
Parties such further deeds, bills of sale or other transfer documents as may be
reasonably requested by the NextMedia Parties in order to more effectively
consummate the transactions contemplated hereby, and the NextMedia Parties shall
from time to time, at the request of, and without further cost and expense to,
PNE, execute and deliver such other instruments and take such other actions as
may reasonably be requested in order to more effectively assume the Assumed
Liabilities.

     9.8 Taxes, Fees and Expenses. All sales, use, transfer, and purchase Taxes
         ------------------------
and fees, if any, arising out of the transfer of the Assets pursuant to this
Agreement shall be paid by PNE. The NextMedia Parties and PNE agree to cooperate
with each other and to file all necessary documentation (including but not
limited to, all Tax Returns) with respect to all such amounts in a timely
manner. Except as otherwise provided in this Agreement, all of the expenses
incurred by PNE in connection with the authorization, preparation, execution and
performance of this Agreement, including, without limitation, all fees and
expenses of its agents, representatives, counsel and accountants and the fees
and expenses related to filing regulatory applications with state and federal
authorities in connection with the transactions contemplated hereby, shall be
paid by PNE. Except as otherwise provided in this Agreement, all of the expenses
incurred by the NextMedia Parties in connection with the authorization,
preparation, execution and performance of this Agreement, including, without
limitation, all fees and expenses of their agents, representatives, counsel and
accountants and the fees and expenses related to filing regulatory applications
with state and federal authorities in connection with the transactions
contemplated hereby, shall be paid by the NextMedia Parties.

     9.9 Bulk Sales Law. The NextMedia Parties hereby waive compliance by PNE
         --------------
with the provisions of Article 6 of the Uniform Commercial Code - Bulk Transfers
and the Bulk Sales Act and any other applicable United States, state or
provincial bulk sales act or statute, if applicable ("Bulk Sales Law"), and PNE
warrants and agrees to pay and discharge when due all claims of creditors which
could be asserted against the NextMedia Parties by reason of such noncompliance
to the extent that such liabilities arise before the Closing, and agrees to
protect, defend, hold harmless and indemnify the NextMedia Parties from and
against any and all such claims and demands pursuant to the procedures set forth
in Article XIII hereof which shall apply thereto in all respects in the event
   ------------
liability for noncompliance with the Bulk Sales Law arises at any time following
the Closing.

     9.10 Noncompetition and Nonsolicitation.
          ----------------------------------

                                       35
<PAGE>

          (a) As additional consideration for the NextMedia Parties' agreement
to acquire the Assets and to remit the Aggregate Consideration to PNE, PNE has
agreed to the noncompetition provision set forth in subparagraph (b) below (the
"Restrictive Covenant"). PNE hereby represents and acknowledges that (i) the
Restrictive Covenant is being entered into in connection with PNE's sale and
contribution of the Assets and (ii) in the absence of PNE agreeing to be bound
by the terms and conditions of the Restrictive Covenant, the Contribution and
the Purchase and Sale would not be consummated by the NextMedia Parties.

          (b) For the three (3) year period following the Closing Date (the
"Noncompete Period"), PNE will not, within any of the Markets, directly or
indirectly, carry on, engage in, assist in or have any financial interest in, or
otherwise participate or be involved in any way in, as an owner, partner,
member, employee, agent, officer, board member, consultant, independent
contractor or shareholder, any outdoor advertising business that is competitive
with the Business. Nothing herein shall prohibit PNE from being a passive owner
of not more than five percent (5%) of the outstanding stock of any class of
securities of a corporation or other entity engaged in such business which is
publicly traded and in which PNE has no active participation. Nothing in this
Section 9.10 shall be construed to prohibit PNE from transferring any of its
------------
assets located in New York which are not being transferred hereunder to any
other party from and after the Closing Date.

          (c) If, at the time of enforcement of the Restrictive Covenant, a
court or an arbitrator shall hold that the duration, scope, area or other
restrictions stated herein are unreasonable, PNE agrees that reasonable maximum
duration, scope, area or other restrictions may be substituted for the stated
duration, scope, area or other restrictions and upon such substitution, this
Agreement shall be automatically modified without further action by the parties
hereto.

          (d) PNE hereby agrees that damages at law, including, but not limited
to, monetary damages, will be an insufficient remedy to the NextMedia Parties in
the event that the Restrictive Covenant is violated and that, in addition to any
remedies or rights that may be available to the NextMedia Parties, all of which
other remedies or rights shall be deemed to be cumulative, retained by the
NextMedia Parties and not waived by the enforcement of any remedy available
hereunder, including, but not limited to, the right to sue for monetary damages,
the NextMedia Parties shall also be entitled, upon application to a court of
competent jurisdiction, to obtain injunctive relief, including, but not limited
to, a temporary restraining order or temporary, preliminary or permanent
injunction, to enforce the Restrictive Covenant, all of which shall constitute
rights and remedies to which the NextMedia Parties may be entitled.

          (e) During the Noncompete Period, PNE will not solicit for employment
any employee of NextMedia Outdoor if such Person is then or was at any time
within the preceding nine (9) months an employee of NextMedia Outdoor, its
subsidiaries or its Affiliates.

     9.11 Publicity. Prior to the Closing, neither party will issue or cause the
          ---------
publication of any press release or other public announcement with respect to
this Agreement or the transactions contemplated hereby without the prior written
consent of the other party; provided, however, that the NextMedia Parties shall
                            --------  -------
be permitted to publicly disclose such information in

                                       36
<PAGE>

the offering memorandum delivered to potential investors with respect to the
Offering. Notwithstanding the foregoing, nothing herein will prohibit either
party from issuing or causing publication of any such press release or public
announcement to the extent that such party determines such action to be required
by Law, in which event the party making such determination will, if practicable
in the circumstances, use commercially reasonable efforts to allow the other
party reasonable time to comment on such release or announcement in advance of
its issuance. The parties hereto acknowledge and agree that following the
Closing of the transactions contemplated hereby that they may issue a joint
press release in agreed form regarding the consummation on the transactions
contemplated hereby. Notwithstanding the foregoing, the parties acknowledge and
agree that each may continue communications with their employees, customers,
suppliers, lenders, lessors, shareholders and other third parties as may be
legally required or necessary or appropriate and not inconsistent with the best
interests of the other parties hereto for the prompt consummation of the
transactions contemplated hereby.

