Exhibit 10.48
LOCAL MARKETING AGREEMENT
This LOCAL MARKETING AGREEMENT (the "Agreement"), made as of this 13th
day of December, 2002, by and between LIN Television Corporation, a Delaware
corporation ("LIN Television"), TVL Broadcasting of Abilene, Inc., a Delaware
corporation (the "Operator"), and Abilene Broadcasting, LLC, a Delaware limited
liability company (the "Licensee" and, together with LIN Television and
Operator, "LIN"), and Mission Broadcasting, Inc. a Delaware corporation
("Programmer").
W I T N E S S E T H:
WHEREAS, Operator and Licensee are each wholly-owned subsidiaries of TVL
Broadcasting, Inc., which in turn is a wholly-owned subsidiary of LIN
Television;
WHEREAS, Operator is the owner of substantially all of the assets (other
than the FCC Licenses) used or useful for the operation of the television
stations KRBC-TV, Abilene-Sweetwater, Texas, and KACB-TV, San Angelo, Texas
(together the "Stations" and each individually a "Station");
WHEREAS, Licensee is currently the holder of all licenses, permits,
construction permits and other authorizations issued by or pending before the
Federal Communications Commission (the "FCC") necessary or useful for the
operation of the Stations (the "FCC Licenses") in respect of the Stations;
WHEREAS, LIN Television, Licensee, Operator and Programmer have entered
into an Asset Purchase Agreement of even date herewith for the sale of all of
the tangible and intangible assets used or useful in connection with operating
the Stations, a copy of which is attached hereto as Exhibit A (the "Purchase
Agreement");
WHEREAS, Programmer desires to assist LIN in providing programming to be
transmitted on the Stations and to provide management and operation services
with respect to the Stations; and
WHEREAS, LIN desires to accept Programmer's assistance and transmit
programming supplied by Programmer on the Stations while maintaining ultimate
control over the Stations' finances, personnel matters and programming, as well
as continuing to broadcast LIN's own public interest programming;
NOW, THEREFORE, in consideration of these premises and the mutual
promises, undertakings, covenants and agreements of the parties contained in
this Agreement, the parties hereto do hereby agree as follows:
ARTICLE 1 - PROGRAMMING
Section 1.1 Programming. Programmer hereby agrees to provide, and LIN
agrees to transmit on the Stations (including, without limitation, their
subcarriers, vertical blanking intervals and any additional authorizations or
spectrum allocated to the Stations in the future,
including, without limitation, their digital television channels), news, sports,
informational, public affairs and entertainment programming and associated
advertising, promotional and public service programming and announcement matter
sufficient to program a substantial amount of each Station's broadcast day on a
daily basis throughout the term of this Agreement (hereinafter the "Programmer
Programming").
Section 1.2 LIN Programming. LIN will retain ultimate responsibility for
ascertaining the needs of each Station's community of license and service area,
including specifically the informational and educational needs of the children
therein. During the term of this Agreement (including, without limitation, any
renewals), Programmer will consult regularly with LIN regarding LIN's
ascertainment of community issues, including the educational and informational
needs of children within each Station's community of license. Based upon these
consultations, Programmer will provide news, public affairs and children's
programming relevant to each Station's community of license and of sufficient
quality to assist LIN in satisfying its obligations to respond to the needs of
the community, including at least three (3) hours per week of core children's
programming. LIN shall have the right and obligation to broadcast at reasonably
agreeable times such additional programming, either produced or purchased by
LIN, as it in good faith determines appropriate to respond to the ascertained
issues of community concern ("LIN Programming"), and to delete or preempt in its
sole good faith discretion any Programmer Programming for the purpose of
transmitting such LIN Programming. In all cases of deletion or preemption of
Programmer Programming by Licensee, except those involving breaking news,
Licensee shall make reasonable efforts to provide Programmer with not less than
fifteen (15) days notice of Licensee's intention to delete or preempt Programmer
Programming.
Section 1.3 Preemption. In addition to the above right of LIN to delete
or preempt Programmer Programming in order to transmit programming responsive to
issues of concern to the Stations' communities of license and service areas, and
to children, LIN maintains the independent right to preempt or delete any
Programmer Programming which LIN reasonably believes in good faith to be
unsatisfactory or unsuitable or contrary to the public interest, or to
substitute programming which, in LIN's reasonable determination, is of greater
local or national importance.
Section 1.4 Access to and Use of Assets. LIN hereby grants to Programmer,
and Programmer hereby accepts from LIN, access to and the right to use, at any
time and from time to time during the term of this Agreement and under the
supervision and control of LIN, antennae, transmitters, equipment, assets,
studio space, rights under leases and all other property owned or leased by LIN
and used and useful in connection with the business and operations of the
Stations (collectively, the "LIN Assets"), pursuant to the terms and subject to
the conditions of this Agreement.
Section 1.5 Conditions to Use of LIN Assets.
(a) Programmer shall use the LIN Assets only to perform its
obligations under this Agreement.
- 2 -
(b) The LIN Assets will, to the extent used by Programmer
throughout the term of this Agreement, be used in all material respects in
accordance with all applicable FCC rules and policies and subject to LIN's
ultimate oversight and control. Programmer may not, without LIN's prior written
consent or except as otherwise provided in this Agreement, make alterations in
or modifications to the LIN Assets.
(c) Programmer shall not use or permit the LIN Assets to be used
in any manner or for any purpose for which the LIN Assets are not designed or
reasonably suitable or otherwise in a manner that is inconsistent with good
engineering practices. Programmer shall comply with all governmental laws, rules
and regulations concerning the operation of the LIN Assets.
