Document:

Exhibit
10.3

 

SECOND
AMENDMENT TO ASSET PURCHASE AGREEMENT

 

THIS
SECOND AMENDMENT TO ASSET PURCHASE AGREEMENT (this “Amendment”), is made as of May 2, 2003, by
and among BIG CITY RADIO, INC., a
Delaware corporation (“BCR”),
BIG CITY RADIO-CHI, L.L.C., a Delaware limited liability company (“BCR License
Sub”; BCR, together with BCR
License Sub, “Seller”), HBC ILLINOIS, INC., a Delaware corporation (“HBC Illinois”), and HBC LICENSE
CORPORATION, a Delaware corporation (“HBC
License” and together with HBC Illinois the “Purchaser”).

 

WHEREAS,
Seller and HBC Illinois are parties to that certain Asset
Purchase Agreement dated as of January 2, 2003 (as amended by the First
Amendment to Asset Purchase Agreement, dated as of January 10, 2003, the “Purchase Agreement”);

 

WHEREAS,
HBC Illinois and Seller desire to make certain modifications
to the Purchase Agreement, including, among other matters, (i) to include HBC
License as a party thereto and (ii) to reflect the rescission of the
designation of the Designated Licensee as the proposed assignee of the FCC
Licenses; and

 

WHEREAS,
all capitalized terms used herein and not otherwise defined
herein shall have the meanings ascribed to such terms in the Purchase
Agreement.

 

NOW,
THEREFORE, in consideration of the premises and the mutual
covenants and agreements herein contained, the parties hereto agree as follows:

 

1.                                       The
sixth “WHEREAS” paragraph of the Purchase Agreement is hereby deleted and
replaced with the following:

 

“WHEREAS, in order
to ensure an orderly, timely and efficient consummation of the transactions
contemplated herein, in light of the pending Merger and Seller’s auction
process, Purchaser had previously designated Designated Licensee as the
assignee of the FCC Licenses and certain other assets of the Station; and

 

WHEREAS, with the
concurrence of Seller and Designated Licensee, Purchaser has subsequently
determined to rescind such designation of the Designated Licensee.”

 

2.                                       The
lead-in paragraph to Section 2.1 of the Purchase Agreement is hereby
amended to read as follows:

 

2.1.                            Purchase and Sale of Assets.

 

Subject to the conditions set forth in
this Agreement, at the Closing, Seller shall assign, transfer, convey and
deliver to Purchaser, and Purchaser shall purchase and accept from Seller, all
right, title and interest of Seller in and to the following assets relating to
the Station (the “Purchased Assets”), free
and clear of all Liens (other than Permitted Liens):

 

 

3.                                       A new Section
2.4 shall be added to the Purchase Agreement to read as follows:

 

2.4.                            Initial Transfer of Certain Purchased Assets.

 

Notwithstanding any provision to the
contrary, Purchaser and Seller have elected to effect the sale and transfer of
the Purchased Assets (other than the License Assets) and the assignment and
assumption of the Assumed Contract (collectively, the “Initial Transfer”), each as effective as of May 2, 2003
(the “Initial Transfer Date”).  For purposes of prorating items of expense
relating to the Purchased Assets transferred at the Initial Transfer pursuant
to Section 3.5 and determining the risk of loss with respect to such
Purchased Assets pursuant to Section 6.8, references in such Sections to
the “Closing” and the “Closing Date” shall be deemed to be references to the
“Initial Transfer” and the “Initial Transfer Date”.

 

4.                                       The
paragraph which succeeds Section 2.1.8 of the Purchase Agreement is
hereby deleted in its entirety.

 

5.                                       Section 3.1 of the Purchase Agreement is
hereby amended to read as follows:

 

3.1.                            Purchase Price.

 

The purchase price for the Purchased Assets
shall be Thirty-Two Million Eight Hundred Seventy-Five Thousand Dollars
($32,875,000), plus the Additional Amount (as defined below), if any
(collectively, the “Purchase Price”).  Purchaser shall pay the Purchase Price to
Seller as follows: (a) the sum of Twenty-Nine Million Eight Hundred
Seventy-Five Thousand Dollars ($29,875,000) paid by Purchaser to Seller on the
Initial Transfer Date pursuant to the Time Brokerage Agreement shall be
credited towards the payment of the Purchase Price and (b) the sum of
Three Million Dollars ($3,000,000) shall be paid in cash to Seller on the
“Deferred Payment Date” (as hereinafter defined) by wire transfer of
immediately available funds to an account or accounts identified by Seller in
writing prior to the Deferred Payment Date. 
As used herein, the “Deferred Payment
Date” shall mean the earlier of (i) the Closing Date or (ii) if Purchaser has
not assigned this Agreement to an unaffiliated third party in accordance with Section 11.8.1
prior to the eighteenth (18th) month anniversary date of this
Agreement (the “18 Month Date”), then
the 18 Month Date.  In addition, if the
Closing has not occurred prior to the 18 Month Date and Purchaser has not
assigned this Agreement to an unaffiliated third party in accordance with Section 11.8.1
prior to the 18 Month Date, then the Purchase Price shall increase by Three
Hundred Thousand Dollars ($300,000) (the “Additional
Amount”).  Purchaser shall pay the
Additional Amount to Seller on the Closing Date by wire transfer of immediately
available funds to an account or accounts identified by Seller in writing prior
to the Closing Date.

 

6.                                       Section 3.2 of the Purchase Agreement is
hereby amended by replacing the words “Purchased Assets” with the words
“License Assets”.

 

2

 

7.                                       Section 3.3 of the Purchase Agreement is
hereby amended to read as follows:

 

3.3.                            Transfer
and Closing Procedures.

 

At the Initial Transfer and the Closing, Seller shall
deliver to Purchaser such bills of sale, instruments of assignment, transfer
and conveyance and similar documents as Purchaser shall reasonably
request.  Against such delivery,
Purchaser shall (a) pay the Purchase Price to Seller in accordance with Section
3.1 above and (b) at the Initial Transfer, execute and deliver an
assumption agreement with respect to the Assumed Contract in a form reasonably
acceptable to both Seller and Purchaser. 
Each party will cause to be prepared, executed and delivered all other documents
required to be delivered by such party pursuant to this Agreement and all other
appropriate and customary documents as another party or its counsel may
reasonably request for the purpose of consummating the transactions
contemplated by this Agreement.  All
actions taken at the Initial Transfer and the Closing shall be deemed to have
been taken simultaneously at the time the last of any such actions is taken or
completed at the Initial Transfer or the Closing, as applicable.

 

8.                                       Section
5.6 of the Purchase Agreement is hereby deleted in its entirety.

 

9.                                       Section
6.1.1 of the Purchase Agreement is hereby amended to read as follows:

 

6.1.1.                     No later
than one (1) Business Day after the date hereof, BCR License Sub, with the
concurrence of Designated Licensee, shall request that the FCC dismiss the
pending application for FCC consent to the assignment of the FCC Licenses from
BCR License Sub to Designated Licensee, FCC File No. BALH-20030102ACF, and no
later than one (1) Business Day after such dismissal, Seller and Purchaser
shall jointly cause to be filed applications with the FCC requesting the FCC’s consent to the assignment of the FCC
Licenses from BCR License Sub to HBC License, which applications are attached hereto at Exhibit A (collectively, the “FCC Assignment
Application”).  Each
party shall pay its own expenses in connection with the preparation and
prosecution of the FCC Assignment Application and shall share equally any
filing fees associated with the FCC Assignment Application.

 

10.                                 Section
6.1.3 of the Purchase Agreement is hereby amended to read as follows:

 

6.1.3.                     Upon the
terms and subject to the conditions set forth in this Agreement, Seller and
Purchaser shall each use their respective reasonable best efforts to promptly
(a) take, or to cause to be taken, all actions, and to do, or to cause to be
done, and to assist and cooperate with the other parties in doing all things
necessary, proper or advisable under applicable Law or otherwise to consummate
and make effective the transactions contemplated by this Agreement; (b) obtain
from any Governmental Authority or other Person any actions, non-actions,
clearances, waivers, consents, approvals, permits or Orders required to be
obtained by Seller, Purchaser or any of their respective Affiliates in
connection with the authorization, execution, delivery and performance of this
Agreement, the consummation of the other transactions contemplated hereby and
thereby and the assignment of the FCC Licenses from BCR License Sub to HBC
License; 

 

3

 

(c) furnish all information
required for any application or other filing to be made pursuant to any
applicable Law or any applicable regulations of any Governmental Authority in
connection with the transactions contemplated by this Agreement, including filings
in connection with the FCC Assignment Application, and to supply promptly any
additional information and documentary material that may be requested in
connection with such filings or applications; (d) avoid the entry of, or have
vacated or terminated, any Order that would restrain, prevent or delay the
Closing or the FCC Order, including defending against and opposing any lawsuits
or other proceedings (including any FCC reconsideration or review), whether
judicial or administrative, reviewing or challenging this Agreement, the
consummation of the other transactions contemplated hereby and thereby or the
assignment of the FCC Licenses from BCR License Sub to HBC License; and
(e) execute and deliver any additional instruments necessary to assign the
FCC Licenses from BCR License Sub to HBC License or to consummate any other
transactions contemplated by this Agreement. 
No party to this Agreement shall consent to any voluntary delay of the
assignment of the FCC Licenses from BCR License Sub to HBC License or the
consummation of the other transactions contemplated hereby at the behest of any
Governmental Authority or other Person without the consent of the other party,
which consent shall not be unreasonably withheld, conditioned or delayed.

