1
EXHIBIT 1
DISTRIBUTION AGREEMENT
[ ], 1997
[Investment Banks]
Dear Ladies and Gentlemen:
A.H. Belo Corporation, a Delaware corporation (the "Company"),
confirms its agreement with each of [Investment Banks] (each an "Agent" and
collectively, the "Agents") with respect to the issue and sale by the Company
from time-to- time in one or more series its unsecured debt securities ("Debt
Securities") and warrants ("Warrants") to purchase Debt Securities (the Debt
Securities and Warrants being herein collectively called the "Securities").
The Debt Securities are to be issued pursuant to an indenture (the
"Indenture"), dated as of [ ], among the Company and [ ], as
trustee (the "Trustee"). Each series of warrants will be issued under a
separate warrant agreement (a "Warrant Agreement") to be entered into between
the Company and a bank or trust company, as warrant agent (the "Warrant
Agent"). As of the date hereof, the Company has authorized the issuance and
sale of up to U.S. $1,500,000,000 aggregate principal amount (or its
equivalent, based upon the applicable exchange rate at the time of issuance, in
such foreign currencies or composite currencies as the Company shall designate
in the Debt Securities) of Debt Securities.
The Company has filed with the Securities and Exchange Commission (the
"Commission") a registration statement on Form S-3 (File No. 333-_______) (the
"Registration Statement") under the Securities Act of 1933, as amended (the
"1933 Act"), including a prospectus (the "Base Prospectus") relating, among
other things, to the Securities. The Company has filed with the Commission,
transmitted for filing to the Commission, or shall promptly file with or
transmit for filing to the Commission a prospectus supplement (the "Prospectus
Supplement") relating to the Securities, including, in each case, all
Incorporated Documents (as hereinafter defined), as from time to time amended
or supplemented by the filing of documents pursuant to the Securities Exchange
Act of 1934, as amended (the "1934 Act"), or the 1933 Act or otherwise. The
term "Prospectus" shall mean the Base Prospectus, the Prospectus Supplement,
the Incorporated Documents and any term sheet or abbreviated term sheet as
those terms are used in Rule 434 of the 1933 Act Regulations (each a "Term
Sheet") except that, if any revised prospectus shall be provided to the Agents
by the Company for use in connection with the offering of the Securities
2
which is not required to be filed by the Company pursuant to Rule 424(b) of the
1933 Act Regulations, the term "Prospectus" shall refer to such revised
prospectus from and after the time it is first provided to the Agents for such
use. Any reference herein to the Registration Statement or the Prospectus
shall be deemed to refer to and include the documents, financial statements and
schedules incorporated by reference therein pursuant to Item 12 of Form S-3
under the 1933 Act, and any reference to any amendment or supplement to the
Registration Statement or the Prospectus shall be deemed to refer to and
include any documents, financial statements and schedules filed by the Company
with the Commission under the 1934 Act after the date hereof, and so
incorporated by reference or deemed incorporated by reference (such
incorporated documents, financial statements and schedules being herein called
the "Incorporated Documents"). Notwithstanding the foregoing, for purposes of
this Agreement any prospectus, prospectus supplement, term sheet or abbreviated
term sheet prepared or filed with respect to an offering pursuant to the
Registration Statement of a series of securities other than the Securities
shall not be deemed to have supplemented the Prospectus.
SECTION 1. REPRESENTATIONS AND WARRANTIES; ADDITIONAL CERTIFICATES.
(a) REPRESENTATIONS AND WARRANTIES. The Company represents and
warrants to each Agent as of the date hereof, as of the date of each acceptance
by the Company of an offer for the purchase of Securities (whether through an
Agent as agent or from an Agent as principal), as of the date of each delivery
of Securities by the Company to the purchasers (the date of each such delivery
to an Agent as principal being hereafter referred to as a "Settlement Date"),
and as of the dates referred to in Section 6(a) hereof (each of the dates
referenced above being referred to hereafter as a "Representation Date"), as
follows:
(i) The Registration Statement in respect of the
Securities has been filed with the Commission; such Registration
Statement and any post-effective amendment thereto, each in the form
heretofore delivered or to be delivered to such Agent, have been
declared effective by the Commission in such form; no other document
with respect to such Registration Statement or the Incorporated
Documents has heretofore been filed or transmitted for filing with the
Commission (other than the prospectuses filed pursuant to Rule 424(b)
of the 1933 Act Regulations, each in the form heretofore delivered to
the Agent); and no stop order suspending the effectiveness of any such
Registration Statement has been issued and no proceeding for that
purpose has been initiated or threatened by the Commission;
(ii) The Incorporated Documents, when they became
effective or were filed with the Commission, as the case may be,
conformed in all material respects to the requirements of the 1933 Act
or the 1934 Act, as applicable, and the rules and regulations of the
Commission thereunder, and none of such documents contained an untrue
statement of a material fact or omitted to state a material fact
required to be stated therein or necessary to make the statements
therein not misleading; and any further documents so filed and
incorporated by reference in the Prospectus, or any amendment or
supplement thereto, when such documents become effective or are filed
with the Commission, as the case may be, will conform in all material
respects to the requirements of the 1933 Act or
3
the 1934 Act, as applicable, and the rules and regulations of the
Commission thereunder and will not contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by any
Agent expressly for use in the Prospectus as amended or supplemented
to relate to a particular issuance of Securities;
(iii) The Registration Statement and the Prospectus, in
each case as amended and supplemented, conform, and any further
amendments or supplements to the Registration Statement or the
Prospectus will conform, in all material respects, to the requirements
of the 1933 Act and the Trust Indenture Act of 1939, as amended (the
"Trust Indenture Act"), and the rules and regulations of the
Commission thereunder and do not and will not, as of the applicable
effective date as to the Registration Statement and any amendment
thereto and as of the applicable filing date as to the Prospectus and
any amendment or supplement thereto, contain an untrue statement of a
material fact or omit to state a material fact required to be stated
therein or necessary to make the statements therein not misleading;
provided, however, that this representation and warranty shall not
apply to any statements or omissions made in reliance upon and in
conformity with information furnished in writing to the Company by any
Agent expressly for use in the Prospectus as amended or supplemented
to relate to a particular issuance of Securities or the information
contained in the Statement of Eligibility and Qualification of the
Trustee under the Trust Indenture Act filed as an exhibit to the
Registration Statement (the "Form T-1"); there is no contract or
document of a character required to be described in the Registration
Statement or the Prospectus or to be filed as an exhibit to the
Registration Statement which is not described or filed as required;
(iv) The Company and its subsidiaries considered as a
whole have not sustained since the date of the latest audited
financial statements included or incorporated by reference in the
Prospectus any material loss or interference with its business from
fire, explosion, flood or other calamity, whether or not covered by
insurance, or from any labor dispute or court or governmental action,
order or decree, otherwise than as set forth or contemplated in the
Prospectus; and, since the respective dates as of which information is
given in the Registration Statement and the Prospectus, there has not
been any material adverse change, or any development involving a
prospective material adverse change, in or affecting the general
affairs, management, financial position or results of operations of
the Company and its subsidiaries considered as a whole, otherwise than
as set forth, incorporated by reference or contemplated in the
Prospectus;
(v) The Company has been duly incorporated and is validly
existing as a corporation in good standing under the laws of the State
of Delaware and has been duly qualified as a foreign corporation for
the transaction of business and is in good standing under the laws of
each other jurisdiction in which it owns or leases properties, or
conducts any business in an amount that is material to the business of
the Company and its subsidiaries considered as a whole so as to
require such qualification; each subsidiary of the Company has been
duly incorporated and is validly existing as a corporation in good
3
4
standing under the laws of its jurisdiction of incorporation and is
duly qualified as a foreign corporation for the transaction of
business and in good standing under the laws of each other
jurisdiction in which it owns or leases properties, or conducts any
business, so as to require such qualification; each of the Company and
its subsidiaries has the corporate power and authority to own or lease
its properties, as applicable, and to conduct its business as
presently conducted and proposed to be conducted, as described in the
Registration Statement;
(vi) The Securities have been duly authorized, and, when
executed, authenticated, issued and delivered pursuant to this
Agreement and any Terms Agreement, will have been duly executed,
authenticated, issued and delivered and will constitute valid and
legally binding obligations of the Company entitled to the benefits
provided by the Indenture and the Warrant Agreement, if any; the
Indenture has been duly authorized and duly qualified under the Trust
Indenture Act and constitutes a valid and legally binding instrument,