     9.12 Employee Matters.
          ----------------

          (a) PNE shall pay directly to each employee of the Business that
portion of all benefits which has been accrued on behalf of that employee (or is
attributable to expenses properly incurred by that employee) as of the Closing
Date, and the NextMedia Parties shall assume no liability therefor. No portion
of the assets of any employee plan, pension plan or any other plan, fund,
program or arrangement, written or unwritten, heretofore sponsored or maintained
by PNE (and no amount attributable to any such plan, fund, program or
arrangement) shall be transferred to the NextMedia Parties, and the NextMedia
Parties shall not be required to continue any such plan, fund, program or
arrangement after the Closing Date. The amounts payable on account of all
benefit arrangements shall be determined with reference to the date of the event
by reason of which such amounts become payable, without regard to conditions
subsequent, and the NextMedia Parties shall not be liable for any claim for
insurance, reimbursement or other benefits payable by reason of any event which
occurs prior to the Closing Date. All amounts payable directly to employees, or
to any fund, program, arrangement or plan maintained by PNE therefor shall be
paid by PNE within thirty (30) days after the Closing Date to the extent that
such payment is not inconsistent with the terms of such fund, program,
arrangement or plan.

          (b) Simultaneously with the execution of this Agreement or within ten
(10) Business Days thereafter, PNE shall deliver to NextMedia Outdoor a list of
all employees of the Business or the PNE Subsidiaries. As soon as is reasonably
practicable, but in no event more than ten (10) days after such delivery by PNE,
NextMedia Outdoor will provide PNE with a list (the "Employee List") of all
employees to whom NextMedia Outdoor intends to make offers of employment.
NextMedia Outdoor will offer employment as of the Closing to all employees on
such Employee List, on such terms of employment as may be determined by
NextMedia Outdoor in its sole and absolute discretion. All employees of PNE who
are employed by NextMedia Outdoor on or after the Closing Date shall be new
employees of NextMedia Outdoor and any prior employment by PNE of such employees
shall not affect entitlement to, or the amount of, salary or other cash
compensation, current or deferred, which NextMedia Outdoor may make available to
its employees. PNE shall be responsible for all Obligations to those employees
not

                                       37
<PAGE>

offered employment by NextMedia Outdoor, and NextMedia Outdoor shall have no
Obligation whatsoever with respect to such employees.

     9.13 Insurance. With respect to any loss, liability or damage relating to,
          ---------
resulting from or arising out of the conduct of the Business on or prior to the
Closing Date for which PNE would be entitled to assert, or cause any other
person or entity to assert, a claim for recovery under any policy of insurance
maintained by or for the benefit of PNE in respect of the Business or the
Assets, at the request of the NextMedia Parties, PNE will use its commercially
reasonable efforts to assert, or to assist the NextMedia Parties to assert, one
or more claims under such insurance covering such loss, liability or damage the
NextMedia Parties are not themselves entitled to assert such claim but PNE is so
entitled. In the case of any damage to or destruction of the Assets occurring
prior to Closing that is covered by insurance maintained by PNE, PNE shall
deliver all insurance proceeds realized therefrom to the NextMedia Parties at
Closing or as soon thereafter as the same are collected by PNE.

     9.14 Financial Statements. At all times after the date hereof, PNE shall,
          --------------------
and shall cause all of PNE's representatives (including their independent public
accountants) to, cooperate in all reasonable respects with the efforts of the
NextMedia Parties and the NextMedia Parties' independent auditors to prepare
such audited and interim unaudited financial statements of the Assets as the
NextMedia Parties may reasonably determine are necessary in connection with any
filing required to be made by it or any of its Affiliates under the Securities
Exchange Act of 1934, as amended (the "Exchange Act"), or the Securities Act of
1933, as amended (the "Securities Act"). PNE shall execute and deliver to the
NextMedia Parties' independent accountants such customary management
representation letters as they may require as a condition to their ability to
sign an unqualified report upon the audited financial statements of the Assets
for the periods for which such financial statements are required under the
Exchange Act or the Securities Act. PNE shall use its best efforts to cause its
independent public accountants to make available to the NextMedia Parties and
its representatives all of their work papers related to the financial statements
or Tax Returns of PNE (to the extent they relate to the Assets or the operation
of the Business) and to provide the NextMedia Parties' independent public
accountants with full access to those personnel who previously have been
involved in the audit or review of PNE's financial statements or Tax Returns,
subject to any limitations imposed by PNE's independent accountants. Any
reasonable out-of-pocket costs incurred by PNE in connection with PNE's
obligations under this Section 9.14. shall be reimbursed by the NextMedia
                       ------------
Parties within a reasonable time after the NextMedia Parties' receipt of
reasonably detailed information regarding such costs.

     9.15 WARN Act Compliance. Through the Closing Date, PNE shall take all
          -------------------
necessary actions to comply with the WARN Act to the extent applicable. The
NextMedia Parties shall not have any disclosure or announcement obligations
under such act with respect to any employees or former employees of PNE, and PNE
shall indemnify the NextMedia Parties and hold the NextMedia Parties harmless
from any action, claim, suit, proceeding or assertion of liability with respect
thereto. PNE shall take all necessary actions to comply with Part 6, Subtitle B,
of Title I of ERISA with respect to its employees and former employees, and the
NextMedia Parties shall not have any Obligations with respect to qualifying
events (as defined in Section 603 of ERISA) on or before the Closing Date.