(d) LIN shall retain title to all of the LIN Assets throughout
the term of this Agreement and nothing contained herein shall be deemed to
effect any transfer of such title.
ARTICLE 2 - OPERATIONS
Section 2.1 Compliance With FCC Regulations.
(a) LIN will retain responsibility for and employ such personnel
as is necessary to assure compliance with all FCC rules and policies, including,
without limitation, all FCC rules and policies relating to (i) technical
operations of each of the Stations, (ii) programming content requirements, (iii)
the maintenance of a main studio and a meaningful managerial and staff presence
at that main studio, (iv) ascertainment of, and programming in response to,
community needs and concerns and the needs and concerns of children, (v)
political programming, (vi) sponsorship identification, (vii) lotteries and
contests, (viii) the maintenance of each Station's public and political files
and (ix) the compilation of appropriate quarterly programs/issues lists,
children's programming lists and employment records.
(b) LIN expressly acknowledges that its duty to maintain the
Stations' public inspection files is non-delegable, and it retains sole
responsibility for maintenance of the files. Programmer will provide to LIN
monthly documentation of the programs it has provided to each Station that it
believes address issues of concern to such Station's community of license.
Programmer also will forward to LIN, within twenty-four (24) hours of receipt by
Programmer, any letter from a Station's viewer addressing such Station's
programming and any documentation that comes into Programmer's custody that
Programmer believes is required to be included in any Station's public
inspection file.
(c) LIN will be responsible for ensuring proper broadcast of each
Station's identification announcements; provided, however, that Programmer will
provide appropriate identification announcements for each of the Stations that
comply with FCC rules and policies in a form reasonably acceptable to LIN.
(d) Programmer agrees that neither it nor its agents, employees,
consultants or personnel will accept any consideration, compensation, gift or
gratuity of any kind whatsoever, regardless of its value or form, including,
without limitation, a commission, discount, bonus, materials, supplies or other
merchandise, services or labor (collectively, "Consideration"), whether or not
pursuant to written contracts or agreements between Programmer and merchants
- 3 -
or advertisers, unless the person or entity paying such Consideration is
identified in the program for which the Consideration was provided as having
paid or furnished such Consideration in accordance with the Communications Act
of 1934, as amended (the "Communications Act"), and applicable FCC rules and
policies.
(e) LIN shall retain full responsibility for overseeing
compliance with the FCC's political programming rules and policies. At least
ninety (90) days prior to the beginning of any primary or general election
period, subject to LIN's approval, Programmer shall propose reasonable rates to
be charged to legally qualified political candidates which rates conform with
applicable election law and FCC rules and policies. Programmer agrees to provide
LIN with access to its documentation concerning the pricing of advertising sold
on each of the Stations as is necessary to permit LIN to ascertain that the
political rate is appropriate. Within twenty-four (24) hours of any request to
purchase time on a Station on behalf of a legally qualified candidate,
Programmer will report the request and their disposition to LIN. LIN shall be
responsible for placing appropriate records in each Station's political files.
Section 2.2 Maintenance.
(a) Programmer shall use its commercially reasonable efforts to
assist LIN, at all times under the supervision and ultimate control of LIN, in
the operation the Stations.
(b) LIN shall retain ultimate operational control over the
Stations and shall retain full responsibility for ensuring compliance with all
FCC technical rules and policies. LIN will employ a chief engineer who will be
responsible for maintaining the Stations' transmission facilities. LIN will
employ a chief operator, as defined by the FCC rules and policies (and who may
also hold the position of chief engineer), who will be responsible for ensuring
compliance by the Stations with the technical operating and reporting
requirements established by the FCC. Programmer shall not take any action, or
fail to take any action which it is obligated to take under this Agreement,
which will cause the Stations not to comply with applicable law, and Programmer
will provide reasonable assistance to LIN to ensure that the Stations comply
with applicable law.
(c) During the term of this Agreement, LIN will make available to
Programmer at least ninety five percent (95%) of each Station's effective
radiated power (as operating as of the Commencement Date) for the entire time
that such Station is broadcasting over the air, except for downtime required for
occasional maintenance and other interruptions contemplated by Section 2.2(d)
and events described in Section 7.1 hereof. LIN will provide Programmer with at
least forty eight (48) hours advance written notice of any routine or
non-emergency maintenance work affecting the operation of either Station at full
power. LIN will, to the extent possible, (i) schedule such maintenance work to
be performed between the hours of 1:00 a.m. and 6:00 a.m., local time, and (ii)
not schedule such maintenance to take place during a rating period.
(d) If either Station suffers any loss or damage of any nature to
its transmission or studio facilities which results in the interruption of
service or the inability of such Station to operate with its maximum facilities
(as operating as of the Commencement Date), LIN will immediately notify
Programmer of such loss or damage and LIN will undertake such
- 4 -
repairs as are necessary to restore full-time operation of such Station as
expeditiously as possible following the occurrence of any such loss or damage.
If LIN is unable to or fails to make such repairs as soon as possible after
providing such written notice to Programmer, then Programmer may elect to
undertake such repairs.
Section 2.3 New Technology.
(a) The parties agree that the FCC frequency allocations
associated with the operation of each of the Stations are included under the
provisions of this Agreement.
(b) The parties acknowledge that, as of the date hereof, the
digital television construction deadline for each of the Stations is November 1,
2002 (the "DTV Deadline Date"), and a request for an extension of time to
construct has been timely filed and is currently pending. During the term of
this Agreement, LIN shall have the right, but not the obligation, to file any
and all petitions, applications, motions or other requests with the FCC to seek
a further extension of time to construct digital broadcast facilities at the
Stations.
