1
Exhibit 99.2
================================================================================
ASSET PURCHASE AGREEMENT
DATED AS OF APRIL 8TH, 1998
BY AND AMONG
OUTDOOR SYSTEMS, INC.,
THE XXXXXXX SHOP, INC.
D/B/A PHILADELPHIA OUTDOOR
AND
XXXXXX XXXXXX
================================================================================
2
TABLE OF CONTENTS
1. DEFINITIONS............................................................1
2. PURCHASE AND SALE OF THE ASSETS; CLOSING...............................1
2.1 Agreement to Purchase and Sell...................................1
2.2 Purchased Assets.................................................2
2.3 Agreement to Assume Certain Liabilities..........................3
2.4 Excluded Liabilities.............................................3
2.5 Closing..........................................................3
2.6 Purchase Price...................................................3
2.7 Transactions at the Closing......................................5
2.8 Third Party Consents.............................................5
3. REPRESENTATIONS AND WARRANTIES OF SELLER...............................6
3.1 Organization and Good Standing...................................6
3.2 Authority; No Conflict...........................................6
3.3 Solvency.........................................................7
3.4 Books and Records................................................7
3.5 Purchased Structures.............................................7
3.6 Permits..........................................................7
3.7 Site Leases and Advertising Contracts............................7
3.8 Leased Assets....................................................8
3.9 Title, Encumbrances..............................................8
3.10 No Undisclosed Liabilities.......................................8
3.11 Taxes............................................................8
3.12 Compliance with Legal Requirements...............................9
3.13 Legal Proceedings; Orders........................................9
3.14 Other Contracts..................................................9
3.15 Insurance........................................................9
3.16 Environmental Matters............................................9
3.17 Intangible Property.............................................10
3.18 Relationships with Affiliates...................................10
3.19 Brokers or Finders..............................................10
3.20 Employee Benefit Matters........................................10
3.21 Material Adverse Change.........................................10
3.22 Disclosures.....................................................10
4. REPRESENTATIONS AND WARRANTIES OF BUYER...............................10
4.1 Organization and Good Standing..................................10
4.2 Authority; No Conflict..........................................11
4.3 Certain Proceedings.............................................11
4.4 Brokers or Finders..............................................11
4.5 Buyer's Inspection..............................................11
4.6 Solvency........................................................11
4.7 Financing.......................................................12
i
3
5. COVENANTS OF SELLER...................................................12
5.1 Access and Investigation........................................12
5.2 Operation of the Purchased Assets...............................12
5.3 Negative Covenant...............................................12
5.4 Required Approvals and Consents.................................12
5.5 Notification....................................................12
5.6 No Negotiation..................................................13
5.7 Tax Clearance...................................................13
5.8 Trade Name......................................................13
5.9 Right of First Refusal..........................................13
5.10 Financial Status of Seller......................................13
6. COVENANTS OF BUYER....................................................14
6.1 Required Approvals..............................................14
6.2 Best Efforts....................................................14
6.3 Notification....................................................14
6.4 Imprints........................................................14
6.5 Ben Franklin Bridge Billboard...................................14
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE...................14
7.1 Accuracy of Representations.....................................15
7.2 Seller's Performance............................................15
7.3 Bank Lien.......................................................15
7.4 Additional Documents............................................15
7.5 No Proceedings..................................................15
7.6 No Prohibition..................................................15
7.7 No Material Adverse Change......................................15
8. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE..................15
8.1 Accuracy of Representations.....................................16
8.2 Buyer's Performance.............................................16
8.3 Additional Documents............................................16
8.4 No Proceedings..................................................16
8.5 No Prohibition..................................................16
9. TERMINATION...........................................................16
9.1 Termination Events..............................................16
9.2 Effect of Termination...........................................17
10. INDEMNIFICATION; REMEDIES.............................................17
10.1 Indemnification and Payment of Damages by Seller................17
10.2 Indemnification and Payment of Damages by Buyer.................17
10.3 Procedure for Indemnification -- Third Party Claims.............18
10.4 Procedure for Indemnification -- Other Claims...................19
10.5 Survival/Limitations............................................19
10.6 Claims Covered by Insurance.....................................19
ii
4
11. GENERAL PROVISIONS....................................................19
11.1 Expenses........................................................19
11.2 Headings; Construction..........................................20
11.3 Public Announcements; Confidentiality...........................20
11.4 Availability of Equitable Remedies..............................20
11.5 Notices.........................................................20
11.6 Further Assurances..............................................21
11.7 Waiver..........................................................21
11.8 Entire Agreement and Modification...............................21
11.9 Assignments, Successors, and No Third-Party Rights..............22
11.10 [Reserved]......................................................22
11.11 Severability....................................................22
11.12 Risk of Loss....................................................22
11.13 Post-Closing Access.............................................22
11.14 Applicable Law..................................................22
11.15 Counterparts....................................................22
iii
5
EXHIBITS
Exhibit A - Definitions
Exhibit B - Form of Xxxx of Sale, Assignment and Assumption Agreement
Exhibit C - Form of Leases
Exhibit D - Form of Plant Lease
Exhibit E - Forms of Non-Competition Agreement
iv
6
SCHEDULES
Schedule 2.2(a) - Billboard Displays/Structures
Schedule 2.2(b) - Site Leases
Schedule 2.2(c) - Advertising Contracts
Schedule 2.2(c)(i) - Leased Structures
Schedule 2.2(g) - Furniture and Equipment
Schedule 2.2(x) - Excluded Assets
Schedule 2.3 - Assumed Contracts
Schedule 5.4 - Consents
v
7
DISCLOSURE SCHEDULE
Part 3.2(b) Part 3.10
Part 3.2(c) Part 3.11(a)
Part 3.5 Part 3.13
Part 3.6 Part 3.14
Part 3.7 Part 3.16
Part 3.8(a) Part 3.18
Part 3.9(b) Part 3.20
Part 3.21
vi
8
ASSET PURCHASE AGREEMENT
This Asset Purchase Agreement (this "Agreement") is entered into as of
April 8, 1998, by and among OUTDOOR SYSTEMS, INC., a Delaware corporation
("Buyer"), THE XXXXXXX SHOP, INC. D/B/A PHILADELPHIA OUTDOOR, a Pennsylvania
corporation ("Seller"), and XXXXXX XXXXXX, a resident of the State of Florida
("Stockholder"), who is a party to this Agreement solely for purposes of Section
5.10 hereof. (Buyer, Seller and Stockholder are sometimes herein referred to
individually as a "Party" and collectively as the "Parties").
RECITALS
WHEREAS, Seller is engaged in the business of owning and operating outdoor
signs and billboards and otherwise providing outdoor advertising services in the
states of Pennsylvania and New Jersey;
WHEREAS, Stockholder is a stockholder of Seller and an officer and
director of Seller; and
WHEREAS, Seller desires to sell certain outdoor advertising assets to
Buyer, and Buyer desires to purchase such assets and to assume certain
liabilities associated with such assets, pursuant to the terms, conditions,
limitations and exclusions contained in this Agreement.
NOW, THEREFORE, in consideration of the mutual representations,
warranties, covenants and agreements, and upon the terms and conditions
hereinafter set forth, the parties do hereby agree as follows:
AGREEMENT
1. DEFINITIONS
For purposes of this Agreement, the terms listed on Exhibit A attached
hereto have the meanings specified or referred to in Exhibit A.
2. PURCHASE AND SALE OF THE ASSETS; CLOSING
2.1 AGREEMENT TO PURCHASE AND SELL. Subject to the terms and conditions of
this Agreement, Seller hereby agrees to grant, sell, assign, transfer, convey
and deliver all of its right, title and interest in and to the Purchased Assets,
free and clear of any Security Interest (except for Permitted Liens), and Buyer
hereby agrees to buy and acquire the Purchased Assets from Seller, and to assume
the Assumed Liabilities upon the terms and conditions set forth in this
Agreement.
9
2.2 PURCHASED ASSETS. The Purchased Assets are the following assets of
Seller:
(a) All of the billboard displays and other out-of-home advertising
structures set forth and described in Schedule 2.2(a) attached hereto, together
with all components, fixtures, parts, appurtenances and equipment attached to or
made a part thereof (collectively, the "Purchased Structures");
(b) All leases, licenses, easements, other rights of ingress or egress
and all other grants of the right to place, construct, own, operate, or maintain
the Purchased Structures, or relating to unbuilt locations in Pleasantville, New
Jersey and Trenton, New Jersey, and all rights therein (collectively, the "Site
Leases"), including those Site Leases listed on Schedule 2.2(b);
(c) All rights under advertising contracts and contracts for
telecommunication equipment existing on the Closing Date (collectively, the
"Advertising Contracts") associated with (i) those structures on Schedule
2.2(c)(i) (the "Leased Structures") and (ii) the Purchased Structures (the
Leased Structures and the Purchased Structures, collectively, the "Structures"),
including those Advertising Contracts listed on Schedule 2.2(c) attached hereto;
and all rights of Seller to the advertising copy displayed on the Structures as
of the Closing Date;
(d) To the extent assignable, all state and local licenses or
permits/tags which Seller has with respect to the Purchased Structures and all
other Governmental Authorizations that Seller has with respect to the operation
of the Purchased Structures, (collectively, the "Permits");
(e) All prepaid expenses of Seller as of the Effective Time relating
to the Purchased Assets, subject to proration at Closing pursuant to Section
2.6(a);
(f) All pertinent Books and Records relating to the Purchased Assets
(except for those related to the Leased Structures for which Buyer shall receive
only copies);
(g) All furniture, equipment and inventory used at the Plant and set
forth on Schedule 2.2(g) but excluding those listed on Schedule 2.2(x);
(h) Any Intangible Property used in connection with the Purchased
Assets not otherwise described in this Section 2.2;
(i) Any Contracts listed in Schedule 2.3; and
(j) To the extent assignable, all rights (including any benefits
arising therefrom), causes of action, claims and demands of whatever nature
(whether or not liquidated) of Seller relating to the Purchased Assets,
including, without limitation, condemnation rights and proceeds, and all rights
against suppliers under warranties covering any of the Purchased Assets.