                                       38
<PAGE>

     9.16 Working Capital.
          ---------------

          (a) At Closing, PNE shall deliver to NextMedia Outdoor a true, correct
and complete detailed statement (certified by a duly authorized financial
officer of PNE) as of the Closing Date of (i) each Account Receivable (the
"Receivable Statement"), which Receivable Statement also shall include prepaid
items and deposits relating to the operation of the Business and (ii) each
account payable of the Business (the "Payable Statement") (it being expressly
acknowledged by PNE that none of the accounts payable reflected on the Payable
Statement have payment terms greater than 180 days). The "Preliminary Working
Capital Amount" shall be the difference between the Receivable Statement and the
Payable Statement delivered in accordance with this Section 9.16. NextMedia
                                                    ------------
Outdoor and PNE hereby acknowledge and agree that for the eighteen (18) month
period following the Closing Date (the "Collection and Payment Period"),
NextMedia Outdoor shall, on PNE's behalf, (A) use its commercially reasonable
efforts to collect the Accounts Receivable set forth on the Receivable Statement
in accordance with NextMedia Outdoor's customary billing and collection
practices; provided, however, that NextMedia Outdoor shall have no obligation to
           --------  -------
commence litigation, employ counsel or engage the services of a collection
agency to effect such collection nor shall NextMedia Outdoor have any obligation
to compromise, adjust, concede or settle any account receivable generated after
the Closing Date, or otherwise grant any credit or allowance, to effect the
collection of an Account Receivable and (B) pay the accounts payable set forth
on the Payable Statement in accordance with their terms (it being agreed and
understood that notwithstanding the provisions of Sections 2.2(e) and
                                                  ---------------
2.5(b)(viii) of this Agreement, that NextMedia Outdoor shall have the right to
------------
use the Accounts Receivable collected by NextMedia Outdoor pursuant to this
Section 9.16(a) for the duration of the Collection and Payment Period) and
---------------
further may use any amounts related to a prepaid item or to a deposit made by
PNE with respect to the operation of the Business prior to the Closing Date.
Notwithstanding the foregoing, in the event that PNE receives any amounts due to
PNE with respect to the Accounts Receivable, or receives any refund of a prepaid
item or a deposit, during the Collection and Payment Period, PNE shall remit any
and all such amounts to NextMedia Outdoor within five (5) Business Days after
receipt thereof to an account or accounts designated by NextMedia Outdoor. In
addition, in the event that PNE receives any invoice or other notice with
respect to the accounts payable listed on the Payable Statement, PNE shall
promptly deliver such invoice or notice to NextMedia Outdoor for payment.

          (b) No later than the 25th day of each calendar month after the
Closing Date, NextMedia Outdoor shall provide PNE with a written accounting of
the following items:

               (i) a detailed statement of the Accounts Receivable that have
been collected by NextMedia Outdoor in the preceding month and the remaining
Accounts Receivable to be collected in accordance with the Accounts Receivable
set forth on the Receivable Statement; and

               (ii) a detailed statement of the accounts payable that have been
paid by NextMedia Outdoor in the preceding month and the remaining accounts
payable to be paid in accordance with the accounts payable set forth on the
Payable Statement.

                                       39
<PAGE>

          (c) Within five (5) Business Days following the expiration of the
Collection and Payment Period, NextMedia Outdoor shall deliver or shall cause to
be delivered to PNE or its designee, a detailed statement of all of the Accounts
Receivable set forth on the Receivable Statement and all of the accounts payable
set forth on the Payable Statement which have been collected and paid, as
applicable, by NextMedia Outdoor during the Collection and Payment Period and of
all prepaid items for which the NextMedia Parties have received a benefit and
all refunds of deposits which have been received by the NextMedia Parties during
the Collection and Payment Period (the "Final Working Capital Statement"). If
PNE disagrees with the calculation of the Final Working Capital Statement, PNE
shall give prompt written notice to NextMedia Outdoor, but in no event later
than thirty (30) days after receipt of such calculation, specifying in
reasonable detail the nature and extent of such disagreement. Thereafter,
NextMedia Outdoor and PNE shall have period of ten (10) days in which to resolve
such disagreement. If the parties are unable to resolve such disagreement within
such 10-day period, the matter shall be submitted to Accountant and Accountant
shall be directed to submit a revised Final Working Capital Statement to the
parties within thirty (30) days. The Accountant's determination shall be final
and binding on both NextMedia Outdoor and PNE. Each party shall bear the fees
and expenses of its own representatives, including its independent accountants,
if any, in connection with the calculation of the Final Working Capital
Statement and shall share equally the fees and expenses of Accountant, if any.
Within five (5) Business Days following the determination of the Final Working
Capital Statement (either by agreement of the parties or pursuant to the dispute
mechanism described above), the difference between the Accounts Receivable and
the accounts payable set forth on the Final Working Capital Statement (the
"Working Capital Amount") shall be paid in accordance with the provisions of
this Section 9.16(c), less any amounts that have been offset against the
     ---------------
Preliminary Working Capital Amount.

          (d) In the event that the Working Capital Amount is a positive amount,
NextMedia Outdoor shall promptly pay to PNE or its designee the Working Capital
Amount. In the event that the Working Capital Amount is a negative amount, PNE
shall promptly pay to NextMedia Outdoor or its designee the Working Capital
Amount (it being expressly agreed and understood by the parties that NextMedia
Outdoor shall have no liabilities or obligations whatsoever for any Accounts
Receivable which remain uncollected at the end of the Collection and Payment
Period).

     9.17 Indebtedness. On or prior to the Closing Date, PNE shall cause the PNE
          ------------
Subsidiaries to repay all outstanding indebtedness, including the elimination of
any intercompany indebtedness, as set forth in Schedule 4.20(b) of the PNE
Disclosure Memorandum. At Closing, PNE shall deliver to the NextMedia Parties
payoff letters that bind the creditors of PNE to release their Liens upon the
payment of the payoff amount by PNE, including the delivery of appropriate UCC-3
termination statements, the release of the stock of the PNE Subsidiaries and the
delivery of original stock certificates of the PNE Subsidiaries to NextMedia.

                                       40
<PAGE>

                                    ARTICLE X

                        CONDITIONS TO OBLIGATIONS OF PNE
                        --------------------------------

     All of the obligations of PNE under this Agreement are subject to the
fulfillment prior to or at the Closing Date of each of the following conditions,
any one or more of which may be waived by PNE:

     10.1 Representations and Warranties. The representations and warranties of
          ------------------------------
any of the NextMedia Parties contained herein or in any certificate, Schedule or
other document delivered pursuant to the provisions hereof, or in connection
herewith, shall be true and correct in all material respects as of the date when
made and, except where otherwise expressly provided herein, shall be deemed to
be made again at and as of the Closing Date and shall be true and correct in all
material respects at and as of such time, except for those representations and
warranties confined to a specific date, which shall be true and correct as of
such date.

     10.2 Performance of Conditions and Agreements. The NextMedia Parties shall
          ----------------------------------------
have performed and complied in all material respects with all agreements and
conditions required by this Agreement to be performed or complied with by it
prior to or on the Closing Date.

     10.3 Material Adverse Change. Since the date hereof there shall not have
          -----------------------
been, and no event shall have occurred or circumstance exist that may result in,
a material adverse change in the general affairs, business, management,
properties, financial condition, results of operations or prospects of NextMedia
taken as a whole.