enforceable in accordance with its terms, subject, as to enforcement,
to bankruptcy, insolvency, reorganization and other laws of general
applicability relating to or affecting creditors' rights and to
general equity principles; the Indenture and Warrant Agreement, if
any, conform, and the Securities of any particular issuance of
Securities will conform, in all material respects, to the descriptions
thereof in the Prospectus as amended or supplemented to relate to such
issuance of Securities; and the Warrant Agreement, if any, has been
duly authorized and constitutes a valid and legally binding
instrument, enforceable in accordance with its terms, subject, as to
enforcement, to bankruptcy, insolvency, reorganization, fraudulent
transfer and other laws of general applicability relating to or
affecting creditors' rights and to general equity principles;
(vii) The issue and sale of the Securities, the compliance
by the Company with the provisions of the Securities, the Indenture,
any Warrant Agreement, this Agreement and any Terms Agreement, and the
consummation of the transactions herein and therein contemplated will
not conflict with or result in a breach or violation of any of the
terms or provisions of, or constitute a default under, any material
indenture, mortgage, deed of trust, loan agreement or other material
agreement or instrument to which the Company or any of its
subsidiaries is a party or by which the Company or any of its
subsidiaries is bound or to which any of the property or assets of the
Company or any of its subsidiaries is subject, nor will such action
result in any violation of the provisions of the Certificate of
Incorporation, or By-Laws of the Company or any statute (including,
without limitation, the Communications Act of 1934, as amended (the
"Communications Act") and the rules and regulations of the Federal
Communications Commission ("FCC") thereunder) or any order, rule or
regulation of any court or governmental agency (including, without
limitation, the FCC) or body having jurisdiction over the Company or
any of its subsidiaries or any of their properties; and no consent,
approval, authorization, order, registration or qualification of or
with any court or governmental agency (including, without limitation,
the FCC) or body is required for the solicitation of offers to
purchase Securities, the issue and sale of the Securities or the
consummation by the Company of the other transactions contemplated by
this Agreement, any Terms Agreement, the Indenture or any Warrant
Agreement, except such as have been, or will have been prior to the
commencement date obtained under the Act or the Trust Indenture Act
and such consents,
4
5
approvals, authorizations, registrations or qualifications as may be
required under state securities or Blue Sky laws in connection with
the solicitation by the Agent(s) of offers to purchase Securities from
the Company and with purchases of Securities by any Agent as
principal, as the case may be, in each case in the manner contemplated
hereby;
(viii) Other than as set forth, incorporated by reference or
contemplated in the Prospectus, there are no legal or governmental
proceedings (including proceedings before the FCC) pending to which
the Company or any of its subsidiaries is a party or to which any
property of the Company or any of its subsidiaries is subject which
would reasonably be expected, in the opinion of the Company,
individually or in the aggregate, to have a material adverse effect on
the consolidated financial position or results of operations of the
Company and its subsidiaries considered as a whole, and, to the best
of the Company's knowledge, no such proceedings are threatened or
contemplated by governmental authorities or threatened by others;
(ix) Immediately after any sale of Securities by the
Company hereunder or under any Terms Agreement, the aggregate amount
of Securities which shall have been issued and sold by the Company
hereunder or under any Terms Agreement and of any other debt
securities and warrants for debt securities of the Company (other than
such Securities) that shall have been issued and sold pursuant to the
Registration Statement will not exceed the amount of debt securities
and warrants registered under the Registration Statement;
(x) To the best of the Company's knowledge, the
accountants who have audited and reported upon the financial
statements filed with the Commission as part of the Registration
Statement and the Prospectus are independent accountants as required
by the 1933 Act. The financial statements included in the
Registration Statement or Prospectus or incorporated therein by
reference fairly present the consolidated financial position and
results of operations of the Company and its subsidiaries at the
respective dates and for the respective periods to which they apply.
Such financial statements have been prepared in accordance with
generally accepted accounting principles consistently applied, except
as set forth in the Registration Statement and Prospectus; and
(xi) The Company has complied with, and is and will be in
compliance with, the provisions of that certain Florida act relating
to disclosure of doing business with Cuba, codified as Section 517.075
of the Florida statutes, and the rules and regulations thereunder or
is exempt therefrom.
(b) ADDITIONAL CERTIFICATIONS. Any certificate signed by any
officer of the Company and delivered to an Agent or to counsel for the Agents
in connection with an offering of Securities shall be deemed a representation
and warranty by the Company to such Agent as to the matters covered thereby on
the date of such certificate.
5
6
SECTION 2. SOLICITATIONS AS AGENTS; PURCHASES AS PRINCIPALS.
(a) SOLICITATIONS AS AGENTS. On the basis of the representations
and warranties herein contained, but subject to the terms and conditions herein
set forth, each Agent agrees, as an agent of the Company, to use its best
efforts to solicit offers to purchase the Securities upon the terms and subject
to the conditions set forth herein and in the Prospectus. Without the prior
written consent of the Company, the Agents are not authorized to appoint sub-
agents or to engage the services of any other broker or dealer in connection
with the offer or sale of the Securities; provided, that without the Company's
consent, the Agents may solicit offers to purchase the Securities from other
brokers or dealers. In connection with the solicitation of offers to purchase
Securities, without the prior consent of the Company, the Agents are not
authorized to provide any written information relating to the Company to any
prospective purchaser other than the Prospectus and the Incorporated Documents.
Each Agent will make reasonable efforts to assist the Company in obtaining
performance by each purchaser whose offer to purchase Securities from the
Company has been solicited by such Agent, as agent, and accepted by the
Company, but such Agent shall not have any liability to the Company in the
event any such purchase is not consummated for any reason.
The Company reserves the right, in its sole discretion, to suspend the
solicitation of offers to purchase the Securities through the Agents commencing
at any time for any period of time or permanently. Upon receipt of
instructions from the Company, the Agents will, as soon as possible, suspend
the solicitation of offers to purchase the Securities from the Company until
such time as the Company has advised the Agents that such solicitation may be
resumed.
The Company agrees to pay each Agent a commission, which such Agent is
hereby authorized to deduct from the sales proceeds of each of the Securities
sold by the Company as a result of a solicitation made by such Agent, equal to
the applicable percentage of the principal amount of each such Security, as set
forth in Exhibit A hereto. Without the consent of the Company, no Agent may
reallow any portion of the commission payable pursuant hereto to dealers or
purchasers in connection with the offer and sale of any Securities.
As an agent, each Agent is authorized, except during periods of
suspension as provided in this Agreement, to solicit offers to purchase the
Securities. Each Agent shall communicate to the Company, orally or in writing,
each reasonable offer to purchase Securities received by such Agent, as agent.
Each Agent shall have the right in its discretion reasonably exercised to
reject any offer to purchase the Securities received by such Agent which it
does not deem reasonable, and any such rejection shall not be deemed a breach
of such Agent's agreements contained herein. The Company shall have the sole
right to accept offers to purchase the Securities and may reject any such offer
in whole or in part, and any such rejection shall not be deemed to be a breach
of any agreement of the Company contained herein. The purchase price, interest
rate, maturity date and other terms of the Securities agreed upon by the
Company shall be set forth in a pricing supplement to the Prospectus to be
prepared following each acceptance by the Company of an offer for the purchase
of Securities (a "Pricing Supplement"). Except as may be otherwise provided in
any Pricing Supplement, each Debt Security will be issued in the denomination
of U.S. $1,000 or any amount in excess thereof which is an integral multiple of
U.S. $1,000. The Pricing Supplement may be in the form of a Term Sheet. All
Debt Securities will be sold at 100%
6
7
of their principal amount unless otherwise agreed to by the Company. Each
Agent acknowledges and agrees that any funds which such Agent receives in
respect of a purchase of Securities, which purchase has been solicited by such
Agent, as agent of the Company, will be received, held and disposed of by such
Agent, as agent of the Company, subject to the right of such Agent to deduct
from the sale proceeds the applicable commission as set forth on Exhibit A
hereto.
If requested by a prospective purchaser of Securities denominated in a
currency other than U.S. dollars, the Agent soliciting the offer to purchase
will use its reasonable efforts to arrange for the conversion of U.S. dollars
into such currency to enable the purchaser to pay for such Securities. Such
requests must be made on or before the fifth Business Day preceding the date of
delivery of the Securities, or by such other dates as determined by such Agent.