(c) In the event LIN does not obtain an extension of time to
construct digital broadcast facilities at the Stations, Programmer shall
construct, in a manner consistent with good engineering practice and LIN's
engineering practices with respect to other similarly situated television
stations owned or operated by LIN, and to the extent commercially reasonable if
Programmer were the owner and licensee of the Stations, digital broadcast
facilities sufficient to meet the obligations of the Stations to construct such
facilities by the DTV Deadline Date (or any extension thereof) in accordance
with all FCC rules and policies (the "DTV Assets"). Upon completion of the
construction of the DTV Assets, Programmer shall enter into an appropriate
agreement with LIN for the lease of the DTV Assets to LIN, and Programmer shall
provide programming for the DTV Assets in accordance with the terms of this
Agreement.
(d) Upon the expiration or termination of this Agreement (other
than the expiration of this Agreement upon the consummation of the transactions
contemplated by the Purchase Agreement), LIN shall purchase from Programmer, and
Programmer shall sell to LIN, the DTV Assets, if any. No later than thirty (30)
days following such expiration or termination, Programmer shall deliver to LIN a
final accounting of all direct, out-of-pocket costs incurred by Programmer in
connection with the construction of the DTV Assets (the "DTV Costs"), including
a certificate executed by an officer of Programmer setting forth the costs
incurred by Programmer in connection with the construction of the DTV Assets
with attached thereto reasonable documentation in support thereof. No later than
fifteen (15) days after delivery of such accounting, LIN shall pay to Programmer
an amount equal to the DTV Costs (by wire transfer of immediately available
funds in accordance with wire transfer instructions delivered by Programmer, or
by such other method of funds transfer as may be agreed by LIN and Programmer),
and Programmer shall assign all right, title and interest in and to the DTV
Assets to LIN. Programmer and LIN shall execute and deliver all instruments
necessary to effectuate the foregoing.
(e) Programmer shall have the sole right, at no cost to LIN and
under the ultimate supervision and control of LIN's designated chief engineer,
to modify the Stations' main transmission system for implementation of any new
technologies on the Stations' DTV or
- 5 -
NTSC channels or build and own a transmission facility for such technologies
(the "New Technology Assets"). Should New Technology Assets be built and owned
by Programmer under this paragraph, the parties agree to enter into an
appropriate agreement for the lease of the New Technology Assets to LIN and
further agree that Programmer shall provide programming and/or other content
thereto under the terms of this Agreement. For purposes of this paragraph, "new
technologies" shall include, without limitation, transmission of compressed
digital multi-channel DTV or NTSC-quality video or audio signals, ancillary or
primary digital voice or data telecommunications services, interactive services
and other future technologies or services.
(f) Upon the expiration or termination of this Agreement (other
than upon the expiration of this Agreement upon the consummation of the
transactions contemplated by the Purchase Agreement), LIN shall have the right,
but not the obligation, to purchase from Programmer, and Programmer shall sell
to LIN, the New Technology Assets, if any. No later than thirty (30) days
following such expiration or termination, Programmer shall deliver to LIN a
final accounting of all direct, out-of-pocket costs incurred by Programmer in
connection with the construction of the New Technology Assets (the "New
Technology Costs"), including a certificate executed by an officer of Programmer
setting forth the costs incurred by Programmer in connection with the
construction of the New Technology Assets with attached thereto reasonable
documentation in support thereof. XXX xxx exercise its right to purchase the New
Technology Assets by delivering written notice of such intent to Programmer
within twenty (20) days after delivery of such accounting. In the event LIN
fails to deliver such written notice during such twenty (20) day period, LIN
shall be deemed to have rejected its right to purchase the New Technology
Assets. In the event LIN elects to purchase the New Technology Assets, LIN shall
pay to Programmer an amount equal to the New Technology Costs (by wire transfer
of immediately available funds in accordance with wire transfer instructions
delivered by Programmer, or by such other method of funds transfer as may be
agreed by LIN and Programmer), and Programmer shall assign all right, title and
interest in and to the New Technology Assets to Buyer, on such date as may be
mutually agreed by the parties but in any event no later than fifteen (15) days
after LIN delivers written notice of its election to purchase the New Technology
Assets. Programmer and LIN shall execute and deliver all instruments necessary
to effectuate the foregoing.
Section 2.4 Additional Affirmative Covenants.
(a) LIN covenants and agrees that it will fully comply with all
applicable federal, state and local laws, rules and regulations (including,
without limitation, all FCC rules and policies) and pertinent provisions of all
contracts, permits and other agreements to which it is a party or is otherwise
bound related to the Stations or this Agreement.
(b) (i) Programmer covenants and agrees that it will fully
comply with all applicable federal, state and local laws, rules and regulations
(including, without limitation, all FCC rules and policies) in the provision of
the Programmer Programming and other services to LIN pursuant to this Agreement
and otherwise in connection with the performance of its obligations hereunder.
(ii) In performing its obligations hereunder, Programmer
shall use its commercially reasonable efforts to perform or discharge on behalf
of LIN the obligations and
- 6 -
liabilities under all contracts related to the business and operation of the
Stations to which LIN is a party or by which XXX xxx be bound (the "Existing
Contracts") in accordance with the provisions hereof. In connection with the
foregoing, LIN shall use all commercially reasonable efforts to provide
Programmer the benefits of any such Existing Contract.