Notwithstanding the foregoing, the Purchased Assets shall not include any
accounts receivable, the Leased Structures, the Plant and the assets listed on
Schedule 2.2(x) (collectively, the "Excluded Assets").
2
10
2.3 AGREEMENT TO ASSUME CERTAIN LIABILITIES. At the Closing, Buyer shall
assume and agree to discharge and perform all liabilities and obligations
pursuant to the Site Leases, Advertising Contracts and the Permits and the
Contracts set forth on Schedule 2.3 (collectively, the "Assumed Liabilities")
but to the extent and only to the extent that such liabilities and obligations
arise or are attributable to events occurring or periods arising on or after the
Closing Date.
2.4 EXCLUDED LIABILITIES. All claims against and liabilities and
obligations of Seller not specifically assumed by Buyer pursuant to Section 2.3,
including, without limitation, the following claims against and liabilities of
Seller (the "Excluded Liabilities"), are excluded, and shall not be assumed or
discharged by Buyer:
(a) Any liabilities to the extent not attributable to the Purchased
Assets;
(b) Any liability of Seller for Taxes relating to periods prior to the
Closing or from the sale of the Purchased Assets under this Agreement;
(c) Any liabilities for or related to indebtedness of Seller to the
Bank or any other banks, financial institutions, or other Persons;
(d) Any liabilities of Seller for or with respect to any employees of
Seller, including, without limitation, any liabilities pursuant to any
compensation, collective bargaining, pension, retirement, severance,
termination, or other benefit plan, agreement, or arrangement;
(e) Any liabilities or obligations of Seller under any Contracts that
are not included within the Purchased Assets; and
(f) Any other liabilities for which satisfaction were due prior to the
Closing.
The foregoing shall not in any way limit the Buyer's obligations under the
Leases, Plant Lease or any other agreement between Buyer and Seller and/or
Seller's Affiliates.
2.5 CLOSING. The purchase and sale of the Purchased Assets (the "Closing")
provided for in this Agreement will take place at the offices of Stradley,
Ronon, Xxxxxxx & Xxxxx, LLP, 2600 One Commerce Square, Northeast Corner of 00xx
xxx Xxxxxx Xxxxxxx, Xxxxxxxxxxxx, XX 00000, on or before April 15, 1998, subject
to the earlier of termination or expiration of the waiting period under the HSR
Act, or such later time and place as the Parties may agree. The effective time
of the Closing shall be 12:00 a.m., Eastern Standard Time, on the Closing Date
(the "Effective Time").
2.6 PURCHASE PRICE. In consideration for the Purchased Assets, Buyer shall
assume the Assumed Liabilities, enter into the Leases and Plant Lease, and pay
an amount (the "Purchase Price") equal to Fifty-Two Million, Eight Hundred
Thousand Dollars ($52,800,000).
(a) (i) The following items shall be prorated between Seller and Buyer
as of the Effective Time with respect to the Purchased Assets: power and utility
charges, property taxes, revenue including accounts receivable, commissions
payable under any Contract assumed by Buyer, rents (including percentage rents)
and security deposits under Site Leases and payments and security deposits under
Advertising Contracts. Prorations will be on a dollar-for-dollar basis based on
the number of days of display before and after the Effective Time. Percentage
rents shall be prorated as of the Effective Time. Seller shall be credited in
the prorations for the amount of any expenses that
3
11
have been prepaid for up to one year post-Closing, but not in excess of one
year. Buyer shall be credited for the amount of any revenues collected by Seller
as of the Effective Time to the extent pertaining to time periods after the
Effective Time.
(ii) Prorations shall be estimated on the basis of the most
current information available at Closing. On the Closing Date, Seller shall
provide to Buyer a list of items and the prorations required by this Section
2.6(a) (the "Preliminary Adjustment"). For each item to be prorated as set forth
herein, Seller shall determine the dollar amounts which, as of the Effective
Time, shall be due and owing to each of Seller and Buyer. At the Closing, Seller
or Buyer, as the case may be, shall pay to the other party any amounts owing to
such other party based upon the apportionments calculated in accordance with
this Section 2.6(a). Seller agrees to furnish Buyer with any documents or
records in Seller's possession that may be needed for Buyer to confirm
prorations in this Section 2.6(a).
(b) Within ninety (90) days after the Closing Date, Buyer will prepare
and provide to Seller the final calculations of prorations required pursuant to
Section 2.6(a) (the "Closing Date Adjustment"). On or before the 120th day after
the Closing Date, all required refunds or payments under Sections 2.6(a) and
2.6(b) shall be made on the basis of the Closing Date Adjustment, subject to
Section 2.6(d).
(c) Notwithstanding Sections 2.6(a) and 2.6(b), the proration as of
the Closing Date of percentage rents payable under any particular Site Lease
shall be made by Buyer and notice thereof (showing the applicable calculations)
given to Seller, within thirty (30) days following the expiration of the period
over which the percentage rents are calculated under such Site Lease. The
proration notice shall be accompanied by any amounts due Seller as shown
therein, or in the event Seller owes Buyer as shown therein, Seller shall
reimburse Buyer such amount within ten (10) days of receipt of the appropriate
proration notice, subject to Section 2.6(d). The proration calculation of
percentage rents shall be based on the amount of revenue generated before and
after the Effective Time and it shall not be based on the number of days before
and after the Effective Time.
(d) If any dispute arises over any amount to be refunded and/or paid
under this Section 2.6 (whether pursuant to the Preliminary Adjustment, the
Closing Date Adjustment or the percentage rent prorations), such refund or
payment shall nonetheless be promptly made to the extent such amount is not in
dispute. If any such dispute cannot be resolved by the Parties, it shall be
submitted to Buyer's accountants and Seller's accountants for resolution by such
accountants. If such dispute is not resolved by such accountants within thirty
(30) days after the dispute is first submitted to both accountants for
resolution, then Buyer's accountants and Seller's accountants shall jointly
designate a third independent certified public accountant (the "Third
Accountant"), and the resolution of such dispute shall be made by the Third
Accountant. The determination of the Third Accountant shall be final and binding
upon the parties to this Agreement. Buyer and Seller shall each pay one-half
(1/2) of the fees and expenses of the Third Accountant. Each party shall
otherwise bear its own costs and expenses associated with the resolution of such
dispute, including the fees and expenses of their respective accountants and
attorneys.
(e) The Parties agree to cooperate with each other in determining and
reaching an agreement in writing on the allocation of the Purchase Price among
the Purchased Assets.
(f) Seller agrees to promptly forward to Buyer any payments that
Seller collects after the Closing with respect to any accounts receivable
relating to the Purchased Assets to the
4
12
extent pertaining to the period after the Effective Time. Buyer agrees to
promptly forward to Seller any payments Buyer receives with respect to the
accounts receivables of Seller.
2.7 TRANSACTIONS AT THE CLOSING. The following transactions shall
take place at the Closing:
(a) Seller or the applicable Owner shall enter into (as applicable)
and deliver to Buyer: (i) the Xxxx of Sale, (ii) the Leases, (iii) the Plant
Lease; (iv) the Non-Competition Agreement; (v) documentation that applications
have been submitted for all applicable Tax Clearances; and (vi) other
instruments of transfer, evidence of consent and all other related documents as
may be reasonably necessary to evidence or perfect the sale, assignment,
transfer, and conveyance of good title to all of the Purchased Assets in
accordance with the terms hereof. Seller shall also deliver to Buyer all Books
and Records described in Section 2.2(f), including the originals of the
Advertising Contracts and Site Leases.
(b) The Stockholder shall enter into and deliver to Buyer the
Non-Competition Agreement.
(c) Buyer shall deliver to Seller by 11:00 a.m. on the Closing Date,
the Purchase Price, as adjusted pursuant to Section 2.6, by wire transfer of
immediately available funds to such accounts and in such amounts as directed by
Seller.
(d) Buyer shall enter into (as applicable) and deliver to Seller or
the applicable Owner: (i) the Xxxx of Sale; (ii) the Leases; (iii) the Plant
Lease; (iv) the Non-Competition Agreement; and (v) other assumption agreements,
instruments and other documents as may be necessary to evidence the assumption
by Buyer of the Assumed Liabilities in accordance with the terms hereof.
(e) The Parties shall also deliver to each other the agreements,
instruments, opinions, certificates and other documents referred to in this
Agreement.
2.8 THIRD PARTY CONSENTS. To the extent that Seller's rights under any
Advertising Contract, Site Lease, or other interest in the Purchased Assets may
not be assigned without the consent of a third party and such consent has not
been obtained, this Agreement shall not constitute an agreement to assign the
same if an attempted assignment would constitute a breach thereof or be
unlawful, and Seller and Buyer, to the extent permitted by law and any terms of
or limitations relating to such asset, shall use their commercially reasonable
efforts to obtain for Buyer the benefits thereunder, and shall cooperate to the
extent permitted by law and any terms of or limitations relating to such asset
in any reasonable arrangement designed to provide such benefits to Buyer,
including any sublease or subcontract or similar arrangement (collectively, the
"Beneficial Arrangements"), and if Buyer has obtained such benefits, Buyer shall
discharge Seller's obligations thereunder arising from and after the Closing
Date, except for any obligations arising because of Seller's breach which are
not due to Buyer's acts or omissions related thereto. Notwithstanding the
foregoing, Seller shall not be required to make any payment to any person or
forego any benefits in order to obtain any such consents. If the Closing is
consummated notwithstanding the absence of all such third party consents, at
such time as any such consent has been obtained, such Advertising Contract, Site
Lease or other interest shall be assigned or transferred to Buyer automatically
without any further conveyance or other action by Buyer or Seller.
5
13
3. REPRESENTATIONS AND WARRANTIES OF SELLER
Seller represents and warrants to Buyer as follows:
3.1 ORGANIZATION AND GOOD STANDING. Seller is a corporation duly
organized, validly existing and in good standing under the laws of the
Commonwealth of Pennsylvania, with full power and authority to conduct the
Business as it is now being conducted, to own or use the Purchased Assets, and
to perform all its obligations with respect thereto. Seller has delivered to
Buyer true and complete copies of its Organizational Documents, as currently in
effect. Seller is duly qualified to do business and in good standing in
Pennsylvania and New Jersey.