 

11.                                 Article 7 of the Purchase Agreement is
hereby amended as follows:

 

(a)                                  The words “Purchased Assets” in the
introductory paragraph are replaced with the words “License Assets”;

 

(b)                                 The words “that relate solely to
the License Assets” are added immediately after the first occurrence of the
words “this Agreement” in each of Section 7.1 and Section 7.2;
and

 

(c)                                  Section 7.5 is deleted in its entirety, and Section
7.6 is renumbered as Section 7.5.

 

12.                                 Article 8 of the Purchase Agreement is
hereby amended by replacing the words “Purchased Assets” in the introductory
paragraph with the words “License Assets”.

 

13.                                 Article 9 of the Purchase Agreement is
hereby amended by deleting Section 9.1.3 and Section 9.2.3

 

14.                                 Section
10.1 of the Purchase Agreement is hereby amended to read as follows:

 

10.1.                     Termination.

 

This Agreement may be terminated by the mutual written agreement of
Purchaser and Seller, or, if the terminating party is not then in material
breach of its obligations hereunder, upon written notice as follows:

 

4

 

10.1.1.                                                               [intentionally
omitted]

 

10.1.2.                                                               by Seller
if Purchaser is in breach of its obligations to pay the Purchase Price in
accordance with Section 3.1 and such breach has not been cured by
Purchaser within five (5) days of written notice of such breach;

 

10.1.3.                                                               by either
Purchaser or Seller if the FCC denies the FCC Assignment Application in an
order that has become a Final Order; or

 

10.1.4.                                                               by either
Purchaser or Seller if the Closing has not occurred on or before the earlier of
(i) the date on which the Time Brokerage Agreement has been terminated by the
Programmer thereunder or by mutual consent of the parties thereto or (ii) the
20th anniversary date of this Agreement (the “Outside Date”).

 

10.1.5.                                                               [intentionally
omitted]

 

10.1.6.                                                               [intentionally
omitted]

 

Except as set forth in Section 10.1.2, the parties expressly
acknowledge and agree that the Agreement shall not be terminated solely as a
result of a material breach by either party in the performance of its
obligations hereunder.  In the event of
such material breach, except as set forth in Section 10.1.2, the sole
remedy of the non-breaching party shall be to commence an action for specific
performance by the breaching party of its obligations hereunder.  The non-breaching party shall also be
entitled to such money damages (including attorneys’ fees and collection costs)
as may be awarded in addition to, and not in lieu of, such specific
performance.

 

15.                                 Section
11.1 of the Purchase Agreement is hereby amended to read as follows:

 

11.1.                     Survival.

 

The representations and warranties in this Agreement (other than those that relate solely to the
License Assets) shall terminate at, and will have no further force
and effect after, the Initial
Transfer Date.  The
representations and warranties in this Agreement that relate solely to the License Assets shall terminate at, and will have no
further force and effect after, the Closing Date.  No covenants or agreements of the
parties contained in this Agreement shall survive the Initial Transfer or the Closing,
except that covenants that contemplate or may involve actions to be taken or
obligations in effect after the Initial
Transfer or the Closing, as the case may be, shall survive in
accordance with their terms.

 

5

 

16.                                 Section 11.4 of the Purchase Agreement is
hereby amended to read as follows:

 

11.4.                     Fees and Expenses.

 

Except as
otherwise expressly provided in this Agreement, all fees and expenses, including
fees and expenses of counsel, financial advisors, and accountants incurred in
connection with this Agreement and the transactions contemplated hereby shall
be paid by the party incurring such fee or expense, whether or not the Closing
shall have occurred; provided, however, that if the FCC has
designated the FCC Assignment Application for a hearing, Purchaser shall
reimburse Seller for all costs reasonably incurred by Seller in connection with
participating in such hearing.

 

17.                                 Section
11.8.1 of the Purchase Agreement is hereby amended to read as follows:

 

11.8.1.                                                               In the
event that the FCC Order has not been granted prior to October 31, 2004, (i)
Purchaser may assign its rights hereunder to an unaffiliated third party that
is legally and financially qualified to be the assignee of the FCC Licenses,
subject to the prior written consent of Seller (which shall not be unreasonably
withheld); provided, that no such assignment shall relieve Purchaser of
its obligations under this Agreement and (ii) Seller may assign its rights
hereunder to a third party, subject to the prior written consent of Purchaser
(which shall not be unreasonably withheld); provided, however,
that in each case, the third party assignee shall be required to assume the
obligations of the assigning party under the Time Brokerage Agreement.  Except as set forth in the preceding
sentence, no party hereto shall assign this Agreement, in whole or in part,
whether by operation of law or otherwise, without the prior written consent of
the other party hereto.

 

18.                                 Annex
I of the Purchase Agreement is hereby amended by revising the definition
for “Time Brokerage Agreement” to
read as follows:

 

“Time Brokerage
Agreement” shall mean the Amended and Restated Time Brokerage
Agreement between BCR License Sub and HBC Illinois dated as of May 2, 2003.

 

19.                                 Annex
I of the Purchase Agreement is hereby further amended by adding the
following definitions:

 

“18 Month Date”
shall have the meaning set forth in Section 3.1.

 

“Additional Amount”
shall have the meaning set forth in Section 3.1.

 

“Deferred Payment
Date” shall have the meaning set forth in Section 3.1.

 

“Initial Transfer”
shall have the meaning set forth in Section 2.4.

 

“Initial Transfer
Date” shall have the meaning set forth in Section 2.4.

 

6

 

“License Assets”
shall mean, collectively, (i) the FCC Licenses, (ii) the transmitter
equipment listed on Schedule 2.4 hereto, (iii) the intangible
property described in Section 2.1.5 of this Agreement,
(iv) the logs and all materials maintained in the FCC public file relating
to the Station, technical data, political advertising records and all other
records, correspondence with and documents pertaining to the FCC, and
(v) and the promotional materials described in Section 2.1.8
of this Agreement.

 

20.                                 Except
as expressly modified hereby, all other terms and conditions of the Purchase
Agreement shall remain in full force and effect in accordance with their terms.

 

21.                                 This
Amendment may be executed in one or more counterparts, each of which will be
deemed an original and all of which together will constitute one and the same
instrument.

 

 

[The remainder of this page
intentionally left blank.]

 

7

 

IN WITNESS WHEREOF, each
of the parties hereto has caused this Second Amendment to Asset Purchase
Agreement to be executed as of the date first written above.

 

	
   

  	
  BIG CITY RADIO, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul R. Thomson

  	
   

  
	
   

  	
   

  	
        Paul
  R. Thomson,

  	
   

  
	
   

  	
   

  	
        Vice
  President

  	
   

  
	
   

  	
   

  	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  BIG CITY RADIO-CHI,
  L.L.C.

  
	
   

  	
  By:      BIG
  CITY RADIO, INC.,

  
	
   

  	
  Its Managing Member

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Paul R. Thomson

  	
   

  
	
   

  	
   

  	
        Paul
  R. Thomson,

  	
   

  
	
   

  	
   

  	
        Vice
  President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HBC ILLINOIS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Gerald J. Ryan

  	
   

  
	
   

  	
   

  	
        Gerald
  J. Ryan,

  	
   

  
	
   

  	
   

  	
        Vice
  President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HBC LICENSE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By:

  	
  /s/ Jeffrey T. Hinson

  	
   

  
	
   

  	
   

  	
        Jeffrey
  T. Hinson,

  	
   

  
	
   

  	
   

  	
        Senior
  Vice President

  	
   

  

 

8

 

SCHEDULE 2.4

 

TRANSMITTER
EQUIPMENT

 

	
  Quantity

  	
   

  	
  DESCRIPTION

  
	
   

  	
   

  	
   

  
	
  1

  	
   

  	
  Harris
  Platinum Z-10 CD Transmitter

  
	
  1

  	
   

  	
  Harris
  Digit CD Exciters (one of these is an N+1 unit)

  
	
  1

  	
   

  	
  Burk
  Technology ARC-16 Remote Control w/ESI

  
	
  2

  	
   

  	
  Burk
  Technology IP-8 Interface Panels

  
	
  1

  	
   