(iii) Except as set forth on Exhibit C hereto or as the
parties may otherwise agree, Programmer shall not designate or engage any agent
or otherwise subcontract with any third party to perform its duties or
obligations under this Agreement or delegate the performance of such duties or
obligations to any third party, including, without limitation, its duties and
obligations hereunder with respect to Programmer Programming and the advertising
sold in connection therewith.
ARTICLE 3 - FEES AND OTHER CONSIDERATION
Section 3.1 LMA Fee. In consideration of its execution and delivery of
this Agreement, Programmer has paid to LIN the Initial Payment (as defined in
the Purchase Agreement) as provided in Section 2.3(a) of the Purchase Agreement.
Section 3.2 Certain Reimbursable Expenses and Commercial Fees.
(a) Commencing on the date of this Agreement and during the term
of this Agreement Programmer shall pay to LIN the amounts described on Exhibit B
hereto pursuant to the terms and subject to the conditions set forth therein.
(b) Programmer shall be responsible for any and all fees charged
by ASCAP, BMI, SESAC or similar performing rights societies on Programmer
Programming, whether such fees are assessed against Programmer based on the
Programmer Programming or against LIN based on the ownership of the Stations.
Programmer shall not disseminate or authorize dissemination by other parties of
information concerning the ratings of the Stations issued by Xxxxxxx Media
Research, the Arbitron Company or any other entity, other than as permitted
under Programmer's valid license with such parties. LIN shall not be required to
purchase a license to receive ratings information but will cooperate with
Programmer in Programmer's efforts to obtain such a license, provided that any
consideration payable under such a license is paid by Programmer.
ARTICLE 4 - PROGRAMMER RETAINED REVENUE AND RELATED MATTERS
Section 4.1 Retained Revenue. Programmer shall retain all revenues
resulting from the sale of advertising and other time on the Stations during the
term of this Agreement, including all revenue from the sale of advertising and
other time during the LIN Programming or otherwise resulting from the operation
of the Stations during the term of this Agreement.
Section 4.2 Advertising Sales. During the term of this Agreement,
Programmer shall have the sole right to (a) sell advertising to be placed in all
programming broadcast on each of the Stations, including, without limitation,
LIN Programming; (b) xxxx for and collect the payments for all programs and
commercials aired on the Stations; (c) negotiate for and receive all
compensation due to the Stations from (i) cable television systems pursuant to
the "retransmission consent" provisions of the Cable Television Consumer
Protection and
- 7 -
Competition Act of 1992, as amended, and the FCC's rules and policies enacted
pursuant thereto, and (ii) satellite service providers pursuant to the Satellite
Home Viewer Improvement Act of 1999, as amended, and the FCC's rules and
policies enacted pursuant thereto. LIN will take, or refrain from taking, any
action as to matters related to clause (c) above in accordance with Programmer's
commercially reasonable requests.
Section 4.3 Accounts Receivable. As of the Commencement Date, Operator
shall assign to Programmer (a) the accounts receivable of Operator relating to
the Stations and existing as of the Commencement Time, (the "Pre-Commencement
Receivables") and (b) the accounts payable of the Operator relating to the
Stations and existing as of the Commencement Time (the "Pre-Commencement
Payables"). From and after the Commencement Time, subject to the provisions of
Section 5.2 hereof, Programmer shall collect the Pre-Commencement Receivables
and satisfy the Pre-Commencement Payables in the ordinary course of business, in
each case for the account of Programmer.
Section 4.4 Bank Accounts. Programmer may deposit any sums it receives
pursuant to this Article 4 or otherwise with respect to the Stations into one or
more bank accounts of the Programmer, established by Programmer in Programmer's
name for this purpose (the "Programmer Accounts"), and the funds in the
Programmer Accounts will be the property of Programmer except as otherwise
provided in this Agreement or the Purchase Agreement. Solely with respect to
payments which Programmer is authorized to receive under this Agreement,
Programmer is authorized to endorse payments received in names other than
Programmer's (e.g., "KRBC-TV" or "KACB-TV") in order to deposit such payments
into the Programmer Bank Accounts.
ARTICLE 5 - TERM, TERMINATION AND ASSIGNMENT
Section 5.1 Term. Subject to the provisions for early termination
contained herein, the initial term of this Agreement shall commence on January
1, 2003, or such other date as may be agreed upon in writing by the parties
(such date, the "Commencement Date") at 12:01 a.m. local time at the Stations
(the "Commencement Time") and shall expire upon the earlier to occur of (a) the
Closing (as defined in the Purchase Agreement), (b) termination of the Purchase
Agreement pursuant to Section 9.1 thereof or (c) termination of this Agreement
pursuant to Section 5.2 or Section 5.3 hereof.
Section 5.2 Termination; Effect of Termination.
(a) In the event that either party shall be in breach of this
Agreement for the nonperformance of a material obligation, the non-breaching
party may, in addition to pursuing any other remedies available at law or in
equity, terminate this Agreement if such breach shall continue for a period of
fifteen (15) days following the receipt of written notice from the non-breaching
party, which notice shall set forth and describe the nature of such breach,
except if the breaching party has commenced a cure of such breach within such
fifteen (15) day period and continues to act in good faith to cure and such
breach is cured within a reasonable time not to exceed thirty (30) days.