3.2 AUTHORITY; NO CONFLICT.
(a) This Agreement constitutes the legal, valid and binding obligation
of Seller, enforceable against it in accordance with this Agreement's terms,
subject to applicable bankruptcy, insolvency, reorganization, moratorium,
fraudulent transfer, and other similar laws relating to or affecting creditors'
rights generally from time to time in effect and to general principles of equity
(including, without limitation, concepts of materiality, reasonableness, good
faith and fair dealing), regardless of whether considered in a proceeding in
equity or law. Upon the execution and delivery by Seller of any agreements and
documents to be executed at Closing pursuant to this Agreement (collectively,
the "Closing Documents"), such Closing Documents will constitute the legal,
valid and binding obligations of Seller, enforceable against it in accordance
with their respective terms, subject to applicable bankruptcy, insolvency,
reorganization, moratorium, fraudulent transfer, and other similar laws relating
to or affecting creditors' rights generally from time to time in effect and to
general principles of equity (including, without limitation, concepts of
materiality, reasonableness, good faith and fair dealing), regardless of whether
considered in a proceeding in equity or law. Seller has the corporate right,
power and authority to execute and deliver this Agreement and the Closing
Documents to which it is a party and to perform its obligations hereunder and
thereunder. The execution, delivery and performance of this Agreement has been
specifically authorized by the unanimous consent of the directors and
stockholders of Seller.
(b) Except as set forth in Part 3.2(b) of the Disclosure Schedule,
neither the execution and delivery by Seller of this Agreement nor the
consummation or performance by Seller of any of the Contemplated Transactions
will:
(i) conflict with, violate, or result in a breach of: (A) any
provision of the Organizational Documents of Seller; (B) any Legal
Requirement or any Order to which Seller or any of the Purchased Assets or
the Leased Assets may be subject; (C) any Governmental Authorization held
by Seller or that otherwise relates to the Business, the Purchased Assets,
or the Leased Assets; or (D) any material Contract to which Seller is a
party or by which the Purchased Assets or the Leased Assets may be bound;
or
(ii) (A) give any Person the right to declare a default or
exercise any remedy under, or to accelerate the maturity or performance
of, or to cancel, terminate, or modify any interest or rights of Seller
under any Contract related to the Purchased Assets; or (B) result in the
imposition or creation of any Security Interest in or with respect to any
of the Purchased Assets.
6
14
(c) Except as set forth in Part 3.2(c) of the Disclosure Schedule,
Seller is not and will not be required to give any notice to or obtain any
Consent from any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the Contemplated
Transactions.
3.3 SOLVENCY. By consummating the transactions contemplated hereby, Seller
does not intend to hinder, delay, or defraud any of Seller's present or future
creditors. Before giving effect to the transactions contemplated hereby, Seller
has been paying its debts as they become due in the Ordinary Course of Business
and, after giving effect to the transactions contemplated hereby, Seller expects
to have the means to and intends to pay or discharge all of its debts (or make
adequate provision for the payment thereof).
3.4 BOOKS AND RECORDS. To the extent in the possession or control of
Seller, the Books and Records of Seller maintained in connection with the
Purchased Assets or the Leased Assets have been made available to Buyer for
inspection and are correct in all material respects and have been maintained in
accordance with sound business practices.
3.5 PURCHASED STRUCTURES. Except as set forth in Part 3.5 of the
Disclosure Schedule, Seller owns all of the Purchased Structures and, to
Seller's Knowledge, each Purchased Structure is located entirely on property
covered by a Site Lease, and each Purchased Structure (i) complies in all
material respects with the terms of the Permits pertaining to it and (ii) is in
condition to accept faces and in adequate condition and repair for its current
use.
3.6 PERMITS. Except as set forth in Part 3.6 of the Disclosure Schedule:
(a) the Permits constitute all material licenses, permits, registrations and
approvals necessary to operate the Purchased Assets; (b) Seller is in material
compliance with the terms of the Permits; (c) Seller is not aware of any fact or
event which constitutes a material violation of any Permit; and (d) Seller has
not received written notice that any Governmental Body issuing any Permit
intends to cancel, terminate, modify, or amend any Permit.
3.7 SITE LEASES AND ADVERTISING CONTRACTS. Seller has delivered to Buyer
true and complete copies of the Advertising Contracts and the Site Leases or has
otherwise provided Buyer with an accurate description of the material terms
thereof. All sales made to advertisers in connection with the Structures have
been made pursuant to Advertising Contracts. To Seller's Knowledge, the Site
Leases and the Advertising Contracts are in full force and effect, and are
binding upon the parties thereto. Except as set forth in Part 3.7 of the
Disclosure Schedule, to the Knowledge of Seller: (x) no material default by
Seller or any other party has occurred under the Site Leases or Advertising
Contracts, (y) no event, occurrence, or condition exists which (with or without
notice or lapse of time or the happening of any further event or condition)
would become a material default by Seller thereunder or would entitle any other
party to terminate a Site Lease or Advertising Contract, to make a claim or
set-off against Seller or otherwise to amend such Site Lease or Advertising
Contract or prevent such Site Lease or Advertising Contract from being renewed
in accordance with its terms; and (z) Seller has not received any written notice
of default, termination, or non-renewal under any Site Lease or Advertising
Contract.
7
15
3.8 LEASED ASSETS.
(a) Except as set forth in Part 3.8(a) of the Disclosure Schedule,
Seller has not and to its Knowledge, no other Owner has, granted or agreed to
grant to any Person any option, agreement or other right to purchase, sell,
lease or occupy any of the Plant or Leased Structures, except (i) to Buyer
pursuant to the Leases and the Plant Lease and (ii) to parties to the applicable
Advertising Contracts but in such case only as set forth in such Advertising
Contracts with respect to the lease of space in connection with the provision of
advertising services.
(b) To the Knowledge of Seller, (i) the ownership of the Leased
Structures and the underlying real property rights are as set forth on Part
3.8(b) of the Disclosure Schedule; (ii) each Leased Structure is located
entirely on property or an easement owned by the Owners listed on Part 3.8(b) of
the Disclosure Schedule; and (iii) each Leased Structure complies in all
material respects with the terms of the permits pertaining to it.
(c) Except as set forth in Part 3.8(c) of the Disclosure Schedule:
(i) the Owner Permits constitute all material licenses, permits, registrations
and approvals necessary to operate the Leased Structures; (ii) Seller and, to
the Seller's Knowledge, applicable Owners are in material compliance with the
terms of the applicable Owner Permits; (iii) Seller is not aware of any fact or
event which constitutes a material violation of any applicable Owner Permit; and
(iv) neither Seller nor, to the Knowledge of Seller, the applicable Owners have
received written notice that any Governmental Body issuing any Owner Permit
intends to cancel, terminate, modify, or amend any Owner Permit.
3.9 TITLE, ENCUMBRANCES.
(a) Except as set forth in Part 3.9(a) of the Disclosure Schedule:
(i) Seller has good title to all of the Purchased Assets; (ii) there are no
existing agreements, options, commitments, or rights with, of or to any Person
to acquire any of the Purchased Assets or any interest therein; and (iii) all of
the Purchased Assets are owned by Seller free and clear of all Security
Interests except for Permitted Liens and the lien of the Bank (which Bank lien
shall be released on or before Closing).
(b) Except as set forth in Part 3.9(b) of the Disclosure Schedule:
(i) none of the Structures, Site Leases, or the Plant are or will be, to the
Knowledge of Seller, subject to zoning, use, or building code restrictions that
will prohibit the continued effective ownership, leasing or other use of such
assets as currently owned and used or operated by Seller; and (ii) Seller has
not received any notice of pending or Threatened claims, Proceedings, planned
public improvements, annexations, special assessments, rezonings or other
adverse claims affecting the Structures, Site Leases or the Plant.
3.10 NO UNDISCLOSED LIABILITIES. Except as set forth in Part 3.10 of the
Disclosure Schedule, or otherwise disclosed in the Disclosure Schedule, Seller
has no material liabilities or obligations of any nature relating to the
Purchased Assets or the Business.
3.11 TAXES. With respect to the Purchased Assets and the Business:
(a) Seller has filed or caused to be filed all Tax Returns that are
or were required to be filed by Seller as of the date hereof pursuant to
applicable Legal Requirements. Seller has paid, or made provision for the
payment of, all Taxes that have or may have become due as of the date
8
16
hereof pursuant to those Tax Returns or otherwise, or pursuant to any assessment
received by Seller, except such Taxes, if any, as are listed in Part 3.11(a) of
the Disclosure Schedule and are being contested in good faith.
(b) No unpaid Taxes create an Encumbrance (other than Permitted
Liens) on the Purchased Assets.
(c) Except as set forth in Section 11.1 hereof, Buyer shall not be
liable for any Taxes of Seller as a result of the Contemplated Transactions.
3.12 COMPLIANCE WITH LEGAL REQUIREMENTS. Except as set forth in Part 3.12
of the Disclosure Schedule, Seller has complied with all Legal Requirements
applicable to Seller's use, ownership and/or operation of the Purchased Assets,
Leased Assets and Business, except for noncompliances or failures that,
individually or in the aggregate, would not be reasonably expected to have a
Material Adverse Effect.
3.13 LEGAL PROCEEDINGS; ORDERS. Except as set forth in Part 3.13 of the
Disclosure Schedule, there is no Proceeding pending or, to the Knowledge of
Seller, Threatened against Seller or affecting any of the Purchased Assets or
Business and there is no Order to which Seller or the Purchased Assets is
subject.
3.14 OTHER CONTRACTS. Seller is not a party to or bound by any Other
Contract, except as disclosed in Part 3.14 of the Disclosure Schedule. With
respect to those Other Contracts which are Assumed Liabilities, (i) Seller has
delivered true and correct copies thereof to Buyer; (ii) to Seller's Knowledge,
such Other Contracts are in full force and effect, and binding on the parties
thereto, and no default by Seller or any other party has occurred thereunder
which has not been cured; and (iii) all fees, commissions and other amounts due
and owing thereunder as of the date hereof have been paid or, as of the Closing
Date, will have been paid.
