EXHIBIT 2.7
AMENDMENT TO ASSET PURCHASE AGREEMENT AND ESCROW AGREEMENT
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THIS AMENDMENT ("Amendment") dated and effective as of the 17th day of
January, 1997, by and between Great Xxxxx Broadcasting, Ltd., a Pennsylvania
limited partnership ("Seller"), and Nassau Broadcasting Partners, L.P., a
Delaware limited partnership ("Buyer").
STATEMENT OF FACTS
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1. Buyer and Seller entered into an Asset Purchase Agreement dated as of
August 30, 1996 ("Agreement") pursuant to which Seller agreed to sell certain
radio stations licensed to Trenton, New Jersey to Buyer and simultaneously
therewith made a down payment of $750,000 toward the purchase price under the
Agreement ("Escrow Amount").
2. Buyer, Seller and the Escrow Agent entered into an Escrow
Agreement with respect to the Escrow Amount ("Escrow Agreement").
3. At the request of Buyer, Buyer and Seller have agreed to amend the
Agreement and the Escrow Agreement. For the purpose of this Amendment,
capitalized terms shall have the meanings ascribed to them in the Agreement,
unless otherwise defined.
NOW, THEREFORE, in consideration of the sum of Ten ($10.00) Dollars,
paid by Buyer to Seller, and for other good and valuable consideration, the
mutual receipt and mutual sufficiency of which are hereby acknowledged, the
parties hereto agree as follows:
1. Section 2.2 of the Agreement shall be deleted in its entirety and
replaced by the following:
2.2(a) Xxxxxxx Money Deposit: Liquidated Damages. Upon the
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execution of this Amendment, the Escrow Agent shall release the Escrow
Amount to Seller.
2.2(b) Additional Escrow Amount. Upon execution of this
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Amendment, Buyer shall deposit $750,000.00 with the Escrow Agent
("Additional Escrow Amount") to be held pursuant to the Escrow Agreement
as amended by this Amendment. The Additional Escrow Amount is to be held
by the Escrow Agent in an interest-bearing account until the New Closing
Date, as hereinafter defined, with all interest thereon accruing to the
benefit of Buyer pursuant to the terms of the Escrow Agreement, as
amended by this Amendment, and all interest already accrued on the
Escrow Amount. The Additional Escrow Amount shall not include accrued
interest.
2. Section 2.3(a) and 2.3(b) of the Agreement shall be deleted and
replaced with the following:
2.3 Method of Payment of Purchase Price. The Purchase Price
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shall be paid as follows:
2.3(a) Additional Escrow Amount. Escrow Agent shall
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deliver the Additional Escrow Amount to Buyer on the New
Closing Date.
2.3(b) Closing. In addition the Additional Escrow Amount
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to be delivered to Seller by the Escrow Agent pursuant to
Subsection 2.3(a) of this Amendment, Buyer shall deliver to
Seller at Closing one or more certified cashier's checks or wire
transfers payable as directed by Seller in the aggregate amount
of Thirteen Million Five Hundred Dollars ($13,500,000.00), less
the total of any Advances paid pursuant to Paragraph 2.7.
3. New Sections 2.5, 2.6, 2.7 and 2.8 shall be added to the Agreement as
follows:
2.5 Liquidated Damages. Buyer acknowledges that the Escrow
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Amount, the Additional Escrow Amount, the Adjustments, as defined in
Section 2.6 of this Amendment and the Advances, as defined in Section
2.7 of this Amendment, are being paid as a condition of obtaining an extension
of the Closing Date of the Agreement. Buyer shall not seek to obtain any portion
of the Escrow Amount delivered to Seller, except that Buyer may seek recovery of
such amount if the Seller Intentionally and willfully refuses or falls to
deliver any documents it is required to deliver at Closing or to discharge any
of its Closing obligations. In the event of termination of the Agreement for any
reason other than as set forth in the next sentence, the Additional Escrow
Amount, together with any and all interest accrued thereon, and the Adjustments
and Advances, shall be returned to Buyer. In the event of termination of the
Agreement by Seller as the result of a failure of a condition set forth in
Section 14.1(d) of the Agreement or failure by Buyer to fulfill its obligations
under this Amendment, and Seller is not in breach of its obligations and
representations under this Amendment and the Agreement, Seller shall be entitled
to, as liquidated damages, and not as a penalty, an amount equal to the greater
of: (i) Two Million Dollars ($2,000,000); or (ii) the aggregate amount of the
Escrow Amount, the Additional Escrow Amount, the Advances and the Adjustments.