- 8 -
(b) In the event of termination of this Agreement as a result of
a breach by Programmer pursuant to either Section 5.1(b) or Section 5.2(a),
Programmer shall cooperate in good faith with LIN and shall take such actions at
no additional cost to Programmer as may be reasonably necessary in order to
transition the programming of the Stations from Programmer Programming and to
permit LIN to program each Station's broadcast day on a daily basis for at least
the minimum operating schedule specified in Section 73.1740 of the FCC's rules
including, without limitation, by (i) assigning to Operator any agreements for
the provision of any Programmer Programming as XXX xxx reasonably request and
(ii) prior to the effectiveness of such assignment or to the extent that such
assignment cannot be made or an attempted assignment of any contract related to
the Programmer Programming is ineffective, taking all reasonably necessary
actions to provide Operator with the benefits of any such contract, provided
that to the extent Operator is provided with the benefits of such contract,
Operator shall perform or discharge on behalf of Programmer the obligations and
liabilities under such contract in accordance with the provisions thereof. With
respect to any actions in connection with the foregoing that would result in any
additional cost or fee to Programmer, Programmer shall only be required to take
such actions to the extent LIN agrees, in writing, to pay or reimburse
Programmer for such additional cost or fee in advance of the incurrence of such
cost or fee.
(c) Upon the termination of this Agreement for any reason, the
Initial Payment shall be retained by LIN or refunded to Programmer in accordance
with the provisions of Section 9.2(b) of the Purchase Agreement.
(d) In the event of termination of this Agreement for any reason
other than pursuant to Section 5.1(a) hereof, as of the time at which this
Agreement terminates (the "Termination Time"), Programmer shall assign to
Operator (i) the accounts receivable of Programmer relating to the Stations and
existing as of the Termination Time, including any outstanding Pre-Commencement
Receivables (the "Pre-Term Receivables"), and (ii) the accounts payable of
Programmer relating to the Stations and existing as of the Termination Time,
including any outstanding Pre-Commencement Payables (the "Pre-Term Payables").
Programmer shall have no right in and to any then outstanding Pre-Term
Receivables (or any amounts collected after the Termination Time with respect
thereto) or obligation with respect to any then outstanding Pre-Term Payables,
and Programmer shall be deemed to have immediately re-assigned the then
outstanding Pre-Term Receivables (and all amounts collected after the
Termination Time with respect thereto) and the then outstanding Pre-Term
Payables to Operator. From and after the Termination Time, neither Programmer
nor any agent of Programmer will make any direct solicitation of any Person that
is a debtor with respect to any Pre-Term Receivables.
(e) In the event of termination of this Agreement (other than by
reason of the Closing), the parties shall pro rate the revenues, expenses, and
liabilities attributable to the Station, including the power and utilities, ad
valorem property taxes (upon the basis of the most recent assessment available),
rents, income and sales taxes, and similar accruing, prepaid and deferred items,
in accordance with the principles that Programmer will be allocated revenues
earned or accrued, and expenses, costs and liabilities incurred in or allocable
with respect to the business and operation of the Stations from the Commencement
Time through the Termination Time and LIN will be allocated revenues earned or
accrued, and expenses, costs and liabilities
- 9 -
incurred in or allocable, with respect to the business and operation of the
Stations after the Termination Time.
(f) In the event of termination of this Agreement (other than by
reason of the Closing), LIN shall reimburse Programmer for any capital
expenditures paid by Programmer (or reimbursed by Programmer to LIN) to the
extent that (i) such capital expenditure relates to the repair or replacement of
any of the assets relating to the Stations and (ii) LIN consented in writing to
such capital expenditures prior to the incurrence thereof and upon written
notice to LIN seeking such consent and describing in reasonable detail the basis
therefor (such capital expenditures the "Approved Expenditures"). For the
avoidance of doubt, Approved Expenditures shall not include any expenditures of
Programmer made in connection with any DTV Assets or New Technology Assets (and
the payment of any expenses related thereto shall be governed by the provisions
of Section 2.3 hereof). Any Approved Expenditures shall be payable by LIN within
ten (10) days following receipt of written notice from Programmer with a final
accounting of all Approved Expenditures, including a certificate executed by an
officer of Programmer setting forth the Approved Expenditures actually incurred
by Programmer with attached thereto reasonable documentation in support thereof.
(g) In the event of termination of this Agreement (other than by
reason of the Closing), Programmer shall assign to Operator all right, title and
interest it shall have or may have in and to (i) any assets acquired or leased
by Programmer pursuant to any Approved Expenditure and (ii) any other fixture or
improvement owned or leased by Programmer (but not any DTV Assets or New
Technology Assets the ownership of which shall be governed by the provisions of
Section 2.3 hereof), and Programmer and LIN shall execute and deliver all
instruments necessary to effectuate the foregoing.
Section 5.3 Renegotiation Upon FCC Action.
(a) Should a change in FCC rules or policies make it necessary to
obtain FCC consent for the implementation, continuation or further effectuation
of any element of this Agreement, the parties hereto shall use their
commercially reasonable efforts diligently to prepare, file and prosecute before
the FCC all petitions, waivers, applications, amendments, rulemaking comments
and other related documents necessary to secure or retain FCC approval of all
aspects of this Agreement. LIN and Programmer shall each bear their own costs
incurred in connection with the preparation of such documents and prosecution of
such actions. Notwithstanding anything in this Agreement to the contrary, it is
understood that no filing shall be made with the FCC with respect to this
Agreement unless each party hereto has had an opportunity to review such filing
and to provide comments thereon. Each party shall use its commercially
reasonable efforts to incorporate the comments (whether in whole or in part) of
the other parties to any filing to be made with the FCC with respect to this
Agreement.