3.15 INSURANCE. Seller maintains in full force and effect policies of
liability insurance covering the Purchased Assets, the Leased Assets and the
Business, and the operation thereof, of the types and with the amounts of
coverage as are consistent with industry standards for outdoor advertising
businesses comparable to the Business.
3.16 ENVIRONMENTAL MATTERS. Except as set forth in Part 3.16 of the
Disclosure Schedule, with respect to the Purchased Assets, the Leased Assets and
the Plant and the Seller's use or operation thereof, to the Knowledge of Seller:
(i) Seller is, and has been, in material compliance with all Environmental Laws;
(ii) Seller has obtained all material required approvals and permits under any
applicable Environmental Laws; (iii) there has not been any Release of Hazardous
Materials in violation of applicable Environmental Laws at, in or upon the
Structures and the Plant; (iv) Seller has not received any written notice from
any Governmental Body or private or public entity advising it that it is or may
be responsible for response costs with respect to a Release, a threatened
Release or clean up of Hazardous Materials produced by, or resulting from the
Business or the Purchased Assets; and (v) Seller has delivered to Buyer true and
complete copies and results of any reports, studies, analyses, tests, or
monitoring, if any, possessed by Seller pertaining to Hazardous Materials in,
on, or under the properties underlying the Structures or the Plant.
9
17
3.17 INTANGIBLE PROPERTY. Seller uses no Intangible Property in connection
with the operation of the Purchased Assets and the Business except for the
Permits, the Books and Records, the trade name "Philadelphia Outdoor" and
licenses for commonly available software programs under which Seller is the
licensee.
3.18 RELATIONSHIPS WITH AFFILIATES. Except as set forth on Part 3.18 of
the Disclosure Schedule: (a) Seller is not a party to any contract with any
shareholder of Seller or any Affiliate of Seller or any of its shareholders
relating to the Purchased Assets or the Business; and (b) neither Seller nor any
of its shareholders nor any Affiliate of Seller or any such shareholder is the
owner (of record or as a beneficial owner) of an equity interest or any other
financial or profit interest in, a Person (other than Seller) that has business
dealings or a material financial interest in any transaction with Seller
involving the Purchased Assets or the Business.
3.19 BROKERS OR FINDERS. Seller and its Representatives have not incurred
any obligation or liability, contingent or otherwise, for brokerage or finders'
fees or agents' commissions or other similar payments in connection with this
Agreement.
3.20 EMPLOYEE BENEFIT MATTERS. Except as disclosed on Part 3.20 of the
Disclosure Schedule:
(a) Seller does not maintain and has never maintained an "employee
benefit pension plan", within the meaning of ERISA Section 3(2), that is or was
subject to Title IV of ERISA.
(b) Seller does not have and has not ever had any past, present or
future obligation or liability to contribute to any "multiemployer plan", as
defined in ERISA Section 3(37).
For purposes of this Section 3.20 the term Seller shall be deemed to include any
other corporation, trade, business, or other entity, other than Seller, which
would together with Seller, now or in the past constitute a single employer
within the meaning of Section 414 of the IRC.
3.21 MATERIAL ADVERSE CHANGE. Since December 31, 1997, there has not been
any Material Adverse Change in the Business, the Purchased Assets and the Leased
Assets, taken as a whole. Since December 31, 1997, Seller has conducted its
business only in the ordinary course and consistent with its prior practice.
3.22 DISCLOSURES. To the extent that any information is specifically
disclosed on any Schedule or Part of a Disclosure Schedule attached to this
Agreement, it shall be deemed disclosed for all purposes and not just for the
limited purpose of the particular Schedule or Disclosure Schedule Part.
4. REPRESENTATIONS AND WARRANTIES OF BUYER
Buyer represents and warrants to Seller as follows:
4.1 ORGANIZATION AND GOOD STANDING. Buyer is a corporation duly organized,
validly existing, and in good standing under the laws of the State of Delaware,
with full power and authority
10
18
to conduct its business as it is now being conducted, to own and use its assets
and to perform its obligations with respect thereto.
4.2 AUTHORITY; NO CONFLICT.
(a) This Agreement constitutes the legal, valid, and binding
obligation of Buyer, enforceable against Buyer in accordance with its terms.
Upon the execution and delivery by Buyer of the Closing Documents to which Buyer
is a party, such Closing Documents will constitute the legal, valid, and binding
obligations of Buyer, enforceable against Buyer in accordance with their
respective terms. Buyer has the corporate right, power and authority to execute
and deliver this Agreement and the Closing Documents and to perform its
obligations under this Agreement and the Closing Documents to which Buyer is a
party. The execution, delivery and performance of this Agreement have been
specifically authorized by the Board of Directors of Buyer.
(b) Neither the execution and delivery of this Agreement by Buyer nor
the consummation or performance of any of the Contemplated Transactions by Buyer
will (1) give any Person the right to prevent, delay, or otherwise interfere
with any of the Contemplated Transactions pursuant to or (2) conflict with,
violate or constitute a breach or default under: (w) any provision of Buyer's
Organizational Documents; (x) any resolution adopted by the board of directors
or the stockholders of Buyer; (y) any Legal Requirement or Order to which Buyer
may be subject; or (z) any material Contract to which Buyer is a party or by
which Buyer may be bound. Buyer is not and will not be required to obtain any
Consent from any Person in connection with the execution and delivery of this
Agreement or the consummation or performance of any of the Contemplated
Transactions.
4.3 CERTAIN PROCEEDINGS. There is no Proceeding pending against Buyer that
challenges, or may have the effect of preventing, making illegal, or otherwise
interfering with, any of the Contemplated Transactions. To Buyer's Knowledge, no
such Proceeding has been Threatened in writing and no event has occurred or
circumstance exist that may give rise to or serve as a basis for the
commencement of any such Proceeding.
4.4 BROKERS OR FINDERS. Buyer has not incurred any obligation or
liability, contingent or otherwise, for brokerage or finders' fees or agents'
commissions or other similar payment in connection with this Agreement.
4.5 BUYER'S INSPECTION. Buyer acknowledges that Buyer's inspection of the
Purchased Assets, Leased Structures, Advertising Contracts, Permits and other
items which are the subject of this Agreement has not revealed any fact or
circumstance which would cause the Seller's representations and warranties set
forth in Section 3 hereof to be inaccurate in any material respect. Buyer
acknowledges that Seller makes no representations and warranties with respect to
the Purchased Assets except for those expressly set forth in this Agreement, and
Buyer takes the Purchased Assets "AS IS, WHERE IS," EXCEPT TO THE EXTENT THAT
REPRESENTATIONS AND WARRANTIES REGARDING THE PURCHASED ASSETS ARE EXPRESSLY SET
FORTH IN THIS AGREEMENT.
4.6 SOLVENCY. Buyer is solvent, and Buyer will be solvent immediately
after the Closing and the consummation of the Contemplated Transactions.
11
19
4.7 FINANCING. The consummation of the Contemplated Transactions by Buyer
is not contingent upon the obtaining of any financing by Buyer.
5. COVENANTS OF SELLER
Seller covenants and agrees with Buyer that, at all times from and after
the date hereof and until the Closing and, with respect to any covenant or
agreement by its terms to be performed in whole or in part after the Closing,
for the period specified herein, Seller will comply with all covenants and
provisions of this Section specifically applicable to it, except to the extent
the other party may otherwise consent in writing.
5.1 ACCESS AND INVESTIGATION. Between the date of this Agreement and the
Closing Date, Seller will, and will cause its Representatives to, afford Buyer
and its Representatives reasonable access during normal business hours to
Seller's personnel, properties, Books and Records, and such additional
financial, operating and other and data and documents relating to the Purchased
Assets and the Business, and furnish Buyer and its Representatives with copies
of the same.
5.2 OPERATION OF THE PURCHASED ASSETS. Between the date of this Agreement
and the Closing Date, Seller will:
(a) operate the Business only in the Ordinary Course of Business;
(b) use its commercially reasonable efforts to maintain the Purchased
Assets and Business, and maintain the relations and good will with advertisers,
landlords and others associated with the operation of the Business; and
(c) confer with Buyer concerning any new Advertising Contract or Site
Lease which involves a term of more than three (3) months or payment of amounts
in excess of $25,000.
5.3 NEGATIVE COVENANT. Except as otherwise expressly permitted by this
Agreement, between the date of this Agreement and the Closing Date, Seller will
operate the Business consistent in all material respects with past practice and
Seller will not: (i) create any Security Interest affecting the Purchased
Assets; or (ii) sell, transfer or otherwise dispose of any of the Purchased
Assets or enter into any agreement to do any of the foregoing.
5.4 REQUIRED APPROVALS AND CONSENTS. As promptly as practicable after the
date of this Agreement, Seller will make all filings required by Legal
Requirements to be made by it in order to consummate the Contemplated
Transactions and use its commercially reasonable efforts (subject to the
limitations set forth in Section 2.8 hereof) to obtain those Consents identified
in Schedule 5.4 hereof, being those consents for the transfer of the Purchased
Assets that Buyer deems necessary; provided, however, that Seller shall not make
any agreement or reach any understanding that would impose additional
obligations or burdens on Buyer without the prior written approval of Buyer.
5.5 NOTIFICATION. Between the date of this Agreement and the Closing Date,
Seller will promptly notify Buyer in writing if Seller becomes aware of any fact
or condition that causes or constitutes a material breach of any of Seller's
representations and warranties as of the date of this Agreement, or if Seller
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this Agreement) cause
or constitute a
12
20
material breach of any such representation or warranty had such representation
or warranty been made as of the time of occurrence or discovery of such fact or
condition. During the same period, Seller will promptly notify Buyer of the
occurrence of any material breach of any covenant of Seller in this Section 5 or
of the occurrence of any event that may make the satisfaction of the conditions
in Section 7 impossible or unlikely.