     10.4 Certificates, Resolutions, Opinion. The NextMedia Parties shall have
          -----------------------------------
delivered to PNE:

          (a) a certificate executed by an authorized representative of each of
NextMedia and NextMedia Outdoor, dated as of the Closing Date, certifying in
such detail as PNE may reasonably request that the conditions set forth in
Sections 10.1 and 10.2 have been fulfilled;
-------------     ----

          (b) certificates executed by the Secretary of State of the State of
Delaware dated not more than thirty (30) Business Days prior to the Closing
Date, of the valid existence of NextMedia and NextMedia Outdoor under the laws
of Delaware, brought down to the Closing Date;

          (c) an opinion from counsel of NextMedia in form and substance
acceptable to PNE and its counsel, dated the Closing Date.

     10.5 HSR Act. All required filings under the HSR Act shall have been
          -------
completed and all applicable time limitations under the HSR Act shall have
expired without a request for further information by the relevant governmental
authorities, or been terminated, or in the event of a

                                       41
<PAGE>

request for information, all applicable time limitations under the HSR Act shall
have expired without objection of such governmental authorities.

     10.6 No Adverse Proceedings. No injunction, decree or judgment of any
          ----------------------
court, agency or other governmental entities shall have been rendered against
the NextMedia Parties or PNE which would render it unlawful, as of the Closing
Date, to effect the transactions contemplated by this Agreement in accordance
with its terms.

     10.7 Closing Documents. The NextMedia Parties shall be ready, willing and
          ----------------
able to deliver, or cause to be delivered, to PNE on the Closing Date the
documents identified in Section 12.2.
                        ------------

                                   ARTICLE XI

               CONDITIONS TO OBLIGATIONS OF THE NEXTMEDIA PARTIES
               --------------------------------------------------

     All of the obligations of the NextMedia Parties under this Agreement are
subject to the fulfillment prior to or at the Closing Date of each of the
following conditions, any one or more of which may be waived by the NextMedia
Parties:

     11.1 Representations and Warranties. The representations and warranties of
          ------------------------------
PNE contained herein or in any certificate, Schedule or other document delivered
pursuant to the provisions hereof, or in connection herewith, shall be true in
all material respects as of the date when made and, except where otherwise
expressly provided herein, shall be deemed to be made again at and as of the
Closing Date and shall be true in all material respects at and as of such time,
except for those representations and warranties confined to a specific date,
which shall be true and correct as of such date.

     11.2 Performance of Conditions and Agreements. PNE shall have performed and
          ----------------------------------------
complied in all material respects with all agreements and conditions required by
this Agreement to be performed or complied with by it prior to or on the Closing
Date.

     11.3 No Material Adverse Change. Since the date hereof, there shall not
          --------------------------
have been, and no event shall have occurred or circumstance exist that may
result in, a material adverse change in the general affairs, business,
management, properties, financial condition, results of operations or prospects
of PNE taken as a whole with respect to the Business or the Assets.

     11.4 Certificates, Resolutions, Opinion. PNE shall have delivered to
          ----------------------------------
NextMedia:

          (a) a certificate executed by an authorized representative of PNE,
dated as of the Closing Date, certifying in such detail as the NextMedia Parties
may reasonably request, that the conditions set forth in Sections 11.1 and 11.2
                                                         -------------     ----
have been fulfilled;

          (b) certificates executed by the Secretary of State of the State of
Delaware dated not more than thirty (30) Business Days prior to the Closing
Date, of the valid existence of

                                       42
<PAGE>

PNE and the PNE Subsidiaries under the laws of Delaware, brought down to the
Closing Date;

          (c) an opinion from counsel of PNE in form and substance acceptable to
NextMedia and its counsel, dated the Closing Date.

     11.5 Third Party Consents and Governmental Approvals. PNE shall have
          -----------------------------------------------
obtained all third party consents and governmental approvals, if any, required
for the transfer or continuance, as the case may be, of the Assumed Contracts
listed on Schedules 2.4(a) and 4.15 of the PNE Disclosure Memorandum (and
contracts of a similar nature that would have been listed on Schedules 2.4(a)
and 4.15 had they been in existence on the date of this Agreement), the Licenses
and the Site Leases, each in a form satisfactory to the NextMedia Parties in
their sole and absolute discretion and without additional cost, expense or
liability to the NextMedia Parties.

     11.6 HSR Act. All required filings under the HSR Act shall have been
          -------
completed and all applicable time limitations under the HSR Act shall have
expired without a request for further information by the relevant governmental
authorities, or been terminated, or in the event of a request for information,
all applicable time limitations under the HSR Act shall have expired without
objection of such governmental authorities.

     11.7 No Adverse Proceedings. No injunction, decree or judgment of any
          ----------------------
court, agency or other governmental entities shall have been rendered against
the NextMedia Parties or PNE which would render it unlawful, as of the Closing
Date, to effect the transactions contemplated by this Agreement in accordance
with its terms.

     11.8 Financial Statements. PNE shall have delivered the PNE Carve-Out
          --------------------
Financial Statements.

     11.9 Closing Documents. PNE shall be ready, willing and able to deliver, or
          -----------------
cause to be delivered, to NextMedia Outdoor, on the Closing Date, the documents
identified in Section 12.1.
              ------------

                                   ARTICLE XII

                               CLOSING DELIVERIES
                               ------------------

     12.1 Deliveries by PNE. At Closing, PNE shall deliver or cause to be
          -----------------
delivered to the NextMedia Parties the following, in form and substance
reasonably satisfactory to the NextMedia Parties and their counsel:

          (a) Bill of Sale. A duly executed Bill of Sale, substantially in the
              ------------
form of Exhibit C hereto;
       ---------

          (b) Assignment and Assumption Agreements. Duly executed Assignment and
              ------------------------------------
Assumption Agreements, substantially in the forms of Exhibits D-1 and D-2
                                                     ------------     ---
hereto;

                                       43
<PAGE>

          (c) Consents. A copy of each required Consent listed on Schedules
              --------
2.4(a) and 4.15 of the PNE Disclosure Memorandum;

          (d) Manager's Certificate. A certificate of PNE, dated as of the
              ---------------------
Closing Date, executed by the Board of Managers of PNE certifying that the
resolutions, as attached to such certificate, were duly adopted by PNE's
managers and members, authorizing and approving the execution of this Agreement
and the Ancillary Agreements and the consummation of the transactions
contemplated hereby and thereby and that such resolutions remain in full force
and effect;

          (e) Officer's Certificate. A certificate, dated as of the Closing
              ---------------------
Date, executed on behalf of PNE in the form described in Section 11.4(a);
                                                         ---------------