  	
  Spectracom
  8195A GPS Receiver w/antenna

  
	
  1

  	
   

  	
  Harris
  Intaplex TDM-163 STL Plus with Synchrocast Add On Package

  
	
  1

  	
   

  	
  Eastern
  Research DNS-1000 T-1 CSU / DSU units 1 each station

  
	
  1

  	
   

  	
  Harris
  A2D2A Analog to Digital / Digital to Analog Converter

  
	
  1

  	
   

  	
  Comrex
  Nexus ISDN Transceiver

  
	
  1

  	
   

  	
  ERI
  960 Series 3-Pole Cavity Filters 1 each station

  
	
  1

  	
   

  	
  Altronics
  Research 10kW Dummy Loads 1 each station

  
	
  1

  	
   

  	
  Harris
  equipment racks

  
	
  1

  	
   

  	
  Dielectric
  4 port 1 5/8 inch coax switches

  
	
  1

  	
   

  	
  ERI
  2 bay Cavity-Backed Resonator Antenna and associated hardware, 103.1 MHz

  

 

9Exhibit
10.4

 

ASSET
PURCHASE AGREEMENT

 

THIS ASSET PURCHASE AGREEMENT (this “Agreement”)
is made as of this 1st day of May, 2003 by and among HBC Illinois, Inc., a
Delaware corporation (“HBC Illinois”), HBC License Corporation, a
Delaware corporation (“HBC License”, and collectively with HBC
Illinois, the “Buyer”), NextMedia Operating, Inc., a Delaware corporation
(“Operating”),
and NM Licensing LLC, a Delaware limited liability company (“Licensing”,
and, collectively with Operating, the “Seller”).

 

RECITALS

 

A.                                   Seller
owns and operates radio station WJTW (FM), licensed to Joliet, Illinois (the “Station”).

 

B.                                     Seller
owns or holds certain tangible and intangible assets, including certain
licenses, permits and authorizations issued by the Federal Communications
Commission (the “FCC”), used or useful in the operation and ownership of the
Station.

 

C.                                     Buyer
desires to purchase from Seller, and Seller desires to sell to Buyer, certain
assets of Seller used or held for use in the ownership and operation of the Station.

 

NOW, THEREFORE, in consideration of the
foregoing and the respective representations, warranties, covenants, agreements
and conditions hereinafter set forth, and other good and valuable
consideration, the receipt and sufficiency of which are hereby acknowledged,
and intending to be legally bound hereby, the parties hereto agree as follows:

 

1.                                      PURCHASE AND SALE OF ASSETS

 

1.1                               Assets
to be Transferred.

 

Subject to the terms and conditions of this Agreement,
on the Closing Date (as hereinafter defined), Seller shall sell, transfer,
convey, assign, and deliver to Buyer, and Buyer shall purchase and accept from
Seller the following assets of Seller that relate to the ownership and
operation of the Station, together with all rights and privileges associated
with such assets (collectively the “Purchased Assets”):

 

(a)                                  Licenses.  The licenses, permits, and authorizations
issued or granted by the FCC to Seller for the operation of the Station or used
in connection with the operation of the Station as listed on Schedule 1.1(a)
attached hereto (the “FCC Authorizations”), and all other
licenses, permits and authorizations issued to Seller by any other governmental
entity in connection with the ownership and operation of the Station as listed
in Schedule 1.1(a) (collectively with the FCC Authorizations, the “Licenses”).

 

(b)                                 Tangible
Personal Property. The  items of  tangible personal property
and equipment owned, leased or held by Seller and used in connection with the
ownership and operation of the Station which are described or listed in Schedule 1.1(b)
attached hereto.

 

 

(c)                                  Books and
Records.  All of Seller’s
rights in and to the public files, technical information and engineering data,
filings with the FCC, and logs and records related to the operation of the Purchased
Assets (excluding records related to any Excluded Asset (as hereinafter
defined)).

 

1.2                               Excluded
Assets.

 

Notwithstanding anything to the contrary contained
herein, it is understood and agreed that the Purchased Assets shall not include
any of the following assets or any right, title or interest therein
(collectively, the “Excluded Assets”):

 

(a)                                  Seller’s
cash on hand as of the Closing and any of Seller’s interests in its bank
accounts and all of Seller’s other cash, cash equivalents, security funds,
securities, investments and deposits;

 

(b)                                 Any
claims, rights and interests in and to any refunds of Taxes for periods prior
to the Closing Date.  For purposes of
this Agreement, the terms “Tax” and “Taxes” shall mean all
federal, state, local, or foreign income, payroll, Medicare, withholding,
unemployment insurance, social security, sales, use, service, service use,
leasing, leasing use, excise, franchise, gross receipts, value added,
alternative or add-on minimum, estimated, occupation, real and personal
property, stamp, duty, transfer, workers’ compensation, severance, windfall
profits, environmental (including Taxes under Section 59A of the Internal
Revenue Code of 1986, as amended (the “Code”), or other tax, charge, fee, levy or
assessment of the same or of a similar nature, including any interest, penalty,
or addition thereto whether disputed or not;

 

(c)                                  Any
accounts receivable for advertising broadcast on the Station up to and
including the Closing Date;

 

(d)                                 Seller’s
business name, all records relating to the Excluded Assets and to Seller’s
accounts payable and general ledger records, and Seller’s books and records
relating to Seller’s internal corporate matters and financial relationships
with Seller’s lenders;

 

(e)                                  Any
insurance policies and proceeds thereof, promissory notes, bonds, certificates
of deposits or other similar items and cash surrender value in regard thereto;

 

(f)                                    Any
pension, profit-sharing, or employee benefits plans;

 

(g)                                 All
of Seller’s Tax Returns and supporting materials, all original financial
statements and supporting materials, all books and records that Seller is
required by law to retain, and all records of Seller relating to the sale of
the Purchased Assets.  The term “Tax Return”
means any return, declaration, report, claim for refund, or information return
or statement relating to Taxes or any amendment thereto, and including any
schedule or attachment thereto; and

 

2

 

(h)                                 All
of such other assets, properties, interests and rights owned by Seller that are
used in connection with the business or operations of the Station that are not
included in the Purchased Assets.

 

2.                                      ASSUMPTION OF LIABILITIES

 

2.1                               Liabilities
to be Assumed.

 

Subject to the terms and
conditions of this Agreement, on the Closing Date, Buyer expressly shall assume
and agrees to perform and discharge those liabilities and obligations that
arise from the ownership or operation of the Purchased Assets from and after
the Closing Date (collectively, the “Assumed Liabilities”).

 

2.2                               Liabilities
Not to be Assumed.

 

Notwithstanding anything
contained in this Agreement to the contrary, Buyer does not assume or agree to
pay, satisfy, discharge or perform, and will not be deemed by virtue of the
execution and delivery of this Agreement or any document delivered in
connection with the execution of this Agreement, or as a result of the
consummation of the transactions contemplated by this Agreement, to have
assumed, or to have agreed to pay, satisfy, discharge or perform, any
liability, obligation or responsibility, fixed or unfixed, known or unknown,
asserted or unasserted, liquidated or unliquidated, secured or unsecured of
Seller other than the Assumed Liabilities.

 

3.                                      PURCHASE PRICE – PAYMENT

 

3.1                               Purchase
Price.

 

The purchase price (the “Purchase
Price”) for the Purchased Assets shall be TWENTY ONE MILLION DOLLARS
($21,000,000).

 

3.2                               Payment
of Purchase Price.

 

The Purchase Price
shall be paid by Buyer as follows:

 

(a)                                  Previous Payment.  Buyer, pursuant to that certain Option
Agreement between Lakeshore Media, LLC (predecessor in interest to Buyer with
respect to such Option Agreement) and Operating dated April 29, 2002, has
previously paid to Seller ONE HUNDRED FIFTY THOUSAND DOLLARS ($150,000) (the “Option
Payment”).  The Option
Payment shall be credited towards the Purchase Price at the Closing.

 

(b)                                 Earnest
Money.  Within ten (10)
business days of execution of this Agreement, Buyer shall deposit with the
Escrow Agent (as defined in the Escrow Agreement attached hereto as Exhibit
A) an earnest money deposit in the amount of NINE HUNDRED FIFTY THOUSAND
DOLLARS ($950,000) in immediately available funds (the “Earnest Money”).  The Earnest Money shall be deposited in an
interest-bearing account pursuant to the terms of the Escrow Agreement.

 

3

 

(c)                                  Cash At
Closing.  At Closing, Buyer
shall pay to Seller TWENTY MILLION EIGHT HUNDRED FIFTY THOUSAND DOLLARS
($20,850,000), which amount shall include the transfer of the Earnest Money.