5.6 NO NEGOTIATION. Until such time, if any, as this Agreement is
terminated pursuant to Section 9, neither Seller nor any Affiliate will, nor
will it permit its Representatives to, directly or indirectly solicit, initiate,
or encourage any inquiries or proposals from, discuss or negotiate with, provide
any non-public information to, or consider the merits of any unsolicited
inquiries or proposals from, any Person (other than Buyer or its
Representatives) relating to or affecting any transaction involving the sale of
the Purchased Assets or the Business.
5.7 TAX CLEARANCE. Seller shall use its commercially reasonable efforts
to obtain all certificates of clearances for Taxes ("Tax Clearances"), if any,
provided or required by the States of Pennsylvania and New Jersey and applicable
local jurisdictions certifying as to the payment by or on behalf of Seller of
all Taxes due on or prior to a date not more than thirty (30) days prior to the
Closing Date (it being agreed and understood that, notwithstanding the
foregoing, if any Tax Clearances are not obtained prior to the Closing, Seller
shall use commercially reasonable efforts to obtain such Tax Clearances after
the Closing and shall in all events be responsible for, and shall discharge in
full, any and all liabilities and obligations therefor).
5.8 TRADE NAME. Subject to the provisions of the Noncompetition
Agreement, Seller agrees not to use the trade name "Philadelphia Outdoor" on any
outdoor advertising structures until the earlier of the fifth (5th) anniversary
of the Closing or the termination of the Leases.
5.9 RIGHT OF FIRST REFUSAL. Seller grants to Buyer, a right of first
refusal ("Right of First Refusal") to purchase any advertising structures which
become the property of, and/or the real property owned by, Seller at 00 Xxxxx
Xxxx, Xxxxxxxxx, Xxx Xxxxxx ("Property"), or any part thereof on the same terms
and conditions as those for which Seller has received a bona fide offer to
purchase. Seller, upon receipt of such an offer to purchase, shall give Buyer
written notice of such offer setting forth the full terms and conditions
thereof. Buyer shall have fifteen (15) days after the receipt of such notice, to
exercise its Right of First Refusal by giving Seller written notice, within such
fifteen (15) day period, of its agreement to purchase on the same terms. If
Buyer does not give notice of its intention to exercise said right Seller may
complete the sale to the other party but only upon the same terms and conditions
presented to Buyer. If a sale is not consummated the Right of First refusal
shall continue to exist with respect to any subsequent offers. If both the
structure located on the Property and the Property are to be sold or transferred
by Seller, the Right of First refusal, if exercised, must be exercised with
respect to both. Transfers of the Property or the structures thereon to or among
members of, or entities controlled by, or for the benefit of the Family shall be
excluded from the Right of First Refusal but the Property and the structures
shall remain subject to the Right of First Refusal, and the transferee shall
take the same subject thereto. The Right of First Refusal shall terminate
contemporaneously with the termination of the Leases.
5.10 FINANCIAL STATUS OF SELLER. In order to induce Buyer to enter into
this Agreement, Seller and Stockholder represent, warrant, covenant and agree
with Buyer that, (i) until the expiration of all of Seller's warranties under
the Agreement, Seller will not be liquidated or dissolved and (ii) Seller shall
maintain a Net Worth of at least (A) $5 million until the first anniversary
13
21
of the Closing; (B) $2.5 million until the second anniversary of the Closing;
and (C) $1 million until the third anniversary of the Closing.
6. COVENANTS OF BUYER
Buyer covenants and agrees with Seller that, at all times from and after
the date hereof and until the Closing and, with respect to any covenant or
agreement by its terms to be performed in whole or in part after the Closing,
for the period specified herein or, if no period is specified, indefinitely,
Buyer will comply with all covenants and provisions of this Section specifically
applicable to it, except to the extent the other parties may otherwise consent
in writing.
6.1 REQUIRED APPROVALS. As promptly as practicable after the date of this
Agreement, Buyer will make all filings required by Legal Requirements to be made
by it to consummate the Contemplated Transactions. Seller shall file all the UCC
termination statements reflecting the termination of the Bank's Lien promptly
after the Closing.
6.2 BEST EFFORTS. Between the date of this Agreement and the Closing Date,
Buyer will use its commercially reasonable efforts to cause the conditions in
Sections 7 and 8 to be satisfied; provided that this Agreement will not require
Buyer to dispose of or make any change in any portion of its business or to
incur any other material burden to obtain a Governmental Authorization, if such
disposal, change or burden would have a material adverse effect on Buyer.
6.3 NOTIFICATION. Between the date of this Agreement and the Closing Date,
Buyer will promptly notify Seller in writing if Buyer becomes aware of any fact
or condition that causes or constitutes a breach of any of Buyer's
representations and warranties as of the date of this Agreement, or if Buyer
becomes aware of the occurrence after the date of this Agreement of any fact or
condition that would (except as expressly contemplated by this Agreement) cause
or constitute a breach of any such representation or warranty had such
representation or warranty been made as of the time of occurrence or discovery
of such fact or condition. During the same period, Buyer will promptly notify
Seller of the occurrence of any breach of any covenant of Buyer in this Section
6 or of the occurrence of any event that may make the satisfaction of the
conditions in Section 8 impossible or unlikely.
6.4 IMPRINTS. Buyer will, at Buyer's cost and expense, remove all imprints
on the Structures containing the name "Philadelphia Outdoor" within 120 days
after the Closing.
6.5 BEN FRANKLIN BRIDGE BILLBOARD. DEKAP shall be entitled to collect
directly all lease payments made by lessee, and Buyer agrees to promptly remit
to DEKAP any such lease payments received by Buyer, pursuant to the terms of
that certain Advertising Lease dated January 1997 between DEKAP (as successor to
Xxxxxx Enterprises) and Xxxxx Silver, Xxxxxx Xxxxxxx and Katmandu Corporation
until the expiration of the current term thereof.
7. CONDITIONS PRECEDENT TO BUYER'S OBLIGATION TO CLOSE
Buyer's obligation to purchase the Purchased Assets and to take the other
actions required to be taken by Buyer at the Closing is subject to the
satisfaction, at or prior to the Closing, of each of the following conditions
(any of which may be waived by Buyer, in whole or in part):
14
22
7.1 ACCURACY OF REPRESENTATIONS. Seller's representations and warranties
in this Agreement must have been accurate in all material respects as of the
date of this Agreement, and must be accurate in all material respects as of the
Closing Date as if made on the Closing Date, and Buyer shall have received a
certificate of an executive officer of Seller, dated as of the Closing Date, as
to such accuracy.
7.2 SELLER'S PERFORMANCE. The covenants and obligations that Seller is
required to perform, comply with, or cause to perform pursuant to this Agreement
at or prior to the Closing must have been performed and complied with in all
material respects, and Buyer shall have received a certificate of an executive
officer of Seller, dated as of the Closing Date, as to such compliance.
7.3 BANK LIEN. The Seller shall have provided Buyer reasonably
satisfactory evidence of the unconditional release of the Lien of the Bank on
the Purchased Assets effective upon the Bank's receipt of the amount which
Seller directs Buyer to wire to the Bank from the Purchase Price.
7.4 ADDITIONAL DOCUMENTS. Each of the following executed documents must
have been delivered to Buyer:
(a) an opinion of Xxxxxxxx, Xxxxx, Xxxxxx & Xxxxx, LLP dated the
Closing Date, reasonably acceptable in form and content to Buyer and its
counsel;
(b) the deliveries required from Seller, Stockholder and applicable
Owners, pursuant to Section 2.7, including, without limitation, the Leases, the
Plant Lease and the Non-Competition Agreement; and
(c) such other documents as Buyer may reasonably request for the
purpose of (i) evidencing the satisfaction of any condition referred to in this
Section 7, or (ii) otherwise facilitating the consummation or performance of any
of the Contemplated Transactions.
7.5 NO PROCEEDINGS. Since the date of this Agreement, there must not have
been commenced and pending or Threatened by any Person or any Proceeding (i)
involving any challenge to, or seeking damages or other relief in connection
with, any of the Contemplated Transactions, or (ii) that prevents, makes
illegal, or otherwise materially interferes with any of the Contemplated
Transactions or seeks to do any of the foregoing.
7.6 NO PROHIBITION. There must not be in effect any Legal Requirement or
any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions, including, without limitation, HSR Act
compliance.
7.7 NO MATERIAL ADVERSE CHANGE. There shall not have been a Material
Adverse Change since the date hereof.
8. CONDITIONS PRECEDENT TO SELLER'S OBLIGATION TO CLOSE
Seller's obligation to sell the Purchased Assets and Seller's obligations
to take the other actions required to be taken by Seller at the Closing is
subject to the satisfaction, at or prior to the
15
23
Closing, of each of the following conditions (any of which may be waived by
Seller, in whole or in part):
8.1 ACCURACY OF REPRESENTATIONS. Buyer's representations and warranties in
this Agreement must have been accurate as of the date of this Agreement and must
be accurate in all material respects as of the Closing Date as if made on the
Closing Date, and Seller shall have received a certificate of an executive
officer of Buyer, dated as of the Closing Date, as to such accuracy.
8.2 BUYER'S PERFORMANCE. The covenants and obligations that Buyer is
required to perform or to comply with pursuant to this Agreement at or prior to
the Closing must have been performed and complied with in all material respects,
and Seller shall have received a certificate of an executive officer of Buyer,
dated as of the Closing Date, as to such compliance.
8.3 ADDITIONAL DOCUMENTS. Each of the following documents must have been
delivered to Seller:
(a) an opinion of Powell, Goldstein, Xxxxxx & Xxxxxx LLP, dated the
Closing Date, reasonably acceptable in form and substance to Seller and its
counsel;
(b) the deliveries required from Buyer in Section 2.7; and
(c) such other documents as Seller may reasonably request for the
purpose of (i) evidencing the satisfaction of any condition referred to in this
Section 8, or (ii) otherwise facilitating the consummation of any of the
Contemplated Transactions.
8.4 NO PROCEEDINGS. Since the date of this Agreement, there must not have
been commenced and pending or Threatened any Proceeding (i) involving any
challenge to, or seeking damages or other relief in connection with, any of the
Contemplated Transactions, or (ii) that prevents, makes illegal, or otherwise
materially interferes with any of the Contemplated Transactions or seeks to do
any of the foregoing.