          (f) Licenses, Contracts, Business Records, Etc. To the extent they are
              ------------------------------------------
in possession of PNE, copies of all Licenses, Assumed Contracts, plans, files
and records used by PNE in connection with the ownership of the Assets or the
operation of the Business, which copies shall be available at the Closing at
PNE's principal business office;

          (g) Good Standing. Certificates of good standing as set forth in
              -------------
Section 11.4(b);
---------------

          (h) Foreign Qualifications. Certificates showing that PNE and the PNE
              ----------------------
Subsidiaries are in good standing and are qualified to do business in each of
the states listed on Schedule 4.2(a) and (b) of the PNE Disclosure Memorandum;

          (i) Payoff Letters. Payoff letters evidencing payment of PNE's
              --------------
Obligations with respect to any outstanding loan agreements which are secured by
the Assets, the capital stock or assets of the PNE Subsidiaries in accordance
with Section 9.17 hereof.
     ------------

          (j) Joinder Agreement. A Joinder Agreement in the form of Exhibit A
              -----------------                                     ---------
attached hereto, pursuant to which PNE shall become a party to, and shall agree
to be bound by the terms and conditions of, the NextMedia LLC Agreement;

          (k) Certification of Non-Foreign Status. PNE shall have provided
              -----------------------------------
NextMedia Outdoor with an affidavit of non-foreign status that complies with
Section 1445 of the Code;

          (l) Financial Statements. PNE shall have delivered the financial
              --------------------
statements required to be delivered to the NextMedia Parties pursuant to Section
                                                                         -------
11.9 hereof; and
----

          (m) Stock Powers. PNE shall have delivered duly executed stock powers
              -------------
with respect to the transfer of the PNE Securities to NextMedia Outdoor;

          (n) Minute Books. PNE shall have delivered any minute books or stock
              ------------
transfer records of the PNE Subsidiaries to NextMedia Outdoor, (which stock
records shall include affidavits of lost stock certificates where appropriate);

                                       44
<PAGE>

          (o) Receivable and Payable Statements. PNE shall have delivered the
              ---------------------------------
Receivable Statement and the Payable Statement to NextMedia Outdoor;

          (p) Escrow Instructions. PNE shall have available at Closing and shall
              -------------------
be prepared to deliver the written instructions to the Escrow Agent as required
by Section 1.4 of the Escrow Agreement; and

          (q) Other. Duly executed copies of all other deeds, endorsements,
              -----
assignments, consents and instruments as may be necessary to transfer the
Assets, including the PNE Securities, to the NextMedia Parties.

     12.2 Deliveries by the NextMedia Parties. At Closing, the NextMedia Parties
          -----------------------------------
shall deliver to PNE the following, in form and substance reasonably
satisfactory to PNE and its counsel:

          (a) Aggregate Consideration. The Aggregate Consideration as provided
              -----------------------
in Section 2.7;
   -----------

          (b) Joinder Agreement. A duly executed counterpart of the Joinder
              -----------------
Agreement, substantially in the form of Exhibit A hereto;
                                        ----------

          (c) Assignment and Assumption Agreements. Duly executed counterparts
              ------------------------------------
of the Assignment and Assumption Agreements, substantially in the forms of
Exhibit D-1 and D-2 hereto;
-----------     ---

          (d) Good Standing. Certificates of good standing as set forth in
              -------------
Section 10.4(b); and
--------------

          (e) Officer's Certificate. Certificates, dated as of the Closing Date,
              ---------------------
executed on behalf of NextMedia and NextMedia Outdoor in the form described in
Section 10.4(a).
---------------

                                  ARTICLE XIII

                          SURVIVAL AND INDEMNIFICATION
                          ----------------------------

     13.1 Survival of Representations, Warranties and Covenants.
          -----------------------------------------------------

          (a) All representations, warranties, covenants, and agreements made by
any party hereto in or pursuant to this Agreement or in any instrument, exhibit
or certificate delivered pursuant hereto shall be deemed to have been material
and to have been relied upon by the party to which made. Notwithstanding any
examination made for or on behalf of any of the parties hereto, the knowledge of
any officer, director, employee or agent of any of the parties hereto or any of
their respective Affiliates, or the acceptance of any certificate or opinion,
all representations and warranties contained in this Agreement shall be deemed
continuing representations and warranties and shall survive the Closing Date for
a period of eighteen (18)

                                       45
<PAGE>

months, except for any breach of the representations and warranties contained in
Section 4.11 hereof (Taxes), which shall survive the Closing Date until the
------------
expiration of the applicable statute of limitations, the representations and
warranties contained in Section 4.12 hereof (Assets), which shall survive the
                        ------------
Closing Date indefinitely and the representations and warranties contained in
Section 4.18 hereof (Environmental), which shall survive the Closing Date for
------------
ten (10) years.

          (b) Unless a specified period is set forth in this Agreement (in which
event such period will control), the covenants in this Agreement will survive
the Closing and remain in effect indefinitely.

     13.2 Indemnification by PNE. Subject to Section 13.5, PNE agrees to
          ----------------------             ------------
indemnify, defend and hold harmless the NextMedia Parties and their Affiliates
and their respective directors, officers, partners, employees, agents and
representatives from and against:

          (a) Any and all losses, liabilities or damages ("Losses") resulting
from any untrue representation or breach of any warranty by PNE contained herein
or in any certificate, document or instrument delivered to the NextMedia Parties
hereunder;

          (b) Any and all Losses resulting from the nonfulfillment of any
covenant or other agreement of PNE contained herein or in any certificate,
document or instrument delivered to the NextMedia Parties hereunder;

          (c) Any and all Losses resulting from PNE's ownership of the Assets or
operation or control of the Business prior to the Closing Date, including,
without limitation, any and all liabilities arising under the Licenses or the
Assumed Contracts which relate to events occurring prior to the Closing Date;

          (d) Any Excluded Liabilities;

          (e) Any liabilities for failure to comply with the Bulk Sales Law, as
further described in Section 9.9 of this Agreement; provided, however, that any
                     -----------                    --------  -------
claim relating to PNE's failure to comply with the Bulk Sales Law does not arise
from the failure of Next Media Outdoor to timely pay the accounts payable in
accordance with Section 9.16 of this Agreement; and
                ------------

          (f) Any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs or expenses, including reasonable legal fees and
expenses, incident to any of the foregoing or in enforcing this indemnity.