 

3.3                               Allocation
of Purchase Price.

 

As soon as practicable,
but no later than thirty (30) days after the Closing Date, the aggregate
Purchase Price (including the assumption by Buyer of the Assumed Liabilities,
if any) shall be allocated among the Purchased Assets for tax purposes (the “Allocation”).  Seller and Buyer shall determine such
Allocation in good faith based upon an appraisal of the Purchased Assets by
Bond & Pecaro (whose fees shall be paid by Buyer).  Seller and Buyer will follow and use the
Allocation in all Tax Returns, filings or other related reports made by them to
any governmental agencies.

 

4.                                      REPRESENTATIONS AND WARRANTIES OF SELLER

 

Each Seller makes the
following representations and warranties to Buyer, each of which is true and
correct on the date hereof, shall remain true and correct to and including the
Closing Date, shall be unaffected by any investigation heretofore or hereafter
made by Buyer, or any knowledge of Buyer other than as specifically disclosed
in the Disclosure Schedule delivered to Buyer at the time of the execution of
this Agreement, and shall survive the Closing of the transactions provided for
herein as specified in Article 14 of this Agreement.

 

4.1                               Organization;
Power.

 

Operating is a
corporation validly existing and in good standing under the laws of the State
of Delaware and is qualified to conduct business in Illinois. Licensing is a
limited liability company validly existing and in good standing under the laws
of the State of Delaware and is qualified to do business in Illinois.  Each Seller has full power and authority to
own, operate and lease its properties, to carry on its business as and where
such is now being conducted and as proposed to be conducted by it, to enter
into this Agreement and the other documents and instruments to be executed and
delivered by each Seller pursuant hereto and to carry out the transactions
contemplated hereby and thereby.

 

4.2                               Authority.

 

The execution and
delivery of this Agreement and the other documents and instruments to be
executed and delivered by each Seller pursuant to this Agreement and the
consummation of the transactions contemplated hereby and thereby have been duly
authorized by all necessary corporate or limited liability company action.  This Agreement constitutes, and when
executed and delivered, the other documents and instruments to be executed and
delivered by each Seller pursuant hereto will constitute, valid binding
agreements of each Seller, enforceable in accordance with their respective
terms except as such may be limited by bankruptcy, insolvency, reorganization
or other laws affecting creditors’ rights generally, and by general equitable
principles.

 

4

 

4.3                               No
Violation.

 

Neither the execution and
delivery of this Agreement or the other documents and instruments to be
executed and delivered by Seller pursuant hereto, nor the consummation by
Seller of the transactions contemplated hereby and thereby (a) will violate any
applicable law or order, (b) will violate any provision of its organizational
instruments, (c) will, either with the giving of notice, the passage of time,
or both, conflict with, constitute grounds for termination of, or result in a
material breach of the terms of, or constitute a default under any agreement,
instrument, trust instrument or permit, (d) will result in the creation of any
lien, charge or encumbrance on any of the Purchased Assets, (e) will in any way
affect or violate the terms or conditions of, or result in cancellation of the
Licenses, and (f) except for prior approval of the transfer of ownership of the
FCC Authorizations by the FCC, and any third party consents listed on Schedule
4.3 attached hereto, will require any authorization, consent, approval,
exemption or other action by or notice to any entity.

 

4.4                               Litigation.

 

There is no litigation
pending or, to Seller’s knowledge, threatened against Seller relating to its
ownership and operation of the Purchased Assets, nor does Seller know of any
basis for any such litigation.

 

4.5                               Compliance
With Laws and Orders.

 

(a)                                  Compliance.  The Purchased Assets are in compliance in
all material respects with all applicable laws and orders, including, without
limitation, the Communications Act of 1934, as amended (“Communications Act”), and
the rules, orders and policies of the FCC. 
Seller:  (i) has not
received notice of any violation or alleged violation pertaining to the
operation of the Purchased Assets, and (ii) to its knowledge after due
inquiry, is subject to no liability for past or continuing violations of any
laws or orders pertaining to the operation of the Purchased Assets.  All reports and returns pertaining to the
operation of the Purchased Assets required to be filed by Seller with any
government entity have been filed and were accurate and complete in all
material respects when filed.

 

(b)                                 Licenses and
Permits.  The FCC
Authorizations are validly issued in the name of Seller.  Seller is in compliance in all material
respects with the FCC Authorizations and will or has applied to the FCC to
obtain approval of the transfer of the FCC Authorizations to Buyer pursuant to Article
6 herein.  Each of the FCC
Authorizations is in full force and effect, is assignable to Buyer in
accordance with the terms hereof, and all fees with respect to such Licenses
have been paid.  Seller has not
received any notice of any material violations of the terms of any of the FCC
Authorizations, the Communications Act or the rules and regulations of the FCC
thereunder that remain pending and unresolved. 
To the knowledge of Seller, there is no action pending or threatened by
or before the FCC which, if determined adversely to Seller, would result in the
revocation, cancellation, rescission or material and adverse modification of
any of the FCC Authorizations.  Seller
acknowledges that to the extent that Seller’s failure to 

 

5

 

comply with the FCC
Authorizations prior to the Closing Date directly results in the payment of any
fees or expenses by Buyer to a third party, including but not limited to the
FCC, that, following receipt of written notice from Buyer to Seller of the
nature and the amount of such payment, Seller shall promptly reimburse Buyer
for the fees or expenses paid by Buyer.

 

4.6                               Title
to and Condition of the Purchased Assets.

 

At
Closing, Seller shall have, and shall convey to Buyer, good and marketable
title to all the Purchased Assets, free and clear of all liens (statutory or
otherwise), security interests, claims, pledges, licenses, equities, options,
conditional sales contracts, assessments, levies, charges or encumbrances of
any nature whatsoever (collectively, “Liens”) except for (a) liens for Taxes not
yet due and payable; (b) rights reserved by any governmental authority to
regulate the affected property; or (c) as to leased assets, interests of the
lessor thereof and liens affecting the interests of the Lessors thereof
(collectively, “Permitted Liens”).  Except
for approval of the transfer of ownership by the FCC and the consents listed on
Schedule 4.3, none of the Purchased Assets are subject to any
restrictions with respect to the transferability thereof.  The Purchased Assets are in good operating
condition and repair, ordinary wear and tear excepted.

 

4.7                               Broker
Commission or Finder’s Fees.

 

Neither Seller, nor any
entity acting on behalf of Seller, has agreed to pay a broker, commission,
finder’s fee or similar payment in connection with this Agreement or any matter
related hereto.

 

4.8                               No
Third Party Options.

 

There are no existing
agreements with, operations of rights of, or commitments to any person other
than Buyer to acquire any of the Purchased Assets or any interest therein.

 

4.9                               Disclosure.

 

No representation or
warranty by Seller in this Agreement, or in any certificate, schedule, document
or exhibit hereto or furnished or to be furnished by or on behalf of Seller
pursuant to this Agreement or in connection with transactions contemplated
hereby, contains or shall contain any untrue statement of material fact or
omits or shall omit a material fact necessary to make the statements contained
therein not misleading.  All statements
and information contained in any such certificate, instrument, or document
delivered by or on behalf of Seller shall be deemed representations and
warranties by Seller.

 

5.                                      REPRESENTATIONS AND WARRANTIES OF BUYER

 

Buyer makes the
following representations and warranties to Seller, each of which is true and
correct on the date hereof, shall remain true and correct to and including the
Closing Date, shall be unaffected by any investigation heretofore or hereafter
made by Seller, or any knowledge of Seller other than as specifically disclosed
in the Disclosure Schedule delivered to 

 

6

 

Seller at the time of the execution of this Agreement,
and shall survive the Closing of the transactions provided for herein as
specified in Article 14 of this Agreement.

 

5.1                               Organization
and Corporate Power.

 

(a)                                  Organization.  Both HBC Illinois and HBC License are corporations
duly incorporated, validly existing and in good standing under the laws of the
State of Delaware.  HBC Illinois is duly
qualified as a foreign corporation in the State of Illinois.

 

(b)                                 Corporate
Power.  Buyer has all
requisite corporate power to enter into this Agreement and the other documents
and instruments to be executed and delivered by Buyer and to carry out the
transactions contemplated hereby and thereby.

 

5.2                               Authority.

 

The execution and
delivery of this Agreement and the other documents and instruments to be
executed and delivered by Buyer pursuant to this Agreement and the consummation
of the transactions contemplated hereby and thereby have been duly authorized
by all necessary limited liability company action.  This Agreement constitutes, and when executed and delivered, the
other documents and instruments to be executed and delivered by Buyer pursuant
hereto will constitute, valid and binding agreements of Buyer, enforceable in
accordance with their respective terms, except as such may be limited by
bankruptcy, insolvency, reorganization or other laws affecting creditors’
rights generally, and by general equitable principles.