Each such conversion will be made by the relevant Agent on such terms and
subject to such conditions, limitations and charges as such Agent may from time
to time establish in accordance with its regular foreign exchange practice.
All costs of exchange will be borne by purchasers of the Securities.
(b) PURCHASES AS PRINCIPAL. Each sale of Securities to an Agent
as principal shall be made in accordance with the terms contained herein and
pursuant to a separate agreement which will provide for the sale of such
Securities to, and the purchase and any reoffering thereof by, such Agent.
Each such separate agreement (which may be an oral agreement if confirmed
within 24 hours thereafter by an exchange of any standard form of written
telecommunication (including facsimile transmission) between the Agent and the
Company) is herein referred to as a "Terms Agreement." Unless the context
otherwise requires, each reference contained herein to "this Agreement" shall
be deemed to include any applicable Terms Agreement between the Company and the
Agent. Each such Terms Agreement, whether oral (and confirmed in writing,
which confirmation may be by facsimile transmission) or in writing shall be
with respect to such information (as applicable) as is specified in Exhibit B
hereto. An Agent's commitment to purchase Securities pursuant to any Terms
Agreement shall be deemed to have been made on the basis of the representations
and warranties of the Company herein contained and shall be subject to the
terms and conditions herein set forth. The Agents may offer the Securities
they have purchased as principal to other dealers. The Agents may sell
Securities to any dealer at a discount and, unless otherwise specified in the
applicable Terms Agreement, such discount allowed to any dealer will not be in
excess of the discount to be received by such Agent from the Company. Unless
otherwise specified in the applicable Terms Agreement, any Securities sold to
an Agent as principal will be purchased by such Agent at a price equal to 100%
of the principal amount thereof less a percentage equal to the commission
applicable to any agency sale of a Security of identical maturity.
(c) ADMINISTRATIVE PROCEDURES. Administrative procedures with
respect to the sale of Securities shall be agreed upon from time to time by the
Agents and the Company (the "Procedures"). The Procedures initially agreed
upon shall be those set forth in Exhibit C hereto. The Agents and the Company
agree to perform the respective duties and obligations specifically provided to
be performed by the Agents and the Company herein and in the Procedures.
7
8
SECTION 3. COVENANTS OF THE COMPANY.
The Company covenants with each Agent as follows:
(a) NOTICE OF CERTAIN EVENTS. The Company will notify the Agents
promptly of (i) the designation and selection of additional agents to become
party to this Agreement, (ii) the designation and selection of additional
agents for the sale of Securities pursuant to any agreement other than this
Agreement, (iii) the effectiveness of any post-effective amendment to the
Registration Statement (other than a post-effective amendment relating solely
to an offering of securities other than the Securities), (iv) the transmittal
to the Commission for filing of any supplement to the Prospectus (other than a
Pricing Supplement or a supplement relating solely to an offering of securities
other than the Securities), (v) the receipt of any comments from the Commission
with respect to the Registration Statement or the Prospectus (other than any
comments relating solely to an offering of securities other than the
Securities), (vi) any request by the Commission for any amendment to the
Registration Statement or any amendment or supplement to the Prospectus or for
additional information (other than any such request relating solely to an
offering of securities other than the Securities) and (vii) the issuance by the
Commission of any stop order suspending the effectiveness of the Registration
Statement or the initiation of any proceedings for that purpose. The Company
will make every reasonable effort to prevent the issuance of any such stop
order and, if any such stop order is issued, to obtain the lifting thereof at
the earliest possible time unless the Company shall, in its sole discretion,
determine that it is not in its best interests to do so.
(b) NOTICE OF CERTAIN PROPOSED FILINGS. At or prior to the filing
thereof, the Company will give the Agents notice of its intention to file any
additional registration statement with respect to the registration of
additional Securities to be covered by this Agreement, any amendment to the
Registration Statement or any amendment or supplement to the Prospectus (other
than a Pricing Supplement or an amendment or supplement relating solely to an
offering of securities other than the Securities), whether by the filing of
documents pursuant to the 1934 Act, the 1933 Act or otherwise, and will furnish
the Agents with copies of any such amendment or supplement or other documents
promptly after the filing thereof.
(c) COPIES OF THE REGISTRATION STATEMENT AND THE PROSPECTUS. The
Company will deliver to the Agents one signed and as many conformed copies of
the Registration Statement (as originally filed) and of each amendment thereto
(including the Incorporated Documents and any exhibits filed therewith or
incorporated by reference therein) as the Agents may reasonably request. The
Company will furnish to the Agents as many copies of the Prospectus (as amended
or supplemented) as the Agents shall reasonably request so long as the Agents
are required to deliver a Prospectus in connection with sales or solicitations
of offers to purchase the Securities.
(d) REVISIONS OF PROSPECTUS -- MATERIAL CHANGES. So long as the
Agents are required to deliver a Prospectus in connection with sales or
solicitations of offers to purchase the Securities, if any event shall occur or
condition exist as a result of which it is necessary, in the opinion of counsel
for the Company, after consultation with counsel for the Agents, to further
amend or supplement the Prospectus in order that the Prospectus will not
8
9
include an untrue statement of a material fact or omit to state any material
fact necessary in order to make the statements therein not misleading in light
of the circumstances existing at the time it is delivered to a purchaser, or if
it shall be necessary, in the opinion of such counsel for the Company, to amend
or supplement the Registration Statement or the Prospectus in order to comply
with the requirements of the 1933 Act or the 1933 Act Regulations, prompt
notice shall be given, and confirmed in writing, to the Agents to cease the
solicitation of offers to purchase the Securities in their capacity as agents
and to cease sales of any Securities the Agents may then own as principal. In
addition, if any Agent holds Securities purchased for resale pursuant to a
Terms Agreement and the Company has given notice to the Agents pursuant to this
subsection (d) within 90 days after the date of execution of such Terms
Agreement, the Company will prepare and file as soon as practicable an
amendment or supplement to the Prospectus so that the Prospectus, as amended or
supplemented, will not include any untrue statement of a material fact or omit
to state any material fact necessary in order to make the statements therein
not misleading in light of the circumstances existing at the time it is
delivered to the Agents.
(e) COMPLIANCE WITH THE 1934 ACT; ACCOUNTANTS' CONSENTS. The
Company will (i) comply, in a timely manner, with all applicable requirements
under the 1934 Act relating to the filing with the Commission of the Company's
reports pursuant to Section 13(a), 13(c) or 15(d) of the 1934 Act and, if then
applicable, of the Company's proxy statements pursuant to Section 14(a) of the
1934 Act and (ii) use its best efforts to obtain the written consent of the
Company's independent accountants as to the incorporation by reference in the
Registration Statement of the audited financial statements reported on by them
and contained in the Company's annual reports on Form 10-K under the 1934 Act;
(f) EARNINGS STATEMENTS. The Company will make generally
available to its security holders, in each case as soon as practicable but in
any event not later than 15 months after the acceptance by the Company of an
offer to purchase Securities hereunder, a consolidated earnings statement
(which need not be audited) covering the twelve-month period beginning after
the latest of (i) the effective date of the Registration Statement, (ii) the
effective date of the most recent post-effective amendment to the Registration
Statement to become effective, the Company's most recent annual report on Form
10-K filed with the Commission prior to the date of such acceptance, which
earnings statement will satisfy the provisions of Section 11(a) of the 1933
Act. The Company may elect to rely upon Rule 158 under the 1933 Act and may
elect to make such earnings statement available more frequently than once in
any period of twelve months;
(g) BLUE SKY QUALIFICATIONS. The Company will endeavor, in
cooperation with the Agents, to qualify the Securities for offering and sale
under the applicable securities laws of such states and other jurisdictions of
the United States as the Agents may reasonably designate, and will maintain
such qualifications in effect for as long as may be required for the
distribution of the Securities; PROVIDED, HOWEVER, that the Company will
promptly notify the Agents of any suspension or termination of any such
qualifications, and PROVIDED, FURTHER, that the Company shall not be obligated
to register or qualify as a foreign corporation or take any action which would
subject it to general service of process in any jurisdiction where it is not
now so subject;
9
10
(h) SUSPENSION OF CERTAIN OBLIGATIONS. The Company shall not be
required to comply with the provisions of subsections (b), (c), (d), (e) or (g)
of this Section 3 during any period from the time the Agents shall have been
notified to suspend the solicitation of offers to purchase the Securities in
their capacity as agents or resales of Securities purchased pursuant to a Terms
Agreement, to the time the Company shall determine that the solicitation of
offers to purchase the Securities through any Agent or Agents or resales as
principal of Securities purchased pursuant to a Terms Agreement by any Agent or
Agents should be resumed. Notwithstanding the foregoing, if any Agent holds
Securities purchased for resale pursuant to a Terms Agreement, the Company
shall comply with the provisions of subsections (b), (c), (d), (e) and (g) of
this Section 3 during the 90-day period from and including the date of
execution of such Terms Agreement; PROVIDED, HOWEVER, that the Company shall
have the right, in its reasonable business judgment, to suspend such compliance
during such 90-day period for an aggregate of up to 45 days, in which event
such 90-day period shall be extended by the greater of (i) the number of days
included in any such period of suspension and (ii) 30 days.