8.5 NO PROHIBITION. There must not be in effect any Legal Requirement or
any injunction or other Order that prohibits or restricts the consummation of
the Contemplated Transactions, including, without limitation, HSR Act
compliance.
9. TERMINATION
9.1 TERMINATION EVENTS. This Agreement may, by notice given prior to or at
the Closing, be terminated:
(a) by mutual consent of Buyer and Seller;
(b) (i) by Buyer if any of the conditions in Section 7 has not been
satisfied as of the Closing Date or if satisfaction of such a condition is or
becomes impossible (other than through the failure of Buyer to comply with its
obligations under this Agreement) and Buyer has not waived such condition on or
before the Closing Date; or (ii) by Seller, if any of the conditions in Section
8 has not been satisfied as of the Closing Date or if satisfaction of such a
condition is or becomes
16
24
impossible (other than through the failure of Seller to comply with its
obligations under this Agreement) and Seller has not waived such condition on or
before the Closing Date; or
(c) by Buyer, on the one hand, or Seller, on the other hand, if the
Closing has not occurred (other than through the failure of the other Party
seeking to terminate this Agreement to comply fully with its obligations under
this Agreement) on or before April 30, 1998, or such later date as the Parties
may agree upon.
9.2 EFFECT OF TERMINATION. Each Party's right of termination under
Section 9.1 is in addition to any other rights it may have under this Agreement.
If this Agreement is terminated pursuant to Section 9.1, all further obligations
of the Parties under this Agreement will terminate, except that the obligations
in Sections 11.1 and 11.3 will survive; provided, however, that if this
Agreement is terminated by a Party because of the breach of the Agreement by the
other Party or because one or more of the conditions to the terminating Party's
obligations under this Agreement is not satisfied as a result of the other
Party's failure to comply with its obligations under this Agreement, the
terminating Party's right to pursue all legal and equitable remedies, separately
or simultaneously, (including specific performance) will survive such
termination unimpaired.
10. INDEMNIFICATION; REMEDIES
10.1 INDEMNIFICATION AND PAYMENT OF DAMAGES BY SELLER.
(a) Seller will indemnify and hold harmless Buyer and its
stockholders, controlling Persons and Affiliates (collectively, the "Seller
Indemnified Persons") for, and will pay to the Seller Indemnified Persons the
amount of, any loss, liability, claim, damage and expense (including reasonable
costs of investigation and defense and reasonable attorneys' fees), whether or
not involving a third-party claim (collectively, "Damages"), arising, directly,
or indirectly, from or in connection with:
(i) any breach of any representation or warranty made by Seller
in this Agreement (including the Disclosure Schedule), or any other certificate
or document delivered by Seller pursuant to this Agreement;
(ii) any breach by Seller of any covenant or obligation of Seller
in this Agreement or any certificate or document delivered by Seller pursuant to
this Agreement;
(iii) any Excluded Liabilities; and
(iv) the failure of Seller to comply with bulk sales or other
similar laws in any applicable jurisdiction.
10.2 INDEMNIFICATION AND PAYMENT OF DAMAGES BY BUYER. Buyer will indemnify
and hold harmless Seller and its stockholders, controlling Persons and
Affiliates (collectively, the "Buyer Indemnified Persons") for, and will pay to
the Buyer Indemnified Persons the amount of any Damages arising, directly or
indirectly, from or in connection with:
(a) any breach of any representation or warranty made by Buyer in
this Agreement or in any certificate or document delivered by Buyer pursuant to
this Agreement;
17
25
(b) any breach by Buyer of any covenant or obligation of Buyer in this
Agreement including, without limitation, any failure to satisfy and discharge
after the Closing the Assumed Liabilities or Buyer's obligations as set forth in
Section 2.8 with respect to any Beneficial Arrangements; and
(c) any and all liabilities and obligations of any nature relating to
Buyer or the Buyer's operation of the Business or the Purchased Assets after the
Closing Date, unless Buyer is entitled to be indemnified for such liability or
obligation pursuant to Section 10.1 above.
10.3 PROCEDURE FOR INDEMNIFICATION -- THIRD PARTY CLAIMS.
(a) Promptly after receipt by an Indemnified Person under Section
10.1 or 10.2, of notice of any claim against it, such Indemnified Person will,
if a claim is to be made against an Indemnifying Party under such Section, give
notice to the Indemnifying Party of the commencement of such claim, but the
failure to notify the Indemnifying Party will not relieve the Indemnifying Party
of any liability that it may have to any Indemnified Person, except to the
extent that the Indemnifying Party demonstrates that the defense of such action
is prejudiced by the Indemnifying Party's failure to give such notice.
(b) If any claim referred to in Section 10.3(a) is brought against an
Indemnified Person and such Indemnified Person gives written notice to the
Indemnifying Party of such claim, the Indemnifying Party may, at its option,
assume the defense of such claim with counsel reasonably satisfactory to the
Indemnified Person and, after written notice from the Indemnifying Party to the
Indemnified Person of its election to assume the defense of such claim, the
Indemnifying Party will not, as long as it diligently conducts such defense, be
liable to the Indemnified Person under this Section 10 for any fees of other
counsel or any other expenses with respect to the defense of such claim,
subsequently incurred by the Indemnified Person in connection with the defense
of such claim, other than reasonable costs of investigation. If the Indemnifying
Party assumes the defense of a claim, (i) no compromise or settlement of such
claims may be effected by the Indemnifying Party without the Indemnified
Person's consent, which consent shall not be unreasonably withheld, unless (A)
there is no finding or admission of any violation of Legal Requirements or any
violation of the rights of any Indemnified Person, and (B) the sole relief
provided is monetary damages that are paid in full by the Indemnifying Party;
and (ii) the Indemnified Person will have no liability with respect to any
compromise or settlement of such claims effected without its consent. Subject to
Section 10.3(c), if notice is given to an Indemnifying Party of any claim and
the Indemnifying Party does not, within thirty (30) days after the Indemnified
Person's notice is given, give notice to the Indemnified Person of its election
to assume the defense of such claim, the Indemnifying Party will be bound by any
determination made in such Proceeding or any compromise or settlement effected
by the Indemnified Person.
(c) Notwithstanding the foregoing, if an Indemnified Person
determines in good faith that there is a reasonable probability that a claim may
adversely affect it or its Affiliates other than as a result of monetary damages
for which it would be entitled to indemnification under this Agreement, the
Indemnified Person may, by notice to the Indemnifying Party, assume, at its sole
cost and expense, including, without limitation, attorneys' fees and legal
costs, the exclusive right to defend, compromise, or settle such claim, but the
Indemnifying Party will not be bound by any determination of a claim so defended
or any compromise or settlement effected without its consent (which may not be
unreasonably withheld).
18
26
10.4 PROCEDURE FOR INDEMNIFICATION -- OTHER CLAIMS. A claim for
indemnification for any matter not involving a third-party claim shall be
asserted by written notice to the Indemnifying Party from whom indemnification
is sought.
10.5 SURVIVAL/LIMITATIONS.
(a) The parties hereto agree that (i) the representations and
warranties contained in Sections 3.2(a) and 3.9(a) shall survive until the third
anniversary of the Closing Date, (ii) all other representations and warranties
contained in this Agreement shall survive until the first anniversary of the
Closing Date, and (iii) all covenants to be performed after the Closing shall
survive for the period or periods specified herein.
(b) Seller's obligation to pay Damages and indemnify the Seller
Indemnified Persons for Damages pursuant to Section 10.1 is subject to the
following limitations:
(i) in no event shall such obligations exceed the Purchase
Price; and
(ii) Seller shall have no such obligation until Buyer has
suffered Damages in excess of $500,000 and then only to
the extent of the Damages in excess of such amount.
(c) Any claim made pursuant to Section 10.1 with respect to a breach
of a representation or warranty must be made within the survival period for such
representation and warranty, as specified in Section 10.5(a).
10.6 CLAIMS COVERED BY INSURANCE. No Party shall be indemnified hereunder
against claims to the extent that proceeds of insurance are actually received by
the Indemnified Person, provided that, if insurance proceeds have not been
received within sixty (60) days after a claim is made hereunder, the Indemnified
Person shall be indemnified as provided for in this Agreement and shall be
obligated to refund to the Indemnifying party the amount paid by the
Indemnifying Party hereunder when and to the extent that insurance proceeds are
later received by the Indemnified Person.
11. GENERAL PROVISIONS
11.1 EXPENSES. Except as otherwise expressly provided in this Agreement,
each Party to this Agreement will bear its respective expenses incurred in
connection with the preparation, execution, and performance of this Agreement
and the Contemplated Transactions, including all fees and expenses of agents,
representatives, brokers, or finders, counsel, and accountants. In the event of
termination of this Agreement, the obligation of each Party to pay its own
expenses will be subject to any rights of such Party arising from a breach of
this Agreement by another Party. Although Seller and Buyer do not believe that
any transfer Taxes will be incurred as a result of the Contemplated
Transactions, Seller and Buyer agree to equally share the payment of any
transfer Taxes relating to the sale and transfer of the Purchased Assets
hereunder.
19
27
11.2 HEADINGS; CONSTRUCTION. The headings of Sections in this Agreement
are provided for convenience only and will not affect its construction or
interpretation. All words used in this Agreement will be construed to be of such
gender or number as the circumstances require. Unless otherwise expressly
provided, the word "including" does not limit the preceding words or terms.
11.3 PUBLIC ANNOUNCEMENTS; CONFIDENTIALITY. Any public announcement or
similar publicity with respect to this Agreement or the Contemplated
Transactions will be issued, if at all, at such time and in such manner as Buyer
and Seller agree in writing, provided that the parties shall reasonably
cooperate in such announcements, and provided further that nothing contained
herein shall prevent any party from at any time furnishing information required
by a Governmental Body. Unless consented to by Buyer and Seller in advance or
required by Legal Requirements, prior to the Closing, each Party shall, and
shall cause their respective Representatives to, keep this Agreement strictly
confidential and may not make any disclosure of this Agreement to any Person.