 

5.3                               No
Violation.

 

Neither the execution and
delivery of this Agreement or the other documents and instruments to be
executed and delivered by Buyer pursuant hereto, nor the consummation by Buyer
of the transactions contemplated hereby and thereby (a) will violate any
applicable law or order, (b) will violate any provision of its organizational
instruments, or (c) will, either with the giving of notice, the passage of
time, or both, conflict with, constitute grounds for termination of, or result
in a material breach of the terms of, or constitute a default under any
agreement, instrument, trust instrument or permit.

 

5.4                               Qualification.

 

Buyer knows of no fact that would, under the
Communications Act or the rules, regulations and policies of the FCC,
disqualify Buyer from acquiring the Licenses.

 

5.5                               Broker
or Finders Fee.

 

Neither Buyer, nor any
entity acting on behalf of Buyer, has agreed to pay a broker, commission,
finder’s fee or similar payment in connection with the Agreement or any matter
related hereto.

 

7

 

5.6                               Financial
Capability.

 

Buyer will have on the
Closing Date, sufficient cash and cash equivalents to purchase the Purchased
Assets and to consummate the transactions contemplated by this Agreement,
including, without limitation, payments of fees and expenses contemplated
hereunder.

 

6.                                      APPLICATIONS TO AND CONSENT BY FCC

 

6.1                               FCC
Consent.

 

Consummation of the
transactions provided for herein and the performance of the obligations of
Seller and Buyer under this Agreement are subject to the condition that the
FCC, within three hundred sixty five (365) days of the date of acceptance for
filing of the Assignment Application (defined hereinafter), shall have issued
its written consent to such assignment without any condition materially adverse
to Buyer (the “FCC Consent”).  In
the event that Seller is unable to procure the FCC Consent, and such failure is
not based on any action or inaction of the Buyer, Buyer may elect to either (i)
have Seller use its commercially reasonable efforts to satisfy the FCC and
obtain the FCC consent or (ii) cancel the transaction and Buyer shall receive
its Earnest Money and any interest earned thereon and the Option Payment.  If Buyer elects alternative (i), Seller
hereby agrees to undertake any commercially reasonable actions to satisfy the
FCC and obtain the FCC Consent.  As used
herein, the “Assignment Application” shall mean the application or
applications that Seller and Buyer must file with the FCC requesting its
consent to the assignment of the FCC Authorizations from Seller to HBC License;
provided, however, that in the event that the merger of Hispanic
Broadcasting Corporation and Univision Communications Inc. (“Univision”),
MB Docket No. 02-235, has not been consummated at the time the Assignment
Application is to be filed, the Assignment Applications also shall include an
application seeking consent to the assignment from Seller to HBC License as
owned and controlled by Univision.

 

6.2                               Assignment
Application and Notice.

 

As promptly as
practicable following the execution date of this Agreement, but no later than
two (2) business days after the execution date of this Agreement, Seller and
Buyer shall file the Assignment Application with the FCC, including all
information, data, exhibits, resolutions, statements and other materials
necessary and proper in connection with the Assignment Application.  Seller shall, at its expense, give due
notice of the filing of the Assignment Application by broadcasting notice of
such filing on the Station or by such other means as may be required by the
rules and regulations of the FCC; provided that Buyer shall deliver to Seller
on the date the Assignment Application is filed with the FCC, the information
relating to Buyer that is required to be included in such notice.

 

6.3                               Mutual
Covenant of Reasonable Cooperation.

 

Seller and Buyer shall
diligently and expeditiously take all necessary and proper steps, provide any
additional information requested by the FCC, and otherwise use their
commercially reasonable efforts to obtain the FCC Consent and to comply with
this Article 6.

 

8

 

6.4                               Assignment
Application Expenses and Fees.

 

Each party shall be
solely responsible for the expenses incurred by it in the preparation, filing
and prosecution of its respective portion of the Assignment Application.  All filing fees relating to the Assignment
Application imposed by the FCC shall be paid one-half each by Seller and Buyer.

 

7.                                      OTHER MATTERS

 

7.1                               Costs.

 

Except as otherwise
provided herein, each party to this Agreement shall be responsible for and bear
all of such party’s own costs and expenses, including, without limitation, any
broker’s or finder’s fees and the expenses of its representatives, incurred at
any time in connection with pursuing or consummating the transactions
contemplated by this Agreement.

 

7.2                               Preclosing
Covenants.

 

Between the execution
date and the Closing Date, except with the prior consent of Buyer, Seller:

 

(a)                                  shall
conduct the operation of the Station in accordance with the Communications Act,
the rules and regulations of the FCC, and all applicable laws and orders; and

 

(b)                                 shall
not cause or permit the Licenses to expire or be surrendered or adversely
modified, or take any action which would cause the FCC or any other
governmental entity to institute proceeding for the suspension, revocation or
adverse modification of any of the Licenses. 
Notwithstanding anything to the contrary contained in this Agreement,
Seller shall not be required to construct the facilities authorized in FCC File
No. BPH-20020822ABT prior to the Closing Date or in order to consummate the
transactions contemplated by this Agreement.

 

7.3                               Risk
of Loss.

 

Risk of loss for damage
to or theft, loss or destruction of the Purchased Assets (by any means,
including, without limitation, acts of God) occurring after the date of this
Agreement and prior to the Closing shall be borne by Seller, and after the
Closing shall be borne by Buyer.

 

7.4                               Updating
of Schedules.

 

From time to time after
the execution of this Agreement and prior to the Closing, Seller will promptly
supplement or amend the Schedules delivered in connection herewith with respect
to any matter which exists or occurs after the date of this Agreement and
which, if existing or occurring at or prior to the date of this Agreement,
would have been required to be set forth or described in the Schedules or which
is necessary to correct any information therein; provided, however,
that the provisions of this Section are informational only and Buyer shall not

 

9

 

be bound to the terms of
any changed Schedules unless they are incorporated into this Agreement by a
written amendment signed by Buyer.

 

7.5                               Transfer
Taxes and Similar Charges.

 

All recordation, transfer
and documentary taxes and fees, stamps, and any excise, sales or use taxes, and
all similar costs of transferring the Purchased Assets in accordance with this
Agreement shall be borne by Seller.

 

7.6                               Bulk
Sales Law.

 

The parties do not
believe that any bulk sales or fraudulent conveyance statute applies to the
transactions contemplated by this Agreement. 
Buyer, therefore, waives compliance by Seller with the requirements of
any such statutes and Seller agrees to indemnify, defend and hold Buyer
harmless against any claim made against Buyer as a result of a failure to comply
with any such statute.

 

7.7                               Other
Action.

 

Both Buyer and Seller
shall use such party’s commercially reasonable efforts to cause the fulfillment
at the earliest practicable date of all of the conditions to each such party’s
obligations to consummate the transactions contemplated in this Agreement.

 

7.8                               Disclosure.

 

Buyer and Seller shall
each have a continuing obligation to promptly notify the other party in writing
with respect to any matter hereafter arising or discovered which, if existing
or known at the date of this Agreement, would have been required to be set
forth or described in the Disclosure Schedule, but no such disclosure shall
cure any breach of any representation or warranty which is inaccurate.  Further, Buyer and Seller shall give prompt
notice to other party at any occurrence that comes to its attention that may
constitute a misrepresentation, breach of warranty, or nonfulfillment of any
covenant or condition on the part of Seller or Buyer contained in this
Agreement.

 

8.                                      FURTHER COVENANTS OF SELLER

 

Seller covenants and
agrees as follows:

 

8.1                               Conduct
of Business Pending the Closing.

 

From the date hereof
until the Closing, or the earlier termination of this Agreement without a
closing, Seller shall have complete control and supervision of and sole
responsibility for the operation of the Station and the Purchased Assets and
during such period:

 

(a)                                  Operation of
the Station.  Seller shall
operate the Station and shall take such action as may be necessary to maintain,
preserve, renew and keep in force and effect (with no adverse effect thereto)
the FCC authorizations.

 

10

 

(b)                                 No Breach.  Seller shall not take or fail to take, or
permit any act or failure to act, which may cause a breach of any commitment or
obligation, or a breach of any representation, warranty, covenant or agreement
made by Seller herein.

 

(c)                                  No
Negotiations.  Seller shall
not directly or indirectly (through a representative or otherwise) solicit or
furnish any information to any prospective buyer, commence, or conduct
presently ongoing, discussions or negotiations with any other party or enter
into any agreement with any other party concerning the sale of the Purchased
Assets or any part thereof (an “acquisition proposal”), and Seller shall
immediately advise Buyer of the receipt of any written acquisition proposal.

 

8.2                               Consents.

 

Seller shall use its
commercially reasonable efforts prior to Closing to obtain all consents
necessary for the consummation of the transactions contemplated hereby.