SECTION 4. PAYMENT OF EXPENSES.
The Company will pay all expenses incident to the performance of its
obligations under this Agreement, including:
(i) The preparation and filing of the Registration
Statement and all amendments thereto and the Prospectus and any
amendments or supplements thereto and all Incorporated Documents;
(ii) The preparation, filing and printing of this
Agreement;
(iii) The preparation, printing, issuance and delivery of
the Securities;
(iv) The fees and disbursements of the Trustee and its
counsel, of any calculation agent or exchange rate agent and of The
Depository Trust Company;
(v) The qualification of the Securities under securities
laws in accordance with the provisions of Section 3(g) hereof,
including filing fees and the reasonable fees and disbursements of
▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, as counsel to the Agents, in connection
therewith and in connection with the preparation of any Blue Sky
survey;
(vi) The printing and delivery to the Agents in quantities
as hereinabove stated of copies of the Registration Statement and any
amendments thereto, and of the Prospectus and any amendments or
supplements thereto, and the delivery by the Agents of the Prospectus
and any amendments or supplements thereto in connection with
solicitations of offers to purchase, or confirmations of sales of, the
Securities;
(vii) Any fees charged by rating agencies for the rating of
the Securities;
(viii) Any advertising and other out-of-pocket expenses of
the Agents incurred with the prior written approval of the Company;
and
10
11
(ix) The subsequent delivery of legal opinions pursuant to
Section 6(b) hereof.
SECTION 5. CONDITIONS OF OBLIGATIONS.
The obligations of any Agent to solicit offers to purchase the
Securities as agent of the Company and the obligations of any Agent to purchase
Securities pursuant to any Terms Agreement will be subject at all times to the
accuracy, as of the applicable Representation Date, of the representations and
warranties on the part of the Company herein and to the accuracy, as of the
date made, of the statements of the Company's officers made in any certificate
furnished pursuant to the provisions hereof, to the performance and observance
by the Company of all covenants and agreements herein contained on its part to
be performed and observed, and to the following additional conditions
precedent:
(a) OPINION OF COUNSEL TO THE COMPANY. On the date hereof, the
Agents shall have received an opinion from ▇▇▇▇▇ ▇▇▇▇▇▇▇ Rain ▇▇▇▇▇▇▇ (A
Professional Corporation) counsel to the Company, dated as of the date hereof
and in form and substance satisfactory to counsel for the Agents to the effect
that:
(i) The Company and each of the Subsidiaries is a
corporation validly existing and in good standing under the laws of
its state of incorporation;
(ii) The Company has full corporate power and corporate
authority to enter into and perform its obligations under this
Agreement and the Indenture to borrow money as contemplated in this
Agreement and the Indenture, and to issue, sell and deliver the
Securities;
(iii) This Agreement has been duly authorized, executed and
delivered by the Company;
(iv) The Indenture has been duly authorized, executed and
delivered by the Company and (assuming due authorization, execution
and delivery by the Trustee) is a valid and binding agreement of the
Company enforceable against the Company in accordance with its terms,
except that such enforceability may be limited by (A) bankruptcy,
insolvency, reorganization, moratorium, fraudulent transfer or other
similar laws now or hereafter in effect relating to or affecting
creditors' rights generally, (B) general principles of equity
(regardless of whether enforcement is sought in a proceeding in equity
or at law); and (C) such other matters as shall be satisfactory to
counsel to the Agents;
(v) No consent or approval of any United States
governmental authority or other United States person or United States
entity is required in connection with the issuance or sale of the
Securities other than registration thereof under the 1933 Act,
qualification of the Indenture under the 1939 Act, and such
registrations or qualifications as may be necessary under the
securities or Blue Sky laws of the various United States jurisdictions
in which the Securities are to be offered or sold;
11
12
(vi) (a) The Debt Securities, when executed by the
Company and authenticated in accordance with the terms of the
Indenture (assuming the due authorization, execution and delivery of
the Indenture by the Trustee) and issued to and paid for by the
purchasers thereof, will be entitled to the benefits of the Indenture
and will be valid and binding obligations of the Company enforceable
against the Company in accordance with their respective terms, except
that such enforceability may be limited by (A) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally; (B)
general principles of equity (regardless of whether such enforcement
is sought in a proceeding in equity or at law); and (C) such other
matters as shall be satisfactory to counsel to the Agents;
(b) The Warrants, when issued by Company will be
valid and binding obligations of the Company enforceable against the
Company in accordance with their respective terms, except that such
enforceability may be limited by (A) bankruptcy, insolvency,
reorganization, moratorium or other similar laws now or hereafter in
effect relating to or affecting creditors' rights generally; (B)
general principles of equity (regardless of whether such enforcement
is sought in a proceeding in equity or at law); and (C) such other
matters as shall be satisfactory to counsel to the Agents.
(vii) The Registration Statement has become effective under
the 1933 Act and the Indenture has been qualified under the 1939 Act,
and, to the best of such counsel's knowledge, no stop order suspending
the effectiveness of the Registration Statement has been issued and no
proceedings for that purpose have been instituted or are pending or
contemplated;
(viii) The execution and delivery of this Agreement and the
Indenture by the Company, the issuance and sale of the Securities and
the fulfillment of this Agreement and the Indenture by the Company
will not conflict with or constitute a breach of or a default (with
the passage of time or otherwise) under (A) the Certificate of
Incorporation or Bylaws of the Company, (B) any statute, law or
regulation to which the Company or any of its properties may be
subject or (C) any judgment, decree or order, known to such counsel,
of any court or governmental agency or authority entered in any
proceeding to which the Company was or is now a party or by which it
is bound; provided, that such counsel may state that (1) the opinion
set forth in clause (B) of this paragraph (viii) is limited to those
United States statutes, laws or regulations currently in effect which,
in such counsel's experience, are normally applicable to transactions
of the type contemplated by this Agreement, and (2) no opinion is
expressed as to the securities or Blue Sky laws of the various
jurisdictions in which the Securities are to be offered and (3) no
opinion is expressed with respect to such clause (B) with respect to
the Securities which are to be indexed or linked to any foreign
currency, composite currency, commodity, equity index or similar
index;
(ix) The Registration Statement, as of the date it became
effective, and the Prospectus, as of the date of this Agreement,
appear on their face to be appropriately responsive in all material
respects to the requirements of the 1933 Act, except that in each case
such counsel need not express an opinion as to (i) the Incorporated
Documents,
12
13
(ii) the financial statements and schedules and other financial or
statistical data included or incorporated by reference therein or
(iii) the Form T-1;
(x) The statements in the Prospectus under the caption
"Description of Debt Securities" and "Description of Warrants" insofar
as they purport to summarize certain provisions of documents
specifically referred to therein, are in all material respects
accurate summaries of such provisions.
In rendering the opinions set forth above, such counsel may state that
(1) with respect to paragraphs (iv) and (vi), such enforcement may be limited
by: (i) requirements that a claim with respect to any Securities denominated
other than in United States dollars (or a judgment denominated other than in
United States dollars in respect of such claim) be converted into United States
dollars at a rate of exchange prevailing on a date determined pursuant to
applicable law and (ii) governmental authority to limit, delay or prohibit the
making of payments outside the United States or in foreign currency or
composite currency; and (2) with respect to paragraphs (iv), (v) and (vi), no
opinion is expressed thereto with respect to any Securities that are to be
indexed or linked to any foreign currency or composite currency, commodity,
equity index or similar index.