     13.3 Indemnification by NextMedia Parties. Subject to Section 13.5,
          ------------------------------------             ------------
NextMedia or NextMedia Outdoor, as applicable, agrees to indemnify, defend and
hold harmless PNE and its Affiliates and their respective directors, officers,
partners, employees, agents and representatives from and against:

                                       46
<PAGE>

          (a) Any and all Losses resulting from any untrue representation or
breach of warranty by the NextMedia Parties contained herein or in any
certificate, document or instrument delivered to PNE hereunder;

          (b) Any and all Losses resulting from the nonfulfillment of any
covenant or other agreement of the NextMedia Parties contained herein or in any
certificate, document or instrument delivered to PNE hereunder;

          (c) Any and all Losses resulting from NextMedia Outdoor's ownership of
the Assets or operation or control of the Business on and after the Closing
Date, including, without limitation, any and all liabilities arising under the
Assumed Contracts which relate to events occurring after the Closing Date; and

          (d) Any and all actions, suits, proceedings, claims, demands,
assessments, judgments, costs or expenses, including reasonable legal fees and
expenses, incident to any of the foregoing or in enforcing this indemnity.

     13.4 Procedure for Indemnification. The procedure for indemnification shall
          -----------------------------
be as follows:

          (a) The party claiming indemnification (the "Claimant") shall give
reasonably prompt notice to the party from whom indemnification is claimed (the
"Indemnifying Party") of any claim, whether between the parties or brought by a
third party, specifying (i) the factual basis for such claim and (ii) the amount
of the claim. If the claim relates to an action, suit or proceeding filed by a
third party against Claimant, such notice shall be given by Claimant within ten
(10) Business Days after written notice of such action, suit or proceeding is
received by Claimant.

          (b) Following receipt of notice from Claimant of a claim, Indemnifying
Party shall have twenty (20) Business Days (or such shorter period of time as
may be required to respond to the subject litigation or proceeding) to make such
investigation of the claim as Indemnifying Party deems necessary or desirable.
For the purposes of such investigation, Claimant agrees to make available to
Indemnifying Party or its authorized representative(s) the information relied
upon by Claimant to substantiate the claim. If Claimant and Indemnifying Party
agree at or prior to the expiration of said twenty (20) day period (or any
mutually agreed upon extension thereof) to the validity and amount of such
claim, Indemnifying Party shall immediately pay to Claimant the full amount of
the claim. If Claimant and Indemnifying Party do not agree within said period
(or any mutually agreed upon extension thereof), Claimant may seek appropriate
legal remedy.

          (c) With respect to any claim by a third party as to which Claimant is
entitled to indemnification hereunder, Indemnifying Party shall have the right
at its own expense, to participate in or assume control of the defense of such
claim, and Claimant shall cooperate fully with Indemnifying Party. If
Indemnifying Party elects to assume control of the defense of any third-party
claim, Claimant shall have the right to participate in the defense of such claim
and retain separate co-counsel at its expense; provided if requested to
participate at Indemnifying

                                       47
<PAGE>

Party's request or if Claimant reasonably believes (based upon an opinion of
counsel) that a conflict of interest exists between Claimant and Indemnifying
Party, then Claimant will be reimbursed for reasonable expenses of counsel.
Indemnifying Party will select counsel reasonably satisfactory to Claimant.
Indemnifying Party will not consent to an entry of judgment or settlement
without release of liability and, with respect to nonmonetary terms, Claimant's
consent (not to be unreasonably withheld or delayed).

          (d) If a claim, whether between the parties or by a third party,
requires immediate action, the parties will make every effort to reach a
decision with respect thereto as expeditiously as possible.

          (e) If Indemnifying Party does not elect to assume control or
otherwise participate in the defense of any third party claim, it shall be bound
by the results obtained by Claimant with respect to such claim.

     13.5 Limitation on Rights of Indemnification.
          ---------------------------------------

          (a) The NextMedia Parties shall have no right to indemnification under
this Article XIII unless and until the aggregate amount of any and all such
     ------------
indemnification claims made by the NextMedia Parties under the Agreement exceeds
$100,000 (the "Deductible"), whereupon the NextMedia Parties shall be entitled
to indemnification for all Losses which have been incurred; provided, however,
                                                            --------  -------
that the Deductible shall not apply to claims arising out of fraud.

          (b) PNE shall have no right to indemnification under this Article XIII
                                                                    ------------
unless and until the aggregate amount of any and all such indemnification claims
made by PNE under this Agreement exceeds the Deductible, whereupon PNE shall be
entitled to indemnification for all Losses which have been incurred; provided,
                                                                     --------
however, that the Deductible shall not apply to claims arising out of fraud.
-------

          (c) For purposes of this Section 13.5, indemnification claims shall be
                                   ------------
calculated without regard to any materiality limitation contained in any
representation or warranty.

          (d) In no event shall the NextMedia Parties be liable to PNE on any
one or more claims for more than $5,000,000, in the aggregate. In no event shall
PNE be liable to the NextMedia Parties on any one or more claims for more than
$5,000,000, in the aggregate.

          (e) After the Closing, the indemnification obligations set forth in
this Article XIII shall be the sole and exclusive remedies of the parties
     ------------
pursuant to, arising out of or related to this Agreement and shall be resolved
in accordance with Article XV, except that either party may obtain equitable
                   ----------
relief in connection with or to enforce any covenant set forth herein.

     13.6 Insurance. In calculating the amount of any Losses for which the
          ---------
NextMedia Parties are entitled to indemnification under this Article XIII, the
                                                             ------------
amount of any insurance proceeds received by NextMedia Outdoor pursuant to
Section 9.13 relating to or in connection
------------

                                       48
<PAGE>

with such Losses shall reduce the amount of any such indemnification claim by
NextMedia Outdoor.