Buyer agrees that any confidential information or material that is obtained from
the Seller regarding the Purchased Assets of Seller will be used solely in
connection with the Contemplated Transactions contemplated hereby. Buyer agrees
that it and its representatives will not disclose any such information which
they receive from the Seller to any third party, except as required by
applicable legal requirements, without the prior written consent of the Seller;
provided, however, that any such information may be disclosed by Buyer to
Buyer's representatives as needed for the purposes of preparing for the
Contemplated Transaction. Buyer agrees that if the Contemplated Transactions are
not consummated for any reason, Buyer shall return all materials received from
the Seller or its representatives and all copies thereof to the Seller or to the
party who furnished such material. The parties' obligations to keep information
confidential under this section 11.3 shall survive the termination of this
Agreement until March 31, 2001.
11.4 AVAILABILITY OF EQUITABLE REMEDIES. The Parties acknowledge and agree
that (i) a breach of the provisions of this Agreement could not adequately be
compensated by money damages, and (ii) any Party shall be entitled, either
before or after the Closing, in addition to any other right or remedy available
to it, to an injunction restraining such breach and to specific performance of
this Agreement.
11.5 NOTICES. All notices, consents, waivers, and other communications
under this Agreement must be in writing and will be deemed to have been duly
given when (a) delivered by hand (with written confirmation of receipt), (b)
sent by facsimile (with confirmation of receipt) provided that a confirmation
copy is sent by regular mail, or (c) when received by the addressee, if sent by
a nationally recognized overnight delivery service (receipt requested), in each
case to the appropriate addresses and telecopier numbers set forth below (or to
such other addresses and facsimile numbers as a Party may designate by notice to
the other Parties):
If to Seller or Stockholder, to:
Philadelphia Outdoor
Xxx 000
Xxxxxxxx, XX 00000-0000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xx. Xxxxxx Xxxxxx
20
28
With a copy to:
Stradley, Ronon, Xxxxxxx & Young, LLP
00 Xxxxxx Xxxxxx Xxxxxxx
Xxxxxxx, XX 00000-0000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxxx X. Xxxxx, Esq.
If to Buyer, to:
Outdoor Systems, Inc.
0000 Xxxxx Xxxxx Xxxxxx Xxxxxxx
Xxxxxxx, Xxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxx
and
Xxxxxxx X. Xxxxxx
0000 X. Xxxxxxxx Xxxxxx, Xxxxx 000
Xxxxxxx, Xxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
With a copy to:
Powell, Goldstein, Xxxxxx & Xxxxxx LLP
000 Xxxxxxxxx Xxxxxx, XX, 00xx Xxxxx
Xxxxxxx, Xxxxxxx 00000
Telephone No.: (000) 000-0000
Facsimile No.: (000) 000-0000
Attention: Xxxxxxx X. Xxxxxxx, Xx., Esq.
11.6 FURTHER ASSURANCES. The Parties agree (i) to furnish upon request to
each other such further information, (ii) to execute and deliver to each other
such other documents, and (iii) to do such other acts and things, all as the
other Party may reasonably request for the purpose of carrying out the intent of
this Agreement and the documents referred to in this Agreement.
11.7 WAIVER. Neither the failure nor any delay by any Party in exercising
any right, power, or privilege under this Agreement or the documents referred to
in this Agreement will operate as a waiver of such right, power, or privilege,
and no single or partial exercise of any such right, power, or privilege will
preclude any other or further exercise of such right, power, or privilege or the
exercise of any other right, power, or privilege.
11.8 ENTIRE AGREEMENT AND MODIFICATION. This Agreement supersedes all
prior agreements between the Parties with respect to its subject matter and
constitutes (along with the documents referred to in this Agreement) a complete
and exclusive statement of the terms of the agreement between the Parties with
respect to its subject matter. This Agreement may not be amended except by a
written agreement executed by the Party to be charged with the amendment.
21
29
11.9 ASSIGNMENTS, SUCCESSORS, AND NO THIRD-PARTY RIGHTS. No Party may
assign any of its rights under this Agreement without the prior consent of the
other Parties except that Buyer may assign any of its rights under this
Agreement to any Affiliate of Buyer or any purchaser of substantially all the
Purchased Assets; provided, however, that in such event, Buyer shall remain
jointly and severally liable with such Affiliate for all duties and obligations
of Buyer hereunder. This Agreement will apply to, be binding in all respects
upon, and inure to the benefit of the Parties, and their successors, by
liquidation or otherwise, and their permitted assigns. Nothing expressed or
referred to in this Agreement will be construed to give any Person other than
the Parties to this Agreement any legal or equitable right, remedy, or claim
under or with respect to this Agreement or any provision of this Agreement.
11.10 [RESERVED]
11.11 SEVERABILITY. If any provision of this Agreement is held invalid or
unenforceable by any court of competent jurisdiction, the other provisions of
this Agreement will remain in full force and effect. Any provision of this
Agreement held invalid or unenforceable only in part or degree will remain in
full force and effect to the extent not held invalid or unenforceable.
11.12 RISK OF LOSS. Material risk of loss or damage to the Purchased
Assets from any cause whatsoever prior to the Effective Time shall be borne by
Seller, and after the Effective Time shall be borne by Buyer.
11.13 POST-CLOSING ACCESS. Buyer agrees that all Books and Records
delivered to Buyer by Seller pursuant to this Agreement shall be maintained open
for inspection by Seller at any time during regular business hours upon
reasonable notice for a period of six (6) years (or for such longer period as
may be required by applicable Legal Requirements) following the Closing and
that, during such period, Seller, at its expense, may make such copies thereof
as it may reasonably desire. Seller agrees that all books and records relating
to the Purchased Assets and retained by Seller shall be maintained open for
inspection by Buyer at any time during regular business hours for a period of
six (6) years (or for such longer period as may be required by applicable Legal
Requirements) following the Closing and that, during such period, Buyer, at its
expense, may make such copies thereof as it may reasonably desire. Nothing
contained in this Section 11.13 shall obligate any Party hereto to make
available any books and records if to do so would violate the terms of any Legal
Requirement to which it is a party or to which it or its assets are subject.
11.14 APPLICABLE LAW. This Agreement shall be governed and controlled as
to validity, enforcement, interpretations, construction, effect and in all other
respects by the internal laws of the Commonwealth of Pennsylvania applicable to
contracts made in that Commonwealth. The parties hereto agree to submit
exclusively to any federal or state court located in the Commonwealth of
Pennsylvania any dispute or controversy arising out of relating to this
Agreement.
11.15 COUNTERPARTS. This Agreement may be executed in one or more
counterparts, each of which will be deemed to be an original copy of this
Agreement and all of which, when taken together, will be deemed to constitute
one and the same agreement.
[This space intentionally left blank.]
22
30
IN WITNESS WHEREOF, the Parties have executed, sealed and delivered this
Agreement as of the date first written above.
BUYER:
OUTDOOR SYSTEMS, INC.
By: /s/ Xxxxxxx X. Xxxxxx
-----------------------------
Xxxxxxx X. Xxxxxx, Chairman
SELLER:
THE XXXXXXX SHOP, INC.
By: /s/ Xxxxxx Xxxxxx
-----------------------------
Xxxxxx Xxxxxx, Vice President
STOCKHOLDER :
/s/ Xxxxxx Xxxxxx
-----------------------------
Xxxxxx Xxxxxx
23
31
EXHIBIT A
DEFINITIONS
"ADVERTISING CONTRACTS" -- as defined in Section 2.2(c).
"AFFILIATES" -- when used with reference to a specified Person, any other
Person that directly, or indirectly through one or more intermediaries, controls
or is controlled by or is under common control with the Specified Person. For
purposes of this definition of Affiliate, "control" means the possession,
directly or indirectly, of the power to direct or to cause the direction of
management and policies of the Person in question, whether through the ownership
of voting securities or by contract or otherwise.
"ASSUMED LIABILITIES" -- as defined in Section 2.3.
"BANK" -- means Corestates Bank, N.A.
"XXXX OF SALE" -- the Xxxx of Sale, Assignment and Assumption Agreement
substantially in the form attached hereto as Exhibit B.
"BOOKS AND RECORDS" -- All of Seller's books and records relating to the
Purchased Assets and the Leased Assets, including, without limitation, all Site
Lease files, Advertising Contract files, Permit files, maintenance and other
records for the Structures, logs and advertiser, customer and supplier lists.
"BUSINESS" - the business and operation of the Purchased Assets and the
Leased Assets and the providing of outdoor advertising services with respect
thereto.
"BUYER" -- as defined in the first paragraph of this Agreement.
"BUYER INDEMNIFIED PERSONS" -- as defined in Section 10.2.
"CLOSING" -- as defined in Section 2.5.
"CLOSING DATE" -- the date and time as of which the Closing actually takes
place.
"CLOSING DOCUMENTS" -- as defined in Section 3.2(a).
"CONFIDENTIAL INFORMATION" -- any information concerning the businesses
and affairs of Seller that is not generally available to the public.
"CONSENT" -- any approval, consent, ratification, waiver, or other
authorization (including any Governmental Authorization).
"CONTEMPLATED TRANSACTIONS" -- all of the transactions contemplated by
this Agreement, including: (a) the purchase of the Purchased Assets by Buyer
from Seller and assignment to and assumption by Buyer of the Assumed
Liabilities, (b) the leases of the Plant and the Leased Structures by Buyer
pursuant to the Plant Lease and the Leases, and (c) the performance of their
respective
A-1
32
covenants and obligations under this Agreement and the Closing Documents by
Buyer, Seller, Stockholder and the other Parties thereto.
"CONTRACT" -- any agreement, contract, obligation, promise, or undertaking
(whether written or oral and whether express or implied) that is legally
binding.
"DAMAGES" -- as defined in Section 10.1.
"DEKAP" - DEKAP Properties, L.P., a Pennsylvania limited partnership.
"DISCLOSURE SCHEDULE" -- the disclosure schedule, delivered by Seller to
Buyer concurrently with the execution and delivery of this Agreement.