In addition, such counsel shall state that they have participated in
conferences with officers and other representatives of the Company, counsel
employed by the Company, representatives of the independent public accountants
for the Company, representatives of the Agents and counsel for the Agents, at
which conferences the contents of the Registration Statement and Prospectus and
related matters were discussed and, although such counsel is not passing upon,
and does not assume any responsibility for, the accuracy, completeness or
fairness of the statements contained in the Registration Statement or the
Prospectus and have not made any independent check or verification thereof, on
the basis of the foregoing, no facts have come to such counsel's attention that
lead them to believe that either the Registration Statement (excluding the
Incorporated Documents) at the time such Registration Statement became
effective (which, for the purposes of this paragraph, shall have the meaning
set forth in Rule 158(c) of the 1933 Act Regulations) contained an untrue
statement of a material fact or omitted to state a material fact required to be
stated therein or necessary to make the statements therein not misleading, or
the Prospectus (excluding the Incorporated Documents) as of the date of this
Agreement (and, if the opinion is being given pursuant to Section 6(b) hereof
as a result of the Company having entered into a Terms Agreement, as of the
Settlement Date with respect to such Terms Agreement) contained an untrue
statement of a material fact or omitted to state a material fact necessary to
make the statements therein, in light of the circumstances under which they
were made, not misleading, except that such counsel need express no opinion
with respect to (i) the Incorporated Documents, (ii) the financial statements,
schedules and other financial or statistical data included or incorporated by
reference in the Registration Statement or the Prospectus or (iii) the Form
T-1.
(b) OPINION OF COUNSEL EMPLOYED BY THE COMPANY. On the date
hereof, the Agents shall have received an opinion from ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
Senior Vice President, General Counsel and Secretary, dated as of the date
hereof and in form and substance satisfactory to counsel for the Agents, to the
effect that:
13
14
(i) Except as set forth in the Prospectus (including the
Incorporated Documents), there is not pending or, to the best of such
counsel's knowledge, after reasonable inquiry, threatened any action,
suit or proceeding against the Company or any of its subsidiaries
before or by any court or governmental agency or body, which is likely
(to the extent not covered by insurance) to have a material adverse
effect on the consolidated financial condition or earnings of the
Company and its subsidiaries, considered as one enterprise;
(ii) To the best of such counsel's knowledge, after
reasonable inquiry, there is no contract or document of a character
required to be described in the Registration Statement or the
Prospectus or to be filed as an exhibit to the Registration Statement
which is not described or filed as required;
(iii) To the best of such counsel's knowledge, after
reasonable inquiry, the Company is not in violation of its Certificate
of Incorporation or Bylaws;
(iv) To the best of such counsel's knowledge, after
reasonable inquiry, (x) the execution and delivery, and (y) the
performance, of this Agreement and the Indenture will not conflict
with or constitute a breach of, or default (with the passage of time
or otherwise) under, any material contract, indenture, mortgage, loan
agreement, security, lease or other instrument to which the Company is
a party or by which it may be bound, or to which any of the property
or assets of the Company or any of its subsidiaries is subject;
(v) The Incorporated Documents, as of the date of this
Agreement, comply as to form in all material respects with the
requirements of the 1933 Act, except that in each case such counsel
need not express an opinion as to the financial statements and
schedules and other financial or statistical data included or
incorporated by reference therein.
In addition, such counsel shall state that nothing has come to such
counsel's attention that leads him to believe that either the Registration
Statement (including the Incorporated Documents) at the time such Registration
Statement became effective (which, for the purposes of this paragraph, shall
have the meaning set forth in Rule 158(c) of the 1933 Act Regulations)
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein
not misleading, or the Prospectus (including the Incorporated Documents) as of
the date of this Agreement (and, if the opinion is being given pursuant to
Section 6(b) hereof as a result of the Company having entered into a Terms
Agreement, as of the Settlement Date with respect to such Terms Agreement)
contained an untrue statement of a material fact or omitted to state a material
fact required to be stated therein or necessary to make the statements therein,
in light of the circumstances under which they were made, not misleading,
except that such counsel need express no opinion with respect to the financial
statements, schedules and other financial or statistical data included or
incorporated by reference in the Registration Statement or Prospectus or with
respect to the Form T-1.
(c) OPINION OF AGENTS' COUNSEL. On the date hereof, the Agents
shall have received an opinion from ▇▇▇▇▇▇, ▇▇▇▇ & ▇▇▇▇▇▇▇▇ LLP, counsel to the
Agents, dated as of the date hereof and in form and substance satisfactory to
the Agents.
14
15
(d) OFFICER'S CERTIFICATE. On the date hereof (and, if this
certificate is being delivered pursuant to a Terms Agreement, as of the
Settlement Date with respect to such Terms Agreement), the Agents shall have
received a certificate signed by an officer of the Company, substantially in
the form of Appendix I hereto and dated the date hereof, to the effect that (i)
the representations and warranties of the Company contained in Section 1(a)
hereof are true and correct in all material respects with the same force and
effect as though expressly made at and as of the date of such certificate, (ii)
the Company has complied with all agreements and satisfied all conditions
required by this Agreement or the Indenture on its part to be performed or
satisfied at or prior to the date of such certificate, and (iii) no stop order
suspending the effectiveness of the Registration Statement has been issued and
no proceedings for that purpose have been initiated or, to the best of such
officer's knowledge, threatened by the Commission. The Officer's Certificate
shall further state that except as contemplated in the Prospectus or reflected
therein by the filing of any amendment or supplement thereto or any
Incorporated Document, at the date hereof and at each Settlement Date with
respect to any Terms Agreement, there shall not have been, since the date of
the most recent consolidated financial statements of the Company included or
incorporated by reference in the Prospectus, any material adverse change in the
consolidated financial condition or earnings of the Company and its
subsidiaries, considered as one enterprise.
(e) COMFORT LETTER. On the date hereof, the Agents shall have
received a letter from the Company's independent certified public accountants,
dated as of the date hereof and in form and substance reasonably satisfactory
to the Agents.
(f) OTHER DOCUMENTS. On the date hereof and on each Settlement
Date with respect to any applicable Terms Agreement, counsel to the Agents
shall have been furnished with such documents and opinions as such counsel may
reasonably require for the purpose of enabling such counsel to pass upon the
issuance and sale of Securities as herein contemplated and related proceedings,
or in order to evidence the accuracy and completeness of any of the
representations and warranties or the fulfillment of any of the conditions
herein contained.
If any condition specified in this Section 5 shall not have been
fulfilled when and as required to be fulfilled, this Agreement may be
terminated by any of the Agents (as to itself only) and any Terms Agreement may
be terminated by the Agent party to such Terms Agreement by notice to the
Company at any time and any such termination shall be without liability of any
party to any other party, except that the covenants set forth in Section 3(f)
hereof, the provisions of Section 4 hereof, the indemnity and contribution
agreement set forth in Sections 7 and 8 hereof, and the provisions of Sections
9 and 13 hereof shall remain in effect.
SECTION 6. SUBSEQUENT DOCUMENTATION REQUIREMENT OF THE COMPANY.
The Company covenants and agrees that so long as the Securities are
authorized for sale pursuant to this Agreement and unless the sale of the
Securities has been suspended as provided in this Agreement:
(a) SUBSEQUENT DELIVERY OF CERTIFICATES. Each time that the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by (i) a
15
16
Pricing Supplement or an amendment or other supplement providing solely for a
change in the interest rates of the Securities or changes in other terms of the
Securities or (ii) an amendment or supplement which relates exclusively to an
offering of securities other than the Securities) or there is filed with the
Commission any document incorporated by reference into the Prospectus or the
Company sells Securities to an Agent pursuant to a Terms Agreement, the terms
of which so require, the Company shall use its best efforts to furnish or cause
to be furnished to the Agents or to the Agent party to the Terms Agreement, as
the case may be, promptly following such amendment, supplement or filing or on
the Settlement Date with respect to such Terms Agreement, as the case may be, a
certificate in form satisfactory to counsel for the Agents to the effect that
the statements contained in the certificate referred to in Section 5(d) hereof
which was last furnished to the Agents are true and correct at the time of such
amendment, supplement, filing or sale, as the case may be, as though made at
and as of such time (except that such statements shall be deemed to relate to
the Registration Statement and the Prospectus as amended and supplemented to
such time) or, in lieu of such certificate, a certificate of the same tenor as
the certificate referred to in said Section 5(d), modified as necessary to
relate to the Registration Statement and the Prospectus as amended and
supplemented to the time of delivery of such certificate.