The parties agree that such amounts constitute a reasonable sum considering all
of the circumstances existing on the date of this Amendment, including the
relationship of the sums to the range of harm to Seller that could reasonably be
anticipated and the anticipation that proof of actual damages would be costly
and inconvenient. In placing their initials at the place provided below, Buyer
and Seller each specifically confirms: the accuracy of the statements made above
and the fact that each was represented by counsel who explained the consequences
of this liquidated damages provision at the time this Amendment was made.
SELLER INITIAL HERE [INITIALS]
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BUYER INITIAL HERE [INITIALS]
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2.6 Earnings Adjustments. In addition to all other consideration payable to
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Seller under this Agreement, Buyer shall pay the following adjustments in the
earnings of Seller beginning on February 14, and thereafter on March 14, April
14, May 14 and May 31, 1997 through the New Closing Date if same shall occur
earlier, $60,000 for each of the following time periods: January 14, 1997
through February 14, 1997; February 15 through March 14, 1997; March 15 through
April 14, 1997; and April 15 through May 14, 1997; and a $30,000 adjustment
shall be paid for the period from May 15, 1997 through May 31, 1997. Each such
payment shall be referred to as an "Adjustment," and each time period shall be
referred to as an "Adjustment Period." If the Closing occurs before the end of
any Adjustment Period, the amount of the Adjustment shall be reduced
proportionately to reflect this. (For example, if the
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Closing occurs on January 15, 1997, Buyer shall be obligated to pay an
additional 1/31 of $60,000.)
2.7 Advances on Purchase Price. Buyer shall pay $100,000 to
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Seller on each of the following dates if the Closing shall not have
occurred on or before those dates: February 14, 1997; March 14, 1997;
April 14, 1997; and May 14, 1997. Such payments shall be referred to
collectively as the "Advances." The Advances shall be credited toward
the Purchase Price consistent with Section 2.3(b).
2.8 Buyer's Option to Make Payment of Additional Escrow Amount
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Directly to Seller. Upon execution of this Amendment, at its option,
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Buyer may pay the sum of Seven Hundred Fifty Thousand Dollars
($750,000.00) directly to Seller, and, in such case, the Escrow Amount
currently held by the Escrow Agent shall be treated as the Additional
Escrow Amount.
4. Section 10.1 of the Agreement shall be deleted and replaced by
the following:
10.1 Closing Date and Real Property Transfer Date. The Closing
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of the transactions contemplated herein, other than for the transfer of
the Real Property, shall be held on a date and time, specified by Buyer
in writing to Seller, which is on or before the earlier of: (i) the
second business day following completion of Buyer's currently pending
bond financing proceedings (projected by Buyer to be completed by March
31, 1997) or any substitute therefor; or (ii) May 31, 1997 ("New Closing
Date"). Notwithstanding anything contained in this Section 10.1 of the
Amendment, if the Closing does not occur by May 31, 1997, then either
Seller or Buyer shall have the right to terminate the Agreement subject
to the terms of the Agreement and this Amendment. The Real Property
Transfer Date shall be the third anniversary of the New Closing Date.
5. Buyer acknowledges that it has completed all due diligence and
has found no exceptions, except that the following due diligence has not yet
been completed, the environmental audit pursuant to Section 7.3(c) of the
Agreement and the engineering Inspection pursuant to Section 7.3(d) of the
Agreement.
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6. Section 7.1 of the Agreement shall be deleted and replaced with the
following:
7.1 Access and Information. Seller shall provide Buyer and its
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accountants continued access to its books and records as they pertain to
the Stations for the purpose of conducting an audit of the operations
and results of the Stations for the period through December 31, 1996.
Buyer shall reimburse Seller for any overtime payroll and related
expenses heretofore or hereafter incurred as a result of such audit.
7. Section 10.4(a)(i) and (ii) of the Agreement shall be deleted and
replaced with the following:
(i) Executed instructions to Escrow Agent, directing it to release to
Seller the balance of the Additional Escrow Amount;
(ii) Thirteen Million Five Hundred Thousand Dollars ($13,500,000),
less the total of any advances paid pursuant to Section 2.7, by bank,
cashier's check, certified check or wire transfer at Seller's election.
8. All references in the Escrow Agreement to the "Escrow Fund" or the
"Escrow Amount" shall now be to the Additional Escrow Amount. Section 2 of the
Escrow Agreement shall be deleted in its entirety and replaced by the following:
2. Distribution of the Additional Escrow Amount
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(a) The Escrow Agent shall hold the Additional Escrow Amount and
disburse it in a manner consistent with Section 2 of this Amendment.
On the Closing Date or May 31, 1997, whichever shall first occur,
Seller shall send to the Escrow Agent telecopied instructions
authorizing the Escrow Agent to pay the balance of the Additional
Escrow Amount to Seller and to pay the balance of the accrued
interest on the Additional Escrow Amount to Buyer. The Escrow Agent
shall, as soon as practicable, comply with the instructions received
from Seller.