"EFFECTIVE TIME" - as defined in Section 2.5.
"ENVIRONMENT" -- soil, land surface or subsurface strata, surface waters,
groundwaters, drinking water supply, stream sediments, plant and animal life,
and any other environmental medium or natural resource.
"ENVIRONMENTAL LAW" -- any Legal Requirement pertaining to environmental
discharges, Release of Hazardous Materials or the manufacture, sale, processing,
handling, transportation, storage or disposal of any Hazardous Materials, or
relating to any environmental condition, including, without limitation, the
Comprehensive Environmental Response, Compensation, and Liability Act
("CERCLA"), the Clean Air Act, the Clean Water Act, the Resource Conservation
and Recovery Act ("RCRA"), the Endangered Species Act, the Federal Insecticide,
Fungicide, and Rodenticide Act, the Hazardous Materials Transportation Act, the
Surface Mining Control and Reclamation Act, the Emergency Planning and Community
Right-to-Know Act, the Safe Drinking Water Act, the Toxic Substances Control
Act, the Coastal Zone Management Act, the National Environmental Policy Act, and
the Noise Control Act. As used in this Agreement, Environmental Laws shall mean
any of such laws or regulations as the same exist now or at the Closing Date.
"ERISA" -- the Employee Retirement Income Security Act of 1974 or any
successor law, and regulations and rules issued pursuant to that Act or any
successor law.
"EXCLUDED ASSETS" -- as defined in Section 2.2.
"EXCLUDED LIABILITIES" -- as defined in Section 2.4.
"FAMILY" - the immediate family members of Xxxxxx Xxxxxx, being Xxxxxx
Xxxxxx, Xxxxxxx Xxxxxx, Xxxxxxx Xxxxxx and Xxxxx Xxxxxx and any spouse,
children, grandchildren (by birth, adoption or otherwise) of any thereof.
"GOVERNMENTAL AUTHORIZATION" -- any approval, consent, license, permit,
waiver, or other authorization issued, granted, given, or otherwise made
available by or under the authority of any Governmental Body or pursuant to any
Legal Requirement.
"GOVERNMENTAL BODY" -- any federal, state, local, municipal, foreign, or
other government; or governmental or quasi-governmental authority of any nature
(including any governmental agency, branch, department, official, or entity and
any court or other tribunal).
A-2
33
"HAZARDOUS MATERIALS" -- any waste or other substance that is listed,
defined, designated, or classified as, or otherwise determined to be, hazardous,
radioactive, or toxic or a pollutant or a contaminant under or pursuant to any
Environmental Law, and specifically including petroleum and all derivatives
thereof or synthetic substitutes therefor and asbestos or asbestos-containing
materials.
"HSR ACT" -- the Xxxx-Xxxxx-Xxxxxx Antitrust Improvements Act of 1976, as
amended, and any regulations and rules promulgated thereunder.
"INDEMNIFIED PERSON" -- any of the Seller Indemnified Persons or the Buyer
Indemnified Persons, as the context requires.
"INDEMNIFYING PARTY" -- the Buyer or the Seller, as the context requires.
"INTANGIBLE PROPERTY" -- All right, title and interest in and to the
goodwill and other intangible property (except for Seller's corporate or trade
names and trade logos) used in connection with the Purchased Assets, all
licenses, permits and authorizations pertaining to the Purchased Assets or the
right to own and operate the Purchased Assets and all right, title and interest
in and to (i) any intellectual property used in connection with the Purchased
Assets, and (ii) all records and data relating specifically to the Purchased
Assets.
"IRC" -- the Internal Revenue Code of 1986, as amended from time to time,
or any successor law, and regulations issued by the IRS pursuant to the Internal
Revenue Code or any successor law.
"IRS" -- the United States Internal Revenue Service and, to the extent
relevant, the United States Department of the Treasury.
"KNOWLEDGE" -- a Person will be deemed to have "Knowledge" of a particular
fact or other matter only if such Person is actually aware of such fact or other
matter. A Person (other than an individual) will be deemed to have "Knowledge"
of a particular fact or other matter if any individual who is serving as a
director, chairman of the board, president, vice president, partner, executor,
or trustee of such Person (or in any similar capacity) has Knowledge of such
fact or other matter.
"LEASES" -- those certain Leases by and between Buyer and the applicable
Owners pursuant to which Owners will lease to Buyer the Leased Structures, in
the form attached hereto as Exhibit C.
"LEASED ASSETS" - the Plant and the Leased Structures.
"LEASED STRUCTURES" -- as defined in Section 2.2(c).
"LEGAL REQUIREMENT" -- any federal, state, local, municipal, foreign,
international, multinational, or other administrative Order, constitution, law,
ordinance, regulation, statute, or treaty.
"MATERIAL ADVERSE CHANGE" -- a change that will probably cause a Material
Adverse Effect.
A-3
34
"MATERIAL ADVERSE EFFECT" -- a material adverse effect on the Business,
the Purchased Assets, or the Plant or operations or conditions (financial or
otherwise) relating thereto, taken as a whole.
"NET WORTH" - the total assets minus the total liabilities of Seller, as
determined in accordance with generally accepted accounting principles
consistently applied.
"NON-COMPETITION AGREEMENTS" - the Non-Competition Agreements between
Buyer and Seller or Buyer and the Stockholder in the forms attached hereto as
Exhibit E.
"ORDER" -- any award, decision, injunction, judgment, order, ruling,
subpoena, or verdict entered, issued, made, or rendered by any court,
administrative agency, or other Governmental Body or by any arbitrator.
"ORDINARY COURSE OF BUSINESS" -- an action taken by a Person will be
deemed to have been taken in the "Ordinary Course of Business" if such action is
consistent with the past custom and practices of such Person and is taken in the
ordinary course of the normal day-to-day operations of such Person (including
with respect to quantity and frequency).
"ORGANIZATIONAL DOCUMENTS" -- (a) the articles or certificate of
incorporation and the bylaws of a corporation; (b) the partnership agreement and
any statement of partnership of a general partnership; (c) the limited
partnership agreement and the certificate of limited partnership of a limited
partnership; (d) any charter or similar document adopted or filed in connection
with the creation, formation, or organization of a Person; and (e) any amendment
to any of the foregoing.
"OTHER CONTRACT" -- any Contract (other than a Site Lease or Advertising
Contract) relating to or affecting the Purchased Assets, the Business, or the
operation thereof (i) under which Seller has or may acquire any rights, (ii)
under which Seller has or may become subject to any obligation or liability, or
(iii) by which Seller or any of the Purchased Assets is or may become bound.
"OWNER" -- an owner of the Leased Assets, as further identified on Part
3.8(b) of the Disclosure Schedule.
"OWNER PERMITS" - all state and local licenses or permits/tags which the
Owners or Seller have with respect to the Leased Structures.
"PARTY" -- as defined in the first paragraph of this Agreement.
"PERMITS" -- as defined in Section 2.2(d).
"PERMITTED LIENS" - liens for taxes not yet delinquent, and mechanic's,
materialmen's and similar liens which have arisen or arise, as the case may be,
in the ordinary course of business.
"PERSON" -- any individual, corporation (including any non-profit
corporation), general or limited partnership, limited liability company, joint
venture, estate, trust, association, organization, labor union, or other entity
or Governmental Body.
"PLANT" - that portion of the office and plant facilities located at 0000
Xxxxxxx Xxxxxx Xxxxxxxxx, Xxxxxxxxxx, Xxx Xxxxxx 00000 to be leased to Buyer
pursuant to the Plant Lease.
A-4
35
"PLANT LEASE" - that certain Lease by and between Buyer and DEKAP pursuant
to which DEKAP will lease to Buyer certain office, plant and equipment,
substantially in the form attached hereto as Exhibit D.
"PROCEEDING" -- any action, arbitration, audit, hearing, investigation,
litigation, or suit (whether civil, criminal, administrative, investigative, or
informal) commenced, brought, conducted, or heard by or before, or otherwise
involving, any Governmental Body or arbitrator.
"PURCHASE PRICE" -- as defined in Section 2.6.
"PURCHASED ASSETS" -- as defined in Section 2.2.
"PURCHASED STRUCTURES" -- as defined in Section 2.2(a).
"RELEASE" -- any spilling, leaking, emitting, discharging, depositing,
escaping, leaching, or dumping, into the Environment, whether intentional or
unintentional.
"REPRESENTATIVE" -- with respect to a particular Person, any director,
officer, employee, agent, consultant, advisor, or other representative of such
Person, including legal counsel, accountants, and financial advisors.
"SECURITY INTEREST" -- any mortgage, pledge, lien, encumbrance, claim,
condition, charge or other security interest or option, restriction of any kind,
including restriction on use, transfer, receipt of income, or exercise of any
other attribute of ownership, or right of any third party with respect thereto.
"SELLER" -- as defined in the first paragraph of this Agreement.
"SELLER INDEMNIFIED PERSONS" -- as defined in Section 10.1.
"SITE LEASES" -- as defined in Section 2.2(b).
"STOCKHOLDER" - as defined in the preamble.
"STRUCTURES" -- as defined in Section 2.2(c).
"TAX" -- shall mean all tax (including income tax, capital gains tax,
value added tax, sales tax, property tax, transfer tax or intangibles tax), levy
assessment, tariff, duty, deficiency or other fee and any related charge or
amount (including fine, penalty and interest) imposed, assessed or collected by
or under the authority of any Governmental Body.
"TAX CLEARANCES" -- as defined in Section 5.7.
"TAX RETURN" -- any return (including any information return), report,
statement, schedule, notice, form, or other document or information filed with
or submitted to, or required to be filed with or submitted to, any Governmental
Body in connection with the determination, assessment, collection, or payment of
any Tax or in connection with the administration, implementation, or enforcement
of or compliance with any Legal Requirement relating to any Tax.
A-5
36
"THREATENED" -- a claim, Proceeding or dispute will be deemed to have been
"THREATENED" if any demand or statement has been made or any notice has been
given that would lead a prudent Person to conclude that such a claim, Proceeding
or dispute is likely to be asserted, commenced, taken, or otherwise pursued in
the future.
A-6