(b) SUBSEQUENT DELIVERY OF LEGAL OPINIONS. Each time that the
Registration Statement or the Prospectus shall be amended or supplemented
(other than by (i) a Pricing Supplement or an amendment or other supplement
providing solely for a change in the interest rates of the Securities or
changes in other terms of the Securities or (ii) an amendment or supplement
providing primarily for the inclusion of additional financial information, or
(iii) an amendment or supplement which relates exclusively to an offering of
securities other than the Securities) or there is filed with the Commission any
document incorporated by reference into the Prospectus (other than any Annual
Report on Form 10-K, Current Report on Form 8-K or Quarterly Report on Form
10-Q relating primarily to financial statements or other financial information
as of and for any fiscal quarter) or the Company sells Securities to an Agent
pursuant to a Terms Agreement, the terms of which so require, the Company shall
use its best efforts to furnish or cause to be furnished promptly following
such amendment, supplement or filing or on the Settlement Date with respect to
such Terms Agreement, as the case may be, to the Agents or to the Agent party
to the Terms Agreement, as the case may be (with a copy to counsel to the
Agents or counsel to such Agent, as the case may be), letters substantially in
the form of Appendix II hereto (modified, as necessary, in the case of a Terms
Agreement) from the counsel last furnishing the opinions referred to in
Sections 5(a) and 5(b) hereof or, in lieu of such letters, letters from other
counsel reasonably satisfactory to the Agents (which, in the case of the
opinions referred to in such Section 5(b), shall include ▇▇▇▇▇▇▇ ▇. ▇▇▇▇▇▇▇▇,
Senior Vice President, General Counsel and Secretary the Company), dated the
date of delivery of such letter and in form satisfactory to counsel for the
Agents, of the same tenor as the opinions referred to in Sections 5(a) and 5(b)
(other than, in the case of the opinion delivered pursuant to Section 5(b)
hereof, the matters covered by Sections 5(b)(i) and 5(b)(iv)(x)) hereof, but
modified, as necessary, to relate to the Registration Statement and the
Prospectus as amended and supplemented to the time of delivery of such opinion.
The Company shall use its best efforts to furnish or cause to be
furnished to the Agents, promptly following each filing by the Company of a
Quarterly Report on Form 10-Q or an Annual
16
17
Report on Form 10-K, a letter from the counsel last furnishing the opinion
referred to in Section 5(b) hereof, or from other counsel reasonably
satisfactory to the Agents, dated the date of delivery of such letter and in
form satisfactory to counsel for the Agents, of the same tenor as the opinion
referred to in Section 5(b)(i) hereof, but modified, as necessary, to relate to
the Registration Statement and Prospectus as amended and supplemented to the
time of delivery of such letter.
(c) SUBSEQUENT DELIVERY OF COMFORT LETTERS. Each time that the
Registration Statement or the Prospectus shall be amended or supplemented to
include additional financial information or there is filed with the Commission
any document incorporated by reference into the Prospectus which contains
additional financial statement information relating to the Company or the
Company sells the Securities pursuant to a Terms Agreement, the terms of which
so require, the Company shall use its best efforts to cause the Company's
independent public accountants promptly following such amendment, supplement or
filing or on the Settlement Date with respect to such Terms Agreement, as the
case may be, to furnish the Agents or to the Agent party to the Terms
Agreement, as the case may be, a letter, dated the date of filing of such
amendment, supplement or document with the Commission, or such Settlement Date,
as the case may be, in form satisfactory to counsel for the Agents (or such
Agent), of the same tenor as the letter referred to in Section 5(e) hereof but
modified, as necessary, to relate to the Registration Statement and Prospectus,
as amended and supplemented to the date of such letter, and of the same general
tenor as the letter referred to in Section 5(e) with such changes as may be
necessary to reflect changes in the financial statements and other information
derived from the accounting records of the Company; PROVIDED, HOWEVER, that if
the Registration Statement or the Prospectus is amended or supplemented
primarily to include financial information as of and for a fiscal quarter, the
Company's independent certified public accountants may limit the scope of such
letter to the unaudited financial statements included in such amendment or
supplement.
SECTION 7. INDEMNIFICATION.
(a) INDEMNIFICATION OF THE AGENTS. The Company agrees to
indemnify and hold harmless each Agent and each person, if any, who controls an
Agent within the meaning of Section 15 of the 1933 Act as follows:
(i) against any and all loss, liability, claim, damage
and expense whatsoever (including, subject to the limitations set
forth in subsection (c) below, the reasonable fees and disbursements
of counsel chosen by the Agents), as incurred, insofar as such loss,
liability, claim, damage or expense arises out of any untrue statement
or alleged untrue statement of a material fact contained in the
Registration Statement or the omission or alleged omission therefrom
of a material fact required to be stated therein or necessary to make
the statements therein not misleading, or arises out of any untrue
statement or alleged untrue statement of a material fact contained in
the Prospectus or the omission or alleged omission therefrom of a
material fact necessary in order to make the statements therein, in
light of the circumstances under which they were made, not misleading;
17
18
(ii) against any and all loss, liability, claim, damage
and expense whatsoever (including, subject to the limitations set
forth in subsection (c) below, the reasonable fees and disbursements
of counsel chosen by the Agents), as incurred, to the extent of the
aggregate amount paid in settlement of any litigation, or
investigation or proceeding by any governmental agency or body,
commenced or threatened, or of any claim whatsoever insofar as such
loss, liability, claim, damage or expense arises out of any such
untrue statement or omission, or any such alleged untrue statement or
omission, if such settlement is effected with the written consent of
the Company; and
(iii) against any and all expense whatsoever (including,
subject to the limitations set forth in subsection (c) below, the
reasonable fees and disbursements of counsel chosen by the Agents), as
incurred, reasonably incurred in investigating, preparing or defending
against any litigation, or investigation or proceeding by any
governmental agency or body, commenced or threatened, or any claim
whatsoever, based upon any such untrue statement or omission, or any
such alleged untrue statement or omission;
PROVIDED, HOWEVER, that this indemnity shall not apply to any loss, liability,
claim, damage or expense (A) to the extent arising out of or based upon any
untrue statement or omission or alleged untrue statement or omission made in
reliance upon the Form T-1 under the 1939 Act filed as an exhibit to the
Registration Statement; or (B) to the extent arising out of any untrue
statement or omission or alleged untrue statement or omission in the Prospectus
if such untrue statement or alleged untrue statement or omission or alleged
omission is corrected in all material respects in an amendment or supplement to
the Prospectus and if, having previously been furnished by or on behalf of the
Company with copies of the Prospectus, as so amended or supplemented, such
Agent thereafter failed to deliver such Prospectus, as so amended or
supplemented, prior to or concurrently with the sale of a Security to the
person asserting such loss, liability, claim, damage or expense who purchased
such Security which are the subject thereof from such Agent; or (C) as to which
such Agent may be required to indemnify the Company pursuant to the provisions
of subsection (b) of this Section 7.
(b) INDEMNIFICATION OF THE COMPANY. Each Agent agrees to
indemnify and hold harmless the Company, its directors, each of its officers
who signed the Registration Statement, and each person, if any, who controls
the Company within the meaning of Section 15 of the 1933 Act against any and
all loss, liability, claim, damage and expense described in the indemnity
contained in subsection (a) of this Section 7, as incurred, but only with
respect to untrue statements or omissions, or alleged untrue statements or
omissions, made in the Registration Statement or the Prospectus in reliance
upon and in conformity with written information furnished to the Company by
such Agent expressly for use in the Registration Statement or the Prospectus.
(c) GENERAL.
(i) In case any action, suit or proceeding (including any
governmental or regulatory investigation or proceeding) shall be
brought against any Agent or any person controlling such Agent, based
upon the Registration Statement or the Prospectus and with respect to
which indemnity may be sought against the Company pursuant to this
Section 7,
18
19
such Agent or controlling person shall promptly notify the Company in
writing, and the Company shall assume the defense thereof, including
the employment of counsel (such counsel to be reasonably acceptable to
such Agent) and payment of all expenses. Any such Agent or any such
controlling person shall have the right to employ separate counsel in
any such action, suit or proceeding and to participate in the defense
thereof, but the fees and expenses of such separate counsel shall be
at the expense of such Agent or such controlling person unless (A) the
employment of such counsel shall have been specifically authorized in
writing by the Company, (B) the Company shall have failed to assume
the defense and employ counsel or (C) the named parties to any such
action, suit or proceeding (including any impleaded parties) shall
include both such Agent or such controlling person and the Company,
and such Agent or such controlling person shall have been advised by
counsel that there may be one or more legal defenses available to it
which are different from, or additional to, those available to the
Company (in which case, if such Agent or such controlling person
notifies the Company in writing that it elects to employ separate
counsel at the expense of the Company, the Company shall not have the
right to assume the defense of such action, suit or proceeding on
behalf of such Agent or such controlling person, it being understood,
however, that the Company shall not, in connection with any one such
action or separate but substantially similar or related actions in the
same jurisdiction arising out of the same general allegations or
circumstances, be liable for the reasonable fees and expenses of more
than one separate firm of attorneys (in addition to any local counsel)
for all such Agents and such controlling persons, which firm shall be
designated in writing by a majority of all such Agents, on behalf of
all of such Agents and such controlling persons).