 

8.3                               Access
to Facilities, Files and Records.

 

At the request of Buyer,
Seller shall from time to time give or cause to be given to the officers,
employees, accountants, counsel, agents, consultants and representatives of
Buyer: (a) full access during normal business hours to all equipment,
machinery, fixtures, furniture and documentation that represents a part of the
Purchased Assets; and (b) all such other information concerning the Purchased
Assets as Buyer may reasonably request; provided that such requests and
Seller’s compliance therewith do not interfere with the normal operations of
the Station.  Any investigation or
examination by Buyer shall not in any way diminish or obviate any representations
or warranties of Seller made in this Agreement or in connection herewith.  Seller shall cause its accountants and any
agent of Seller in possession of Seller’s books and records to cooperate with
Buyer’s requests for information pursuant to this Agreement.

 

8.4                               FCC
Cooperation.

 

Seller will use its
commercially reasonable efforts to cooperate with Buyer with any FCC filings
that Buyer may make regarding the relocation of the Station’s broadcast
facilities.  Notwithstanding the
foregoing, Seller shall not be obligated to take any action that would result
in the incurrence of any out-of-pocket expense or would adversely effect the
operation of Seller’s business.

 

8.5                               Financial
Statements.

 

Seller shall provide
unaudited financial statements related to its operation of the Station as may
be reasonably requested by Buyer to the extent that such information is
available and in the form in which such information is available.  Notwithstanding the foregoing, Seller shall
provide such information to Buyer without any representation or warranty as to
its accuracy or otherwise.  Seller shall
not be obligated to prepare any financial statements which are not readily
available or to incur any expenses in connection with providing the information
referenced in this Section 8.5.

 

11

 

9.                                      CONDITIONS PRECEDENT TO BUYER’S OBLIGATIONS

 

Each and every obligation
of Buyer to be performed on the Closing Date shall be subject to the
satisfaction prior to or at the Closing of each of the following conditions:

 

9.1                               Representations
and Warranties True on the Closing Date.

 

Each of the
representations and warranties made by Seller in this Agreement, and the
statements contained in any instrument, certificate or writing delivered by
Seller pursuant to this Agreement, shall be true and correct when made and
shall be true and correct in all material respects at and as of the Closing
Date as though such representations and warranties were made or given on and as
of the Closing Date, except for those given as of a specified date which must
only be true and correct as of such specified date.

 

9.2                               Compliance
With Agreement.

 

Seller shall have
performed and complied in all material respects with all of Seller’s agreements
and obligations under this Agreement which are to be performed or complied with
by Seller prior to or on the Closing Date, including the delivery of the
closing documents specified in Section 12.2 hereof.

 

9.3                               Absence
of Litigation.

 

No litigation
shall have been commenced or threatened, and no investigation by any government
entity shall have been commenced, against Buyer, Seller or any of the
affiliates, officers, members or shareholders of any of them, with respect to
the transactions contemplated hereby.

 

9.4                               Consents
and Approvals.

 

The FCC Consent and all
other approvals, consents and waivers that are required to effect the
assignments of the FCC Authorizations shall have been received.

 

9.5                               Closing
Certificates.

 

Buyer shall have received
a certificate, dated as of the Closing Date, from an authorized representative
of each Seller certifying that the conditions set forth in Sections 9.1
and 9.2 hereof have been fulfilled.

 

9.6                               Opinion
of Counsel.

 

Buyer shall have received
a written opinion of Seller’s FCC counsel dated as of the Closing Date, in
substantially the form attached hereto as Exhibit B.

 

10.                               CONDITIONS PRECEDENT TO SELLER’S OBLIGATIONS

 

Each and every obligation
of Seller to be performed on the Closing Date shall be subject to the
satisfaction prior to or at the Closing of the following conditions:

 

12

 

10.1                        Representations
and Warranties True on the Closing Date.

 

Each of the
representations and warranties made by Buyer in this Agreement, and the
statements contained in any instrument, certificate or writing delivered by
Buyer pursuant to this Agreement, shall be true and correct when made and shall
be true and correct in all material respects at and as of the Closing Date as
though such representations and warranties were made or given on and as of the
Closing Date, except for those given as of a specified date which must only be
true and correct as of such specified date.

 

10.2                        Compliance
With Agreement.

 

Buyer shall have
performed and complied in all material respects with all of Buyer’s agreements
and obligations under this Agreement which are to be performed or complied with
by Buyer prior to or on the Closing Date, including the delivery of the closing
documents and the Purchase Price specified in Section 12.3 of this
Agreement.

 

10.3                        Consents
and Approvals.

 

The FCC Consent
and all other approvals, consents and waivers that are required to effect the
assignments of the FCC Authorizations shall have been received.

 

10.4                        Certifications,
etc.

 

Seller shall have
received a certificate, dated as of the Closing Date, from an authorized
representative of Buyer, certifying that the conditions set forth in Sections
10.1 and 10.2 hereof have been fulfilled.

 

10.5                        Absence
of Litigation.

 

No litigation
shall have been commenced or threatened, and no investigation by any government
entity shall have been commenced, against Buyer, Seller or any of the
affiliates, officers, members or shareholders of any of them, with respect to
the transactions contemplated hereby.

 

11.                               INDEMNIFICATION

 

11.1                        By
Seller.

 

Subject to the terms and
conditions of this Article 11, Seller hereby agrees to indemnify, defend and
hold harmless Buyer, and its directors, officers, employees, members, managers
and controlled and controlling persons (hereinafter “Buyer’s Affiliates”), from
and against all Claims (as defined herein) asserted against, imposed upon, or
incurred by Buyer, Buyer’s Affiliates or the Purchased Assets, directly or
indirectly, by reason of, or resulting from:

 

(a)                                  the
inaccuracy or breach of any representation or warranty of Seller contained in
or made pursuant to this Agreement; provided that any claim for
indemnification made by Buyer pursuant to this Section 11.1(a) must be
made within the time period described in Section 14 of this Agreement;

 

13

 

(b)                                 the
breach of any covenant of Seller contained in this Agreement;

 

(c)                                  any
Claim brought by or on behalf of any broker or finder retained, employed or
used by Seller or any of its directors, officers, employees, members or agents
in connection with the transactions provided for herein or the negotiation
thereof, whether or not disclosed herein;

 

(d)                                 any
Claim relating to the ownership or operation of  the Purchased Assets prior to the Closing Date including, without
limitation, any liabilities arising under the FCC Authorizations which relate
to events occurring prior to the Closing Date; or

 

(e)                                  any
Claim made against Buyer as a result of a failure to comply with any bulk sales
or fraudulent conveyance statute.

 

As used in this Article
11, the term “Claim” shall include losses, damages, liabilities,
judgments, awards, penalties and settlements, demands, claims, suits, actions,
causes of action, proceedings and assessments, and the costs and expenses
(including court costs and fees and reasonable attorneys’ fees and expenses) in
connection therewith and related thereto.

 

11.2                        By
Buyer.

 

Subject to the terms and
conditions of this Article 11, Buyer hereby agrees to indemnify, defend and
hold harmless Seller, and its directors, officers, employees, members,
managers, and controlled and controlling persons (hereinafter “Seller’s
Affiliates”) from and against all Claims asserted against, imposed
upon or incurred by Seller or Seller’s Affiliates, directly or indirectly, by
reason of or resulting from:

 

(a)                                  the
inaccuracy or breach of any representation or warranty of Buyer contained in or
made pursuant to this Agreement;

 

(b)                                 the
breach of any covenant of Buyer contained in this Agreement;

 

(c)                                  any
Claim brought by or on behalf of any broker or finder retained, employed or
used by Buyer or any of its directors, officers, employees, members or agents
in connection with the transactions provided for herein or the negotiation
thereof, whether or not disclosed herein; or

 

(d)                                 any
Claim relating to the ownership or operation of the Purchased Assets arising
from events that occurred on or after the Closing Date including, without
limitation, any Liabilities arising under the FCC Authorizations which relate
to events occurring on or after the Closing Date.

 

11.3                        Indemnification
of Third-Party Claims.

 

The following provisions
shall apply to any Claim subject to indemnification which is (i) a suit, action
or arbitration proceeding filed or instituted by any third party, or (ii) any
other form of proceeding or assessment instituted by any government entity:

 

14

 

(a)                                  Notice and
Defense.  The party or
parties to be indemnified (whether one or more, the “Indemnified Party”) will
give the party from whom indemnification is sought (the “Indemnifying Party”) prompt
written notice of any such Claim, and the Indemnifying Party may undertake the
defense thereof by representatives chosen by it.  Failure to give such notice shall not affect the Indemnifying
Party’s duty or obligations under this Article 11, except to the extent the
Indemnifying Party is prejudiced thereby. 
So long as the Indemnifying Party is defending any such Claim actively
and in good faith, the Indemnified Party shall not settle such Claim.  The Indemnified Party shall make available
to the Indemnifying Party or its representatives all records and other
materials required by them and in the possession or under the control of the
Indemnified Party, for the use of the Indemnifying Party and its representatives
in defending any such Claim, and shall in other respects give reasonable
cooperation in such defense.