(b) If any court or federal, state or local government authority
(including the FCC) orders or takes any action which becomes effective and which
requires the termination or material modification of this Agreement to comply
with such action or otherwise with applicable law (a "Permissibility
Determination"), the parties shall use their commercially reasonable efforts to
renegotiate this Agreement in good faith and recast this Agreement in terms that
are likely to cure the defects caused by the Permissibility Determination while
maintaining the
- 10 -
benefit of the bargain to the parties hereunder and to return a balance of
benefits to both parties comparable to the balance of benefits provided by the
Agreement in its current terms. If the parties are unable to recast this
Agreement in a manner that cures such defects and otherwise is mutually
agreeable to the parties, this Agreement will terminate effective on such date
as the parties' activities are required to terminate pursuant to the
Permissibility Determination. Upon such termination of this Agreement, LIN will
reasonably cooperate with Programmer to the extent permitted in order to enable
Programmer to fulfill advertising or other programming contracts then
outstanding, and Programmer will reasonably cooperate with LIN in order to
effectuate a reasonable transition period from the Programmer's Programming to
other programming on the Stations.
Section 5.4 Assignability. No party hereto may assign this Agreement
without the prior written consent of the other parties; provided, however, that
this Agreement shall be assigned in connection with any assignment by any party
of its rights and obligations under the Purchase Agreement. This Agreement shall
be binding upon and inure to the benefit of the parties hereto and their
respective successors and permitted assigns.
ARTICLE 6 - INDEMNIFICATION
Section 6.1 Indemnification by Programmer. Programmer will indemnify,
defend and hold harmless LIN, its affiliates and all officers, directors,
employees, stockholders, partners, members and agents of LIN and their
affiliates (individually, a "LIN Indemnitee") from and against any and all
claims, demands, costs, damages, losses, liabilities, joint and several,
expenses of any nature (including, without limitation, reasonable attorneys',
accountants' and experts' fees and disbursements), judgments, fines, settlements
and other amounts (collectively, "Damages") arising from any and all claims,
demands, actions, suits or proceedings, civil, criminal, administrative or
investigative (collectively, "Claims") in which a LIN Indemnitee may be
involved, as a party or otherwise, arising out of: (a) the activities, acts or
omissions of Programmer, or Programmer's employees, agents or contractors, under
or in connection with this Agreement or with respect to the Stations which
activities, acts or omissions involve or result in, among other things, (i)
libel and slander; (ii) infringement of trade marks, service marks or trade
names; (iii) violations of law, rules, regulations, or orders (including the
FCC's rules and policies); or (iv) invasion of rights of privacy or infringement
of copyrights or other proprietary rights; or (b) any breach by Programmer of
its obligations under this Agreement.
Section 6.2 Indemnification by LIN. LIN will indemnify, defend and hold
harmless Programmer, its affiliates and all officers, directors, employees,
stockholders, partners, members and agents of Programmer and their affiliates
(individually, a "Programmer Indemnitee") from and against any and all Damages
arising from any and all Claims in which a Programmer Indemnitee may be
involved, as a party or otherwise, arising out of: (a) the activities, acts or
omissions of LIN, or LIN's employees, agents or contractors, under or in
connection with this Agreement or with respect to the Stations which activities,
acts or omissions involve or result in, among other things, (i) libel and
slander; (ii) infringement of trade marks, service marks or trade names; (iii)
violations of law, rules, regulations, or orders (including the FCC's rules and
policies); or (iv) invasion of rights of privacy or infringement of copyrights
or other proprietary rights; or (b) any breach by LIN of its obligations under
this Agreement.
- 11 -
Section 6.3 Insurance. Programmer will maintain broadcasters' liability
insurance policies covering libel, slander, invasion of privacy and the like,
general liability, blanket crime, property damage, business interruption,
automobile liability, and workers' compensation insurance in forms and amounts
customary in the television broadcast industry (to the extent commercially
reasonable, for example, Programmer shall not be required to obtain insurance
specifically with respect to property it does not own), and LIN will maintain
the existing insurance policies on the Stations or other policies providing
substantially similar coverages, and each of the parties hereto will name the
other as an additional insured under such policies to the extent that their
respective interests may appear and will provide for notice to the other party
prior to cancellation thereof. Upon request, each party will provide the other
with certificates evidencing such insurance, and will further provide
certificates evidencing renewal thereof prior to the expiration of such
policies.
ARTICLE 7 - MISCELLANEOUS
Section 7.1 Force Majeure. Notwithstanding anything contained in this
Agreement to the contrary, no party shall be liable to another party for failure
to perform any obligation under this Agreement if prevented from doing so by
reason of fires, acts of terrorism, strikes, labor unrest, embargoes, civil
commotion, rationing or other orders or requirements, acts of civil or military
authorities, acts of God or other contingencies, including, without limitation,
equipment failures, beyond the reasonable control of the parties, and all
requirements as to notice and other performance required hereunder within a
specified period shall be automatically extended to accommodate the period of
pendency of such contingency which shall interfere with such performance.
Section 7.2 Confidentiality and Press Releases.
(a) Each party shall hold in strict confidence all documents and
information concerning the other and its business and properties and, if this
Agreement is terminated, such confidences shall be maintained, and all documents
and information (in written form) shall immediately thereafter be returned to
the party originally furnishing such documents and information.
(b) No press release or public disclosure, either written or
oral, of the existence or terms of this Agreement or the transactions
contemplated hereby shall be made by either party to this Agreement without the
consent of the other (which consent shall not be unreasonably withheld,
conditioned or delayed), and each party shall furnish to the other advance
copies of any release which it proposes to make public concerning this Agreement
or the transactions contemplated hereby and the date upon which such party
proposes to make public such press release.