(b) In the event that Seller shall give the Escrow Agent written
notice stating that: (i) the Agreement has been terminated by Seller
consistent with the Agreement due to a breach or default in any
material respect of the representations, warranties or obligations by
Buyer under the terms of the Agreement; (ii) Seller is
entitled to the Additional Escrow Amount as liquidated damages in
accordance with Section 3 of this Amendment; and (iii) Seller has
given notice of such claim to Buyer, then the Escrow Agent shall
promptly give Buyer a copy of such written notice. At any time on or
before the fifth day after such notice from the Escrow Agent, Buyer
may contest the claim of Seller to the Additional Escrow Amount by
written notice delivered to Seller and Escrow Agent setting forth the
grounds for such dispute. Promptly after the expiration of five (5)
days from the date of such notice to Buyer, if the Escrow Agent shall
not have, during such five (5) day period, received from Buyer
written notice disputing Seller's claim to the Additional Escrow
Amount, the Escrow Agent shall pay the Additional Escrow Amount to
Seller as a portion of liquidated damages and as the exclusive remedy
of Seller and in complete satisfaction of any and all claims against
Buyer. If Buyer shall give notice disputing Seller's claim to the
Escrow Amount, the Escrow Agent shall retain the Escrow Amount until
the dispute is resolved in accordance with this Section 8 of the
Amendment. All notices to be delivered or permitted to be delivered
under this Section shall be delivered as provided in Section 16 of
the Agreement.
(c) In the event that Buyer shall give written notice to the
Escrow Agent stating: (i) that the Agreement was not consummated for
any reason other than a breach or default in any material respect of
the representations, warranties or obligations of Buyer; (ii) that
Buyer is entitled to the return of the Additional Escrow Amount in
accordance with the Agreement or this Amendment; and (iii) that Buyer
has given a copy of such notice to Seller, then the Escrow Agent
shall promptly deliver a copy of such written notice to Seller. At
any time on or before the fifth day after such notice from the Escrow
Agent, Seller may contest Buyer's claim to the Additional Escrow
Amount setting forth the grounds for such dispute. Promptly after the
expiration of five (5) days from the date of such notice to Seller,
if the Escrow Agent shall not have, during the five (5) day period,
received from Seller written notice disputing Buyer's claim to the
Escrow Amount or Additional Escrow Amount, the Escrow Agent shall pay
the Additional Escrow Amount to Buyer. If Seller shall give notice
disputing Buyer's claim to the Additional Escrow Amount, the Escrow
Agent shall retain the Additional Escrow Amount until the dispute is
resolved in accordance with Section 8 of the Amendment. All notices
given or permitted to be given under this Section shall be given as
provided in Section 16 of the Amendment.
(d) If the Escrow Agent shall retain the Additional Escrow
Amount, or any part of the Additional Escrow Amount, on account of a
dispute in accordance with this Section 6 of this Amendment, the Escrow
Agent shall make no delivery to or any other disposition of the
Additional Escrow Amount until it has received a final court order from
a court of competent jurisdiction directing disposition of the
Additional Escrow Amount or until it shall receive written instructions
of both Buyer and Seller authorizing the release of the Additional
Escrow Amount, whichever shall occur earlier.
9. This Amendment may be signed in any number of counterparts with the
same effect as if the signature to each counterpart were on the same instrument.
10. Except as modified by this Amendment, the Agreement and the Escrow
Agreement, and all of the covenants, agreements, terms, provisions and
conditions therein shall remain in full force and effect. The covenants,
agreements, terms, provisions and conditions contained in this Amendment shall
bind and inure to the benefit of the parties hereto and their respective
successors, and, except as otherwise provided in the Agreement and Escrow
Agreement, as modified in this Amendment, their respective assigns.
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In WITNESS WHEREOF, this Amendment has been duly executed by the parties
hereto as of the date first above written.
GREAT XXXXX BROADCASTING, LTD,
By: GREAT XXXXX BROADCASTING. INC.
Its General Partner
By: /s/ Xxxx Xxxxx
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Name: Xxxx Xxxxx, President
NASSAU BROADCASTING PARTNERS, L.P.
By: Nassau Broadcasting Partners, Inc., its
General Partner
By: /s/ Xxxxx X. Xxxxxxxxxx, Xx.,
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Xxxxx X. Xxxxxxxxxx, Xx. President
Acknowledge and Agreed:
EIZEN, XXXXXXXX & XxXXXXXXX, P.C.,
as Escrow Agent
By /s/ Xxxxxxx Xxxxx
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Xxxxxxx Xxxxx
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