 

(b)                                 Failure to
Defend.  If the Indemnifying
Party, within a reasonable time after notice of any such Claim, decides not to
defend such Claim actively and in good faith, the Indemnified Party will (upon
further notice) have the right to undertake the defense, compromise or
settlement of such Claim or consent to the entry of a judgment with respect to
such Claim, on behalf of and for the account and risk of the Indemnifying
Party, and the Indemnifying Party shall thereafter have no right to challenge
the Indemnified Party’s defense, compromise, settlement or consent to judgment.

 

(c)                                  Indemnified
Party’s Rights.  Anything in
this Article 11 to the contrary notwithstanding, (i) if there is a reasonable
probability that a Claim may materially and adversely affect the Indemnified
Party other than as a result of money damages or other money payments, the
Indemnified Party shall have the right to defend, compromise or settle such
Claim, and (ii) the Indemnifying Party shall not, without the written consent
of the Indemnified Party, settle or compromise any Claim or consent to the
entry of any judgment which does not include as an unconditional term thereof
the giving by the claimant or the plaintiff to the Indemnified Party of a
release from all liability in respect of such Claim.

 

11.4                        Payment.

 

The Indemnifying Party
shall promptly pay the Indemnified Party any amount due under this Article
11.  Upon judgment, determination,
settlement or compromise of any third party Claim, the Indemnifying Party shall
pay promptly on behalf of the Indemnified Party, and/or to the Indemnified
Party in reimbursement of any amount theretofore required to be paid by it, the
amount so determined by judgment, determination, settlement or compromise and
all other Claims of the Indemnified Party with respect thereto, unless in the
case of a judgment, an appeal is made from the judgment.  If the Indemnifying Party desires to appeal
from an adverse judgment, then the Indemnifying Party shall post and pay the
cost of the security or bond to stay execution of the judgment pending
appeal.  Upon payment in full by the
Indemnifying Party, the Indemnifying Party shall succeed to the rights of such
Indemnified Party, to the extent not waived in settlement, against the third
party who made such third party Claim.

 

15

 

11.5                        Limits
on Indemnity.

 

Notwithstanding any other
provision hereof or of any applicable law, neither party will be entitled to
make a claim against the other party under Sections 11.1(a), 11.2(a)
or 11.3 for any breach of a representation and warranty unless and until
the aggregate amount of claimed losses exceeds Ten Thousand Dollars ($10,000),
in which event the party seeking indemnification will be entitled to make a
claim against the other party for the full amount of claimed losses.  Notwithstanding the foregoing, the aggregate
amount of claims that may be asserted for indemnification hereunder shall in no
event exceed Two Million One Hundred Thousand Dollars ($2,100,000).

 

12.                               CLOSING

 

12.1                        Closing.

 

The closing of this
transaction (the “Closing”) shall take place no later than the tenth (10th)
business day after the date of finality of the FCC Consent, or on such other
date to which the parties mutually agree (the “Closing Date”).  The Closing shall be conducted by exchange
of documents by facsimile, electronically, and overnight carrier or such other
means as the parties mutually agree.

 

12.2                        Documents
to be Delivered by Seller.

 

At the Closing, Seller
shall deliver to Buyer the following documents, in each case duly executed or
otherwise in proper form:

 

(a)                                  Compliance
Certificate.  The
certificates described in Section 9.5 of this Agreement.

 

(b)                                 Assignment
of FCC Authorizations.  An
Assignment of FCC Authorizations sufficient in the opinion of Buyer and its
counsel to assign the FCC Authorizations to Buyer.

 

(c)                                  Opinions of
Counsel.  A written opinion
of Seller’s FCC counsel, dated as of the Closing Date, addressed to Buyer, in
substantially the form of Exhibit B attached hereto.

 

(d)                                 Resolutions.  A copy of the resolutions of the board of
directors and/or managers of each Seller authorizing and approving this Agreement
and the transactions contemplated by this Agreement.

 

(e)                                  Good
Standing Certificates.  Good
standing certificates from Delaware and Illinois for each Seller.

 

(f)                                    Transfer
Documents.  Such bills of
sale, assignments, and other good and sufficient instruments of transfer as
Buyer may reasonable request in order to convey and transfer to Buyer title to
the Purchased Assets (collectively, the “Transfer Documents”).

 

16

 

(g)                                 Other
Documents.  All other documents,
instruments or writings required to be delivered at or prior to the Closing
pursuant to this Agreement and other certificates of authority and documents as
Buyer may reasonably request.

 

12.3                        Documents
to be Delivered by Buyer.

 

At the Closing, Buyer shall
deliver to Seller the following documents, in each case duly executed or
otherwise in proper form:

 

(a)                                  Cash
Purchase Price.  A wire
transfer of immediately available funds as required by Section 3.2(c) of
this Agreement.

 

(b)                                 Compliance
Certificate.  The certificate
described in Section 10.4 of this Agreement.

 

(c)                                  Resolutions.  A copy of the resolutions of the respective
boards of directors of each of HBC License and HBC Illinois authorizing and
approving this Agreement and the consummation of the transactions contemplated
by this Agreement.

 

(d)                                 Other
Documents.  All other
documents, instruments or writings required to be delivered to Seller at or
prior to the Closing pursuant to this Agreement and such other certificates of
authority and documents as Seller may reasonably request.

 

12.4                        Post-Closing
Use of FCC Authorizations.

 

If the Closing occurs
prior to the time that Buyer can use the Purchased Assets to operate a radio
station at the site proposed in the FCC Form 301 Application attached hereto as
Exhibit C, Seller acknowledges and agrees that it shall negotiate
in good faith with Buyer to enter into an arrangement with Buyer whereby the
Purchased Assets may continue to be used to operate the Station.

 

13.                               TERMINATION

 

13.1                        Right
of Termination Without Breach.

 

This Agreement may be
terminated without further liability of any party at any time prior to the
Closing:

 

(a)                                  by
mutual written agreement of Buyer and Seller, or

 

(b)                                 by
either Buyer or Seller if the Closing shall not have occurred on or before the
date which is one year from the date on which the Assignment Application is
filed with the FCC, provided the terminating party has not, through breach of a
representation, warranty or covenant, prevented the Closing from occurring on
or before such date.

 

17

 

13.2                        Termination
for Breach.

 

(a)                                  Termination
by Buyer.  If (i) Seller has
failed to cure any material violation or breach of any of its agreements,
representations or warranties contained in this Agreement within ten (10) days
after delivery of written notice of such violation of breach from Buyer,  (ii) there has been a failure of
satisfaction of a condition to the obligations of Buyer which has not been
waived by Buyer (and such failure has not been caused by an act or failure to
act by Buyer) or (iii) Seller shall have attempted to terminate this
Agreement under this Article 13 or otherwise without grounds to do so and
without acting in good faith, then Buyer, by written notice to Seller at any
time prior to the Closing that such violation, breach, failure or wrongful
termination attempt is continuing, may terminate this Agreement.  Upon termination of this Agreement by Buyer
pursuant to this Section 13.2(a), Buyer, in addition to any other remedy
that may be available, shall be entitled to equitable relief pursuant to Section
16.4 of this Agreement.

 

(b)                                 Termination
by Seller.  If (i) Buyer has
failed to cure any material violation or breach of any of its agreements,
representations or warranties contained in this Agreement within ten (10) days
after delivery of written notice of such violation or breach from Seller, (ii)
there has been a failure of satisfaction of a condition to the obligations of
Seller which has not been waived by Seller or (iii) Buyer shall have
attempted to terminate this Agreement under this Article 13 or otherwise
without grounds to do so and without acting in good faith, then Seller, by
written notice to Buyer at any time prior to the Closing that such violation,
breach, failure or wrongful termination attempt is continuing, may terminate
this Agreement and shall be entitled to retain the Earnest Money and the Option
Payment as its sole and exclusive remedy as liquidated damages and not
as a penalty.

 

14.                               SURVIVAL OF REPRESENTATIONS AND WARRANTIES

 

All representations and
warranties of Seller and Buyer contained in this Agreement shall survive for
two (2) years after the Closing Date.

 

15.                               [INTENTIONALLY OMITTED]

 

16.                               MISCELLANEOUS

 

16.1                        Further
Assurances.

 

From time to time, at
Buyer’s request and without further consideration, Seller shall execute and
deliver to Buyer such documents, instruments and consents and take such other
action as Buyer may reasonably request in order to consummate more effectively
the transactions contemplated hereby, to discharge the covenants of Seller and
to vest in Buyer good, valid and marketable title to the Purchased Assets.  Buyer acknowledges and agrees that, from and
after the Closing Date, that Buyer shall cooperate with Seller and shall take
such action as Seller shall reasonably request so that Buyer may continue to
operate the Excluded Assets or otherwise address any matter relating to
Seller’s ownership of the Purchased Assets or operation of the Station prior to
the Closing Date; provided, however, that in connection with Buyer
performing 

 

18

 

its obligations under
this Section 16.1, Buyer shall not be obligated to incur any
out-of-pocket costs or expenses.

