Exhibit 10.1
OPTION
AGREEMENT
RECITALS
1. This Agreement is entered into as of this 1st day of
August, 2007, by and between Ace Radio Corporation
(“Permittee”), a Texas corporation, whose place of
business is at 2801
Via Fortuna Drive, Suite 675, Austin, Texas 78746
, and Matinee
Media Corporation
(“Option Holder”), a Texas corporation, whose place of
business is at 2801 Via Fortuna Drive, Suite 675, Austin,
Texas 78746.
2. Permittee holds a construction permit issued by the
Federal Communications Commission (“FCC”) for the new
FM radio station more fully described on Exhibit A
attached hereto (the “Station”). Option Holder
desires to have the right to acquire the Station including, if
applicable, any related Station Assets (defined below), and
Permittee is willing to grant Option Holder an option to acquire
the construction permit or other FCC authorization for the Station
and any related Station Assets, after the applicable construction
permit has been granted, and subject to the prior consent of the
FCC.
AGREEMENT
3. Now, therefore, in consideration of the mutual
promises and covenants herein exchanged, and for other good and
valuable consideration, the parties agree as follows:
Option Holder’s
Option
4. Permittee hereby grants Option Holder an exclusive option
to acquire its FCC authorization for the Station, subject to the
prior approval of the FCC, in exchange for the sum of one million
four hundred fifty-two thousand ninety dollars ($1,452,090.00) (the
“Purchase Price”). Upon execution of this
Agreement, Option Holder will pay to Permittee the sum of ten
dollars ($10.00) (the “Option Price”), by certified or
cashier’s check or wire transfer, for the exclusive right to
purchase the Station for the Purchase Price. Permittee agrees
that it may not assign or sell the Station or the Station Assets to
any third party without Option Holder’s prior written
consent. Such consent will not be unreasonably withheld, but
will require that the assignee or purchaser also assumes
Permittee’s obligations under this Agreement pursuant to
Paragraph 13 hereof.
5. This option shall also include the right to acquire all tangible
and intangible assets used or held by Permittee for use in the
operation of the Station, including without limitation the
equipment, contracts, leases and the goodwill of the business of
the Station (“Station Assets”), free and clear of
liens, claims and encumbrance, in exchange for reimbursement of the
actual out-of-pocket expenses incurred by Permittee as contemplated
in Section 7(b)(ii).
6. Option Holder may exercise its option to purchase the
Station and, if applicable, the Station Assets by giving written
notice to Permittee during a period commencing one day after the
date of this agreement and expiring five (5) years
thereafter. Upon Option Holder’s giving
notice of exercise of its option, the parties
will cooperate in preparing and filing the necessary application
for FCC consent, which will be filed within twenty (20) days after
Option Holder’s notice of exercise. Each party will pay
its own legal expenses relating to the assignment application, and
the FCC filing fee will be paid by Option Holder. Both
parties will prosecute the assignment application in good faith and
will not knowingly take any action or fail to take any action so as
to jeopardize FCC approval of the assignment, except pursuant to
the rights of termination set forth in Paragraph 12
hereof. FCC
consent to the assignment application without any material adverse
conditions other than those of general applicability is referred to
herein as the “FCC Consent.” Buyer and Seller
shall diligently prosecute the FCC Application and otherwise use
their commercially reasonable efforts to obtain the FCC Consent as
soon as possible after Option Holder’s exercise of its option
hereunder. The FCC Consent and other FCC actions described in
this Agreement shall be “final” at such times as any
such action (i) has not been vacated, reversed, stayed, set
aside, annulled or suspended, (ii) is one with respect to
which no timely appeal, request for stay or petition for rehearing,
reconsideration or review by any party or by the FCC on its own
motion, is pending, and (iii) is one as to which the time for
filing any such appeal, request, petition or similar document or
for the reconsideration or review by the FCC on its own motion
under the Communications Act of 1934, as amended, has
expired.
7. Closing on the assignment of the Station, and if
applicable the Station Assets, will be held at a time and place
mutually agreed to by the parties w ithin five (5) business days after the FCC
Consent becomes final (as defined above), provided that, at Option
Holder’s sole option, the Closing may occur at an earlier
date which is after the grant of the initial FCC Consent but prior
to finality of that consent. At the closing:
a. Permittee will assign and convey to Option Holder, and
will execute any documents required to do so: the FCC
construction permit or license for the Station, any other
governmental authorizations associated with that Station, all of
its right, title and interest in the call sign for that
Station, and the Station Assets, all free and clear of any
lien or encumbrance of any kind.
b. Option Holder will pay to Permittee cash, by certified or
cashier’s check or wire transfer, in the amount of the sum of
(i) the Purchase Price; (ii) the actual out-of-pocket
legal and other expenses, including financing costs, incurred by
Permittee prior to closing related to (A) processing and
prosecuting the FCC construction permit or license for the Station,
(B) the “build out” of the Station or (C) the
assignment application with the FCC; and (iii)
the portion, if any, of
any bidding credit that was received by Permittee when it purchased
the FCC construction permit for the Station which Permittee must
repay to the FCC prior to or as a result of the assignment of the
Station hereunder, whether due to the existence of this Agreement,
the status of the assignee, the passage of time or otherwise
.
c. The parties will deliver to each other such ot
|