     13.7 Right of Offset. If the NextMedia Parties or their Affiliates are
          ---------------
entitled to indemnification from PNE pursuant to this Article XIII, the
                                                      ------------
NextMedia Parties shall first offset any such Losses against the Preliminary
Working Capital Amount, if any, pursuant to the provisions of Section 9.16 to
                                                              ------------
the extent thereof; provided, however, that, notwithstanding anything to the
                    --------  -------
contrary contained in Section 9.16(c), the Working Capital Amount, if any, or
                      --------------
any portion thereof, that is necessary in the reasonable judgment of the
NextMedia Parties, to satisfy any unsatisfied written claims timely made by the
NextMedia Parties pursuant to this Article XIII concerning any indemnifiable
                                   ------------
Losses hereunder, shall not be paid to PNE until final resolution of such claims
has been made in accordance with the provisions of this Article XIII.
                                                        ------------

                                   ARTICLE XIV

                          TERMINATION AND RISK OF LOSS
                          -----------------------------

     14.1 Termination of Agreement. This Agreement may be terminated at any time
          ------------------------
prior to Closing only for the following reasons:

          (a) By the mutual agreement of the NextMedia Parties and PNE;

          (b) By either of PNE or the NextMedia Parties if the Closing has not
occurred by July 31, 2001, provided that if the Closing shall not have occurred
                           --------
on or before any such date due to a breach of this Agreement by the NextMedia
Parties or PNE, the breaching party may not terminate this Agreement pursuant to
this Section 14.1(b);
     ---------------

          (c) By either of PNE or the NextMedia Parties if there shall have been
entered a final, nonappealable order or injunction of any governmental entity
restraining or prohibiting the consummation of the transactions contemplated
hereby or any material part thereof;

          (d) Except as provided in (e) and (f) below, by either of PNE or the
NextMedia Parties if, prior to the Closing Date, the other party is in material
breach of any representation, warranty, covenant or agreement herein contained
and such breach shall not be cured on or before July 31, 2001, provided that
                                                               --------
such terminating party shall not also be in material breach of this Agreement at
the time notice of termination is delivered; or

          (e) By PNE if PNE notifies NextMedia that all of the closing
conditions under Article XI have been met and NextMedia does not or is unable to
                 ----------
close on or before July 31, 2001.

          (f) By NextMedia if NextMedia notifies PNE that all of the closing
conditions under Article X have been met and PNE does not or is unable to close
                 ---------
on or before July 31, 2001.

                                       49
<PAGE>

          (g) By written notice of NextMedia Outdoor to PNE, in accordance with
Section 14.4.
-------------

          (h) By PNE, if NextMedia Outdoor, at any time after June 25, 2001, has
not delivered the Deposit to the Escrow Agent, in which event the NextMedia
Parties will be obligated to pay PNE Five Million Dollars ($5,000,000) as
liquidated damages.

     14.2 Procedures and Effect of Termination. In order to effect the
          -------------------------------------
termination of this Agreement pursuant to, and in accordance with, the terms and
conditions of any provision of Section 14.1, written notice of such termination
shall be given to the other party to this Agreement and this Agreement, assuming
the relevant provision of Section 14.1 has been satisfied, shall terminate and
                          ------------
the transactions contemplated hereby shall be abandoned, without further action
by either of the parties hereto. If this Agreement is terminated as provided
herein:

          (a) upon request therefor, each party shall redeliver all documents,
work papers and other materials of the other party hereto, and all copies of any
such materials, relating to the transactions contemplated hereby, whether
obtained before or after the execution hereof, to the party furnishing the same;
and

          (b) neither party hereto shall have any liability or further
obligation to the other party to this Agreement resulting from such termination
except: (i) that the provisions of Section 9.1 (Confidentiality), Section 9.8
                                   -----------                    -----------
(Expenses) and this Section 14.2 shall remain in full force and effect and the
                    ------------
parties shall have the obligations stated therein, and (ii) no party waives any
claim or right for damages against a breaching party to the extent that such
termination results from the breach by a party hereto of any of its
representations, warranties, covenants or agreements set forth herein.

     14.3 Remedies. In the event of any wrongful termination of this Agreement
          --------
by either party, the other party shall have the right to seek all legal and
equitable remedies for damages resulting from such wrongful termination.

     14.4 Risk of Loss. The risk of loss or damage to the Assets shall be upon
          ------------
PNE at all times prior to the Closing Date, unless such loss or damage was
caused by the NextMedia Parties or by any employee of the NextMedia Parties .
PNE shall promptly notify the NextMedia Parties of any such loss or damage. If
the lost or damaged Assets are capable of being replaced or repaired for an
aggregate amount less than $10,000,000, then PNE shall, at its sole cost and
expense, replace or repair such Assets prior to the Closing Date or deliver to
the NextMedia Parties at the Closing an amount in cash equal to the cost of
replacement or repair of such Assets, as mutually agreed in good faith by the
NextMedia Parties and PNE, unless such loss or damage was caused by the
NextMedia Parties or by any employee of the NextMedia Parties. Notwithstanding
the foregoing, if the amount required to replace or repair such Assets exceeds
$10,000,000, PNE may elect not to replace or repair such Assets, provided,
                                                                 ---------
however, that in such event the NextMedia Parties, at their option, may elect to
-------
terminate this Agreement without either party being subject to a claim by the
other for damages in connection with this Section 14.4, or the NextMedia Parties
                                          ------------
may waive any default or breach with respect to the loss

                                       50
<PAGE>

or damage and receive a $10,000,000 reduction in the cash portion of Aggregate
Consideration payable at Closing.

     14.5 Resolution of Disagreements. If the NextMedia Parties and PNE are
          ---------------------------
unable to agree upon the extent of any loss or damage, the cost to repair,
replace or restore any lost or damaged property, the adequacy of any repair,
replacement, or restoration of any lost or damaged property, or any other matter
arising under Section 14.4, the disagreement shall be referred to an insurance
              ------------
company mutually acceptable to each of the NextMedia Parties and PNE, whose
decision shall be final, binding upon and non-appealable by the parties, and
whose fees and expenses shall be paid one-half by PNE and one-half by the
NextMedia Parties.

                                   ARTICLE XV

                                   ARBITRATION
                                   -----------

     15.1 Arbitration.
          -----------

          (a) Except as otherwise set forth in this Agreement, any dispute,
controversy or claim arising out of or relating to this Agreement (including any
questions regarding its existence, validity, scope or termination) or the
performance by the parties of its terms shall be finally settled by binding
arbitration held in Wilmington, Delaware in accordance with the Commercial
Arbitration Rules of the American Arbitration Association then in effect. The
interpretation and enforceability of this Article XV shall be governed
                                          ----------
exclusively by the Federal Arbitration Act, 9 U.S.C. Sections 1-16.

          (b) The panel of arbitrators shall consist of three neutral
arbitrators to be selected by the American Arbitration Association from a list
of arbitrators compiled by the American Arbitration Association.

          (c) The arbitrator(s) shall allow such discovery as the arbitrator(s)
determine appropriate under the circumstances and shall resolve the dispute as
expeditiously as practicable, and if reasonably practicable, within one hundred
twenty (120) days after the selection of the arbitrator(s). The arbitrator(s)
shall give the parties written notice of the decision, with the reasons therefor
set out, and shall have thirty (30) days thereafter to reconsider and modify
such decision if any party so requests within ten (10) days after the decision.
Thereafter, the decision of the arbitrator(s) shall be final, binding, and
nonappealable, absent fraud or arithmetical error, with respect to all Persons,
including, without limitation, Persons who have failed or refused to participate
in the arbitration process.