(ii) In case any action, suit or proceeding (including any
governmental or regulatory investigation or proceeding) shall be
brought against the Company, any of the Company's directors or
officers, or any person controlling the Company, with respect to which
indemnity may be sought against any Agent pursuant to this Section 7,
such Agent shall have the rights and duties given to the Company by
subsection (c)(i) of this Section 7, and the Company, the Company's
directors and officers and any such controlling person shall have the
rights and duties given to the Agents by subsection (c)(i) of this
Section 7.
SECTION 8. CONTRIBUTION.
In order to provide for just and equitable contribution in
circumstances in which the indemnity agreement provided for in Section 7 hereof
is for any reason held to be unenforceable with respect to the indemnified
parties although applicable in accordance with its terms, the Company and each
Agent shall contribute to the aggregate losses, liabilities, claims, damages
and expenses of the nature contemplated by said indemnity agreement incurred by
the Company and the Agents, as incurred, in such proportion as is appropriate
to reflect the relative benefits received by the Company on the one hand and
each of the Agents participating in the offering that gave rise to such losses,
liabilities, claims, damages and expenses (a "Relevant Agent") on the other
hand from the offering of such Securities. If, however, the allocation provided
by the immediately preceding sentence is not permitted by applicable law or if
the indemnified party failed to give the notice required pursuant to Section
7(c) hereof or pursuant to the last sentence
19
20
of this Section 8, then the Company and each Agent shall contribute to such
aggregate losses, liabilities, claims, damages and expenses incurred by the
Company and the Agents, as incurred, in such proportion as is appropriate to
reflect not only such relative benefits but also the relative fault of the
Company on the one hand and each Relevant Agent on the other in connection with
the statements or omissions which resulted in such losses, liabilities, claims,
damages or expenses, as well as any other relevant equitable considerations.
The relative benefits received by the Company on the one hand and each Relevant
Agent on the other hand in connection with the offering of such Securities
shall be deemed to be in the same proportion as the total net proceeds from the
sale of such Securities by such Relevant Agent received by the Company (before
deducting expenses) bear to the total commissions or other compensation or
remuneration received by such Relevant Agent in respect thereof. The relative
fault shall be determined by reference to, among other things, whether the
untrue or alleged untrue statement of a material fact or the omission or
alleged omission to state a material fact relates to information supplied by
the Company or such Relevant Agent and the parties' relative intent, knowledge,
access to information and opportunity to correct or prevent such statement or
omission. If more than one Agent is a Relevant Agent in respect of a
proceeding, each Relevant Agent's obligation to contribute pursuant to this
Section 8 shall be several and not joint, and shall be in the proportion that
the principal amount of the Securities that are the subject of such proceeding
and that were offered and sold through such Relevant Agent bears to the total
principal amount of the Securities that are the subject of such proceeding.
Notwithstanding the provisions of this Section 8, no Agent shall be required to
contribute any amount in excess of the amount by which the total price at which
the Securities purchased by or through it were sold exceeds the amount of any
damages which such Agent has otherwise been required to pay by reason of such
untrue or alleged untrue statement or omission or alleged omission. No person
guilty of fraudulent misrepresentation (within the meaning of Section 11(f) of
the ▇▇▇▇ ▇▇▇) shall be entitled to contribution from any person who was not
guilty of such fraudulent misrepresentation. For purposes of this Section 8,
each person, if any, who controls an Agent within the meaning of Section 15 of
the 1933 Act shall have the same rights to contribution as such Agent, and each
director of the Company, each officer of the Company who sign within the
meaning of Section 15 of the 1933 Act shall have the same rights to
contribution as the Company. Any party entitled to contribution pursuant to
the first sentence of this Section 8 will, promptly after receipt of notice of
commencement of any action, suit or proceeding against such party in respect of
which a claim for contribution may be made against another party or parties
under this Section 8, notify such party or parties from whom contribution may
be sought, but the omission to so notify such party or parties shall not
relieve the party or parties from whom contribution may be sought, from any
other obligation it or they may have otherwise than under this Section 8;
PROVIDED, HOWEVER, that such notice need not be given if such party entitled to
contribution hereunder has previously given notice pursuant to Section 7(c)
hereof with respect to the same action, suit or proceeding.
SECTION 9. REPRESENTATIONS, WARRANTIES AND AGREEMENTS TO SURVIVE DELIVERY.
All representations, warranties and agreements contained in this
Agreement or any Terms Agreement, or contained in certificates of officers of
the Company submitted pursuant hereto, shall remain operative and in full force
and effect, regardless of any investigation made by or on
20
21
behalf of any Agent or any controlling person of any Agent, or by or on behalf
of the Company, and shall survive each delivery of and payment for any of the
Securities.
SECTION 10. TERMINATION.
(a) TERMINATION OF THIS AGREEMENT. This Agreement (excluding any
Terms Agreement) may be terminated by the Company (i) for any reason at any
time with respect to any Agent or Agents upon the giving of 2 business days'
written notice of such termination to each other party hereto or (ii) at any
time upon notice to each other party hereto if no Securities then remain
authorized for sale pursuant hereto. This Agreement may be terminated by any
Agent (as to itself only) either (x) upon the giving of 2 business days'
written notice of such termination to each other party hereto or (y) at any
time upon notice to the Company if the Company shall have failed to furnish or
cause to be furnished the certificates, opinions or letters referred to in
Section 5 or 6 hereof or if no Securities then remain authorized for sale
pursuant hereto.
(b) TERMINATION OF A TERMS AGREEMENT. An Agent party to a Terms
Agreement may terminate such Terms Agreement (as to itself only) immediately
upon notice to the Company, at any time prior to the Settlement Date relating
thereto if (i) there has been, since the date of this Agreement or since the
respective dates as of which information is given in the Registration
Statement, any material adverse change in the consolidated financial condition
or earnings of the Company and its subsidiaries, considered as one enterprise,
(ii) there has occurred any material adverse change in the financial markets in
the United States or any outbreak or escalation of hostilities or other
calamity or crisis, the effect of which is such as to make it, in the
reasonable judgment of such Agent, impracticable to market the Securities or to
enforce contracts for the sale of the Securities, (iii) if trading in any
securities of the Company has been suspended (other than pursuant to a request
by the Company with respect to an announcement by the Company of certain
information not constituting a material adverse change, since the date of this
Agreement or the respective date as of which information is given in the
Registration Statement, in the consolidated financial condition or earnings of
the Company and its subsidiaries, considered as one enterprise), the effect of
which is such as to make it, in the reasonable judgment of such Agent,
impracticable to market the Securities or to enforce contracts for the sale of
the Securities, (iv) if trading generally on the New York Stock Exchange has
been suspended, or minimum or maximum prices for trading have been fixed, or
maximum ranges for prices for securities shall have been required, by such
exchange or by order of the Commission or any other governmental authority, or
if a banking moratorium has been declared by either Federal or New York
authorities or if a banking moratorium has been declared by the relevant
authorities in the country or countries of origin of any foreign currency or
currencies in which the Securities are denominated or payable or (v) after the
date of such Terms Agreement, the rating assigned by any nationally recognized
securities rating agency to any debt securities of the Company as of the date
of such Terms Agreement shall have been lowered or any such rating agency shall
have publicly announced that it has placed any debt securities of the Company
on what is commonly termed a "watch list" with negative implications.