(c) Notwithstanding anything contained herein to the contrary, no
party shall be prohibited from (i) making any disclosures to any governmental
authority that it is required to make by law, including, without limitation, the
filing of this Agreement with the FCC and placing a copy of this Agreement in
the Stations' public inspection files, (ii) disclosing this Agreement or its
terms to its attorneys, accountants, agents or advisors, (iii) filing this
Agreement with, or disclosing the terms of this Agreement to, any institutional
lender to such
- 12 -
party or (iv) disclosing to its investors and broker/dealers such terms of this
transaction as are customarily disclosed to them in connection with similar
transactions.
Section 7.3 Trademarks. LIN hereby grants Programmer an unlimited,
royalty-free license to use in connection with providing programming on the
Stations any and all trademarks, service marks, patents, trade names, jingles,
slogans, logotypes and other intangible rights owned and used or held for use by
LIN in conjunction with the Stations. LIN agrees to execute such additional
documentation as may be necessary or desirable to effectuate the license granted
under this paragraph.
Section 7.4 Notices. All notices, demands and requests required or
permitted to be given under the provisions of this Agreement shall be (i) in
writing, (ii) sent by facsimile (with receipt personally confirmed by
telephone), delivered by personal delivery or sent by commercial delivery
service or certified mail, return receipt requested, (iii) deemed to have been
given on the date sent by facsimile with receipt confirmed, the date of personal
delivery or the date set forth in the records of the delivery service or on the
return receipt and (iv) addressed as follows:
(a) If to LIN:
LIN Television Corporation
Four Xxxxxxxx Xxxxxx
Xxxxx 000
Xxxxxxxxxx, Xxxxx Xxxxxx 00000
Attention: Xxxxxx X. Parent, Esq.
Telephone: 000-000-0000
Facsimile: 000-000-0000
with a copy to
Xxxxxxxxx & Xxxxxxx
0000 Xxxxxxxxxxxx Xxxxxx, XX
Xxxxxxxxxx, X.X. 00000-0000
Attention: Xxxx X. Xxxxxxxxx, Esq.
Telephone: 000-000-0000
Facsimile: 202-662-6291
(b) If to Programmer:
Mission Broadcasting, Inc.
000 Xxx Xxxx Xxxxx
Xxxxxxxxx, Xxxx 00000
Attention: Xxxxx X. Xxxxx, President
Telephone: 000-000-0000
Facsimile: 000-000-0000
- 13 -
with a copy to
Drinker Xxxxxx & Xxxxx LLP
0000 X Xxxxxx, X.X.
Xxxxx 0000
Xxxxxxxxxx, X.X. 00000
Attention: Xxxxxx X. Xxxxxxxx
Telephone: 000-000-0000
Facsimile: 000-000-0000
or to any other or additional persons and addresses as the parties may from time
to time designate in a writing delivered in accordance with this Section 7.4.
Section 7.5 Severability. If any covenant or provision hereof is
determined to be void or unenforceable in whole or in part, it shall not be
deemed to affect or impair the validity of any other covenant or provision, each
of which is hereby declared to be separate and distinct. If any provision of
this Agreement is so broad as to be unenforceable, such provision shall be
interpreted to be only so broad as is enforceable. If any provision of this
Agreement is declared invalid or unenforceable for any reason other than
overbreadth, the offending provision will be modified so as to maintain the
essential benefits of the bargain among the parties hereto to the maximum extent
possible, consistent with law and public policy.
Section 7.6 Payment of Expenses. Except as otherwise provided, Licensee
and Programmer shall pay their own expenses incident to the preparation and
carrying out of this Agreement, including, without limitation, all fees and
expenses of their respective counsel.
Section 7.7 Relationship and Dealings with Third Parties. Each of the
parties hereto is an independent contractor, and no party is, nor shall be
considered to be, the agent of another party for any purpose whatsoever. No
party has any authorization to enter into any contracts nor assume any
obligations for another party nor make any warranties or representations on
behalf of another party, other than as expressly authorized herein. Nothing in
this Agreement shall be construed as establishing an agency, partnership,
fiduciary relationship or joint venture relationship between the parties hereto.
No party is nor shall hold itself out to be vested with any power or right to
bind contractually or act on behalf of another party as another party's
contracting broker, agent or otherwise for committing, selling, conveying or
transferring any of another party's assets or property, contracting for or in
the name of another party or making any representations contractually binding
another party.
Section 7.8 Conflict. Nothing in this Agreement is intended to modify or
amend the rights and obligations of the parties under the Purchase Agreement,
including, without limitation, the treatment of and disputes regarding the
Initial Payment (as defined in the Purchase Agreement).
Section 7.9 Further Assurances. Subject to the terms and conditions of
this Agreement, from time to time each party hereto will use commercially
reasonable efforts to take, or cause to be taken, all such actions and to do or
cause to be done, all things necessary, proper or advisable under the FCC's
rules and policies or other applicable law to consummate and make
- 14 -
effective the transactions contemplated by this Agreement, including, without
limitation, executing and delivering such documents as the other party may
reasonably request in connection with the performance of this Agreement and the
consummation of the other transactions contemplated hereby.
Section 7.10 Governing Law. This Agreement and the rights and obligations
of the parties hereunder shall be governed by, and construed and enforced in
accordance with, the laws of the State of New York without regard to its
conflict of law rules, as though entered into by New York residents and to be
performed entirely within the State of New York.