 

16.2                        Disclosures
and Announcements.

 

Both the timing and the
content of all disclosure to third parties and public announcements concerning
the transactions provided for in this Agreement by either Seller or Buyer shall
be subject to the approval of the other party in all material respects, except
that neither party’s approval shall be required as to any statements and other
information which either party may submit to the FCC, or be required to make
pursuant to any rule or regulation of the FCC, or otherwise as required by law.

 

16.3                        Assignment;
Parties in Interest.

 

(a)                                  Assignment.  Except as expressly provided herein, the
rights and obligations of a party hereunder may not be assigned, transferred or
encumbered without the prior written consent of the other party.  Notwithstanding the foregoing, Buyer may,
upon written notice to Seller, cause one or more assignees of Buyer to carry
out all or part of the transactions contemplated hereby; provided, however,
that Buyer shall, nevertheless, remain liable for all of its obligations to Seller
hereunder.

 

(b)                                 Parties in
Interest.  This Agreement
shall be binding upon, inure to the benefit of, and be enforceable by the
respective successors and permitted assigns of the parties hereto.  Nothing contained herein shall be deemed to
confer upon any other person any right or remedy under or by reason of this
Agreement.

 

16.4                        Equitable
Relief.

 

Seller agrees that any
breach of Seller’s obligation to consummate the sale of the Purchased Assets on
the Closing Date will result in irreparable injury to Buyer for which a remedy
at law would be inadequate; and that, in addition to any relief at law which
may be available to Buyer for such breach and regardless of any other provision
contained in this Agreement, Buyer shall be entitled to the equitable relief of
specific performance and any and all other remedies available at law or in
equity.  If any action is brought by
Buyer against Seller for failure by Seller to complete the sale of the
Purchased Assets on the Closing Date, Seller will waive the defense that there
is an adequate remedy at law.

 

16.5                        Law
Governing Agreement.

 

This Agreement shall be
construed and interpreted according to the internal laws of the State of
Illinois, excluding any choice of law rules that may direct the application of
the laws of another jurisdiction.

 

16.6                        Amendment
and Modification.

 

Buyer and Seller may
amend, modify and supplement this Agreement in such manner as may be agreed
upon by them in writing.

 

19

 

16.7                        Notice.

 

All notices, requests,
demands and other communications hereunder shall be given in writing and shall
be:  (a) personally delivered; (b) sent
by telecopier, facsimile transmission or other electronic means of transmitting
written documents; or (c) sent to the parties at their respective addresses
indicated herein by registered or certified U.S. mail, return receipt requested
and postage prepaid, or by private overnight mail courier service.  The respective addresses to be used for all
such notices, demands or requests are as follows:

 

(a)                                  If
to Buyer, to:

 

Hispanic Broadcasting
Corporation

3102 Oak Lawn Avenue,
Suite 215

Dallas, Texas 75219

Attention:  Jeffrey T. Hinson, Senior Vice President

Facsimile:  (214) 525-7750

E-mail:
jhinson@hispanicbroadcasting.com

 

(with a copy to)

 

Hallett & Perrin,
P.C.

2001 Bryan St., Suite
3900

Dallas, Texas 75201

Attention:  Bruce H. Hallett, Esq.

Facsimile:  (214) 922-4170

E-mail:  bhallett@hallettperrin.com

 

or to such other person
or address as Buyer shall furnish to Seller in writing.

 

(b)                                 If
to Seller to:

 

Next Media Operating,
Inc.

6312 S. Fiddler’s Green
Circle, Suite 360E

Englewood, Colorado 80111

Attention: Sean Stover

Facsimile:  (303) 694-4940

 

(with a copy to)

 

Weil, Gotshal &
Manges LLP

100 Crescent Court, Suite
1300

Dallas, Texas 75201

Attention:                                         Glenn
D. West, Esq.

                                                                                                John
E. Quattrocchi, Esq.

Facsimile:  (214) 746-7777

 

or to such other person
or address as Seller shall furnish to Buyer in writing.

 

20

 

If personally delivered,
such communication shall be deemed delivered upon actual receipt; if
electronically transmitted pursuant to this paragraph, such communication shall
be deemed delivered the next business day after transmission (and sender shall
bear the burden of proof of delivery); if sent by overnight courier pursuant to
this paragraph, such communication shall be deemed delivered upon receipt; and
if sent by U.S. mail pursuant to this paragraph, such communication shall be
deemed delivered as of the date of delivery indicated on the receipt issued by
the relevant postal service, or, if the addressee fails or refuses to accept
delivery, as of the date of such failure or refusal.  Any party to this Agreement may change its address for the
purposes of this Agreement by giving notice thereof in accordance with this
Section.

 

16.8                        Confidentiality.

 

Any and all information,
disclosures, knowledge or facts regarding Buyer or Seller or their respective
businesses or properties to which the other party is exposed as a result of the
negotiation, preparation or performance of this Agreement shall be confidential
and shall not be divulged, disclosed or communicated to any other person, firm,
corporation or entity, except for the other party’s employees, attorneys, accountants,
investment bankers, investors and lenders, and their respective attorneys, on a
need-to-know basis for the purpose of consummating the transactions
contemplated by this Agreement. 
Notwithstanding the foregoing, no party shall be required to keep confidential
information that (a) is in the public domain, (b) is required to be disclosed
pursuant to an order or request of a judicial or governmental authority
(provided the non-disclosing party is given reasonable prior notice such that
it may seek, at its expense, confidential treatment of the information to be
disclosed), or (c) is required to be disclosed under applicable law or
rule, as reasonably determined by counsel for the receiving party.

 

16.9                        Entire
Agreement.

 

This instrument embodies
the entire agreement between the parties hereto and supersedes all prior oral
or written agreements, understandings, representations and warranties and
courses of conduct and dealing between the parties with respect to the
transactions contemplated herein.

 

16.10                 Counterparts.

 

This Agreement may be
executed in one or more counterparts, each of which shall be deemed an
original, but all of which together shall constitute one and the same
instrument.  For purposes of this
Agreement, facsimile signatures shall be treated the same as original
signatures.

 

16.11                 Headings.

 

The headings in this
Agreement are inserted for convenience only and shall not constitute a part
hereof.

 

21

 

16.12                 Severability.

 

If any one or more of the
provisions contained in this Agreement should be found invalid, illegal or
unenforceable, in any respect, the validity, legality, and enforceability of
the remaining provisions contained herein shall not in any way be affected or
impaired thereby.  Any illegal or
unenforceable term shall be deemed to be void and of no force and effect only
to the minimum extent necessary to bring such term within the provisions of
applicable law and such term, as so modified, and the balance of this Agreement
shall then be fully enforceable.

 

16.13                 Attorneys’ Fees.

 

If either party initiates
any litigation against the other party involving this Agreement, the prevailing
party in such action shall be entitled to receive reimbursement from the other
party for all reasonable attorneys’ fees and other costs and expenses incurred
by the prevailing party in respect of that litigation, including any appeal,
and such reimbursement may be included in the judgment or final order issued in
that proceeding.

 

16.14                 Counsel.

 

Each party has been
represented by its own counsel in connection with the negotiation and
preparation of this Agreement and, consequently, each party hereby waives the
application of any rule of law that would otherwise be applicable in connection
with the interpretation of this Agreement, including, but not limited to, any
rule of law to the effect that any provision of this Agreement shall be
interpreted or construed against the party whose counsel drafted that
provision.

 

16.15                 Schedules.

 

The Schedules and Exhibits
attached to this Agreement and any other documents delivered to Buyer by Seller
pursuant hereto are hereby made a part of this Agreement as if set forth in
full herein.

 

[Signature
Page Follows]

 

22

 

IN WITNESS WHEREOF,
the parties have executed this Agreement as of the date and year first above
written.

 

 

	
  BUYER:

  	
  HBC ILLINOIS, INC.

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Gerald J. Ryan

  	
   

  
	
   

  	
  Name:

  	
  Gerald J. Ryan

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  HBC LICENSE CORPORATION

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Jeffrey T. Hinson

  	
   

  
	
   

  	
  Name:

  	
  Jeffrey T. Hinson

  	
   

  
	
   

  	
  Title:

  	
   Sr. Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
  SELLER:

  	
  NEXTMEDIA OPERATING, INC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Sean R. Stover

  	
   

  
	
   

  	
  Name:

  	
  Sean R. Stover

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  NM LICENSING LLC

  
	
   

  	
   

  
	
   

  	
   

  
	
   

  	
  By: 

  	
  /s/ Sean R. Stover

  	
   

  
	
   

  	
  Name:

  	
  Sean R. Stover

  	
   

  
	
   

  	
  Title:

  	
  Vice President

  	
   

  
						

 

23

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