          (d) The arbitrator(s) shall have authority to award relief under legal
or equitable principles, including interim or preliminary relief, and to award
the costs of the arbitration and recovery of attorneys fees and expenses in such
manner as may be consistent with the arbitrator(s) deem appropriate.

                                       51
<PAGE>

          (e) All proceedings under this Article XV, and all evidence given or
                                         ----------
discovered pursuant hereto, shall be maintained in confidence by all parties.

          (f) The arbitrator's decision shall be binding, and the prevailing
party may enforce such decision in any court of competent jurisdiction.

          (g) The fact that the dispute resolution procedures specified in this
Agreement shall have been or may be invoked shall not excuse any party from
performing its obligations under this Agreement and during the pendency of any
such procedure all parties shall continue to perform their respective
obligations in good faith, subject to any rights to terminate this Agreement
that may be available to any party and to the right of set off provided herein.

          (h) All applicable statutes of limitation shall be tolled while the
procedures specified in this Article XV are pending. The parties will take such
                             ----------
action, if any, required to effectuate such tolling.

                                   ARTICLE XVI

                                  MISCELLANEOUS
                                  -------------

          16.1 Notice. All notices, requests, demands and other communications
required or permitted hereunder shall be in writing and shall be deemed to have
been duly given if delivered or mailed, first class, or by facsimile, certified
mail, postage prepaid to each of the parties hereto at the respective addresses
set forth below (or at such other address either party may have theretofore
notified the other party in writing):

             (a)   To:                   PNE MEDIA, LLC
                                         2104 Stanley Terrace
                                         Union, New Jersey  07083
                                         Attn:  Ash Varma
                                         Fax:  908-688-0827

                   With copies to:       R. Alexander Bransford, Jr.
                                         Kilpatrick Stockton LLP
                                         1100 Peachtree Street
                                         Suite 2800
                                         Atlanta, Georgia 30309-4530
                                         Fax:  404-815-6039

             (b)   To:                   NextMedia Outdoor, Inc.
                                         6312 South Fiddler's Green Circle, 360E
                                         Englewood, CO  80111
                                         Attn:  Sean R. Stover
                                         Fax:  (303) 694-4940

                                       52
<PAGE>

                   With copies to:       Glenn D. West and John Quattrocchi
                                         Weil, Gotshal & Manges LLP
                                         100 Crescent Court
                                         Suite 1300
                                         Dallas, Texas  75201-6950
                                         Fax:  214-746-7777

For purposes of this notice provision, NextMedia Outdoor shall serve as agent
for notice for each of the NextMedia Parties.

     16.2 Entire Agreement. This Agreement supersedes all prior discussions and
          ----------------
agreements by and between PNE and the NextMedia Parties with respect to the
Contribution and the Purchase and Sale and the other matters with respect
thereto, and the Agreement and the documents referenced herein contain the sole
and entire agreement among the parties hereto with respect to the transactions
contemplated herein.

     16.3 Waiver; Amendment. Prior to or on the Closing Date, PNE, acting
          -----------------
through its Board of Managers, Chairman or President, shall have the right to
waive any default in the performance of any term of this Agreement by the
NextMedia Parties, to waive or extend the time for the fulfillment by the
NextMedia Parties of any and all of its obligations under this Agreement, and to
waive any or all of the conditions precedent to the obligations of PNE under
this Agreement, except any condition which, if not satisfied, would result in
the violation of any material Law or applicable governmental regulation. Prior
to or on the Closing Date, the NextMedia Parties, acting through their
authorized representatives, shall have the right to waive any default in the
performance of any term of this Agreement by PNE, to waive or extend the time
for the fulfillment by PNE of any and all of its obligations under this
Agreement, and to waive any or all of the conditions precedent to the
obligations of the NextMedia Parties under this Agreement, except any condition
which, if not satisfied, would result in the violation of any Law. This
Agreement may be amended by a subsequent writing signed by the parties hereto.

     16.4 Officers' Certificates. Each certificate executed and delivered by an
          ----------------------
authorized representative of a party pursuant to this Agreement shall be deemed
to have been executed and delivered by such authorized representative in his or
her capacity as an authorized representative of the party on whose behalf the
certificate is executed and delivered, and not in his or her personal capacity,
and such officer shall have no personal liability by reason of his or her
execution or delivery of any such certificate in the absence of fraud,
deliberate misrepresentation, other intentional tortuous conduct, or gross
negligence on the part of such authorized representative.

     16.5 Counterparts, Headings, Etc. This Agreement may be executed
          ---------------------------
simultaneously in any number of counterparts, each of which shall be deemed an
original, but all of which shall constitute one and the same instrument. The
headings herein set out are for convenience of reference only and shall not be
deemed a part of this Agreement.

     16.6 Binding Effect. This Agreement shall be binding upon and shall inure
          --------------
to the benefit of the parties hereto and their respective successors and
permitted assigns. Neither party

                                       53
<PAGE>

may assign this Agreement without the prior written consent of the other party
hereto; provided, however, that NextMedia Outdoor may assign this Agreement to
        --------  -------
any of its wholly owned subsidiaries or Affiliates.

     16.7 Governing Law. The validity and effect of this Agreement and the
          -------------
rights and obligations of the parties hereto shall be governed by and construed
and enforced in accordance with the laws of the State of Delaware without
regards to conflicts of laws principles.

                [REMAINDER OF THIS PAGE INTENTIONALLY LEFT BLANK]

                                       54
<PAGE>

     IN WITNESS WHEREOF, the parties have caused this Agreement to be executed
by their duly authorized representatives as of the day and year first above
written.

                                      PNE MEDIA, LLC

                                      By:_______________________________________
                                      Name:_____________________________________
                                      Title:____________________________________

                                      NEXTMEDIA INVESTORS LLC

                                      By:_______________________________________
                                      Name:_____________________________________
                                      Title:____________________________________

                                      NEXTMEDIA OUTDOOR, INC.

                                      By:_______________________________________
                                      Name:_____________________________________
                                      Title:____________________________________

                                       55

Source: [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00037-of-00352.parquet"}, [{"source": "alea-institute/alea-institute/kl3m-data-edgar-agreements/train-00037-of-00352.parquet"}]]