Section 7.11 Waiver of Compliance; Consents. Except as otherwise provided
in this Agreement, any failure of any of the parties to comply with any
obligation, representation, warranty, covenant, agreement or condition herein
may be waived by the party entitled to the benefits thereof only by a written
instrument signed by the party granting such waiver, but such waiver shall not
operate as a waiver of, or estoppel with respect to, any subsequent or other
failure. Whenever this Agreement requires or permits consent by or on behalf of
any party hereto, such consent shall be given in writing in a manner consistent
with the requirements for a waiver of compliance as set forth in this Section
7.11.
Section 7.12 Survival. The covenants and agreements of the parties
contained herein to be performed in any respect after the expiration or
termination of this Agreement shall survive the expiration or termination of
this Agreement until fully discharged and performed.
Section 7.13 Headings. The headings in this Agreement are for the sole
purpose of convenience of reference and shall not in any way limit or affect the
meaning or interpretation of any of the terms or provisions of this Agreement.
Section 7.14 Entire Agreement. This Agreement, the Schedules and Exhibits
hereto, the Purchase Agreement and all documents, certificates and other
documents to be delivered by the parties pursuant hereto or thereto,
collectively represent the entire understanding and agreement between Buyer and
LIN with respect to the subject matter of this Agreement. This Agreement
supersedes all prior negotiations between the parties and cannot be amended,
supplemented or changed except by an agreement in writing that is signed by the
parties hereto.
Section 7.15 Counterparts. This Agreement may be executed in two or more
counterparts, each of which shall be deemed an original, but all of which
together shall constitute one and the same document. Each party hereto will
receive by delivery or facsimile or other electronic transmission a duplicate
original of the Agreement executed by each party, and each party agrees that the
delivery of the Agreement by facsimile or other electronic transmission will be
deemed to be an original of the Agreement so transmitted.
[Remainder of Page Intentionally Left Blank]
- 15 -
IN WITNESS WHEREOF, this Local Marketing Agreement has been executed by
the duly authorized officers of Programmer and LIN as of the date first written
above.
LIN TELEVISION CORPORATION MISSION BROADCASTING, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx By: /s/ Xxxxx Xxxxx
--------------------------------- ---------------------------
Title: Vice President Title: Vice President
TVL BROADCASTING OF ABILENE, INC.
By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------
Title: Vice President
ABILENE BROADCASTING, LLC
By: /s/ Xxxxxxx X. Xxxxxxxx
---------------------------------
Title: Vice President
- 16 -
EXHIBIT A
PURCHASE AGREEMENT
EXHIBIT B
EXPENSES ELIGIBLE FOR REIMBURSEMENT
At the conclusion of each calendar month during the term of this
Agreement, Programmer shall pay LIN an amount equal to all of LIN's actual
reasonable monthly costs (the "Monthly Costs") incurred by LIN in connection
with their ownership and operation of the Stations in accordance with the terms
and conditions of this Agreement and the Purchase Agreement; provided, however,
that Programmer shall not be responsible for reimbursing LIN for compensation
paid to employees of LIN in excess of the rates approved by Programmer. After
the end of each calendar month during the term of this Agreement, LIN will
submit to Programmer an invoice for such Monthly Costs incurred during such
month, and the amount of such costs reflected on such invoice will be due and
payable on the fifth (5th) day after the date upon which such invoice is
received. The Monthly Costs which are subject to reimbursement shall include,
but shall not be limited to, the following: (a) the salaries, commissions,
payroll taxes, insurance and other related costs of LIN's employees employed in
connection with the business and operation of the Stations; (b) lease
obligations with respect to any of the LIN Assets leased to LIN; (c) utility
bills for utility services at each Station's main studio/office locations and
tower or transmission sites; (d) telephone system maintenance costs and local
exchange and long distance telephone costs for telephone systems and usage at
the main studio/office locations and tower or transmitter sites; (e) costs of
engineering and technical personnel necessary to assure compliance with the
FCC's rules and policies and maintenance and repair of the Stations'
transmitting and relay facilities; (f) all liabilities and obligations under all
Existing Contracts; (g) premiums for insurance policies required under this
Agreement or the Purchase Agreement; (h) real and personal property taxes; (i)
business, license and regulatory fees; and (j) reasonable maintenance and repair
costs. For the avoidance of doubt, the Monthly Costs shall not include any
Retained Liabilities (as defined in the Purchase Agreement).
EXHIBIT C
DESIGNATED AGENTS FOR PROGRAMMER AND
DELEGATED DUTIES AND OBLIGATIONS
Programmer intends to enter into a Shared Services Agreement ("SSA")
with Nexstar Broadcasting of Abilene, L.L.C. ("Nexstar"), which owns broadcast
station KTAB-TV, Abilene, Texas (or with another entity under common control
with Nexstar).
Pursuant to the SSA, Nexstar will provide certain, specified services to
Programmer for the Stations, such as engineering and production services and
news programming. However, the news programming Nexstar provides will always be
less than 15 percent of the Stations' overall programming. Programmer will make
all programming decisions (including selecting and scheduling programs) and
Programmer will undertake all aspects of time sales, including setting rates and
employing and supervising its own sales staff. Nexstar will not control, nor
have any right to control, Programmer's management, policies or operations.
Pursuant to the SSA, any services provided by Nexstar to Programmer for the
Stations will be subject to the control and supervision of LIN as provided in
this Agreement.
Programmer and Nexstar will not enter into any other agreements directly
or indirectly related to the Stations, including any agreement in the nature of
a joint sales agreement or time brokerage agreement.