(c) GENERAL. In the event of any such termination, no party will
have any liability to any other party hereto, except that (i) a terminating
Agent shall be entitled to any commissions earned in accordance with the third
paragraph of Section 2(a) hereof, (ii) if at the time of
21
22
termination (A) a terminating Agent and the Company shall have entered into a
Terms Agreement and the Settlement Date with respect thereto shall not yet have
occurred or (B) an offer to purchase any of the Securities has been accepted by
the Company but the time of delivery to the purchaser or his agent of
Securities relating thereto has not occurred, the covenants set forth in
Sections 3 (subject to the provisions of Section 3(h)) and 6 hereof shall
remain in effect until such Settlement Date or until such Securities are so
delivered, as the case may be, and (iii) the covenant set forth in Section 3(f)
hereof, the provisions of Section 4 hereof, the indemnity and contribution
agreements set forth in Sections 7 and 8 hereof, and the provisions of Sections
10 and 13 hereof shall remain in effect.
SECTION 11. NOTICES.
All notices and other communications hereunder shall be in writing and
shall be deemed to have been duly given if mailed or transmitted by any
standard form of telecommunication. Notices to the Agents shall be directed,
as the case may be, to:
[ ]
Notices to the Company shall be directed to it at:
[ ]
SECTION 12. PARTIES.
This Agreement shall inure to the benefit of and be binding upon the
Agents (and, in the case of a Terms Agreement, the Agent or Agents party
thereto) and the Company and their respective successors. Nothing expressed or
mentioned in this Agreement is intended or shall be construed to give any
person, firm or corporation, other than the parties hereto and their respective
successors and the controlling persons and officers and directors referred to
in Sections 7 and 8 hereof and their heirs and legal representatives, any legal
or equitable right, remedy or claim under or in respect of this Agreement or
any provisions herein contained. This Agreement and all conditions and
provisions hereof are intended to be for the sole and exclusive benefit of the
parties hereto and their respective successors and said controlling persons and
officers and directors and their heirs and legal representatives, and for the
benefit of no other person, firm or corporation. No purchaser of Securities
shall be deemed to be a successor by reason merely of such purchase.
SECTION 13. GOVERNING LAW.
THIS AGREEMENT AND THE RIGHTS AND OBLIGATIONS OF THE PARTIES CREATED
HEREBY SHALL BE GOVERNED BY AND CONSTRUED IN ACCORDANCE WITH THE LAWS OF THE
STATE OF NEW YORK APPLICABLE TO AGREEMENTS MADE AND TO BE PERFORMED IN SUCH
STATE.
If the foregoing is in accordance with your understanding of our
agreement, please sign and return to the Company a counterpart hereof,
whereupon this instrument along with all
22
23
counterparts will become a binding agreement between the Agents and the Company
in accordance with its terms.
Very truly yours,
A. H. BELO CORPORATION
By
-------------------------------
Name:
Title:
CONFIRMED AND ACCEPTED,
as of the date first above written:
[ ]
By
-------------------------------
Name:
Title:
---------------------------------
[( )]
[ ]
By
-------------------------------
Name:
Title:
23
24
EXHIBIT A
Commission
TERM(1) RATE(2)
---- ----
More than 9 months but less than 1 year . . . . . . . 0.___%
From 1 year but less than 18 months . . . . . . . . . 0.___
From 18 months but less than 2 years . . . . . . . . 0.___
From 2 years but less than 3 years . . . . . . . . . 0.___
From 3 years but less than 4 years . . . . . . . . . 0.___
From 4 years but less than 5 years . . . . . . . . . 0.___
From 5 years but less than 6 years . . . . . . . . . 0.___
From 6 years but less than 7 years . . . . . . . . . 0.___
From 7 years but less than 10 years . . . . . . . . . 0.___
From 10 years but less than 15 years . . . . . . . . 0.___
From 15 years but less than 20 years . . . . . . . . 0.___
From 20 years but less than 30 years . . . . . . . . 0.___
From 30 years . . . . . . . . . . . . . . . . . . . . To be determined by the
Company and the
relevant Agent(s)
-----------------
(1) With respect to each Security that is subject to purchase by the
Company at the option of the holder thereof (a "Put Security"), the
word "Term" as used in this Exhibit A refers to the earliest purchase
date specified in the applicable Put Security.
(2) With respect to each Security that is a Original Issue Discount
Security (as defined in the Indenture), the commission payable to
each Agent with respect to each such Security sold as a result of a
solicitation made by such Agent shall be based on the purchase price
of such Security.
A-1
25
EXHIBIT B
The following terms, if applicable, shall be agreed to by each Agent and the
Company pursuant to each Terms Agreement:
Principal Amount: $_________
(or principal amount of foreign currency
or composite currency)
Interest Rate
If Fixed Rate Security, Interest Rate:
If Floating Rate Security:
Base Rate or Rates:
Initial Interest Rate:
Spread or Spread Multiplier, if any:
Interest Reset Dates:
Interest Payment Dates:
Index Maturity:
CMT Maturity Index, if any:
Interest Determination Dates:
Maximum Interest Rate, if any:
Minimum Interest Rate, if any:
Interest Reset Period:
Interest Payment Period:
Calculation Agent (if other than the Trustee):
If Redeemable:
Earliest Redemption Date:
Redemption Price:
Stated Maturity:
Final Maturity (for Renewable Securities):
Initial Maturity (for Renewable Securities):
Purchase Price: ___%
Settlement Date and Time:
Currency of Denomination (if currency is other than
U.S. dollar):
Currency of Payment (if currency is other than
U.S. dollar):
Denominations:
Additional Terms:
B-1
26
Also, agreement(4) as to whether the following will be required:
Officer's Certificate pursuant to Section 6(a) of the Distribution
Agreement.
Legal Opinions pursuant to Section 6(b) of the Distribution Agreement.
Comfort Letter pursuant to Section 6(c) of the Distribution Agreement.
Any restriction on the ability of the Company to sell senior debt
securities with an identical or substantially similar maturity between the
date of the Terms Agreement and the applicable Settlement Date.
Payment by the Company of legal expenses of counsel to Agent(s).
----------------
(4) The following generally will not be required in connection with a sale
of less than $50,000,000 aggregate principal amount of Securities.
B-2
27
Exhibit C
Procedures
28
Appendix I
FORM OF OFFICER'S CERTIFICATE
A.H. BELO CORPORATION
I, [Name], [Title] of A.H. Belo Corporation, a Delaware corporation
(the "Company"), pursuant to Section 5(d) of the Distribution Agreement, dated
[ ], 1997 (the "Distribution Agreement"), between the Company
and each of (i) [ ], (ii) [ ]
(collectively, the "Agents"), relating to the offering from time to time by the
Company directly or through the Agents of up to $1,500,000,000 aggregate
principal amount of debt securities and warrants of the Company to purchase
such debt securities, hereby certify on behalf of the Company that:
1. Except as contemplated in the Prospectus (as defined in the
Distribution Agreement) or reflected therein by the filing of any amendment or
supplement thereto or any Incorporated Document (as defined in the Distribution
Agreement), since the date of the most recent consolidated financial statements
included or incorporated by reference in the Prospectus, there has not been any
material adverse change in the consolidated financial condition or earnings of
the Company and its subsidiaries, taken as a whole.
2. The representations and warranties of the Company contained in
Section 1(a) of the Distribution Agreement are true and correct in all material
respects with the same force and effect as though expressly made at and as of
the date hereof.
3. The Company has complied with all agreements and satisfied all
conditions required by the Distribution Agreement or the Indenture (as defined
in the Distribution Agreement) on its part to be performed or satisfied at or
prior to the date hereof.
4. No stop order suspending the effectiveness of the Registration
Statement (as defined in the Distribution Agreement) has been issued and no
proceedings for that purpose have been initiated or, to the best of my
knowledge, threatened by the Securities and Exchange Commission.
IN WITNESS WHEREOF, I have hereunto signed my name this ____ day of
__________, 1997.
---------------------------
Name:
Title:
I-1
29
Appendix II
FORM OF RELIANCE LETTER OF COUNSEL
___________, 19
[Investment Banks]
Re: A.H. BELO CORPORATION DEBT SECURITIES AND WARRANTS
Dear Sirs:
[We] [I] have delivered an opinion to you dated _________, 19__ as
counsel to A.H. Belo Corporation (the "Company"), pursuant to Section 5 of
the Distribution Agreement, dated as of [ ], 1997
(the "Distribution Agreement"), between the Company and [the investment banks].
You may continue to rely upon such opinion as if it were dated as of this date,
except that all statements and opinions contained therein shall be deemed to
relate to the Registration Statement and Prospectus (as such terms are defined
in the Distribution Agreement) as amended and supplemented to this date.
This letter is delivered to you pursuant to Section 6(b) of the
Distribution Agreement.
Very truly yours,
II-1